DODGE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION! 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 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 ADDmONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 18 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 20 SCHEDULES I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 22 2 SCHEDULE OF STATE REVENUE 24 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 3 OVERALL 25 4 BYPROGRAM 26 ( J '- C DODGE 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 .. r , SECTION I FINANCIAL ,, RUSSELL "' HINTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.W.. Suite 214 Atlanta. Georgia 30334-8400 June 19, 2001 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Dodge County Board ofEducation INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTAR,Y INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Ladies and Gentlemen: We have audited the accompanying general pUipose financial statements ofthe Dodge County Board of Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibjlity ofthe Dodge 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 ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial 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 opinion. As described in the notes to the general pUipose financial statements, the Board'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: 2000ARL-l3A T ., -, 7 L,. ,I .J . } LJ .. _ . ,, .. l v . 't ' :J. . . :1 - ..... 'r' , .. !, * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board 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 did not recognize as expenditures, in the year ended June 30, 2000, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2000. Also funds received, subsequent to June 30, 2000, 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, 1999, were improperly recorded in the year ended June 30, 2000. 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 Dodge County Board ofEducation as of June 30, 2000, 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 June 19, 2001, on our consideration ofthe Dodge County Board ofEducation'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 Dodge County Board of Education taken as a whole. The accompanying combining statements (Exhibits E and F) and the financial schedules (Schedules I through 4), which includes the Schedule ofExpenditures ofFederal Awards as required by U.S. Office ofManagement 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 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. 2000ARL-13A . ' , L " . " " ;.,. ' C 't. ,, 'i ' ' . l . ' . - 't '' .., ..,.. -- .' ' '. jj; --, - .' ... 1, 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:jb 2000ARL-13A State Auditor DODGE COUNTY BOARD OF EDUCATION DODGE COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30. 2000 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Inventories Food Donated Commodities Purchased Food GOVERNMENTAL FUND SPECIAL GENERAL REVENUE FUND FUND $ 682,031.87 $ 480,848.95 1,300,000.00 261,400.31 194,193.53 26,754.92 12721.05 Total Assets $ 2,243,432.18 $ ===71=4=,5=18=.4=5= LIABILITIES AND FUND EQUITY . LIABILITIES Accounts Payable Salaries Payable Expired Grant Balances Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved U ndesignated Total Fund Equity $ 61,646.74 248,080.43 8511.22 $ 37,088.15 $ 2,243,432.18 $ 2,243,432.18 $ 26,754.92 12,721.05 319 715.94 396,280.06 Total Liabilities and Fund Equity $ 2,243,432.18 $ ====7=14,....51,..8..,.4=5= The notes to the general purpose financial statements are an integral part of this statement. -2- EXHIBIT"A" TYPES CAPITAL PROJECTS FUND TOTALS (Memorandum Only) JUNE 30, 2000 JUNE 30, 1999 $ 523,622.60 $ 1,686,503.42 $ 2,532,830.78 1,300,000.00 1,200,000.00 455,593.84 557,962.03 26,754.92 12 721.05 28,563.09 12,892.50 $ 523,622.60 $ 3,481,573.23 $ 4,332,248.40 $ 61,646.74 $ 904,492.95 248,080.43 235,911.50 8 511.22 $ 318,238.39 $ 1140 404.45 $ 37,088.15 $ 38,852.44 26,754.92 12,721.05 28,563.09 12,892.50 $ 523,622.60 3,086,770.72 3,111,535.92 $ 523,622.60 $ 3,163,334.84 $ 3,191,843.95 $ 523,622.60 $ 3,481,573.23 $ 4,332,248.40 -3- DODGE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2000 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 Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation Capital Outlay ' , ( ~. Total Expenditures Excess of Revenue~ over (under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers Out Total Other Financing Sources (Uses) Excess of Revenues and Other Financing Sources . over (under) Expenditures and Other Financing Us~s FUND BALANCE JULY 1 Food Inventory - Net Change in Period Donated Commodities Purchased Food '' t GENERAL FUND ., ,, $ 15,118,724.63 $ ; 98,553.83 2,793,155.35 492,658.56 $ 18,503,092.37 $ SPECIAL REVENUE FUND .. 791.478.81 2,816,660.05 389 681.84 3,997,820.70 - -~ - $ 12.423,166.26 $ 811,290.14 ' 484,558.55 408,457.19 278,265.03 974,850.65 101,666.93 1,051,490.03 1,319,623.36 21,692.00 668,022.00 $ 18,543,082.14 $ ' $ .-39,989.77 $ 1,605,576.33 .216,236.72 428,164.73 21,074.06 73,302.69 24.450.33 27,542.15 31,591.08 9,335.84 1,547,086.49 3,984,360.42 13,460.28 $ $ -101 011.41 $ -101 011.41 $ $ -141,001.18 $ 2,384.433.36 , 1,011.41 1 011.41 14,471.69 383,787.99 -1,808.17 -171.45 FUND BALANCE JUNE 30 $ 2,243,432.18 $ ===39=6._,2=8=0.=06.,. The notes to the general purpose financial statements are an integral part of this statement. -4- EXHIBIT"B" CAPITAL PROJECTS FUND TOTALS (Memorandum Only) YEAR ENDED JUNE 30, 2000 JUNE 30, 1999 $ 0.00 $ 15,910,203.44 $ 15,367,843.44 2,915,213.88 2,548,370.62 2,793,155.35 2,749,518.27 882,340.40 529,081.62 $ 0.00 $ 22,500,913.07 $ 21,194,813.95 $ 0.00 $ 14,028,742.59 $ 13,262,333.20 1,027,526.86 912,723.28 429,531.25 351,567.72 999,300.98 101,666.93 1,079,032.18 1,351,214.44 31,027.84 1,547,086.49 668,022.00 917,831.09 667,094.20 444,239.15 342,337.48 975,564.22 84,282.25 1,072,960.88 1,097,037.72 32,422.99 1,483,617.54 $ 0.00 $ 22,527,442.56 $ 20,379,720.72 $ O.OQ $ -26,529.49 $ 815,093.23 $ 100,000.00 $ 101,011.41 $ 100,000.00 -101 011.41 -100,000.00 $ 100,000.00 $ 0.00 $ 0.00 $ 100,000.00 $ -26,529.49 $ 815,093.23 423,622.60 3,191,843.95 2,364,875.02 -1,808.17 -171.45 11,969.55 -93.85 $ 523,622.60 $ 3,163,334.84 $ 3,191,843.95 5 - ,. PODGE COUNTY BOARD QF EDUCATION COMBINED STATEMENT OF REVENUES EXPENPIJURES AND CHANGES IN fUND BALANCES BUDGET AND ACTUAL - (NQN-GAAP BASIS) GENERAL AND SPECIAL RE;VENUE FUNDS YEAR ENDED JUNE 30 2000 EXHIBIT"C" GENERAL FUND ACTUAL (BUDGET BUDGET BASIS! REVENUES State Funds Federal Funds Taxes Other Funds $ 14,637,238.05 $ 15,118,724.63 60,000.00 . 98,553.83 2.461,000.00 2,793,155.35 404,000.00 492 658.56 Total Revenues $ 17,562,238.05 $ 18,503,092.37 EXPENDITURES Current Instruction Suppon Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Other Supon Services Food Services Operation Capital Outlay Total Expenditures Excess of Revenues over {under) Expenditures s s 12,517,082.38 12,423,166.26 815,408.27 413,056.67 411,514.45 273,443.90 961,944.60 108,985.38 1,165,199.05 1,405,914.94 21,692.00 811,290.14 484,558.55 408,457.19 278,265.03 974,850.65 101,666.93 1,051,490.03 1,319,623.36 21,692.00 583,000.00 668,022.00 s s 18,677,241.64 18,543,082.14 s $ 1,115,003.59 .39 989.77 OTHER FINANCING SOURCES fUSES) Other Sources Other Uses Total Other Financing Sources {Uses) s s -100,000.00 -101 011.41 s s 100,000.00 101 011.41 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -1,215,003.59 $ -141,001.18 FUND BALANCE JULY 1 1999 2,218,118.10 2,384,433.36 SPECIAL REVENUE FUND ACTUAL (BUDGET BUDGET BASIS! $ 751,585.32 $ 791.478.81 2,555,617.00 2,816,660.05 363,500.00 389 681.84 $ 3,670,702.32 $ 3,997,820.70 s 1,459,481.23 $ 1,605,576.33 252,135.69 371,678.45 18,203.00 75,766.00 24,594.74 216,236.72 428,164.73 21,074.06 73,302.69 24,450.33 37,228.75 28,877.76 7,201.00 1,542,486.00 27,542.15 31,591.08 9,335.84 1,547,086.49 $ 3,817,652.62 $ 3,984,360.42 s s -146 950.30 13 460.28 s 1,011.41 $ 1 011.41 $ -146,950.30 $ 14,471.69 384,922.30 342 332.40 FUND BALANCE JUNE JO ZQQO s $ 1 003114.51 212431432. 18 s 2371972.00 $ 3561804.09 The notes to the general purpose financial statements are an integral part of this statement. .7. DODGE COUNTY BOARD OF EDUCATION , . EXHIBIT "D" NOTES TO THE GENERALPURPOSE FINANCIAL STATEMENTS JUNE30.2000 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RE.PORTING ENTITY The Dodge County Board o.f Education (Board) 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 Boai-p..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 Board.is a primary,government and consists of all the organizations that compose its legal entity. FUND ACCOUNTING ,The Board uses funds 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 govemin,ental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. ,General Fix11d ,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 Board. 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 indivi.dual schools, neither til~ 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: ,l .The general purpose financial statements account-for all State, Federal, Taxes and Other funds under control of the Board, in compliance with generally accepted accounting principles applicable to ,governmeptal }llll_ts, unl.ess otherwise disclosed in ,these notes..Funds pre_sented in this report are as follows: . ~~- - .. - _,:_ . ,,, " , : ' GOVERNMENTAL FUND TYPES - are used to account for all ortnost ofa Board's educational activities. Governmental Fund Types include:, . GENERAL FUND - the fund used to account for all financial resources ofthe Board 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. 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. -8 - DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30,2000 Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. 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. 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. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. 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 2000, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in early August 1999 and ending in late May 2000. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 2000, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2000, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 2000. Also, the State's portion ofthe compensation paid in July and August 2000 was received and recorded as revenue in the fiscal year subsequent to June 30, 2000. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were recorded in the year ended June 30, 2000. 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. -9- : ''(_ ; DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS _JUNE 30. 2000 r Note I: SUMMARY OF:SIGNIFICANT ACCOUNTING POLICIES . -~ . BUDGET . ,. .. ' The Dodge County Board of Education's budget is a complete financial plan for the Board'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 fynds is prepared by fund; function and object. The.legal levelofbildget c_ontrcilwas established by tJ:ie Board.at the aggregate level. The budget for governmental funds was prepared on . a basis either than generallya~cepted accounting principles.: : .. ,. ' . . . ' . ',I . ' The budget process begin_s.when the Board's administration prepares'a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board; such budget is advertised at least o"nce in a n;~spaper of general circulation in the locality. At the next regular meeting of ~he Board after advertisement,,the Board receives comments on the'tentative budget, makes revisions as .n~cessaryai-id adopts~ fin~! 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 Educ{ltion. The Board may increase or d_ecrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. . ~ ;, , 'L .. . :, . The St<1;temen~ of Revenu_es,. Expenditures and Changes in Fund Balances - Budget and Actual presents actual,!!!!d budgete!f,data for the General Fund and 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: ' . : r. . 'J ,I. : f ::..., J i::tJND ~.ALANCE JULY I, 1999 . i Adjustments Inventorie~ - July 1, ~ 999 Food , , Donated Commodities . Purchased Foods ' . F'!Ild Balance July 1, 1999 (Budget Basis) 'Special Revenue . Fund $ 383,787.99 ' ,r+ -~,: .: 1 '; .' ' . , . .. -28,563:09 . r . -12,892.50 $ . 342,332.40 ', .Excess of Revenues and Other Financing Sources . o~er (ui-ider) Expenditures and Other Financing ' Vs~s , , I_ .' FUND BALANCE.Jl.JNE 30. 2000 (Budget Basis) r ; . 14 47L69 ' - 10- DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30,2000 Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. INVESTMENTS COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipati_ng interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one 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 of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return 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, (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 - 11 - ., DODGE COUNTY BOARD OF'EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000 Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 Dodge County Board of Commissioners fixed the property- tax levy for the 1999 tax year (calendar year) on October 21, 1999 (levy date). Taxes were due on January 20, 2000. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Dodge County Tax Commissioner bills and collects the property taxes for the Board of Education,' withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board. The tax milJage rate levied for the 1999 tax.year (calendar year)for the Dodge County Board of Education was as. follows.(a mill equals $1 per thousand dollars of assessed value): School Operations U,.Qmills 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 ofpurchase. 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: INTERFUND TRANSACTIONS The Board has the following types 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. . .. , Operating transfers are recorded for all interfund transactions other than reimbursenie'nts; - 12 - DODGE COUNTYBOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000 Note I: 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 ofoperations 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 ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value ofsecurities pledged shall be equal to not Jess 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 Jess 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 ofoperating funds placed in demand deposit checking accounts. Acceptable security for deposits consists ofany 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 Jaws of the State of Georgia, and -13- DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" .. NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000 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 . r Association, and the Federal National Mortgage Association:, CATEGORIZATION OF DEPOSITS At June 30, 2000, the bank balances were $4,385,105.91. The amounts ofthe total bank balances are classified into three categories of credit risk: ) . , . Category 1 " Cash that is insured (e.g., Federal depository:insurance) or collateralized with , . securities held by the Board or by the Board's agent in the Board's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent inthe Board'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 Board's name.) .... ': . ,The Board's deposits are classified by risk category at June 30, 2000, as follows: Risk Category Bank Balance 1 $ 300,000.00 2 4,085,105.91 3 0.00 ,Total $4,385,105.91 Note 3: NON-MONETARY TRANSACTIONS The Board receives food commodities from the United States Department ofAgriculture (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 Board is exposed to various risks ofloss related to torts; theft of, damage to, and destruction of assets; errors or. omissions; job related illness or injuries to employees; natural disaster and unemployment compensation. c.14- DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO IBE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30,2000 Note 4: RISK MANAGEMENT The Board has obtained commercial insurance for risk ofloss associated with torts, assets and errors or omissions. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years. The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years. The Board is self-insured with regard to unemployment compensation claims. The Board 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 of that loss can be reasonably estimated. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: 1999 2000 Beginning ofYear Liability Claims and Changes in Estimates Claims Paid End of Year Liability $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 2,186.26 $ 2,186.26 $ 0.00 The Board participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December 1, 1991, to develop, implement and administer a program ofworkers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Trust for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Trust with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust in excess of $250,000.00 loss per occurrence, up to $2,000,000.00. The Board has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent Each Employee $ 50,000.00 . $ I 00,000.00 Note5: ON-BEHALFPAYMENTS The Board has recognized revenues and expenditures in the amount of $308,183.58 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies. - 15 - DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000 Note 5: ON-BEHALF PAYMENTS Georgia Department of Education - , ,, -. ,.. ,. ' 1 : Paid to the Georgia Department of Community Health For Health.Insurance ofNonsCertified Personnel In the amount of$237,395.58 . '' Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost ,c . 1n the amount of$14,33L00 , '\ ,_:_:..: j '' Office cif 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 $56,457.00 , Note 6: CONTINGENT LIABILITIES j ...... 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 Board believes that such disallowances; if any, will be immaterial to its overall financialposition. '. Note 7: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM o-,f GEORGIA (TRS) . ' .... TRS PLAN DESCRIPTION . ., . : . Substantially all teachers, admicistrativi:and clerical personnei employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharinimultiple . employer d.efined benefit \ p.ension ' plan. TRS prov. ides service' re.tire.ment, 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 of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board 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 11.29% and employer contributions for the current fiscal year 'and the preceding .two . ' fisc:al years are as follows: - . ' - . : ' . i-'.16- DODGE COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000 Note 7: RETIREMENT PLANS Fiscal Year 2000 1999 1998 Percentage Contributed 100% 100% 100% Required Contribution $1,385,671.72 $ 1,400,736.38 $ 1,285,524.30 -17- DODGE COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE30.2000 ASSETS Cash and Cash Equivalents : ' . Accounts Re'I~ Ref-orm Demonstration ' Even Start !O Grants Local Educational Agencies Title II EisenhOIN8r Professional Development Title VI Class Size Reduction Innovative Education Program Strategies Goals 2000 State and Local Education Systemic Improvement Grants Vocational Education Basic Grants to States High School Program Basic Grant 64.332 84.213 84.010 84.281 84.340 84.298 84.276 ,,;, 84.048 . Total U. S. Department of Education ' ' \, Health and Human Services, U. S. Department of Pass-Through From Children and Youth Coordinating Council Abstinence Education Block Grant I 93.235 :...'1 NIA NIA NIA NIA NIA I NIA GC ". 231,056.00 255,017.26 708,679.99 221,112.62 255,017.26 708,948.73 (3) __ 35,168.88 99,386.00 25,188.35 99,386.00 25,303.00 92,205.00 91,590.68 35,040.65 44 733.78 $ 1I7331642.63 $ -~1,~7~48=96~1~.5~30 NIA $ 6735.19 $ 921.86 (3) Justice, U.S. Department of . 1 , Pass-Through from Chlldren and Youth Coordinating Council S.T.A.R. Program 16.540 NIA $ 50,000.00 $ _ _ _50=000=~00~ PODGE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDIILJRES OF FEDERAL AWARDS YEAR ENDED JUNE 30 2000 SCHEDULE "1" FUNDING AGENCY PROGRAMIGRANT OTHER FEDERAL ASSISTANCE Defense, U. S. Department of Direct Department of the Army R.0.T.C. Program CFDA NUMBER PASSTHROUGH ENTITY ID NUMBER FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD $ _ __.,,3"'5,,c8,.,18o,-6:;e_4 (4) Total Federal Financial Assistance N/A = Not Available $ 2,s1s,213.SS s _ ....3.,.:3=54.6aa6:::3.:.9.3. Notes to the Schedule of Expenditures of Federal Awards (1) The amounts shown for the Food Distribution Program represents the F~erally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year. (2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2000 National School Lunch Program. (3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source. (4) Expenditures on this program were not maintained by fund source. Major Programs are identified by an asterisk (*) in front of the CFDA number. The Board did not provide Federal Assistance to any Subrecipient. The accompanying schedule of expenditures of Federal awards includeS the Federal grant adivity of the Dodge County Board of Education and is presented on the modified ac.crual ba_sis of accounting which is the basis of accounting used in the presentation of the general purpose financial statements. See notes to the general purpose financial statements. -23- DODGE COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 2000 SCHEDULE "2" AGENCY/FUNDING GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Tethnology Specialist Local Five Mill Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Apprenticeship Program At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Mentoring Program Mentor Teacher Program Preschool Handicapped Program Remedial Summer School Program Teachers' Retirement Year 2000 Funding Lottery Programs Assistive Tec:hnology Computers in the Classroom Human Resourc.es, Georgia Department of Family Connection Office of Planning and Budget Georgia Challenge Program Office of School Readiness Pre--Klndergarten Program Office of Treasury and Fiscal Services Public Sdlool Employees Retirement CONTRACTS Education, Georgia Department of Georgia's Reading Challenge Pass--Through Communities in Schools C?f Georgia, Inc. Communities in School Grants OTHER Educatlon, Georgia Department of Relmburaement for GENESIS Project GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 7,889, 142.00 1,753,640.00 468,354.00 345,680.00 92,455.00 2,140,033.00 553,528.00 177,609.00 . 262,525.00 405,776.00 71,225.00 33,549.00 28,842.00 -1,077 ,056.00 1,313,037.00 $ 5,612.00 2,000.00 6,589.47 1,500.00 237,395.58 5,000.00 . 6,900.00 162.00 37,825.00 4,521.58 14,331.00 15,348.oo 50,000.00 56,457.00 $ 105,670.00 16,060.32 78,055.00 7,889,142.00 1,753,640.00 468,354.00 345,680.00 92,455.00 2,140,033.00 553,528.00 177,609.00 262,525.00 . 405,776.00 71,225.00 33,549.00 28,842.00 -1,077 ,056.00 1,313,037.00 105,670.00 . 5,612.00 2,000.00 6,589.47 1,500.00 237,395.58 5,000.00 6,900.00 162.00 37,825.00 4,521.58 14,331.00 15,348.00 16,060.32 78,055.00 50,000.00 20,000.00 20,000.00 571,693.49 571,693.49 56,457.00 141,369.00 21,250.00 141,369.00 21,250.00 54125.00 54,125.00 See notes to the general purpose financial statements. $ 15,118,724.63 $ 791,478.81 $ 15,910,203.44 -24- DODGE COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 2000 SCHEDULE "3" Minimum Expenditure Requirements {Total Allotment) Expenditures on Combined Program Basis Salaries Operations Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures per Audit Amount of Underexpenditure for Total Allotment FOURTEEN WEIGHTED AND MEDIA CENTER PROGRAMS 100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS $ 10,456,816.00 $ 293,221.00 $ 11,003,322.27 484,012.04 $ $ 11,487,334.31 415,824.68 -36,881.74 $ 11,450,452.57 $ 0.00 $ =====0-;;;00;;,, See notes to the general purpose financial statements. - 25 - PODGE COUNTY BOARD OF EPUCATJON.. 1 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM . GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS . YEAR ENDEQ JUNE 30 2000 . GENERAL AND CAREER ED!,JCATIQN PROGBAM Ki_ndergarten (~) Grades 1 - 3 {') Sub-Total - K-3" - J ,,, Grades 4 - 5 () Grades 6 - 6 {') Grades 9 12 {') "' High School Laboratories (r '.:'I ', Vocational Education Laboratories (*) Total General and Career Education Programs SPECIAL EQ!JCATIQN PRQGBAMS Regular Programs Category I {') Category II (') Category Ill (*) Category IV r) Category V (*) Sub-Total - Regular ,1 Category VI {Gifted)(') Total Special Education Programs BEMEDIAL EQUCA]]QN PBQGMM C:l Total Fourteen Weighted Programs MEQIA CENTER PBQ!:.zBAMS Salaries Operations Total Media Center Programs ALLOTMENTS FROM GEORGIA DEPARTMENT OF REQUIRED ORIGINAL _.!!._ ORIGINAL MID-TERM $ 971,921.00 $ 874,728.90 $ 0.00 2,352,179.00 2,116,961.10 $ 3,324,100.00 90 $ 2,991,690.00 $ 0.00 1,oqq,06s.oo 9q,1. ~00,061.20 .. 1,595,923.00 90 :-.:, 945,567.00 90 1,436,330.70 'I. 651,010.30 575,925.00 90 516,332.50 c.- :, ... -,, 447,559.00 90 402,603.10 s 7,669,142.00 $ 7,100,227.60 $ . '0.00 s 1,514,962.00 ..-I ' f,1 $ 1,363,463.60 $ 0.00 . ' s s 1,,514,?62.00 90 1,363,463.80 $ 0.00 238,658.00 90 214,792.20 s 1,753,840.00 s s 1,578,276.00 0.00 $ s 468,354.00 90 s 421,518.60 0.00 s 10,111,136.00 s 9,100,022.40 $ 0.00 s 279,654.00 90 $ 251,666.60 $ 0.00 66,026.00 100 66,026.00 $ 345,680.00 $ 317 714.60 $ 0.00 s Total Fourteen Weighted and Media Center Programs 10,456,616.00 s s 9,417,737.00 0.00 STAFF DE~ELQPMENI PBQ!JBeiMS Cost of Instruction Professional Development s 30,000.00 $ 30,000.00 $ 0.00 62 455.00 62,455.00 0.00 Total Staff Development Programs (*) Identifies Fourteen Weighted Programs. $ 92,455.00 100 $ 92,455.00 $ 0.00 See notes to the general purpose financial statements. - 26 SCHEDULE ~4~ EDUCATION TOTAL REQUIRED ACTUAL EXPENDITURES SALARIES OPERATIONS TOTAL AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT s 874,728.90 $ 1,003,725.84 $ s 18,231.27 1,021,957.11 2,116,961.10 2,238.769.50 61,697.98 2,300,467.48 $ 2,991,690.00 $ 3,242,495.34 $ 79,929.25 $ 3,322,424.59 $ 0.00 900,061.20 1,030,824.56 29,235.13 1,060,059.69 0.00 1,436,330.70 1,823,481.42 77,673.01 1,901,154.43 0.00 851,010.30 1,140,006.67 77,477.35 1,217,484.02 0.00 518,332.50 575,310.33 41,653.70 616,964.03 0.00 402,803.10 526,800.82 46 467.16 573,267.98 0.00 s s s 7,100,227.80 8,338,919.14 s 352,435.60 8,691,354.74 $ 1,363,483.80 $ s $ 1,363,483.80 104,112.05 $ 464,110.34 960,753.16 51,537.34 6,715.32 1,587,228.21 $ 214,792.20 260,329.34 s s $ 1,578,276.00 1,847,557.55 $ s 421,518.60 502,471.20 $ s $ 9,100,022.40 10,688,947.89 $ s 1,479.53 17,284.85 22,143.50 339.29 s 41,247.17 105,591.58 481,395.19 982,896.66 51,876.63 6,715.32 1,828,475.38 8,883.28 267;212.62 s 48,130.45 1,895,688.00 s 15,268.63 517,729.83 s 415,824.68 11,104,772.57 s s 251,688.60 66,026.00 $ 317 714.60 $ 314,374.38 $ s 314,374.38 s 68,187.36 s 68,187.36 314,374.38 68,187.36 382,561.74 s $ 9,417 737.00 $ 11,003,322.27 s s 484,012.04 11,487,334.31 0.00 0.00 0.00 0.00 0.00 0.00 $ 30,000.00 62,455.00 s===9.,2.,..,ss=.o==o $ 67,186.08 $ 67,186.08 25,842.06 25,842.06 s 93,028.14 $ 93,028.14 $==-=-=.;0;;..00.;, 27 u ,. SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS RussELL W. H1NTON STATE AUDITOR (404) 656-2174 ~..,,:f . ;r;-;; DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington S1reet, S. W., Suite 214 Atlanta. Georgia 30334-8400 June 19, 2001 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Dodge 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 ofDodge County Board ofEducation as ofand for the year ended June 30, 2000, and have issued our report 'thereon dated June 19, 2001. 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 app~icable 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 Dodge County Board of Education's financial statements are free of materiaJ 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 ofout 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 Dodge 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 2000YB-40A ,. J ' . ' J,1 LJ ,.I,: r ,. 'J ,, J .,, '-, , ;: I -, J . , -- '-i I. ,.- . r l - 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 our judgment, could adversely affect Dodge County Board ofEducation'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 ofFindings and Questioned Costs as item FS-6451-00-01. 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, the reportable condition described above is considered to be a material weakness. This report is intended solely for the information and use of management, members of the Dodge County Board ofEducation, 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, RWH:jb 2000YB-40A sell W. Hinton State Auditor ,,.I . IJ :'.., ,,, .....' .. ,. ' , 1_: [' . ..I ') .( ., ,,, . ' .I ,. .,... f _,, - .. . . !, l: , ' j RussELL W. HINTON STATE AUDITOR (404) 656-2174 .........9.f...~.........., "It": \C'I ;-r,;b DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street. S.W.. Suite 214 Atlanta, Georgia 30334-8400 June 19, 2001 Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members of the State Board of Education and Superintendent and Members of the Dodge County Board of Education REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULARA-133 Ladies and Gentlemen: Compliance We have audited the compliance ofDodge County Board ofEducation with the types ofcompliance requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2000. Dodge County Board of Education's major Federal programs are identified in 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 ofDodge County Board ofEducation's management. Our responsibility is to express an opinion on Dodge 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 ofAmerica; 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 Dodge 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 Dodge County Board of Education's compliance with those requirements. 2000SA-10A , ' .- In our opinion, the Dodge 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, 2000. Internal Control Over Compliance The management of Dodge County Board of Education 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 Dodge County Board ofEducation'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 ofthe 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 management, members of the Dodge County Board ofEducation, 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, ~~ lQ_ ~ } I ... \.,U ~sell W. Hinton State Auditor RWH:jb 2000SA-10A ,. '' ) 1' , ,.,:,' I' .J 'l _1_ SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS ;., .') DODGE COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS FS-6451-98-02 FS-6451-99-01 Further Action Not Warranted Unresolved - See Corrective Action/Responses CORRECTIVE ACTION/RESPONSES GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6451-99-01 The Dodge County Board ofEducation chooses not to maintain General Fixed Assets at the present time due to a lack of staffsufficient to cover the task and also not enough funds to hire additional personnel. ., /4 SECTIONN FINDlNGS AND QUESTIONED COSTS DODGE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000 I SUMMARY OF AUDITOR'S RESULTS 1. Type of Report Issued on the Financial Statements The auditor's opinion on the Dodge County Board of Education's financial statements was qualified 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 Dodge 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 ofthe Dodge County Board ofEducation disclosed no instances ofnoncompliance that were deemed to be material to the financial statements. 4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Dodge 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 Dodge CountyBoard ofEducation'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 Dodge County Board ofEducation'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 84.0 IO Elementary and Secondary Education Act - Title I - Grants to Local Educational Agencies 8. Type "A" Program Dollar Threshold The dollar threshold for type"A" programs was $300,000.00. 9. Low Risk Auditee The Dodge County Board of Education did not qualify as a low risk auditee as defined by Section .530 ofOMB Circular A-133. - 1- :.DODGE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS ._ YEAR ENDED JUNE 30,2000 Il FINANCIAL STATEMENT FINDINGS AND QUESTIONED EOSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group - Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Numbef: FS-6451-00-01 :, ' . I, ; The Dodge County Board of Education failed to maintain a system-wide Geiietal Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial stateinehts of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should .be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an . inventory of land, buildings and equipment owned by the Board 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. Management's Response: The Dodge County Board ofEducation does not 'have the qualified staffto maintain Fixed Assets but hopefully, will consider in the near future. . ,.. - - ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. " .:.t p f r i. -' . ', 1i ' ,,, " ...... I -2-