Douglas County Board of Education, Douglasville, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2001

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DOUGLAS 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 REVEI\.'UES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

9

F NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

11

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

26

H

COMBINING STATEMENT OF RE\'ENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

28

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

30

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

32

DEBT SERVICE FUND

K

COMBINING BALANCE SHEET

34

L

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

35

DOUGLAS COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

36

2 SCHEDULE OF STATE REVENUE

38

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

41

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

42

5

BY SITE

43

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

R11,,11.1 \\'. H1:-.1or-.
STATE AUC'ITOR '<O<l 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
25--1 W,1,hmgton S1recl S 'Vo.:. Sullc 214 Atl,mla. Georgia 30334-X400
March 15, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Douglas 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 accompanymg general-purpose financial statements of the Douglas County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Douglas County Board of Education'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 of matenal 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 opmton.
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 opm1on, vary in some respects from generally accepted accounting principles. These variances are described as follows:

2001ARL-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 accountmg 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, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, 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, 2000, were improperly recorded m the year ended June 30, 2001. 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 opmion, 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 of the Douglas County Board of Education as of June 30, 2001, and the results of its operations and the cash flows of its nonexpendable trust fund 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 March 15, 2002, on our consideration of the Douglas County Board of Education's internal control over financial reportmg 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 Douglas County Board of Educat10n taken as a whole. The accompanying combining statements (Exhibits G through L) 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 of States, Local Governments, and Non-Profit Orgamzatwns, are presented for purposes of additional analysis and are not a required part of the
2001ARL-:13

general-purpose financial statements. Such information has been subjected to the auditmg procedures applied in the audit of the general-purpose financial statements and in our opinion, except for the effects ofthe 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 of this report has been filed as a permanent record m the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 506-24.
Respectfully submitted,
~ ...oa.w4~
Russell W. Hinton State Auditor
RWH:gp 2001ARL-13

DOUGLAS COUNTY BOARD OF EDUCATION

--------------------------- ------

DOUGLAS COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2001

ASSETS Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Consumable Supplies Food Donated Commod1t1es Purchased Food
Amount Available 1n Debt Service Fund
Amount to be Provided 1n Future Years For Payment of Bond Debt
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

s 1,124,82882 $ 328,310 30 s

114.427 07

3,940,824 36

600,000.00

35,909,603 88

2,170,889 39

646,511 74

6,274,991 00

456,130 74

153.454 06 90,905 27

$ 7,692,673 31 $ 1,819,181 37 $ 42,299,021 95

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Notes Payable Expired Grant Balances Payable Contracts Payable Reta1nages Payable General Obligation Bonds Payable
Total L1ab11it1es
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Cont1nuat1on of State Programs For Debt Service For Endowment Corpus For Inventories Consumable Supplies Food Donated Commod1t1es Purchased Food For Purpose of Bond Issue For SPLOST ProJects Unreserved Designated for Self-Insurance Designated for Equipment Purchases Defiat Undes1gnated
Total Fund Equity

s 2.457 ,609 80 $
90,545 74
978.00

319,839 60 $ 739,008 51
1,365 69

88,970 91
1,088,605 43 516,282.36

$ 2,549,133 54 $ 1,060,213 80 $ 1,693,858 70

$

264,731.49

456,130 74 $
27,191 53 4,395,486 01 $ 5,143,539 77 $

153.454 06 90,905 27
$

28,611,108.17 11,994,055.08

102,359.91

412,248 33

0 00

758,967 57 $ 40,605,163.25

Total L1ab11it1es and Fund Equity

$ 7,692,673 31 $ 1,819,181 37 $ 42,299,021 95

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

-2-

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPE NON EXPENDABLE TRUST FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

{Memorandum Onl~l

JUNE 30, 2001

JUNE 30, 2000

s $ 1,045,024 63

1,678 11

s $ 2,514,268 93

4,052,906 89

48,057 99

55,451 60

40,553,937 83

14,467,387 65

84,736.78

9,177,128 91

4,535,726 64

s

1,177,819 40

456,130 74
153,454.06 90,905 27
1,177,819 40

810,592 61
134,545.20 73,585 70
503,028 76

90,522,180 60

90,522,180 60

68,261,971 24

s $ 1,17781940

57,129 71 $

91,700,000 00 $ 144,745,825.74 $ 92,839,744.69

s 2,866,420 31 $ 2,850,625 51

829,554.25

714,632 74

9,950,000 00

2,343 69

13,78971

1,088,605 43

154,345.16

516,282 36

36,123.23

$

91,700,000 00

91,700,000 00

68,765,000 00

$

s 91,700,000 00

97,003,206 04 $ 82,484,516.35

s 1,177,81940
$
0 00
s s 1,177 81940
$ 1 177 819 40 $

47,000.00
10 129 71 57 129 71

s

264,731 49 $

1,177,819 40 47,000 00

260,369.59 24,000 00
503,028.76 47,000.00

456,130 74

810,592 61

153,454 06 90,905 27 28,611,10817 11,994,055 08

134,545 20 73,585 70
10,147,15613

27,191.53 102,359 91
4,817,864 05

279,926 12 152,533 28 -2,761,746 08 684,237 03

s 47 742 619 70 $ 10,355,228 34

57 129.71 $

s s 91,700,000 00

144,745,825 74

92,839,744 69

-3-

DOUGLAS COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2001

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 Admin1strat1on Business Adm1nistrat1on Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay Debt Service
Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING ~OURCES (USES)
Accrued Interest on Bonds Sold Proceeds from General Obligation Bonds
Par Value Premium on Bonds Sold Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1

GENERAL FUND

SPECIAL REVENUE
FUND

$ 68,752,365 60 $ 213,339 33
38,638,256 63 3,772,207 85

1,981,417 78 6,654,340.21
3,300,742 63

$ 111 376 169 41 $ 11,936,500.62

$ 70,569,466.00 $
2,684,883 22 3,103,064 44 2,759,367.55 1,011,129.93 7,866,429.75 1,521,538 76 7,954,061 82 3,929,588 08 2,159,355.32 1,250,309 00
5,641 11 6,936 90

4,173,001 80
172,707.79 507,517.81
55,706.20 54,741 53
2,450 46
101,720 00 184,133 78
32,739.26 78,522 58 6,869,523 99

$ 104,821,771 88 $ 12,232,765 20

$ 6,554,397 53 $

-296,264 58

s 6,554,397 53 $
-1,410,857 76

-296,264 58 1,055,232 15

FUND BALANCE JUNE 30

$ 5,143,539 77 $ ====75=8,=96=7.=57=

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 1 2001

JUNE 30 1 2000

$ 3,358,813 50

s 74,092,596 88 $ 64,732,573 79

6,867,679 54

5,987,390 24

8,283,490 02 $ 10,835,457 16

57,757,203 81

48,555,046 55

661,395 27

125,229 24

7,859,574 99

7,063,545 20

s 12,303,698 79 $ 10,960,686 40 $ 146,577,055 22 $ 126,338,555 78

$ 74,742,467.80 $ 70,831,929 12

$

736,678 00

11,393,540 67

2,857,591 01 3,610,582.25 2,815,073 75 1,065,871 46 7,868,880.21 2,258,216 76 8,055,781.82 4,113,72186 2,192,094 58 1,328,831.58 6,875,165 10 11,400,477 57

5,518,437.96 3,135,092 58 2,699,780 63 1,049,731 78 8,109,574 51 1,296,950 46 8,371,179 38 3,787,826 45 2,783,529.62 1,264,728 39 6,406,835 93 9,616,720.25

$ 7,065,000.00 3,219,851 56 4,628.58

7,065,000 00 3,219,851 56
4,628.58

5,970,000.00 5,249,295 93
8 456 54

$ 12,130,218 67 $ 10,289,480 14 $ 139,474,235 89 $ 136,100,069 53

$

173 480 12 $

671,206 26 $ 7,102,819.33 $ -9,761,513 75

$ $ 30,000,000.00
284,527 00
$ 30,284,527 00 $
$ 30,458,007.12 $ 10,147,15613

3,584 38 $

3,584.38

30,000,000 00 284,527.00 $

3,584 38 $ 30,288, 111 38 $

978,717.57 -978 717 57
0.00

674,790.64 $ 37,390,930.71 $ -9,761,513 75

503,028 76

10,294,559.28

20,056,073 03

$ 40,605,163 25 $ 1,177,819 40 $ 47,685,489 99 $ 10,294,559 28

-5-

DOUGLAS 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. 2001

EXHIBIT "C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds
Total Revenues

$ 64,907,668 00 $ 171,488 00
35,950,031 00 4 170,000 00

68,752,365 60 213,339 33
38,638,256 63 3,772,207 85

s $ 105,199,187 00

111 37616941

EXPENDITURES

Current Instruction Support Services Pupil Sel'VlceS Improvement of lnstrucbonal Se1V1ces Educational Media Services General Adm1mstratIon School Admin1strabon Business Adm1mstratIon Maintenance and Operabon of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay

s s 68,399,863 13

70,569,466 00

3,110,154 72 3,016,701 15 2,936,346 44 1,093,188 69 7,623,671 56 1,090,786 52 8,839,287 78 4,432,060 48 2,133,955 47
5.150 00

2,684,883 22 3,103,064 44 2,759,367 55 1,011,129 93 7,866,429 75 1,521,538 76 7,954,061 82 3,929,588 08 2,159,355 32 1,250,309 00
5,641 11 6,936 90

Total Expenditures

$ 102,681,165 94 $ 104,821,771 88

Excess of Revenues over (under) Expenditures $ 2,518,021 06 $ 6,554,397 53

FUND BALANCE JULY 1. 2000

-1,675,744 86

-1410857 76

FUND BALANCE JUNE 30. 2001

$

8421276 20 $ 5,143,539 77

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

s 2,021,552 80 $
5,896,432 65

1,981,417 78 6,654,340 21

3,250,652 42

3,300,742 63

$ 11,168,637 87 $ 11,936,500 62

$ 3,849,597 85 $ 4,173,001 80

202,887 00 491,032 65
49,00000 61,679 00
5,140 00 10,000 00 82,400 00 188,624 50 45,491 00 94,788 00 6,247,881 97

172,707 79 507,517 81
55,706 20 54,741 53
2,45046
101,720 00 184,133 78
32,739 26 78,522.58 6,869,523 99

$ 11,328,521 97 $ 12,232,765 20

$ -159,884 10 $ -296,264 58

1,055,366 28

1,055,232 15

$ 895,482 18 $

758,967 57

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

DOUGLAS COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2001

EXHIBIT "D"

OPERATING REVENUES None Recorded
OPERATING EXPENSES Current Awards Operating Income (Loss)
NONOPERATING REVENUES Net Investment Income Interest Earned Net Income (Loss)
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

ENDOWMENT FUND
PERPETUAL TRUST
OF WINSTON ELEMENTARY

TOTALS

(Memorandum Onl:r}

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

0.00 $

0 00 $

0 00

$

4 217 53 $

4 217 53 $

0.00

$

-4,217.53 $

-4,217.53 $

0 00

615 05 63 13

615 05 63 13

4,192.01 47 70

$

-3,539.35 $

-3,539.35 $

4,239 71

60,669.06

6066906

56,429 35

$

57 129 71 $

57 129. 71 $ ====6=0=,6=69=0=6=

The notes to the general-purpose financial statements are an integral part of this statement. -8-

DOUGLAS COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2001

EXHIBIT"E"

Cash Flows from Operating Activities. Cash Paid for Awards
Cash Flows from Investing Act1v11ies Interest Received on Investments Proceeds from Sale of Investments Net Cash Provided by Investment Act1v1t1es
Net Increase in Cash Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

ENDOWMENT FUND
PERPETUAL TRUST
OF WINSTON ELEMENTARY

TOTALS

{Memorandum Onli'.) YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

s

-4217.53 $

-4 217.53 $

0.00

$

63 13 $

63.13 $

4217.53

4,217 53

47.70

$

4 280.66 $

4 280.66 $

47 70

$

63.13 $

63.13 $

47.70

1 614.98

1 614.98

1 567.28

$

1 678.11 $

1 678.11 $ ======16=14==98~

The notes to the general-purpose financial statements are an integral part of this statement. -9 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FfNANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Douglas 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 entlty. 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 andliabilities 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 a 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.

- 11 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note I: 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.
FIDUCIARY FUND TYPE - the fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:
NONEXPENDABLETRUSTFUND Perpetual Trust of Winston Elementary - the fund used to account for an endowment ofwhich the corpus 1s to be invested and preserved intact with the resultant income to be used to fund Winston Elementary School student needs and purposes as identified by the principal and faculty.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding.
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 liabi_lities 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 liabihties 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.
All nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation of these funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
- 12 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 and therefore 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.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions 1s 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 2001, a substantial number ofpersonnel of the School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 2000 and ending in August 2001. 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, 2001, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30, 2001. Also, the State's portion of the compensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. 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.
The accrual basis of accounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
BUDGET
The Douglas 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 ofthe budget at any level. The
- 13 -

------------------------

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 function 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 ofthis 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 ofthe 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.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of cash 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 msured Federal savings and loan associations.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating 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 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 of Georgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofretum 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,
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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 200 I

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(5) Pnme 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 Douglas County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on October 8, 2000 (levy date). Taxes were due on December 8, 2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Douglas County Tax Commissioner bills and collects the property taxes for the School District, withholds 1.00% oftaxes 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, 2001 for maintenance and operations amounted to $37,233,902.83 and for school bonds amounted to $1,998,413.01.

Tax millage rates levied for the 2000 tax year (calendar year) for the Douglas County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

19.I0mills 1.00 mills

20.10 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $17,041,813.93 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection of this tax once an additional $6,963,813.46 has been collected or on June 30, 2002, whichever occurs first.

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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
CONSUMABLE SUPPLIES Consumable supplies are reported on the Combined Balance Sheet at cost (first-in, first-out). The School District uses the consumption method to account for the consumable supplies inventory whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. The consumable supplies inventory reported on the balance sheet is equally offset by a reservation of fund balance which indicates that it is not available for discretionary expenditure even though it is a component of net current assets.
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). The School District uses the consumption method to account for both inventories. Donated food commodities are recorded as an asset and as revenue when received, and expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenditures are recorded as the inventory items are used. 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 ofnet current assets.
GENERAL OBLIGATION BONDS
The School District issues general obligation bonds to provide funds for the acquisition and construction ofmajor capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit of the 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 of expenditures/expenses initially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
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
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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 200 I

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
present financial position, results of operations or cash flows 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 AND INVESTMENTS
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 ofthe 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 mdebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created hy 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
(7) Bonds, bills, notes, certificates of mdebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the Umted States government both as to principal and mterest 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.
- 17 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 2: DEPOSITS AND INVESTMENTS

CATEGORIZATION OF DEPOSITS At June 30, 2001, the bank balances were $7,265,289.53. The amounts ofthe total bank balances are classified into three categones 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 m the School District's name.
Category 2 - Cash collateralized with securities held by the pledging financial institut10n'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 nsk category at June 30, 2001, as follows:

Risk Category

Bank Balance

I

$2,053,388.72

2

5,211,900.81

3

0.00

Total

$ 7,265,289.53

CATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below:

Category I - Insured or registered, or securities held by the School District or the School District's agent in the School District's name.
Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the School District's name.
Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the School District's name.

At June 30, 2001, the carrying value of the School District's total investments was $39,953,937.83 which is materially the same as fair value. The investments are classified as to risk categories as follows:

- 18 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS AND INVESTMENTS

Type of Investment
Investment Ponfoho Accounts
Local Government Investment Pools
Total Investments

Risk Categoric~

2

3

Carrying Amount

Fair Value

S--5.5A.i.L@ s=_===o=o==>o s 48 057 22 s 103,509 59 s 103,509 59

39,850.428 24 39,850,428 24 S39 953 917,83 S39 953 9~7 83

The carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office ofTreasur.y and Fiscal Services in which the School District owns no identifiable securities. The investment policy of the State of Georgia, Office ofTreasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description ofthe Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. The pool is not registered with the Securities and Exchange Commission as an investment company but does operate Georgia Fund 1 in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds ofGeorgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.

Investments in Georgia Fund 1 and Fund 6 a_re directed toward short-term instruments such as U.S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2001, was 39 days. The average investment duration for Fund 6 on June 30, 2001, was 6 months.

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

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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 4: RISK MANAGEMENT

The School District is exposed to various nsks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injunes to employees; natural disaster; unemployment compensation; dental plan and vision plan.

The School District has obtained commercial insurance for risk ofloss associated with torts, assets and errors or omissions. The School District has neither significantly reduced coverage for these nsks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years.

The School District has elected to self-insure for all losses related to natural disaster. The School District has not experienced any losses related to this risk in the past three years.

The School District has established a hmited risk management program for workers' compensation claims. A premium is charged when needed by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The School District accounts for claims with expenditure and liability being reported when it 1s probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $250,000.00 loss per occurrence, up to the statutory limit.

Changes in the workers' compensation claims habihty during the last two fisc;:il years are as follows:

2000 2001

Begmnmg of Year Liab1hty

Claims and Changes m Estimates

Claims Paid

End of Year Liability

$

O.OQ $ 164 939.62 $ 164,939.62 $

0.00

$

s 0 00

207,691.24 $ 207,691.24 $

0.00

The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and hab1hty 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 habihty during the last two fiscal years are as follows:

2000 2001

Begmnmg of Year Liab1hty

Claims and Changes m Estimates

$

0.00 s

9,969.82 $

$

0.00 $ 12,116.00 $

Claims Patd

End of Year Ltabthty

9,969.82 $

0.00

12,116.00 $

0.00

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DOUGLAS COUNTY BOARD OF EDUCATYON

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 4: RISK MANAGEMENT

The School District is self-insured with regard to dental claims. The School District accounts for claims within the General Fund with expenditures and liability being reported when it 1s probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

Begmmng of Year Liability

Claims and Changes m Estimates

Claims Paid

End of Year Liab1hty

2000 2001

$

0 00 $ 885,075.09 $ 885,075.09 $

0.00

$

0.00 $ 934,238.77 $ 934,238.77 $

0.00

The School District is self-insured with regard to vision claims. The School District accounts for claims within the General Fund with expenditures 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 vision claims liability during the last two fiscal years are as follows:

2000 2001

Begmnmg of Year Liab1hty

Claims and Changes m Estimates

Claims Paid

End of Year L1ab1hty

$

0.00 $ 110,900.98 $ 110,900.98 $

0.00

$

0.00 $ 115,270.00 $ 115,270.00 $

0.00

The School District has purcha~ed surety bonds to provide additional insur~ce coverage as follows:

Position Covered

Amount

Superintendent All Other Employees

$ 200,000.00 $ 500,000.00

Note 5: GENERAL LONG-TERM DEBT

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

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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 5: GENERAL LONG-TERM DEBT

Purpose

Interest Rates

Amount

General Government - Refunding - Series 1993 General Government - Series 1995 General Government - Series 1997 General Government - Refunding - Series 1999 General Government - Series 2001

4.20% - 5.65% 4.35% - 5.85% 4.00% - 5.00% 3.10% - 5.00% 3.625% - 4.00%

$ 27,580,000.00 5,405,000.00 7,455,000.00
21,260,000.00 30,000,000.00

$ 91,700,000.00

The changes in General Long-Term Debt during the fiscal year ended June 30, 2001, were as follows:

General Obligation
Bonds

Balance July 1, 2000

$ 68,765,000.00

Additions G.O. Bonds

30,000,000.00

Deductions Debt Retired

7,065,000.00

Balance June 30, 2001

$ 91,700,000.00

At June 30, 2001, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

General Obligation
Bonds

2002 2003 2004 2005 2006 2007 - 2011 2012 - 2015

$ 10,179,371.26 16,212,292.52 12,357,857.52 14,470,915.02 14,489,415.02 37,819,103.84 8,595,425.04

Total Principal and Interest

$114.124.380.22

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DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 6: SHORT-TERM DEBT

The School District issues tax anticipation notes in advance of property tax collect1ons, 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 each December. 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 precedmg 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.

Begmnmg Balance

Add1t1ons

Payments

Endmg Balance

Tax Ant1c1pat1on Notes

$9,950,000.00 $====!0=,0!=,!.0 $2.9-5Jl.,Q_Q.Qj10 $===="'0=".0==0

Note 7: PRIOR YEAR DEFEASEMENT OF DEBT

In fiscal years 1985 and 1999, the School District defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the School District's general-purpose financial statements. At June 30, 2001, $13,945,000.00 of bonds are outstandmg and are considered defeased.

Note 8: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of$1,348,758.02 for health msurance 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 $979,786.63

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $123,362.39

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 $245,609.00

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DOUGLAS COUNTY BOARD OF EDUCATJON

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 9: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstandmg construction or renovation contracts executed by the School District as of June 30, 2001, together with funding available:

Project

Unearned Executed Contracts

Funding Available From State

Mirror Lake Elementary School New Manchester Elementary School Lottery 02G/0 1S-648-012

$ 7,314,510.91 7,453,068.72 2,923,171.82

$ 373,201.50

S17.690.751.45 $ 373,201.50

The amounts described in this note are not reflected m the general-purpose financial statements.

Note 10: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by granter agencies. This could result in requests for reimbursement to the granter 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.

The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance ofroutine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the general-purpose financial statements.

Note 11: SUBSEQUENT EVENTS

In the subsequent fiscal year, voters authorized the School District to issue general obligation bonds in the amount of $9,445,000.00. The proceeds from these bonds will be used for the purpose of funding the acquisition and installation ofnew technology and equipment at all educational facilities; the acquisition, construction and equipping of three new schools and the purchase ofland to be used as sites for future educational facilities; the acquis1t1on, construction and equipping of classroom additions, physical education facilities and renovations and modifications to existing educational facilities; and the acquisition of new school buses and transportation equipment.

Note 12: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clencal personnel employed by local school districts are covered by the Teachers Retirement System of Georgia (TRS), which is a ~est-sharing multiple
- 24 -

DOUGLAS COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 12: RETIREMENT PLANS

employer defined benefit pension plan. TRS provides service retirement. disability ret!fement 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 obtamed 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 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2001 2000 1999

100% 100% 100%

$ 7,593,472.56 $ 7,529,015.59 $ 7,202,776.78

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DOUGLAS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2001

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commod1t1es Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

355,732.78 $

159,887.08

600,000.00

42,767 48

1,035.20

153,454.06 90,905.27

Total Assets

$ 1,242,859.59 $ ===16=0=,9=2=2.=28=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total L1abiht1es
FUND EQUITY
Fund Balances Reserved For Continuation of State Programs For Inventories Food Donated Commod1t1es Purchased Food Unreserved Designated for Equipment Purchases Undes1gnated
Total Fund Equity
Total L1abil1t1es and Fund Equity
See notes to the general-purpose financial statements - 26 -

$

167,558.64 $

42,288.14

316,333.38

118,634.14

$

483,892 02 $

160,922 28

$

153,454.06

90,905.27

102,359.91

412,248 33 $

0.00

$

758 967 57 $

0 00

$ 1,242,859 59 $ ===1=60;;e,,=92;;,;2~.2;;,;8~

EXHIBIT"G"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2001

JUNE 30, 2000

$

515,619.86 $ 1,403,976 16

600,000 00

$

602,709.06

646,511 74

515,663.90

153,454 06 90,905 27

134,545.20 73 585 70

$

602,709.06 $ 2,006,490.93 $ 2,127,770 96

$

187,309.56 $

187,309.56 $

132,063.62

109,992.82

319,839.60

268,736.87

304,040.99

739,008.51

657,948 61

1 365.69

1 365.69

1378971

$

602,709 06 $ 1,247,523.36 $ 1,072,538 81

$

24,000 00

$

153,454.06

90,905 27

134,545 20 73,585 70

102,359.91

152,533 28

$

0.00

412,248.33

670 567 97

$

0.00 $

758,967.57 $ 1,055,232 15

$

602,709.06 $ 2,006,490.93 $ 2,127,770 96

- 27 -

DOUGLAS COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Adm1mstrat1on School Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

459,928 00 $ 1,331,807.17

2,836,588 78

3,300,742.63

$ 6,597,259 41 $ 1 331 807.17

$ 1,257,550 51
92,768.00 3,658 47

1,830.19

$ 6,869,523.99

$ 6,869,523.99 $ 1,355,807.17

$

-272,264.58 $

-24,000.00

$

-272,264.58 $

1,031 ,232.15

-24,000.00 24 000.00

$ 758,967.57 $ -======~o~o=o=

See notes to the general-purpose f1nanc1al statements - 28 -

EXHIBIT"H"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

189,682.61 $ 1,981,417.78 $ 1,947,435.07

3,817,751 43

6,654,340.21

5,738,173 52

3,300,742.63

3,076,941.06

$ 4,007,434.04 $ 11,936,500 62 $ 10,762,549.65

$ 2,915,451.29 $ 4,173,001.80 $ 3,882, 134.69

79,939.79 503,859.34
55,706.20 54,741.53
2,450.46 101,720.00 182,303.59
32,739.26 78,522.58

172,707.79 507,517.81
55,706.20 54,741.53
2,450.46 101,720.00 184,133.78
32,739.26 78,522.58 6,869,523.99

174,022 25 302,733.01
52,659.46 13,276.93 167,136.87 27,971.33
34,442.54 6,399,548.16

$ 4 007 434.04 $ 12,232,765.20 $ 11,053,925.24

$

0.00 $

-296,264.58 $

-291,375.59

59.60

$

0.00 $

-296,264.58 $

-291,315.99

0 00

1,055,232.15

1,346,548.14

$

0.00 $

758 967.57 $ 1,055,232.15

- 29 -

DOUGLAS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 2001

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$

167.14 $ 2,394,483.29

29,226,209.59

6,683,394 29

2,916,177.50

$ 29,226,376 73 $ 11,994,055.08

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Contracts Payable Retamages Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For SPLOST ProJects Unreserved Undes1gnated
Total Fund Equity
Total L1ab1ht1es and Fund Equity

$

88,970.91

483,439.34

42,858.31

$

615,268.56

$ 28,611,10817 $ 11,994,055.08

0.00

0.00

$ 28,611,108.17 $ 11,994,055.08

$ 29,226,376 73 $ 11,994,055 08

See notes to the general-purpose financial statements - 30 -

EXHIBIT "I"

LOTTERY PROJECT

TOTALS

JUNE 30, 2001

JUNE 30, 2000

$ 2,394,650.43 $

435,646.77

35,909,603.88

7,138,406.79

$ 3,358,813.50

6,274,991.00

2,810,354 10

$ 3,358,813 50 $ 44,579,245.31 $ 10,384,407.66

$ 2,280,223.36 $ 2,280,223.36 $

88,970 91

605,166.09

1,088,605.43

473 424.05

516,282.36

$ 3,358,813.50 $ 3,974,082.06 $

46,783 14
154,345 16 36,123.23
237,251 53

$ 28,611,108.17 11,994,055.08 $ 10,147,156 13

$ _ _ _ _0.;;._;;;_00;;._

0.00

0 00

$ _ _ _ _0_0_0_ $ 40,605,163.25 $ 10,147,156 13

$ 3,358,813 50 $ 44,579,245.31 $ 10,384,407 66

- 31 -

- - - - - - - - - - - - - - - - - - - - ----- --
DOUGLAS COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Support Services
Business Adm1mstrat1on Capital Outlay
Salaries Employee Benefits Land and Land Improvements Building and Building Improvements Equipment
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Premiums on Bonds Sold Proceeds from General Obligation Bonds
Par Value Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$ 8,283,490 02

$

209,145.55

452,249 72

$

209,145.55 $ 8 735 739 74

$

736,678.00

15,098.19 $ 3,417.42

815,826.38 311,544.39

$ 1,882,564.38 $

$ -1,673,418.83 $

76,983.93 18,731.23 1,004,321.35 1,159,696.94 819,713.20
3,079,446 65
5,656,293.09

$

284,527.00

30,000,000.00

$ -3,809,394 14

$ 30,284,527.00 $ -3,809,394.14

$ 28,611,10817 $ 1,846,898.95

0.00

10,147,156.13

$ 28,611I108 17 $ 11,994,055.08

See notes to the general-purpose financial statements. - 32 -

EXHIBIT "J"

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ 3,358,813.50 $ 3,358,813.50 $

181,486.30

8,283,490.02

6,945,139.35

661,395.27

629,487.06

$ 3,358,813 50 $ 12,303,698 79 $ 7 756112 71

$

736,678.00

$ 7,168,207.64

92,082.12 $ 22,148.65 1,004,321.35 9,143,730.96 1,131,257.59

227,751.94 40,661.01
471,724.40 6,933,298.03 1,870,790.51

$ 7,168,207.64 $ 12,130,218.67 $ 9,544,225.89

$ -3,809,394 14 $

173 480.12 $ -1,788,113.18

$

284,527.00

$ 3,809,394.14

30,000,000.00 3,809,394.14 $ -3,809,394.14

2,229,753.08 -3,208,411.05

$ 3,809,394.14 $ 30,284,527.00 $

-978,657.97

$

0.00 $ 30,458,007.12 $ -2,766,771.15

0.00

10 147 156 13

12,913,927.28

$=====o=.o=o= $ 40,605,163.25 $ 10,147,156 13

- 33 -

DOUGLAS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30, 2001

EXHIBIT "K"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30, 2001

JUNE 30, 2000

$ 1,021,886 95 $

23,137.68 $ 1,045,024 63 $

443,992 15

35,242 02

12,81597

48,057 99

84 736 78

84 736 78

59,036 61

Total Assets

$ 1,141,86575 $

35,953 65 $ 1,177,819 40 $ =====5=0=3=0,=2=8=76===

FUND EQUITY
Fund Balances Reserved For Debt Service Unreserved Undes1gnated

$ 1,141.865 75 $

35,95365 $ 1,177,81940 $

0 00 - - - - -0.0-0

0.00

503,028.76 0 00

Total Fund Equity

$ 1,141,865 75 $

35,953 65 $ 1 177 819 40 $==5=0=3=,0=2=8=7=6

See notes to the general-purpose f1nanc1al statements. - 34 -

DOUGLAS COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND YEAR ENDED JUNE 30. 2001

EXHIBIT "L"

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000

REVENUES Taxes Other Funds Total Revenues
EXPENDITURES

$ 2,077,133 25 $ 101,872 88

8,758,323 91 $ 10,835,457 16 $ 10,587,182 78

23,356 36

125.229 24

70,665 66

s s s 2,179,006 13

8,781,680 27 $ 10,960,686 40

10,657,848 44

Debt Service Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures

s s 1,526,527 65
4 628 58

7,065,000 00 $ 1,693,323 91

s 7,065,000 00
3,219,851 56
4,628 58

5,970,000 00 5,249,295 93
8 456 54

s $ 1,531 ,156 23 $ 8,758,323 91

10,289,480 14 $ 11,227,75247

s $ 647,849 90

23,356.36 $

s 671,206 26

-569,904 03

OTHER FINANCING SOURCES

Accrued Interest on Bonds Sold

3 584 38

3 584 38

Excess of Revenues and Other Financing Sources

over (under) Expenditures

s 647,849.90 $

s 26,940 74

674,790.64 $ -569,904 03

FUND BALANCE JULY 1

494,015.85

9 012 91

503,028 76

1,072,932 79

FUNDBALANCEJUNE30

S 1,141,865 75 $

35,953 65 S 1 177 819 40 $ =====50=3=,0=2=8=7=6=

See notes to the general-purpose financial statements.

- 35 -

---- --- -- - - - ------ --- - - - - - - - - - - - - - - - -

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Agriculture, U S Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program National School Lunch Program Pass-Through From Office of School Readiness Food and Nutnt1on Program Summer Food Service Program for Children

10 553 10 555
10 559

Total Child Nutnt1on Cluster

Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food D1stnbut1on Program (1)

10 550

Total U S Department of Agriculture

Defense, U S Department of Other Programs Pass-Through From Georgia Department of Education Food and Nutnt1on Program Fresh Produce Program (1)

. 10 550

Education, U S Department of Special Education Cluster Pass-Through From Georgia Department of Education lnd1v1duals with D1sab1hlles Education Act Part B - Special Education Flow Through Capacity Building Improvement Grant Preschool

84 027 84 027 84 173

Total Special Education Cluster

Other Programs Direct Foreign Language Assistance Pass-Through From Georgia Department of Education Comprehensive School Reform Demonstration ProJect Elementary and Secondary Education Act Tillel Grants to Local Educational Agencies Title II Eisenhower Professional Development Title VI Innovative Education Program Strategies Class Size Reduction Title VIII Advanced Placement Incentive Program Goals 2000 State and Local Education Sy:;tem1c Improvement Grants Safe and Drug-Free Schools and Communities Vocational Education - Basic Grants to States High School Program Basic Grant

84 293 84 332
84 010 84 281 84 298 84 340 84 330
84 276 84 186
84 048

Total U S Department of Education

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

NIA

$ 518,196 56

(2)

NIA

1,833,075 90 $

6,370,250 82 (3)

NIA

72,577 58

72,577 58

$ 2,423,850 04 $

6,442,828 40

NIA

342,178 74

356,135 59

s $ 2,766,028 78

6,798,963 99

NIA

$ 70,560.00 $

70,560 00

NIA

s 1,700,434 16 $

1,700,434 16

NIA

60,616 08

60,616 08

NIA

124,463 12

124,463 12

$ 1,885,513 36 $

1,885,513 36

171,488 00

171,488 00

NIA

114,803 58

114,803 58

NIA

1,200,866 35

1,200,866 35

NIA

47,188 21

47,188 21

NIA

71,934 00

71,934 00

NIA

250,120 00

250,120 00

NIA

44,786 88

44,786 88

NIA

9,214 31

9,214 31

NIA

62,779 28

62,779 28

NIA

105,097 46

105,097 46

$ 3,963,791 43 $

3,963,791 43

36 -

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Health and Human Services, U S Department of Pass-Through From the Cobb/Douglas Mental Health, Mental Retardation and Substance Abuse Regional Board Block Grants for Prevention and Treatment of Substance Abuse

93 959

Defense, U S Department of Direct Department of the Manne Corps R O T C Program

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

NIA

$ 25,448 00 $ _ _ _2_5,~4_48_00_

s 41,851 33

(4)

Total Federal Financial Assistance

S 6,867,679 54 S 10,858,763 42

N/A = Not Available

Notes to the Schedule of Expenditures of Federal Awards

(1) The amounts shown for the Food D1stnbutlon Program and the Fresh Produce Programs represent the Federally assigned value of nonmonetary assistance for donated commod1t1es 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 1n the 2001 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
n MaJor Programs are 1dent1fied by an astensk in front of the CFDA number

The School D1stnct did not provide Federal Assistance to any Subrec1p1ent

The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Douglas County Board of Education and 1s presented on the modified accrual basis of accounting which 1s the basis of accounting used in the presentation of the general-purpose financial statements

See notes to the general-purpose financial statements

37

--------------------- -------- -----------------------------

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 2001

SCHEDULE "2"

AGENCY/FUNDING

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

GRANTS Community Affairs. Georgia Department of Local Assistance Grant

$

58,981 OD

$

58,981 00

Education. Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Pnmary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with D1sab1ht1es Category I Category II Category Ill Category IV Category V Gifted Student - Category VI Remedial Education Program English Speakers of Other Languages (ESOL) Media Center Program Staff and Professional Development Indirect Cost Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Principal Supplements Vocational Supervisors Education Equahzat1on Funding Grant Food Services Vocational Education Other State Programs Alternative Program Apprenticeship Program At-Risk Summer School Program Governor's Emergency Fund Health Insurance Innovative Programs Mentonng Program Mentor Teachers National Teacher Cert1f1cat1on Pay for Performance Preschool Handicapped Program Remedial Summer School Special Education Support Cost Teachers' Retirement Tu1t1on for the Mult1-Hand1capped Lottery Programs Ass1stive Technology Computers in the Classroom Exceptional Growth-Capital Out!ay

3 158 506 00 755,373 OD
8,964,847 00 2,290,660 00 5,048,481 OD 8,278,065 OD 7,074.107 00 2,787,715 DD
459,753 DD 883,234 00 4,539.494 DO 920,902 OD
94,738 OD 2,154,923 00
698 873 00 179,836 00 151877600 421 805 00 9,195 036 00

1 464 459 00 376 797 00
338 352 00 72 933 00
113 033 00 3 432 327 00
s
102 194 40

459,928 00

658 695 00 45 000 00 18 388 22 6 000 00
979 786 63 5 000 00 3 884 64 16 952 00 E 38e 00
592 000 00 23506051
18 991 06 24 000 00 123 362 39 10788675

3,812 38 351,272 00

$ 3,358,813 50

3 158,506 00 755,373 00
8,964,847 00 2,290,660 00 5,048,481 DD 8,278,065 00 7,074,107 00 2,787.715 DD
459,753 OD 883,234 00 4,539.494 OD 920,902 OD
94,738 00 2,154,923 00
698,873 00 179,836 00 1,518,776 00 421,805 00 9,195,036 00
1,464,459 00 376,797 00 338,352 00 72,933 00 113,033 00
3,432,327 00 459,928 00 102,194 40
658,696 00 45,000 00 18,388 22 6,000 00
979,786 63 5,000 00 3,884 64
16,952 00 6,388 00
592,000 00 236,060 51
18,991 06 24,000 00 123,362 39 107,886 75
3,812 38 351,272 00 3,358,813 50

Office of School Readiness Pre-Kindergarten Program

976,722 79

976,722 79

Office of Treasury and F1scal Services Public School Employees Retirement

245 609 00

245,609 00

- 38 -

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 2001

SCHEDULE "2"

AGENCY/FUNDING
CONTRACTS Education, Georgia Department of Foreign Language Model Program Georgia's Reading Challenge Reading First Program

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$

156,906 00

123,254 00

$ 189,68261

s

156,906 00

123,254 00

189,682 61

$ 68.752,36560 $ 1,981,41778 $ 3358,81350 $ 74,092,59688

See notes to the gen~ral-purpose financial statements

- 39 -

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2001

SCHEDULE "3"

PROJECT
Funding the repayment of principal and interest on the School District"s Series 1986 Bonds completely as they mature, the principal and interest on the School D1stnct"s Series 1993 Bonds maturing January 1, 1998 through and including January 1. 2003 and the principal and interest on the School District's Series 1995 Bonds maturing January 1, 1998 through and including January 1, 2003
Funding the acqu1s1t1on, construction and equ1pp1ng of phase II of the new high school, a new middle school and a new elementary school. the purchase of land for future schools and renovations and add1t1ons to existing schools, including the acqu1s1t1on of all necessary property
Funding the repayment of principal and and interest on the School District"s Series 1993 Bonds matunng July 1, 2003 through and including July 1, 2007 and the principal and interest on the School District's Series 1999 Bonds maturing January 1, 2003 through and including January 1, 2007
Funding the acqu1s1llon and installation of new technology and equipment at all educational fac1hties, the acqu1s1tion, construction and equipping of three new schools and the purchase of land to be used as sites for future educational fac1l1t1es and add1t1ons renovations and mod1f1cat1ons to existing educational fac1ht1es and the acqU1s1t1on of new school buses and transportation equipment

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3) (4) (5)

AMOUNT EXPENDED
IN PRIOR YEARS (3)

PROJECT STATUS

$ 34,000,000 00 $ 34,000,000 00 $ 2.189,32578 $ 15,718.41600 Ongoing

29,000.000 00

39,408,041 56

10,247,654 29 29.160,387 27 Ongoing

30,000 000 00

30,000,000 00

0 00

0 00 Ongoing

79,000 000 00

79,000,000 00

1,145.886 38

0 00 Ongoing

$ 172 000,000 DO $ 182,408 041 56 $ 13,582.866 45 $ 44,878,803 27

(1) The School District's original cost estimate as spec1f1ed in the resolution calling for the 1mpos1t1on of the Local Option Sales Tax

(2) The School District's current estimate of total cost for the proiects Includes all cost from project inception to completion

(3) The voters of Douglas County approved the 1mpos1t1on of a 1% sales tax to fund the above proJects and retire associated debt Amounts expended for these projects may include sales tax proceeds, state. local property taxes and/or other funds over the hfe of the projects

(4) In add1t1on to the expenditures shown above, the School D1stnct has incurred interest to provide advance funding for the above projects as follows

Prior Years

$ 1,718,639 59

Current Year Total

264,275 00
s 1,982.914 59

(5) The Series 1986 Bonds and a portion of the Series 1995 Bonds were retired through the sale of Series 1999 Refunding Bond Issue The School District will ullhze the SPLOST proceeds budgeted for this projeCt. plus any excess SPLOST proceeds to retire the Series 1999 Refunding Bond Issue

See notes to the general-purpose financial statements

-41 -

DOUGLAS COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2001

SCHEDULE "4"

DESCRIPTION

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

Direct Instructional Programs

Kindergarten Program

$

Kindergarten Program-Early Intervention Program

Primary Grades (1-3) Program

Primary Grades-Early Intervention (1-3) Program

Upper Elementary Grades (4-5) Program

Middle School (6-8) Program

High School General Education (9-12) Program

Vocational Laboratory (9-12) Program

Students with D1sab1ilt1es

Category I

Category II

Category 111

Category IV

CategoryV

Gifted Student - Category VI

Remedial Education Program

Alternative Education Program

English Speakers of Other Languages (ESOL)

TOTAL DIRECT INSTRUCTIONAL PROGRAMS

s

3,658.564 00 $ 874,965 00
10,384,172 00 2,653,319 00 5,847,761 00 9,588.658 00 8,194.087 00 3,229,069 00 7,990,244 00
2,496,093 00 809,520 00 762,981 00 208,307 00

s 3,549,340 43
815,484 19 9,377,651 52 2,555,038 97 6,018,065 71 8,613,130 09 8,480,301 86 2,761,995 19
321,581 07 962,379 96 5,837,516 88 561,482 24
47,867 25 3,005,763 28 1,035,739 90
719,673 82 243,495 27

s 94,303 10
22,547 89 313,057 26
40,354 18 187,146 08 265,321 73 401,791 93 360,147 98
18,895 95 16,434 89 112,70911 19,419 81
4,877 04 50,473 84 12,076 73 16,342 97
4,031 16

3,643,643 53 838,032 08
9,690,708 78 2,595,393 15 6,205,211 79 8,878,451 82 8,882,093 79 3,122,14317
340,477 02 978,814 85 5,950,225 99 580,902 05
52,744 29 3,056,237 12 1,047,816 63
736,016 79 247,526 43

s 56,697,740 00 54,906,507 63 $ 1,939,931 65 $ 56,846,439 28

Media Center Program Staff and Professional Development

1,759,234 00 488,584 00

2,376,982 86 166,045 62

343,993 50 323,81917

2,720,976 36 489,864 79

TOTAL QBE FORMULA FUNDS

$

58,945,558 00 $ 57,449,536 11 $ 2,607,744 32 $ 60,057,280 43

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

See notes to the general-purpose financial statements

- 42 -

DOUGLAS COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2001

SCHEDULE "5"

SITE
Chapel Hill High School L1th1a Springs Comprehensive High School Arbor Station Elementary School Fairplay Middle School Dorsett Shoals Elementary School Alexander High School Chestnut Log Middle School Factory Shoals Elementary School South Douglas Elementary School Bright Star Elementary School Holly Springs Elementary Chapel Hill Elementary School Sweetwater Elementary School Burnett Elementary School Easts1de Elementary School 8111 Arp Elementary School Winston Elementary School Beulah Elementary School Turner Middle School Lithia Springs Elementary School Chapel Hill Middle School Douglas County High School Mount Carmel Elementary School Stewart Middle School Annette Winn Elementary School Proiect C.L.A.S.S. (Elementary Alternative) CrossRoads Day Alternative (Middle and High) Central Office (Alternative Education Program)
TOTAL
(1) Comprised of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

2,318,050.00 $

2,231,460.39

4,485,490.00

4,836,576.76

1,852,742 00

1,943,895 88,

2,319,089.00

2,164,786.94

1,813,834.00

1,867,053.22

4,083,675.00

4,336,544.75

2,877,492.00

2,649,636.55

1,769,856.00

1,752,695 10

1,640,505.00

1,632,372.92

1,606,689.00

1,612,879.35

1,719,809.00

1,634,569 87

1,872,645.00

1,919,664 05

1,983,213.00

2,063,495.69

2,093,290.00

2, 162,841.20

2,030,048.00

2,102,839.03

1,670,125.00

1,625,909.96

1,678,532.00

1,599,016.68

1,506,468.00

1,553,812.44

2,219,283.00

2,099,088.31

1,554,456.00

1,462,571.10

2,792,603.00

2,632,544.40

4,341,534.00

4,605,056.32

1,975,810.00

1,886,521.18

2,292,670 00

2,241,724 80

1,436,851.00

1,392,599.03

93,888 46

702,915 89

762,981.00

39,479.01

$

56,697,740 00 $ 56,846,439.28

See notes to the general-purpose financial statements. - 43 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

R1 1,,1,11 \\'. H1r-10N
STATE AUr'llOR :aQJJ 65~ l 17J

DEPARTMENT OF AUDITS AND ACCOUNTS
25-1 W.,~hmgton S11cct. S \\'. Suite 21-1 Atl:rntJ. Georgia 30334-X-iOO
March 15, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Supenntendent and Members of the Douglas 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 Douglas County Board of Education as of and for the year ended June 30, 2001, and have issued our report thereon dated March 15, 2002. 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 Douglas County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certam provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the detennination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results ofour 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 Douglas County Board ofEducation's internal control over financial reporting in order to detennine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2001 YB-41

control over financial reporting. However, we noted a certam matter involvmg the mtemal control over financial reportmg and its operation that we consider to be a reportable cond1t1on. Reportable conditions mvolve matters com mg to our attention relatmg to s1gmficant defic1enc1es 111 the design or operation of the mternal control over financial reporting that, m ourJudgment, could adversely affect Douglas County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management m the financial statements. The reportable condition 1s described in the accompanymg Schedule of Findings and Questioned Costs as item FS-6481-01-01.
A maten al weakness 1s a condition 111 which the design or operation of one or more of the internal control components does not reduce to a relauvely low level the risk that misstatements in amounts that would be material 111 relation to the financial statements bemg audited may occur and not be detected with111 a timely penod by employees 111 the normal course of performing their assigned functions. Our cons1derat10n of the internal control over financial report111g 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-6481-01-01 to be a material weakness.
This report is intended solely for the 111formation and use of the management, members of the Douglas County Board ofEducation, Federal awarding agencies and pass-through entities and 1s not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
c-:::>u ~. CQ w~~~
;~II W. Hinton State Auditor
RWH:gp 200 I YB-41

,,u Rt

I \\". Ht,10~

STATE AUQITOR

1404) 656 21 74

DEPARTMENT OF AUDITS AND ACCOUNTS
25-t WJ~hrngton S1rect. S \\. Suite 21-t At IJnta. Geor g1a 30334-X-tOO
March 15, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Douglas 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 Douglas County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 200 I. Douglas County Board ofEducation'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 Douglas County Board of Education's management. Our responsibility is to express an opinion on Douglas 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 AI33, Audas 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 Douglas County Board of Education's compliance with those requirements and performmg 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 determinat10n on Douglas County Board of Education's compliance with those requirements.
2001SA-I0

In our opmion, the Douglas County Board of Education complied, 111 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, 2001.
Internal Control Over Compliance
The management of Douglas Count) Board of Education 1s responsible for establishing and mamtaimng effective internal control over compliance with reqmrements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performmg our audit, we considered Douglas County Board ofEducation's mternal control over compliance with reqmrements that could have a direct and material effect on a major Federal program m order to detern1me our aud1tmg procedures for the purpose of expressing our opmion 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 m the mternal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe mternal 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 bemg audited may occur and not be detected within a timely penod by employees m the normal course of performing their assigned functions. We noted no matters mvolvmg the mternal control over compliance and its operation that we consider to be material weaknesses.
Tl11S report 1s intended solely for the information and use of the management, members of the Douglas County Board of Education, Federal awarding agencies and pass-through entities and is not mtcnded to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
<"j).c.,1 uA 2-_ Lt) .
~ell W. Hmton State Auditor
RWH gp 2001SA-10

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

DOUGLAS COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6481-99-01 FS-6481-99-02 FS-6481-00-01 FS-6481-00-02

Unresolved - See Corrective Action/Responses Further Action Not Warranted Previously Reported Corrective Action Implemented Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

EXPENDITURES/LIABILITIES/DISBURSEMENTS Falsifying Documents, Theft and Forgery Finding Control Number: FS-6481-99-01

The School District is continuing to monitor, examine and evaluate procedures and internal controls that affect the possibility of any impropriety recurring. We also continually review jobs and job descriptions to ensure separation of duties and to provide a checksand-balance system that will help prevent any unauthorized occurrence. On May 2, 2002, prior to the date ofhis trial, the comptroller entered a plea ofguilty and received a sentence of 35 years confinement, to serve ten years.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6481-00-02

The Douglas County Board of Education will not initiate reporting fixed assets on the financial statements because of the prohibitive cost of assessment, valuation and accounting for those assets. However, the Governmental Accounting Standards Board Statement Number 34 will dictate the inclusion of general fixed assets in subsequent years and the School District is currently reviewing options to meet those reporting requirements.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

F A-6481-00-01

Previously Reported Corrective Action Implemented

SECTION IV FINDINGS AND QUESTIONED COSTS

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 200 I
SUMMARY OF AUDITOR'S RESULTS
I. Type of Report Issued on the Financial Statements The auditor's opm1on on the Douglas County Board of Education's financial statements was qualified for vanous departures from generally accepted accountmg pnnciples.
2 Reportable Conditions in Internal Control Disclosed bv the Audit of the Fmancial Statements The audit report for the Douglas County Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above 1s considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit of the Douglas 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 Douglas County Board of Education did not disclose any reportable cond1t1ons in internal control over maJor programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Douglas 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 .51 0(a) of 0MB Circular A-133 The Douglas County Board of Education's audit did not disclose audit findmgs 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 Nutntion Program - Food Services - School Breakfast Program I0.555 Food and Nutrition Program - Food Services - National School Lunch Program 10.559 Food and Nutnt1on Program - Food Services - Summer Food Service Program for Children 10.550 Food and Nutntion Program - Food Distribution Program 10.550 Food and Nutrition Program - Fresh Produce Program
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $313,205.36.
- 1-

DOUGLAS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
I SUMMARY OF AUDITOR'S RESULTS
9. Low Risk Auditee The Douglas County Board of Education qualified as a low risk auditee based on a waiver granted by the U.S. Department of Education.
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Vv'eakness Repeated From Prior Year Findmg Control Number: FS-6481-01-01
The Douglas 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 ofa General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildmgs 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.
Management's Response:
We concur with this recommendation. The Board is currently reviewing the requirements for recording general fixed assets on the financial statements in conformity with Statement No. 34 ofthe Governmental Accounting Standards Board. Accounting controls and procedures are being established to record an inventory of land, buildmgs and equipment and to maintain records of additions and deletions.
III FEDERAL AWARD Fl1\1DINGS AND QUESTIONED COSTS
No matters were reported.
-2 -