Dade County Board of Education, Trenton, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2002

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DADE COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS-OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

8

ADDITIONAL FINANCIAL INFORMATION

COMBINrNG STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

22

SCHEDULES

I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

24

2 SCHEDULE OF STATE REVENUE

26

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

27

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

28

5

BY SITE

29

DADE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133
SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

RUSSELi. W. HINTON
STATE AUOITOn (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, SW Suite 214 Atlanta, Georgia 30334-8400
September 4, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Dade County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the Dade County Board of Education, as of and for the year ended June 30, 2002, as listed in the table of contents. These general-purpose financial statements are the responsibility ofthe Dade County Board ofEducation's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our op1mon.
As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

2002ARL-13

* The general-purpose financial statements of the Board of Education did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
* The Board of Education did not recognize as expenditures, in the year ended June 30, 2002, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2002. Also funds received, subsequent to June 30. 2002, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2001, were improperly recorded in the year ended June 30, 2002. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Dade County Board of Education as of June 30, 2002, and the results of its operations for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated September 4, 2003, on our consideration of the Dade County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Dade County Board of Education taken as a whole. The accompanying combining statements (Exhibits E and F) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general-purpose financial statements. Such information has been subjected to the auditing procedures applied in the
2002ARL-13

audit of the general-purpose financial statements and in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,

RWH:gp 2002ARL-13

State Auditor

DADE COUNTY BOARD OF EDUCATION

DADE COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2002

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
lnventones Food Donated Commod1t1es Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of Bond Debt Capital Lease Agreements

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

114,678 90

$ 2,395,990 71

7,000,000 00

438,652 05 $

362,979 33

59,332 19

20,11416 7,475 11

Total Assets

$

553,330 95 $

390,568 60 $ 9,455,322 90

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salanes Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Deferred Revenue Capital Lease Agreements General Obligation Bonds Payable
Total L1ab1ht1es
FUND EQUITY
Fund Balances Reserved For Debt Service For lnventones Food Donated Commod1t1es Purchased Food For Purpose of Bond Issue Unreserved UndesIgnated
Total Fund Equity

$

68,292 57

46,756 65 $

189,824 94

7 15

737 83

110,237 00
419,854 34 44,953 75

$

305,619 14 $

575,045 09

$

20,114 16

7,475 11

$ 8,880,277 81

$

553,330 95

57,360 19

0 00

$

553,330 95 $

84,949 46 $ 8,880,277 81

Total Llab1ht1es and Fund Equity

$

553,330 95 $

The notes to the general-purpose financial statements are an integral part of this statement

-2-

390,568 60 $ 9,455,322 90

EXHIBIT "A"

DEBT SERVICE
FUND $ 1,579,770 25
318.769 35

ACCOUNT GROUP
GENERAL LONG-TERM
DEBT

TOTALS

(Memorandum Only)

JUNE 30, 2002

JUNE 30, 2001

$ 4,090,439 86 $ 1,490,834 51

7,000,000 00

1,179,732 92

740,703 33

$ 1,898,539 60

20,11416 7,47511
1,898,539 60

24,999 97 6,472 77
1,677,406 11

8,401,460 40 330,795 48

8,401,460 40 330,795 48

422,593 89 527,994 36

$ 1,898,539 60 $ 10,630,795 48 $ 22,928,557 53 $ 4,891,004 94

$

68,292 57 $

156,993 65

189,824 94

7 15

419,854 34

44,953 75

737 83

$

330,795 48

330,795 48

10,300,000 00

10,300,000 00

$ 10,630,795 48 $ 11,511,459 71 $

109,600 10 32,124 72
141,554 76
527,994 36 2,100,000 00 2,911,273 94

$ 1,898,539 60
0 00 $ 1,898,539 60

$ 1,898,539 60 $ 1,677,406 11

20,11416 7,475 11
8,880,277 81
610,691 14
$ 11,417,097 82 $

24,999 97 6,472 77
270,852 15 1,979,731 00

$ 1,898,539 60 $ 10,630,795 48 $ 22,928,557 53 $ 4,891,004.94

-3-

------------------ ------------ ----
DADE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 2002

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Admin1stratIon School AdmInistratIon Business AdmInistrabon Maintenance and Operabon of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay Debt Service
Pnnc1pal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Accrued Interest on Bonds Sold Premium on Bonds Sold Proceeds from General Obligation Bonds
Par Value Capital Leases
Total Other Financing Sources
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change In Penod Donated Commod1t1es Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 11,808,492 62 $ 1,667 00
3,852,589.53 296,049 31
$ 15,958,798 46 $

674,880 84 1,760,216 09
507,637 58
2,942,734 51

$ 10,758,048 45 $
319,13536 237,463 32 466,649 01 771,957 64 1,089,845 56
75,082 49 1,138,387 16
535,364 34
4,87068 2,215 65

1,548,811 55 97,861 46 99,285 61 28,853 95
9,388 51 87965
1,148,706 76

152,701 50 27,915 33

44,497 38 3,772 62

$ 15,579,636 49 $

$

379,161 97 $

2,982,057 49 -39,322 98

$

379,161 97 $

-39,322 98

174,168 98

128,155 91

-4,885 81
1,002 34

FUND BALANCE JUNE 30

$

553,330 95 $ ===84===94=9====46=

The notes to the general-purpose financial statements are an integral part of this statement -4-

EXHIBIT"B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$ 12,483,373 46 $ 11,907,085 97

1,761,883 09

1,338,207 37

$ 1,790,737 10

5,643,326 63

5,143.739 17

$

80,835 68

31,268 90

915,791 47

916,833 21

$

80,835 68 $ 1,822,006 00 $ 20,804,374 65 $ 19,305,865 72

$ 12,306,860 00 $ 11,563,129 13

$

221,000 00

729,795 71

416,996 82 336,748 93 466,649 01 800,811.59 1,089,845 56 296,082 49 1,138,38716 544,752 85
5,750 33 1,150,922 41
729,795 71

363,966.81 317,621 04 460,536 67 974,699 35 1,141,708 24
54,937 20 1,016,813 04
659,866 38 5,995 74 47348
1,092,185.39 84,035 91

$ 1,800,000 00 186,285 85 2,137 36

1,997,198 88 217,973 80 2,13736

1,686,491 56 180,447 36 1,426 01

$

950,795 71 $ 1,988,423 21 $ 21,500,912 90 $ 19,604,333 31

$

-869,960 03 $

-166,417 21 $

-696,538 25 $

-298,467.59

$ $ 9,750,237 84 $ 9,750,237 84 $

24,014 44 $ 113,774 10

24,014 44 113,774 10

249,762 16

10,000,000 00 $

387,550 70 $ 10,137,788 54 $

143,200 00 143,200 00

$ 8,880,277 81 $

221,13349 $ 9,441,250 29 $

-155,267 59

000

1,677,406 11

1,979,731 00

2,133,447 47

-4,885 81 1,002 34

4,678 03 -3, 126 91

$ 8,880,277 81 $ 1,898,53960 $ 11,417,09782 $ 1,979,731 00 -5-

DADE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2002

EXHIBIT "C"

GENERAL FUND

BUDGET

ACTUAL

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues

$ 11,535,676 59 $ 11,808,492 62

113,11900

1,667 00

3,759,485 57

3,852,589 53

71,000 00

296,049 31

$ 15,479,281 16 $ 15,958,798 46

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Admin1strat1on School Admm1strat1on Business Admm1strat1on Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Debt Service

$ 10,658,992 07 $ 10,758,048.45

261,762 32 229,028 93 495,934 40 878,130.24 1,127,90613
54,355 49 1,057,017 56
671,838 76

319,135 36 237,463 32 466,649 01 771,957 64 1,089,845 56
75,082 49 1,138,387 16
535,364 34 4,870 68 2,215 65
180,616 83

Total Expenditures

$ 15,434,965 90 $ 15,579,636 49

Excess of Revenues over (under) Expenditures $

44,315 26 $

379,161 97

FUND BALANCE JULY 1. 2001

20,19812

174,168 98

SPECIAL REVENUE FUND

BUDGET

ACTUAL

$ 611,757 20 $ 674,880.84 1,472,475 53 1,760,216 09

490,528 85

507,637 58

$ 2,574,761 58 $ 2,942,734 51

$ 1,540,386 20 $ 1,548,811 55

23,500 00

97,861 46 99,285 61

28,853 95

1,009,449 48

9,388 51 879 65
1,148,706 76 48.270 00

$ 2,573,335 68 $ 2,982,057 49

$ 1,425 90 $ -39,322 98

111,583 31

96,68317,

FUND BALANCE JUNE 30. 2002

$ 64,513 38 $=~55=3=!:,3=30==9=5

$ 113,009 21 $ 57,360 19

The notes to the general-purpose financial statements are an integral part of this statement -7-

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Dade County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The School District uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the School District. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School District, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of the School District's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.

-8-

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and capital lease obligations.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The School District considers receivables collected within sixty days after yearend to be available. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.

-9-

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2002, a substantial number of personnel of the School District were employed for a one hundred and ninety day period beginning in August 2001 and ending in early June 2002. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 2001 and ending in August 2002. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the School District in the same twelve months. As of June 30, 2002, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 2002, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30, 2002. Also, the State's portion of the compensation paid in July and August 2002 was received and recorded as revenue in the fiscal year subsequent to June 30, 2002. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2001, were recorded in the year ended June 30, 2002. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
BUDGET
The Dade County Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the School District's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
The Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to fund balance as reflected on Exhibit "B" ofthis report:
- 10 -

.._...... , -- ~ ....

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Special Revenue
Fund

FUND BALANCE JULY 1, 2001

$ 128,155.91

Adjustments Inventories - July 1, 2001 Food Donated Commodities Purchased Foods

-24,999.97 -6,472.77

Fund Balance July 1, 2001 (Budget Basis)

$ 96,683.17

Excess of Revenues over (under) Expenditures

-39,322.98

FUND BALANCE JUNE 30, 2002 (Budget Basis)

$ 5Zi360,12

CASH AND CASH EQUIVALENTS

COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.

INVESTMENTS

COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds and in selecting among options for investment or among institutional bids for deposits. the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:

(1) Obligations issued by the State of Georgia or by other states,

(2) Obligations issued by the United States government,

- 11 -

------------------------ --~-

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,

(4) Obligations of any corporation of the United States government,

(5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,

(7) Repurchase agreements, and

(8) Obligations of other political subdivisions of the State of Georgia.

RECEIVABLES

Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general-purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

PROPERTY TAXES

The Dade County Board of Commissioners fixed the property tax levy for the 2001 tax digest year (calendar year) on November 30, 2001 (levy date). Taxes were due on January 30, 2002 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 200 I tax digest are reported as revenue in fiscal year 2002. The Dade County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2002 for maintenance and operations amounted to $3,678,248.83.

The tax millage rate levied for the 2001 tax year (calendar year) for the Dade County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

15.40 mills

SALES TAXES

Special Purpose Local Option Sales Tax revenue during the year amounted to $1,790,737.10 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.

- 12 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.
COMPENSATED ABSENCES
Compensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general-purpose financial statements.
Additionally, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources has not been recorded in the General Long-Term Debt Account Group as this liability is also deemed to be immaterial to the fair presentation ofthese financial statements.
GENERAL OBLIGATION BONDS
The School District issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The School District has the following type of interfund transactions:
Reimbursements ofexpenditures initially made from a fund that are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.

- 13 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general-purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:
(I) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and

- 14 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 2: DEPOSITS

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 2002, the bank balances were $12,347,498.60. The amounts of the total bank balances are classified into three categories of credit risk:

Category I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the School District or by the School District's agent in the School District's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the School District's name.)

The School District's deposits are classified by risk category at June 30, 2002, as follows:

Risk Category

Bank Balance

I

$ 1,779,770.25

2

0.00

3

10,567,728.35

Total

$12.347,498.60

Note 3: NON-MONETARY TRANSACTIONS

The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories

Note 4: RISK MANAGEMENT

The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; acts of God and unemployment compensation.

- 15 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 4: RISK MANAGEMENT

The School District has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions, job related illness or injuries to employees and acts of God excluding earthquakes and flood. The School District has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years.

The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated.

Changes in the unemployment compensation claims liability during the last two fiscal years are as follows:

2001 2002

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

$

0.00 $

890.00 $

890.00 $

0.00

$

0.00 $

0.00 $

0.00 $

0.00

The School District has purchased surety bonds to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent Each Principal

$ 50,000.00 $ 10,000.00

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Dade County Board of Education has entered into various lease agreements as lessee for school buses and computer equipment. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows:

- 16 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 5: GENERAL LONG-TERM DEBT

Purpose

Interest Rates

Amount

General Government - Series 1997 General Government - Series 2001 Series A General Government - Series 2001 Series B

3.9%-4.6% 2.60%- 3.75% 3.25%

$ 300,000.00 8,850,000.00 1,150,000.00

$10.300.000.00

The changes in General Long-Term Debt during the fiscal year ended June 30, 2002, were as follows:

Capital Leases

General Obligation
Bonds

Total

Balance July 1, 2001

$ 527,994.36 $ 2,100,000.00 $ 2,627,994.36

Additions G.O. Bonds

10,000,000.00 10,000,000.00

Deductions Debt Retired

197,198.88 1,800,000.00 1,997,198.88

Balance June 30, 2002

$ 330,195.48 $10.300,000.00 $10.630,795,48

At June 30, 2002, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

Capital Leases

General Obligation
Bonds

Total Debt

2003 2004 2005 2006 2007 2008
Total Principal and Interest
Deduct: Imputed Interest

$ 158,198.79 $ 639,407.50 $ 797,606.29 140,579.31 1,661,070.00 1,801,649.31 34,022.91 1,987,272.50 2,021,295.41 34,022.92 2,209,987.50 2,244,010.42 2,515,531.25 2,515,531.25 2,608,000.00 2,608,000.00
$ 366,823.93 $11.621.268.15 $11.988.092.68
36,028.45

Net Present Value of Future Minimum Lease Payments $ 330,795.48

- 17 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 6: SHORT-TERM DEBT

The School District obtains temporary loans in advance of property tax collections, depositing the proceeds in its General Fund. This short-term debt is to provide cash for operations until property tax collections are received by the School District. Article IX, Section V, Paragraph V of the Constitution of the State of Georgia limits the aggregate amount of short-term debt to 75 percent of the total gross income from taxes collected in the preceding year and requires all short-term debt to be repaid no later than December 31 of the calendar year in which the debt was incurred.

Beginning Balance

Additions

Payments

Ending Balance

Temporary Loans

$====0-.0"""0 $ soo.oQOJlQ $ soo,000.00 $===o=.o=o

Note 7: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of $165,898.40 for health insurance and retirement contributions paid on the School District's behalf by the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $143,482.40

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $22,416.00

Note 8: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the School District as of June 30, 2002:

Project

Unearned Executed Contracts

Dade Middle School

$ 933,747.35

The amount described in this note is not reflected in the general-purpose financial statements.

- 18 -

DADE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 9: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.

Note l 0: ACCUMULATED EMPLOYEES' LEAVE

The Board's professional personnel earn one and one-quarter days of sick and personal leave each month with a maximum accumulation of 65 days. Retiring teachers with l Oor more years ofservice in the Dade County School System will receive compensation based on a percentage of unused sick and personal leave at their current rate of pay, up to the maximum of 45 days. See Note 1 Compensated Absences

Note 11: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school districts are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 9.24% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2002 2001 2000

100% 100% 100%

$ 951,215.45 $ 1,110,872.07 $ 1,014,660.97

- 19 -

DADE COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2002

ASSETS
Cash and Cash Equivalents
Accounts Receivable
lnventones Food Donated Commod1t1es Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

114,472.75 $

77,826 05

840.00

7,500.00

20,11416 7,475 11

Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salanes Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Inventories Food Donated Commodities Purchased Food Unreserved Undes1gnated
Total Fund Equity

$

142,902.02 $ =====85=,3=2=6.=05=

$

4,662.44 $

20,086.20

53,290.12

64,502.02

737.83

$

57,952 56 $

85,326.05

$

20,11416

7,475.11

57,360 19 $

000

$

84,949 46 $

000

Total Liabilities and Fund Equity
See notes to the general-purpose financial statements. - 20 -

$

142,902.02 $ =====8=5,=3=26=0=5=

EXHIBIT"E"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$

192,298 80 $

216,384 79

$

354,639.33

362,979 33

124,956 02

20,11416 7,475 11

24,999.97 6,472.77

$

354,639.33 $

582,867 40 $ ==3=7=2=,8=13==55=

$

260,591.37 $

260,591.37 $

71,038 16

22,008 01

46,756.65

32,064 72

72,032 80

189,824 94

141,554.76

7.15

7.15

737 83

$

354,639 33 $

497,917 94 $

244,657.64

$

$ _ _ _ _0_00_

$

0.00 $

20,114.16 $ 7,475 11

24,999.97 6,472.77

57,360 19

96,683.17

84,949.46 $ _ _1_2_8~1,_55_.9_1_

$

354,639.33 $

582,867.40 $

372,813.55

=========

- 21 -

DADE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2002

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Student Transportation Services Other Support Services Food Services Operation
Debt Service Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commod1t1es Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

82,506.00 $

512,987.79

507,637.58

$ 1,103,131 37 $

592,374.84 592,374.84

$

560,475 37

23,854.97 1,792 09

$ 1,142,454.35

6,252.41

$ 1,142,454.35 $

$

-39,322 98 $

128,155.91

592,374 84 0.00 0.00

-4,885.81 1,002.34

$

84,949 46 $ ====o=.o=o=

See notes to the general-purpose financial statements - 22 -

EXHIBIT"F"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$

674,880.84 $

662,904.03

$ 1,247,228 30

1,760,216 09

1,338,207 37

507,637.58

508,023.25

$ 1,247,228 30 $ 2,942,734.51 $ 2,509,134.65

$

988,336.18 $ 1,548,811.55 $ 1,198,416 00

74,00649 97,493.52 28,853.95
9,388.51 879.65

97,861 46 99,285.61 28,853.95
9,388.51 87965
1,148,706 76

92,314.14 60,350 28 23,878.22
5,344 37 47348
1,090,005 74

44,497.38 3,772.62

44,497.38 3,772.62

41,019 62 7,250.38

$ 1,247,228 30 $ 2,982,057 49 $ 2,519,052 23

$

000 $

-39,322.98 $

-9,917.58

000

128,155.91

136,522.37

-4,885.81 1,002.34

4,678.03 -3,126.91

$====0=====00== $

84,949 46 $

128,155.91

- 23 -

DADE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2002

SCHEDULE 1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U S Department of Child Nutnt1on Cluster Pass-Through From Georgia Department of Educabon Food and Nutnhon Program Food Services School Breakfast Program National School Lunch Program
Total Child Nutnt1on Cluster
Other Programs Pass-Through From Georgia Department of Education Food and Nutnt1on Program Food DIstnbut10n Program (1)
Total U S Department of Agnculture
Education, U S Department of Special Education Cluster Pass-Through From Georgia Department of Education lnd1vIduals with D1sab1ht1es Education Act Part B - Special Education Capacity Building Improvement Flow Through Preschool
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Accountability Grant Title II Eisenhower Professional Development Trtlelll Technology Literacy Challenge TrtJeVI Innovative Education Program Strategies Class Size Reduction Vocational Education - Basic Grants to States High School Program Basic Grant
Total U S Department of Education
Environmental Protection Agency, U S Direct Environmental Education Grant

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10 553 10 555

NIA

$ 114,518 42

(2)

NIA

346,628 49 $

1,090,613 47 (3)

$ 461,146 91 $

1,090,61347

10 550

NIA

51,840 88

51,840 88

$ 512,987 79 $

1,142,454 35

84 027 84 027 84173

NIA

$

7,037 00 $

NIA

321,639 62

NIA

41,402 00

$ 370,078 62 $

7,037 00 321,639 62
41,402 00
370,078 62

84 010 84 348 84 281 84 318 84 298 84 340
84 048

NIA

594,591 56

594.591 56

N/A

17,573 61

17,573 61

NIA

18,662 51

18,662 51

NIA

125,000 00

125,000 00

N/A

15,996 00

15,996 00

NIA

74,693 00

74,693 00

N/A

30,633 00

30,633 00

$ 1.247,228 30 $

1,247,228 30

66951

$

1,667 00 $

1,667 00

Total Federal Financial Assistance NIA c Not Available

- 24 -

$ 1,761,883 09 $

2,391,349.65

DADE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2002

SCHEDULE "1"

Notes to the Schedule of Expenditures of Federal Awards
(1) The amounts shown for the Food D1stnbut10n Program represents the Federally assigned value of nonmonetary assistance for donated commodrt1es received and/or consumed by the system dunng the current fiscal year
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2002 National School Lunch Program
(3) Expenditures for this program include State, and/or Other Funds Expenditures are not maintained by fund source
MaJor Programs are 1dent1fied by an astensk () 1n front of the CFDA number
The School Dtstnd did not provide Federal Assistance to any Subrecip1ent
The accompanying schedule of expenditures of Federal awards includes the Federal grant ad1v1ty of the Dade County Board of Education and 1s presented on the modified accrual basis of accounting which 1s the basis of accounting used m the presentation of the general-purpose financial statements

See notes to the general-purpose financial statements.

- 25 -

---- -----------------'--==-======~-

DADE COUNTY BOARD OF EDUCATION
SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30 2002

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education Direct lnstrucbonal Cost Kindergarten Program Kindergarten Program - Ear1y Intervention Program Pnmary Grades (1-3) Program Pnmary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-B) Program High School General Education (9-12) Program Vocatlonal Laboratory (9-12) Program Students with D1sab1litles Category I Category II Category Ill Category IV CategoryV Gifted Student - Category VI Remedial Education Program Alternative Education Program Special Education Supplemental Speech 20 Days Addmonal lnstructJon Media Center Program Staff and Professional Development Indirect Costs Categoncal Grants Pupil Transportabon Regular Bus Replacement Sparsity Nursing Services Pnncipal Supplements Vocational Supervisors M1d-tenm Adjustment Hold-Hanmless Educabon Equalization Funding Grant Food Services Vocational Education Other State Programs Health Insurance Mentor Teachers Preschool Handicapped Program Reading Program (Grades K-3) After School Program (Grades 4-B) Lottery Programs ASSIStlve Technology Computers in the Classroom
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
Human Resources, Georgia Department of After School Program Drug Free and Prevention Family ConnectJon Tobacco Use Prevenbon Project

See notes to the general-purpose financial statements

- 26-

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 666,503 00 74,742 00
1,410,261 00 190,400 00 696,218 00
97,326 00 1,354,602 00 1,061,737 00
490,416 00
18,969 00 137,955 00 594,247 00 183,385 00
12,237 00 576,037 00
29,854 00 104,407 00
7,878 00 70,755 00 236,165 00 44,003 00 1,567,797 00

$

666,503 00

74,74200

1,410,261 00

190,400 00

696,218 00

97,32600 1,354,602 00 1,061,737 00
490,416 00

18,969 00 137,955 00 594,247 00 183,385 00
12,237 00 576,037 00
29,854 00 104,407 00
7,878 00 70,755 00 236,185 00 44,003 00 1,567,797 00

339,678 00 90,997 00 20,000 00 65,601 00 10,417 00 19,093 00 36,331 00
1,054,144 00 $
177,571 63

82,506 00

143,482 40 76500
23,222 00 30,462 59 21,864 00

6,605 00 70,287 17

339,678 00 90,997 00 20,000 00 65,601 00 10,417 00 19,093 00 36,331 00
1,054,144 00 82,506 00 177,571 63
143,482 40 76500
23,222 00 30,462 59 21,864 00
6 605 00 70,287 17

515,482 67

515,482 67

22,416 00

22,416 00

24,789 00 15,155 00 81,590 00
5,000 00

24,789 00 15,155 00 B1,590 00
5 000 00

$ 11,808,492 62 $ 674,BB0 84 $ 12,483,373 46

DADE COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30. 2002

SCHEDULE "3"

PROJECT
Constructing and equipping of new classrooms. a dnveway and parking facihties for Dade County Elementary School, new classrooms and bu1ld1ng modifications for Davis Elementary School. replacement of heating and air-cond11Jomng system and installation of intercom system for Dade County Middle School. constructing a road and parking improvements and building modifications for Dade County High School, constructing a new dnveway for school maintenance and transportation department and renova!Jng, repainng, improving and equipping ex1st1ng school buildings and other buildings and facihltes useful or desirable in connection therewith, including acqurnng any necessary property therefore. both real and personal

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS (3)

PROJECT STATUS

$ 15,0001000 oo $ 15,000,000 00 $ 840,631 56 $

000 Ongoing

(1) The School Drstnct's onginal cost estimate as specrfied 1n the resolution calling for the 1mpos11Jon of the Local Option Sales Tax
(2) The School D1stnct's current estimate of total cost for the project Includes all cost from pl'Oject 1ncepllon to complellon
(3) The voters of Dade County approved the rmposrtJon of a 1% sales tax to fund the above pro,ect and retire asSOC1ated debt Amounts expended for this proJect may include sales tax proceeds, state. local property taxes and/or other funds over the hie of the project.

See notes to the general-purpose finanaal statements

27-

DADE COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE\
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2002

SCHEDULE "4"

DESCRIPTION
Direct Instructional Programs Kindergarten Program Kindergarten Program-Early Intervention Program Pnmary Grades (1-3) Program Pnmary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Early lntervenbon (4-5) Program Middle School (6-8) Program High School General Education (9-12} Program Vocational Laboratory (9-12) Program Students with D1sabli1hes Category II Category Ill Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program
TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Media Center Program Staff and Professional Development

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

$

744,285 00 $ 783,062 23 $

10,735 09 $

793,797 32

83,464 00

48,888 85

48,888 85

1,574,841 00 1,490,422 90

53,442 47

1,543,865 37

212,62000

241,214 02

717 33

241,931 35

776,902 00

917,585 77

24,762 38

942,348 15

109,249 00 1,512,687 00 1,185,644 00
547,648 00 1,066,083.00
643,261 00 33,338 00
116,591 00

110,280 06 1,713,356 90 1,431,459 68
592,141 63
137,80914 735,780 93 144,610 88
18,207 82 745,947 82
38,045 57 136,288 07

45,128 39 67,246 64 20,742 72
3,318 07
59620 468 27

110,280 06 1,758,485 29 1,498,706 32
612,884 35
137,809 14 739,099 00 144,610 88
18,207 82 746,544 02
38,045 57 136,756 34

$

8,606,613.00 $ 9,285,102 27 $ 227,157 56 $ 9,512,259 83

263,748 00 49,139 00

408,067 03 2,035 10

25,338 04 47,284 60

433,405.07 49,319 70

TOTAL QBE FORMULA FUNDS

$

8,919,500 00 $ 9,695,204 40 $ 299,780 20 $ 9,994,984 60

(1) Compnsed of State Funds plus Local Five Mill Share

See notes to the general-purpose financial statements

- 28 -

DADE COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2002

SCHEDULE "5"

SITE Dade Elementary School Dade County High School Davis Elementary School Dade Middle School Dade County Crossroads Central Office (Alternative Education Program)
TOTAL
(1) Compnsed of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

3,076,695.00 $

3,296,313 47

2,185,061.00

2,573,061 95

1,231,567.00

1,361,582 32

1,996,699 00

2,179,901 51

33,136.31

116,591 00

68,264 27

$

8,606,613 00 $=====9=,5=12=,2=5=9=.8=3

See notes to the general-purpose financial statements - 29 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W. Suite 214 Atlanta, Georgia 30334-8400
September 4, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Dade County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Dade County Board of Education as of and for the year ended June 30, 2002, and have issued our report thereon dated September 4, 2003. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Dade County Board ofEducation's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Dade County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2002YB-41

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Dade County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as item FS-6411-02-02.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-6411-02-02 to be a material weakness.
This report is intended solely for the information and use of the management, members ofthe Dade County Board of Education, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
II.)~
Ru ell W. Hinton
RWH:gp 2002YB-41

RUSSELL W. HINTON
STATE AUDITOR (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W Suite 214 Atlanta. Georgia 30334-8400
September 4, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Dade County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Dade County Board of Education with the types of compliance requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 2002. Dade County Board of Education's major Federal programs are identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Dade County Board of Education's management. Our responsibility is to express an opinion on Dade County Board of Education's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and 0MB Circular Al 33, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and 0MB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Dade County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Dade County Board of Education's compliance with those requirements.
2002SA-10

In our opinion, the Dade County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 2002.
Internal Control Over Compliance
The management of Dade County Board ofEducation is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Dade County Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with 0MB Circular A-133.
Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use of the management, members ofthe Dade County Board of Education, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
--~Respectfully submitted,
~- :k
RWH:gp 2002SA-10

SECTION 111 AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

DADE COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2002

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6411-00-01 FS-6411-01-01 FS-6411-01-02

Further Action Not Warranted Unresolved - No Corrective Action Implemented Previously Reported Corrective Action Implemented

CORRECTIVE ACTION/RESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6411-01-01

The Dade County Board of Education has chosen not to maintain a system-wide General Fixed Assets Account Group.

SECTION IV FINDINGS AND QUESTIONED COSTS

DADE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
I SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Dade County Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Dade County Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit of the Dade County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Dade County Board of Education did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Dade County Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Dade County Board of Education's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Dade County Board of Education qualified as a low risk auditee as defined by Section .530 of 0MB Circular A-133.
- 1-

DADE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURES/LIABILITIES/DISBURSEMENTS Nonmaterial Noncompliance Overpayment of Board Member Per Diem Amount: $6,350.00 Finding Control Number: FS-6411-02-01
The Dade County Board of Education increased Board members per diem to $100.00 per meeting attended without first obtaining the passage of required local legislation. The Official Code of Georgia Annotated Section 20-2-55 provides, in part, as follows:
"In any local school system for which no local act is passed, members of the local board of education shall, when approved by the local board affected, receive a per diem of $50.00 for each day of attendance at meeting of the board... "
The School District should seek reimbursement for these overpayments for deposit in to the Board's General Fund. In addition, the Board should rescind its action approving the increase for Board member per diem amounts.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-6411-02-02
The Dade County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements of the School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include inventory of land, buildings and equipment owned by the School District and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
-2-