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

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STATE OF.GEORGIA .. ,

I 'DE-PARTMENT OF_A.UDITS' AND.,ACCOUNTS

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_ :EARLY COUNTY.BOARD OF EDUCATION

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;, -::: REPORT ON.AUDIT:.

- OF THE FINANCiAL STATEMENTS

' . .FOR THE.FISCAL YEAR ENDED JUNE,30, 2002



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RussellW. Hinton-

'State A_uditor,

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EARLY 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 GROUPS

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUNDS

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

DEBT SERVICE FUND

I

COMBINING BALANCE SHEET

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPES

K

COMBINING BALANCE SHEET

EXPENDABLE TRUST FUNDS

L

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

EXPENDABLE TRUST FUNDS

Page
2 4 7 8
22 24 26 27 28 29 30 31

EARLY COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDffiONAL FINANCIAL INFORMATION

SCHEDULES

I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

32

2 SCHEDULE OF STATE REVENUE

34

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

35

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

36

5

BY SITE

37

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 ACCORDANCEWITHGOVERNMENTAUDITINGSTANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE Willl 0MB CIRCULARA-133

SECTION ill AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS

SECTION JV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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!ll,'-LI I W. HINl ON
STAT[ AlJDllOfi
1404, E~,t, 2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 W:1,hmgton Street.SW Suite 214 Atl,.mt.i Gcorg:1d 10334 8400
Apnl 16,2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board ofEducatwn
and Supcnntendent and Members of the Early 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 ofthe Early County Board of Education, as of and for the year ended June 30, 2002, as listed m the table of contents These general-purpose financial statements are the respons1b1hty of the Early County Board of Education's management Our respons1b1hty 1s to express an opm1on on these general-purpose financial statements based on our audll
We conducted our audit m accordance with aud1tmg standards generally accepted m the Urnted States of Amenca and the standards applicable lo financial audits contamed m Government Aud1t111g Standards, issued by the Comptroller General of the Urnted States Those standards rcqulfc that we plan and perform the audit to obtam reasonable assurance about whether the financial statements are free ofmatenal misstatement An audit 111cludes exammmg, on a test basis, evidence supportmg the amounts and disclosures m the financial statements An audit also mcludes asscssmg the accountmg prmc1ples used and s1gruficant estimates made by management, as well as evaluatmg the overall financial statement presentahon We believe that our audit provides a reasonable basis for our op1mon
As descnbed m the notes to the general-purpose financial statements, the Board of Educahon's financial statements have been prepared usmg certam accountmg practices and pohc1es which, m our op1mon, vary m some respects from generally accepted accounlmg pnnc1plcs These vanances are descn bed as follows

2002ARL-14

School ac!IVJty accounts mamtamed at the md1v1dual schools are not mcluded m the general-purpose financial statements To confonn to generally accepted accountmg pnnc1ples, these accounts should be mcluded m the general-purpose financial statements
The School D1stnct changed its method of accountmg for the final two payments on one hundred and nmety day employment contracts and the related revenue date from the State to fund these contracts AdJustments have been made m the fiscal year 2002 financial statements to record expenditures for salanes and frmge benefits earned by employees through June 30, 2002, (even though paid m July and August 2002) and the related revenue due from the State to fund these contracts No adjustment was made for the s1m1lar salanes and benefits earned m fiscal year 2001 but recorded m fiscal year 2002 as this mfonnauon was not readily avrulable The net effect of the above accountmg treatment resulted m the accompanymg financrnl statements reflecting fourteen months of expemhtures for a maJonty of General Fund salanes and fnnge benefits and fourteen months of revenue from the State to fund these contracts Generally accepted accountmg pnnc1ples reqwre that expenditures be recorded when mcurred, rather than when funds are received or disbursed
The aggregate effects on the general-purpose financial statements of these vanances or om1ss1ons have not been detennmed, but are beheved to be matenal
In our opm10n, except for the effects on the general-purpose financial statements of the matters referred to m the precedmg paragraph, the general-purpose financrnl statements referred to above present farrly, mall matenal respects, the financial position of the Early County Board ofEduca!Jon as of June 30, 2002, and the results of its opera!lons for the year then ended, m conformity with accountmg pnnc1ples generally accepted m the Umted States of Amenca
As discussed m Note 1 to the general-purpose financial statements, dunng fiscal year 2002, the Board ofEducation completed a comprehensive mventory ofits general fixed assets for mclus10n m the general-purpose financrnl statements. This change 1s m accordance with accountmg pnnc1ples generally accepted m the Umted States of Amenca
In accordance With Govenrrnent Auchtmg Standards, we have also JSsued our report dated Apnl 16, 2003, on our consideration of the Early County Board ofEduca!lon's mtemal control over financial reportmg and our tests of1ts comphance with certrun prov1s10ns oflaws, regulations, contracts and grants That report 1s an mtegral part of an audit performed m accordance with Govenrrnent Aud1tmg Standards and should be read m conJunc!lon with this report m cons1denng the resuJts of our audit
Our audit was performed for the purpose of fonnmg an oprruon on the general-purpose financial statements ofthe Early County Board ofEducation taken as a whole. The accompanymg combmmg statements (Exh1b1ts E through L) and the financial schedules (Schedules 1 through 5), wluch mcludes the Schedule ofExpenditures of Federal Awards as reqmred by U S Office ofManagement and Budget Crrcular A-133, Audits ofStates, Local Governments. and Non-Profit Orgamzatwns, are presented for purposes of adchllonal analysis and are not a requrred part of the general-purpose
2002ARL-14

financial statements Such mformallon has been subJected to the aud!tmg procedures apphed m the audit of the general-purpose financ1aJ statements and m our opm1on, except for the effects of the matters referred tom the thud paragraph, such mformal!on 1s faITly stated, mall matenal respects, m relation to the general-purpose financial statements taken as a whole
A copy ofth1s report has been filed as a permanent record m the office ofthe State Auditor and made ava1lable to the press ofthe State, as provided for by Offic1aJ Code ofGeorgia Annotated Section 506-24
Respectfully submitted,
&D~~
Hmton State Aud!tor
RWHas 2002ARL-14

EARLY COUNTY BOARD OF EDUCATION

Ca&h and Cuh Equtvalants
lnve1tmenta
Accounts R!Kelvable
lnventone1 Food Donated Commodities Purchased Food
General Foced Aalflll Land Buildings Equ1pmant lmprovemanta Other than Budding
Amount Available In Debt Service Fund
Amount to be Provx:led In Future Years For Payment of Bond Debt Cepltal Leese Agrnmenll
TotalAueb

EARLY COUNTY BOARD OF EDUCATION COMBINER BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30 2002

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

I

2,700 99 S

13 398 45

s 1 671 353 26

126 395 37

20 74!5 87 16 309 57

s 1.671 353 28 $ 166 151 eo s ____,_,._,_.......

LIABIUTIES AND FUND EQUITY
LIABILITIES
Cash Overdran Accounts Payable Salanes Payabla Short-Tenn Debi Expired Grant Balllnce1 Payable Defenwd Revenue Caprtal LHN Agreements General Obligation Bonds Peyable
Total LJablhtles
FUND ECUrTY
Investment In Ganaral Fixed Auetl Fund Balanca1
Relflrved For Bus Raplacement Funds For Debt Service For lnvontones Food Donated Commodlbe PurchaMd Food For Purpot,11 of Bond llsue
UnreMJVed Deficit Designated tor Self-tn1urance Undesignated
Total Fund Equrty
Total Liablhbel and Fund Equity

s

82 684 48

51883262 S

1 355 722 62

58,705 18 173 429 29
37 202 58

s 1 951 03a 90 s _ _.2..~.,,,,,,,_1.,.0,.s_

s

21 069 25


-317,867 61 1111172 000

20 745 87
16 309 57
-140 240 69
0 00

s

285 686 64 $ -103 185 25 $

511067
6 267 78 13 398 45

s 1 871 353 26 s

166 151 80 s

13 398 45

The note to u,a genenal-purpose finanaal statements an, an integral part cl this 1tatamant
-' -

EXHIBIT A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPE EXPENDABLE lR!.!ST FUND~

s

324 987 45 s

5 938 17

809,406 96

6 136 12

225 751 00

ACCOUNT GROUPS

GENERAL

GENERAL

FIXED

LONG-TERM

ASSETS

DEBT

TOTALS

(Memon11ndum On~}

J!.!NE 30 2002

JUNE 30 2001

s

347 025 06 s

547 785 03

815 543 08

1 167 494 20

2 023 499 63

415 238 19

s

90 472 00

16 735 652 10

2 28SI 025 90

867 9-42 00

s

1360145 41

20,745 87 16,309 57
90 472 00 18 735 852 10
2,289 025 90 667 a-42 00
1360145 41

15 532 92 21 854 55
90 472 00 18 735 652 10
2,073,9&4 00 867 942 00
1 675,286 46

1 214 854 59 156 342 84

1 214,854 !59 156 342 84

2 369 713 54 177 978 03

s s 1 360 145 41

s 12 074 29 s 19 983 092 00

2 731 342 84 s 25 937 558 05 s 26 178 913 02

s

62 684 46 s

326 275 45

577 337 80

52 530 09

152915211

181 811 83

500 000 00

37 202 58

124 165 94

s

156 342 84

156 342 84

&4 720 &4 177 976 03

2 575 000 00

2 575 000 00

4 065 000 00

s s s 2 731 342 64

4 957 719 79

5492 50218

s 1 360 145 41

s 19 983 092 00

0 00 s s 1 360 146 41 s

12,074 ~9

0 00

12 074 29 s 19 983 092 00

s 19,983 092 00 s 19,768 030 10

21 069 25 1360145 41

SI 711 25 1 675 286 46

20 745 87 18 309 57
5 110 67

15 532 92 21 854 55
499311

-456 108 30 11 11172 20 362 07

-8 7 084 04 18 177 72
1e 908 n

s 20,979,838 26 s 20 68l5 410 5-4

s s 1 360 145 41

12 074 29 s 19 9831092 00 s 2 731 342 84 s 25 ;37 558 05 s 26 178 913 02

. 3.

EARLY COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30 2002

REVENUES
State Funds
Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current
Instruction Support Services
Pupil SeMc:eS Improvement of lnstrudlonal Services Educabonal Media Services General Adminl:strahon School Aclm1mstrat10n Business Aclmlnistrahon Maintenance and Operation of Plant Student Transportation SeMces Central Support SeMces Other Support SeMCeo Food Services Operation Debt Serv,ce
Pnnopal Interest
Paying Agan! Fees
Total Expenditures
Excess of Revenues over (under) Expenchlures
OTHER F\NANCING SOURCES /USES!
Capital Leases Operatmg Transfers In Operating Transfers Out
Total Other Flnancmg Sources (Uses)
Excess of Revenues and Other F111ancmg Sources over (under) Expenchtures and Other Flnanang Uses
FUND BALANCE JULY 1
Food Inventory - Net Change m Period
Donated Commodlbas
Purchased Food

GENERAL FUND

GOVERNMENTAL FUND

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 13 302,271 03 $
4,115,31336 117 86143
$ 17,535,445 82 $

679 676 60 2,546,482 32
147 634 76 $
3,373,793 68 $

309 67 30967

$ 11,987,998 50 $
547,697 61 351,582 99 406,814 23 574,on 23 1,068 421 94 156,978 50 1011,69002 803,333 85
11,75000 79 657 09
21,635 19 11,05618

1,851,564 69 $
103,491 54 142,753 12
2,995 93 43,699 28
3,526 40
12 783 74 13 788 18
25,083 32 1,283,592 23

$ 17,032,693 33 $

$

502 752 49 $

3 483 278 43 $ -109 484 75 $

o oo
o oo 309 67

$

s

-441509

$

-441509 s

4,415 09 4.415 09

$

498,337 40 s

-105 069 66 $

-784 024 04

2,216 44

5,212 95 -5.544 98

309 67 13,088 78

FUND BALANCE JUNE 30

$

-285.686 64 $

-103 185 25 S _ _ _,_3.,.3.9_8_4_5_

The notes to the general-purpose financal statements ere an lntegral part of this statement -4 -

EXHIBIT "B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUNDS

TOTALS

(Memorandum Onty)

YEAR ENDED

JUNE 30, 2002

JUNE 30 2001

$ 13 981,947 63

2,546,482 32

$ 1,347,38512 35 712 33

5,482,698 48
s 301 51819

s $ 1 383 097 45 $ 22,292,646 62

s
26119

s 13,981,947 63
2,546,482 32
5,482,698 48
301 779 38

11,623,175 58 2,183,905 29 4,940,324 10 403 123 31

s 261 19

22,292,907 81 s 19,150,528 28

s 13,839,563 19 s

651,18915 494,33611 409,810 16 617,776 51 1,071,948 34 156,978 50 1,024,473 76 817,122 03
1175000 104,740 41 1,283,592 23

s 1,490 000 00
206,012 50
2 226 00

1,511,63519 217 068 68 2 226 00

s 1698238 50 s 22,214,210 26 s

s -315141 05 s

78 436 36 $

s 000

s 13,839 56319

11,733,31613

651,18915 494,336 11 409,810 16 617,776 51 1,071,948 34 156,978 50 1,024,473 76 817,122 03
11,75000 104,740 41 1,283,592 23

648,843 94 312,097 65 315,757 47 442,683 97 908,423 52 190,559 92 1,16251480 868,509 43
11,75000 31,617 69 1,257 204 06

1,511,63519 217,068 68 2 226 00

1,577,374 13 286,800 56 4 452 00

000 s 22,214,210 26 s 1975190527

26119 s

s 78 697 55

-<50137699

$
s s -315141 05 s
1,675,286 46

4,415 09 -441509
000
78 436 36 s
906,567 64

5,212 95 -5 544 98

s

105,780 50

s

441509

10,974 93

-441509

-10 974 93

s

0 00 $

105 780 50

261 19 s
11,81310

78,697 55 s
918,380 74

-495,596 49 1,396 985 45

5 212 95 -5 544 98

9,640 30 7 351 48

$ 136014541 $

984 671 97 S

1207429 $

996 746 26 $ _ _.9~1,::8._.3~80::,7:.:4:..

-5-

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

EXHIBIT "C"

GENERAL FUND

BUDGET

ACTUAL

REVENUES
State Funds
Federal Funds
Taxes Other Flms
Total Revenues
EXPENDITURES

$ 11,424,619 31 $ 13,302 271 03

4,460,001 69 324 657 00

4,115 313 36 11786143

$ 16,209,476 00 $ 17 535 445 82

Cumont lnstrucllon
Support Sorvlc:es
Pupil Services
Improvement of lnstructJonal Services EducaUonal t.Aed1a SerVlces General Admlnlstraoon School Admintstral.Jon
Buso,ess Admimstratlon
Malntonanca and Operation of Plant
Student Transportabon Services central Support SeMces
Other Support Services Food Services Operation Capital Outlay Debt Service
Total Expenditures
Excess of Revenues over (under) Expenditures

$ 10,331,36176 $ 11,987,998 50

91,225 28 407 717 48 353,625 69 551,304 56 970,207 22 258,611 64 1,258,589 10 709 233 46
15,735 00

547,697 61 351,582 99 406,61423 574,077 23 1,066 421 94 156,876 50 1,011,690 02 803,333 85
11,75000 79 657 09

8 50000

32 691 37

$ 15,356.321 41 $ 17,032,693 33

$ 653,156 59 $ 502 752 49

OTHER FINANCING SOURCES /USES)

Other Sources

Other Uses

$

Total Other Financing So46ces (Uses) $

Excess of Revenues and Other Flnandng Sources

owr (under) Expendrtures and Other F,nandng

Uses

$

E!J~Q aeiL.ei~~i; J!.!LY l 2001

Adjustments
Food lnwntory - No1 Chango Ill Penod
Donated Commodities Purchaaed Food

-878 085 00 $ -878 085 00 $
-25,928 41 $ -338 474 22
3944

-4 415 09 -4 415 09
498,337 40 -784,024 04

FUND BALANCE JUNE 30 2002

$ -365.363 19 $ -285 686 84

SPECIAL REVENUE FUND

BUDGET

ACTUAL

$ 598 440 60 $ 679 676 60 2 445 446 00 2,546 482 32

167 600 00

147 634 76

$ 321148660 s 3 373 793 68

$ 1,710,036 01 $ 1,651,564 69

125 635 87 103,649 96
3 000 00 56 600 09

103,491 54 142,753 12
2 995 93 43,699 26
3,526 40

4,721 07 1,71973

12,783 74 13,78618

30 822 67 123711544

25 083 32 1,283,592 23

$ 3.273.700 84 $ 3,483.278 43 $ -62,214 24 $ -109 484 75

$

4 415 09

$

4 415 09

$ -62,21424 $ -105 069 66

61,370 87

2 216 44

5,212 95 -5 544 88

$

-84337 $ -103,18525

The notes to the general-purpose finanaal statements are an Integral part of this statement
-7-

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Early County Board of Education (School D1stnct) 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 Supenntendent appomted by the Board The School D1stnct 1s organized as a separate legal entity and has the power to levy taxes and issue bonds Its budget 1s not subject to approval by any other entity Accordmgly, the School D1stnct 1s a pnmary government and consists of all the organizations that compose its legal entity
FUND ACCOUNTING
The School D1stnct uses funds and account groups to'report on its financial position and the results of1ts operations Fund accountmg 1s designed to demonstrate legal compliance and to aid financial management by segregatmg transactions related to certam governmental functions or act1v1t1es A fund 1s a separate accountmg entity with a self-balancmg set of accounts An account group 1s a financial reportmg device designed to provide accountability for certam assets and llab1ht1es that are not recorded m the funds because they do not directly affect expendable available financial resources
Although "school activity accounts" are mamtamed at the md1v1dual schools, neither the assets, llab1llt1es and fund eqmty, nor the revenues, expenditures and changes m fund balances of these accounts are reflected m these financial statements To conform to generally accepted accountmg pnnc1ples, these accounts should be recorded m the general-purpose financial statements
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School D1stnct, m compliance with generally accepted accountmg pnnc1ples applicable to governmental umts, unless otherwise disclosed m these notes Funds and the account groups presented m this report are as follows
GOVERNMENTAL FUND TYPES - arc used to account for all or most of the School D1stnct's educational activities Governmental Fund Types mclude.
GENERAL FUND - the fund used to account for all financial resources of the School D1stnct ell.cept those reqmred to be accounted form another fund These transactions relate to resources obtained and used for services proVJded by a board of education
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restncted to expenditures for specified purposes These funds are received pnmanly from the Georgia Department of Educat10n and from the Federal government to accomplish specific educallonal objectives
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acqms1Uon or construct10n of major capital facilities
-8-

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEBT SERVICE FUND - the fund used to account for the accurnulat10n ofresource~ for, and the payment of, general long-term pnnc1pal, mterest and paymg agent fees
FIDUCIARY FUND TYPES - the funds used to account for assets held by a government umt ma trustee capacity or as an agent for md1v1duals, pnvate orgaruzat10ns, other government umts and/or other funds These funds mclude
EXPENDABLE TRUST FUNDS Robert L. Steel, M.D., DCT Scholarship Fund - the fund used to account for the pnnc1pal and earmngs wluch may be expended to provide scholarslup aid to the graduatmg seruors ofthe Early County School System
Early County Learning Center Endowment Fund - the fund used to account for the pnnc1pal and earrungs which may be expended to proVJde financial assistance to Adults Learrung Center graduates m their pursmt toward long-term employment and financial mdepcndencc
ACCOUNT GROUPS
GENERAL FIXED ASSETS ACCOUNT GROUP -A financial reportmg device used to account for all general fixed assets acquued or constructed for use by the School D1stnct
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reportmg device used to account for general obhgat1on debt outstandmg and capital lease obligations
BASIS OF ACCOUNTING
The accountmg and financial reportmg treatment applied to a fund 1s detenmned by its measurement focus All governmental and expendable trust funds are accounted for usmg a current financial resources measurement focus With this measurement focus, only current assets and current hab1ht1es generally are mcluded on the balance sheet Operatmg statements of these funds present mcreases (1 e, revenues and other financmg sources) and decreases (1.e, expenditures and other financmg uses) m net current assets. Theu reported fund balance 1s considered a measure of available spendable resources
L1ab1ht1es which are expected to be financed from available spendable resources are reported as hab1htles m the governmental funds Other hab1ht1es, which are not expected to be financed from available spendable resources, are reported m the General Long-Term Debt Account Group
Governmental and expendable trust funds are accounted for usmg the modified accrual basis of accountmg under which

- 9-

r

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO 11-IE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are rccogmzed when susceptible to accrual (1.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 penod or soon enough thereafter to be used to pay hab1ht1es of the current penod The School Distnct considers receivables collected w1thm sixty days after yearend to be available Property taxes, sales taxes and interest are considered to be susceptible to accrual Nonexchange transactions, in wtuch the School D1stnct gives (or receives) value without directly rece1vmg (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations Revenue for property taxes ts recogruzed in the fiscal year for wtuch the taxes are levied Revenue from sales taxes 1s recogmzed in the fiscal year the resources are received or susceptible to accrual Revenue from grants and donations 1s recogmzed in the fiscal year in wtuch all ehgib1hty reqmrements have been satisfied
Expenditures are generally recogmzed when the related fund hab1hty 1s incurred
For fiscal year 2002, the School D1stnct changed its method of accounting for the final two payments on one hundred and mnety day contracts and for the related revenue due from the State to fund these contracts Adjustments have been made in the fiscal year 2002 financial statements to record expenditures for salanes and fringe benefits earned by employees through June 30, 2002, (even though paid in July and August 2002) and the related revenue due from the State to fund these contracts. This change 1s in accordance with generally accepted accounting pnnc1ples No adjustment was made for the s1m1lar salanes and benefits earned m fiscal year 200 I but recorded in fiscal year 2002 as this mformat10n was not readily available
The net effect ofthe above accounting treatment resulted in the accompanymg financial statements reflecting fourteen months of expenditures for a majonty of General Fund salanes and fringe benefits and the related revenue due from the State to fund these contracts Generally accepted accounting pnnc1ples reqmre that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed
BUDGET
The Early County Board of Education's budget 1s a complete financial plan for the School D1stnct's fiscal year and 1s based upon estimates of expenditures together with probable funding sources There 1s no statutory proh1b1t1on regarding overexpend1ture of the budget at any level The budget for all governmental funds 1s prepared by fund, function and object The legal level of budget control was estabhshed by the Board at the aggregate level The budget for governmental funds was prepared on a basis other than generally accepted account:mg pnnc1ples
The budget process begms when the School D1stnct's adm1111stratlon prepares a tentative budget for the Board's approval After approval ofth1s tentative budget by the Board, such budget 1s advertised at least once in a newspaper of general c1rculat1on in the locahty At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes rev1s1ons as

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2002

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
necessary and adopts a final school budget. This final budget 1s then submitted, m accordance with prov1s1ons of the Quahty Basic Educat10n Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may mcrease or decrease the budget at any time dunng the year. All unexpended budget authonty lapses at fiscal year-end
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash eqmvalents consist of cash on hand, demand deposits and short-term mvestments with ongmal matunlles of three months or less from the date of acqms1t10n m authonzed financial mst1tut10ns Georgia Laws OCGA 45-8-14 authonze the School D1stnct to deposit its funds m one or more solvent banks or msured Federal savmgs and loan associations
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School D1stnct m nonpart1c1patmg mterest-earnmg contracts (such as cerl!ficates of deposit) and repurchase agreements are reported at cost Part1c1patmg mterest-earrung contracts and money market mvestments with a matunty at purchase of one year or less are reported at amortized cost Both part1c1pallng mterest-earnmg contracts and money market mvcstments With a matunty at purchase greater than one year are reported at fair value The Official Code ofGeorgia Annotated Section 36-83-4 authonzes the School D1stnct to mvest its funds and m selectmg among opllons for mvestment or among mstltut10nal bids for deposits, the highest rate ofreturn shall be the obJectlve, given eqmvalent conditions of safety and hqmd1ty Funds may be mvested m the followmg:
(1) Obhgat1ons issued by the State of Georgia or by other states,
(2) Obhgauons issued by the Uruted States government,
(3) Obhgat10ns fully msured or guaranteed by the Umted States government or a Uruted States government agency,
(4) Obligations of any corporation of the Uruted States government,
(5) Pnme banker's acceptances,
(6) The Local Government Investment Pool admm1stered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obhgat1ons of other pohtlcal subd1V1s10ns of the State of Georgia
- 11 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RECEIVABLES

Receivables consist of grant reimbursements due on Federal. State or other grants for expenditures made but not reimbursed and other receivables disclosed from mformat1on available Receivables are recorded when either the asset or revenue recogmtlon cntena has been met Receivables recorded on the general-purpose financial statements do not mclude any amounts which would necessitate the need for an allowance for uncollectlble rcce1vables

PROPERTY TAXES

The Early County Board ofConumss1oners fixed the property tax levy for the 2001 tax digest year (calendar year) on September 5, 2001 (levy date) Taxes were due on December 20, 2001 (hen date) Taxes collected with.in the current fiscal year orw1tlun 60 days after year-end on the 2001 tax digest arc reported as revenue m fiscal year 2002 The Early County Tax Comm1ss1oner bills and collects the property taxes for the School D1stnct, withholds 2 5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School D1stnct Property tax revenues dunng the fiscal year ended June 30, 2002 for mamtenance and operat10ns amounted to $4,077,026 98 and for school bonds amounted to $325.68

The tax millage rate leVJed for the 2001 tax year (calendar year) for the Early County Board of Educatlon was as follows (a mill equals $1 per thousand dollars of assessed value)

School Operations

I6.Q mills

SALES TAXES

Special Purpose Local Option Sales Tax revenue dunng the year amounted to $1,347,059 44 and 1s to be used for capital outlay for educahonal purposes or debt service This sales tax was authorized by local referendum and the sales tax must be re-authonzed at least every five years

INVENTORIES

FOOD INVENTORIES Inventones of donated food commod11Ies used m the preparat10n of meals are reported on the Combmed Balance Sheet at their Federally assigned value Purchased foods mventones are reported on the Combmed Balance Sheet at cost (first-m, first-out). Donated food commod1t1es are recorded as revenues and expenditures at the lime commodity items are received. Purchased foods mventones are recorded as expenditures at the tlme ofpurchase The mventones reported on the balance sheet for donated food commodihes and for purchased foods are equally offset by rcservat10ns of fund balance which md1cates that these amounts do not constltute "available spendable resources" even though they are a component of net current assets

- 12 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTl:.S TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2002

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL FIXED ASSETS
General fixed assets purchased, mcludmg capital outlay costs, arc recorded as expenditures m the vanous funds at the !ime of purchase All purchased general fixed assets are valued at cost where h1stoncal records are available and at es!imated h1stoncal cost where no h1stoncal records exist Donated general fo,ed assets are recorded at fair market value on the date donated Disposals are deleted at recorded cost No deprecia!ion has been provided on General Fixed Assets The cost of normal maintenance and repairs that do not add to the value of assets or matenally extend the useful hves of the assets 1s not cap1tal1zed
GENERAL OBLIGATION BONDS
The School D1stnct issues general obhgatlon bonds to provide funds for the acqms1t10n and construction ofmaJor capital fac1ht1es Bond prermums and discounts. as well as issuance costs. are recogmzed m the financial statements dunng the year bonds are issued General obligation bonds are direct obhga!ions and pledge the full faith and credit ofthe government The outstandmg amount of these bonds 1s recorded m the General Long-Term Debt Account Group
INTERFUND TRANSACTIONS
The School D1stnct has the followmg types of mterfund transac!ions
Reimbursements of expenditures m1t1ally made from a fund that are properly applicable to another fund are recorded as expenditures m the re1mbursmg fund and as reductions of expenditures m the fund that 1s reimbursed
Operating transfers are recorded for all mterfund transactions other than reimbursements
MEMORANDUM ONLY -TOTAL COLUMNS
Total columns on the general-purpose financial statements are cap!ioned "Memorandum Only" to md1cate that they are presented only to facilitate financial analysis Data m these columns do not present financial pos1t10n or results of opera!ions m conformity with generally accepted accountmg pnnc1ples Neither are such data comparable to a consohdahon lnterfund ehmmatlons have not been made m the aggrega!ion of this data Certam reclass1fica!ions have been made to the comparative data to conform to the current year class1ficat1ons
DEFICIT FUND BALANCES
Funds reportmg a deficit fund balance position at June 30, 2002, are as follows

- I3 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Fund Type/Fund Name

Deficit Balances

Governmental Fund Type General Fund School Fund Semces Fund

$ 317,867 61 $ 140,240 69

For the General Fund deficit, the School D1stnct mcreased the millage rate from 13 to 16 mills For the School Food Semces Fund deficit, the School D1stnct mcreased the sale pnce for some menu items and has added new items to its menus.

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 many depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofmsurance, or by collateral The aggregate ofthe face value of such surety bond and the market value of secuntles pledged shall be equal to not less than 110 percent ofthe pubhc funds being secured after the deduction ofthe amount ofdeposit insurance
Ifa deposllory elects the pooled method (OCGA 45-8-13 I) the aggregate ofthe market value ofthe
secuntles pledged to secure a pool ofpubhc funds shall be not less than 110 percent ofthe daJ.lypool balance OCGA Section 45-8-l l(b) provides an officer holdmg pubhc funds may, m his d1scret1on, waive the reqmrement for secunty m the case ofoperating funds placed m demand deposit checking accounts

Acceptable secunty for deposits consists of any one of or any combmat1on of the following

(I) Surety bond signed by a surety company duly quahfied and authonzed to transact business w1tlun the State of Georgia,

(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

(3) Bonds, bills, notes, certificates of mdebtedness or other duect obhgatlons of the Umted States or of the State of Georgia,

(4) Bonds, bills, notes, certificates of indebtedness or other obhgallons of the counties or mumc1paht1es of the State of Georgia,

(5) Bonds of any pubhc authonty created by the laws of the State of Georgia. providing that the statute that created the authonty authonzed the use of the bonds for this purpose,

(6) Industnal revenue bonds and bonds ofdevelopment authontles created by the laws ofthc State of Georgia, and

- 14 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 2. DEPOSITS AND INVESTMENTS

(7) Bonds, bills, notes, certificates of indebtedness, or other obhgat1ons of a subs1d1ary corporation of the Umted States government, which are fully guaranteed by the Umted States government both as to pnnc1pal and mterest or debt obhgalions issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperallves, the Farm Credit Banks, the Federal Home Loan Mortgage Associalion, and the Federal Nallonal Mortgage Assoc1at1on

CATEGORIZATION OF DEPOSITS At June 30, 2002, the bank balances were $941,710.61. The amounts of the total bank balances are classified mto three categones of credit nsk.

Category I - Cash that 1s insured (e g, Federal depository msurance) or collaterahzed with secunt1cs held by the School D1stnct or by the School D1stnct's agent in the School D1stnct's name
Category 2 - Cash collaterahzed with secunties held by the pledging financial inslltut1on's trust department or agent m the School D1stnct's name
Category 3 - Uncollaterahzed deposits (This includes any bank balance that 1s collaterahzed with secunlles held by the pledgmg financial mslltullon, or by !ls trust department or agent but not in the School D1stnct's name )

The School D1stnct's deposits arc classified by nsk category at June 30, 2002, as follows

Risk Category

Bank Balance

I

S 424,987 45

2

516,723 16

3

000

Total

$ 941.7)0,61

CATEGORIZATION OF INVESTMENTS At June 30, 2002, the fa1r value of the School D1stnct's total investments was $797,201 88 and this enllre amount consisted ofU. S Government Secunties which were umnsured or unregistered, with secunt1es held by the counterparty, or by its trust department or agent but not in the School D1stnct's name

Note 3 NON-MONETARY TRANSACTIONS

The School D1stnct receives food commodities from the Umted States Department of Agnculturc (USDA) for school breakfast and lunch programs These commod1t1es arc recorded at the1r Federally assigned value See Note 1 - Inventories

- 15 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
nJNE 30. 2002

Note 4 GENERAL FIXED ASSETS

The followmg 1s a summary of changes m the General Fixed Assets Account Group dunng the fiscal year

Balance July I, 2001

Land

Bmldmgs

Improvements Other Than Bmldmgs

Egu1gment

TQtal

s

000 5

000 s

0 00 s

000 $

0 00

Retroacnve Restatement of Pnor Year Balances

2Q HZ QQ l~ IlH~Z lQ ~7 2~Z QQ i Q7~ 2li~ QQ 12 7~6 QlQ 10

Balance July 1, 2001
Restated

S 90,47200 516,735,652 !0 S 867,94200 S 2,073,96400 Sl9,768,030 IO

Addtllons

215 061 90 215 061 90

Balance June 30, 2(K)2 S _ ..2UJ.Z~ 516735~ZJ.0 5 86794200 5 228902590 S1998309200

Note 5 RISK MANAGEMENT

The School D1stnct 1s exposed to vanous nsks of loss related to torts; theft of, damage to, and destruction of assets, errors or om1ss1ons, Job related illness or mJunes to employees, acts of God and unemployment compensat10n

The School D1stnct part1c1pates m the Georgia School Boards Association Risk and Insurance Management System, a pubhc entity nsk pool organized on July 1, 1994, to develop and adm1ruster a plan to reduce nsk of loss on account of general hab1hty, motor vehicle hab1hty, or property damage, mcludmg safety engmeenng and other loss prevention and control techniques, and to admlil!ster one or more groups of self-insurance funds, mcludmg the processmg and defense of claims brought agamst members of the system The School D1stnct pays an annual premmm to the system for its general msurance coverage Add1t10nal coverage 1s provided through agreements by the system with other compallles accordmg to their specialty for property, bmler and machmery (mcludmg coverage for flood and earthquake), general hab1hty (mcludmg coverage for sexual harassment, molestation and abuse) and automobile nsks. Payment of excess msurance for the system vanes by hne of coverage

For the current fiscal year, due to the costs of available coverage, the School D1stnct s1gmficantly reduced coverage for acts of God

The School D1stnct 1s self-msured with regard to unemployment compensation claims A premium 1s charged when needed by the General Fund to each user fund on the basis ofthe percentage ofthat fund's payroll to total payroll m order to cover estimated claims budgeted by management based on known claims and pnor expenence. The School D1stnct accounts for claims with expenditure and hab1hty bemg reported when 1t 1s probable that a loss has occurred, and the amount of that loss can be reasonably estimated

- 16 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 5 RISK MANAGEMENT

Changes m the unemployment compensation claims hab1hty dunng the last two fiscal years are as follows

2001 2002

Begmnmg of Year L1ab1hty

Claims and Changesm Estimates

Claims Paid

End ofYear Liab1hty

$

Q00 $

000 $

0 00 $

0.00

$

0 00 $

7 066 00 $

7 066 00 $

0 00

The School Distnct part1c1pates m the Georgia Education Workers' Compensation Trust, a pubhc entity nsk pool orgamzed on December I, 1991, to develop, implement and adm1mster a program of workers' compensation self-msurance for its member organizations The School D1stnct pays an annual premium to the Trust for its general msurance coverage Add1t1onal msurance coverage 1s proVIded through an agreement by the Trust with the Umted States F1dehty and Guaranty Company to provide coverage for potential losses sustamed by the Trust m excess of $350,000 00 loss per occurrence, up to $2,000,000 00.

The School D1stnct has purchased surety bonds to proVIde additional msurance coverage as follows

Position Covered

Amount

Supenntendent Bookkeeper All Employees

$ 50,000 00 S 14,000 00 $ 100,000 00

Note 6. OPERATING LEASES

Early County Board ofEducation has entered mto vanous leases as lessee for copy machmes These leases are considered for accounting purposes to be operatmg leases Lease expenditures for the year ended June 30, 2002, amounted to $40,329.48. Future m1rumum lease payments for these leases are as follows

Year Endmg

Amount

2003 2004
Total

$ 19.735.08 267 28
$ _ 20.002.3,!i

- 17 -

EARLY COUNTY BOARD OF EDUCATION

E:X'1!IBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2002

Note 7 GENERAL LONG-TERM DEBT

CAPITAL LEASES The Early County Board of Education has entered into vanous lease agreements as lessee for energy retrofit and copy machines These lease agreements quahfy as capital leases for accountmg pwposes and, therefore, have been recorded at the present value ofthe future minimum lease payments as of the date oftherr incepl!on The following 1s an analysis ofthe carrying value of general fixed assets being acqmred under outstandmg capital leases as of June 30, 2002

General Fixed Assets

Eqmpment

$ 4).935,00

GENERAL OBLIGATION DEBT OUTSTANDING General Obhgauon Bonds currently outstandmg are as follows

Purpose

Interest Rates

Amount

General Government - Senes 1995

42%-5.8% $ 2.575.000,00

The changes m General Long-Term Debt dunng the fiscal year ended June 30, 2002, were as follows

Capital Leases

General Obhgal!on
Bonds

Total

Balance July 1. 2001

$ 177,978 03 $ 4,065,000.00 $ 4,242,978 03

Deducl!ons Debt Rel!red

21,635 19 1,490,000 00 1,511,635 19

Balance June 30, 2002

$ 156.342.84 S 2.575.000,00 $ 2.731.342.84

At June 30, 2002, payments due by fiscal year which includes pnnc1pal and mterest for these items are as follows

- 18 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TifE GENERAL-PURPOSE FINANCIAL STAI'EMENTS

JUNE 30, 2002

Note 7 GENERAL LONG-TERM DEBT

Fiscal Year Ended June 30

Capital Leases

General Obhgat10n
Bonds

Total Debt

2003 2004 2005 2006 2007 2008 - 2012 2013 - 2015

$ 110,236 02 $ 237,837.50 $ 348,073 52

28,129 92

243,087 50

271,217 42

28,12991

252,785 00

280,914 91

12,427 14

261,605 00

274,032 14

269,517 50

269,517 50

1,495,332 50 1,495,332 50

1,041,080 00 1,041,080 00

Total Pnnc1pal and Interest $ 178,922 99 $ 3,801,245 00 S).980,) 67.99

Deduct Imputed Interest

22.580 15

Net Present Value of Future
M1rumum Lease Payments $ !56.342.84

Note 8 SHORT-TERM DEBT

The School D1stnct obtams temporary loans m advance of property tax collect10ns, depos1tmg the proceeds m its General Fund This short-term debt 1s to provide cash for operations unlil property tax collect1ons are received by the School D1stnct Article IX, Sect10n V, Paragraph V of the Constitution of the State of Georgia hm1ts the aggregate amount of short-term debt to 75 percent of the total gross mcome from taxes collected m the precedmg year and reqmrcs all short-term debt to be repaid no later than December 31 of the calendar year m which the debt was mcurred

Begmnmg Balance

Add11Ions

Payments

Endmg Balance

Temporary Loans

$ 500 000 00 $1 550 075 OQ S;2,050 075,QO $~_~---"- QJJ0

Note 9 ON-BEHALF PAYMENTS

The School D1stnct has recogmzed revenues and expenditures m the amount of $192,027 67 for health msurance and retirement contnbutlons paid on the School D1stnct's behalf by the followmg State Agencies

Georgia Department of Education P3.ld to the Georgia Department ofCommumty Health For Health Insurance of Non-Certified Personnel In the amount of $166,052 67

- 19 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNF 30. 2002

Note 9 ON-BEHALF PAYMENTS
Office of Treasury and Fiscal Services Paid to the Pubhc School Employees Retirement System For Public School Employees Retirement (PSERS) Employer"s Cost In the amount of $25,975.00
Note 10 CONTINGENT LIABILITIES
Amounts received or receivable pnnc1pally from the Federal government are subject to audit and review by grantor agencies This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms The School D1stnct beheves that such d1sallowances, 1f any, will be 1mmatenal to its overall financial position
The School D1stnct 1s a defendant m vanous legal proceedings pertauung to matters mc1dental to the performance ofroutme School D1stnct operations The ult1ITiate d1spos1t1on of these proceedmgs 1s not presently determmable, but 1s not believed to be matenal to the general-purpose financial statements.
Note 11 SUBSEQUENT EVENTS
On August 20, 2002, the voters of Early County voted m favor of a Special Purpose Local Option Sales Tax referendum for educational purposes The 1mpos1t1on ofthe tax approved by the voters, as stated on the Oflic1al Ballot of Early County, 1s as follows
"Shall a special one percent sales and use tax be contmued m Early County for a penod not to exceed 20 calendar quarters, commencmg upon the exp1rat1on of the special one percent sales and use tax currently bemg leVIed m Early County, and for the ra1smg of not more than $9,000,000 for the purpose ofproVIdmg funds to pay or to be apphed toward (a) the cost of(1) the acqms1tion, construction and eqmppmg of new school bmldmg and fac1hties, mcludmg a high school physical education fac1hty, (11) addmg to, renovatmg, 1mprovmg and eqmppmg ex1stmg school buildmgs and fac1ht1es, mcludmg middle school physical education fac1ht1es, (111) makmg certain technology improvements, and (1v) acqumng any property necessary or desirable therefor, both real and personal (the "Projects"), mcludmg school buses, the maximum cost of the Projects to be funded from the proceeds of such tax not to exceed $7,800,000, and (b) the retirement of previously mcurred debt with respect to capital outlay proJects of the School D1stnct cons1stmg of the $2,950,000 Early County School D1stnct (Georgia) General Obhgat10n Sales Tax bonds, Senes 1995, the maximum amount of debt service to be paid on such bonds from sales and use tax proceeds not to exceed $1,200,0009 If the contmuatlon of the tax is approved by the voters, such vote shall also constitute approval of the issuance of general obhgat1on debt of Early County School D1stnct m the pnnc1pal amount of$5,200,000 for the above purposes, mcludmg cap1tahzed mterest through February I, 2003

- 20 -

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2002

Note 12 RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, adrn1mstralive and clencal personnel employed by local school d1stncts are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-shanng mulliple employer defined benefit pension plan TRS provides sel"Vlce rehrement, d1sab1hty rehrement and slll"Vlvors benefits for its members in accordance with State statute The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the School D1stnct who are covered by TRS arc required by State statute to contnbute 5% of their gross earnings to TRS. The School D1stnct makes monthly employer contnbulions 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 contnbulion rate 1s 9 24% and employer contnbutlons for the current fiscal year and the preceding two fiscal years are as follows

Fiscal Year

Percentage Contnbuted

Required Contnbut1on

2002 2001 2000

100% 100% 100%

$ 982,218 43 $1,112,92506 $ I,079,482 99

- 21 -

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

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

74,120 44

$

20,745 87

16 309 57

Total Assets

$

37 055 44 $ =-,_7.4.,_1=20=44==-

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salanes Payable Expired Grant Balances Payable Deferred Revenue
Total L1ab1ht1es
FUND EQUITY
Fund Balances Reserved For lnventones Food Donated Commod1bes Purchased Food Unreserved Deficit Undes1gnated
Total Fund Equity

s

106,673 44

6,392 04 s

27,17521

$

140 240 69 $

18,14810 48,869 54
7,10280
7412044

$

20,745 87

16,309 57

-140,240 69

000 $

0 00

$ -103, 185 25 $

000

Total L1ab1ht1es and Fund Equrty
See notes to the general-purpose financial statements - 22 -

$

37 055 44 $ ==""7=4"=12=0=44==

EXHIBIT "E"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$

35,253 99 $

109,37443 $

330,089 22

126,395 37

126,395 37

20,327 01

20,745 87 16 309 57

15,532 92 21 854 55

$

161 649 36 $

212,825 24 $==3.,8.7..080_03'"'7=0=

$

106,673 44 $

14,10029

$

34,165 04

58,705 18

51,247 54

97,384 54

173,429 29

181,811 83

30,099 78

37,202 58

123,706 76

14 72084

$

161 649 36 $

376 01049 $

385 587 26

$

20,745 87 $

15,532 92

16,309 57

21,854 55

-140,240 69

-35,171 03

$

0 00

ODO

ODO

$

0 00 $ -103 185 25 $

2 216 44

$

161 649 36 $

2721825 24 $ ==3.,.8..,7._8..,03._7.,.D.,_

- 23 -

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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional SeMces Educabonal Media SeMces General Adm1mstrabon School Adm1n1strabon Ma1n1enance and Operabon of Plant Student Transportabon SeMces Central Support Services Other Support Services Food SeMces Operabon
Total Expenditures
Excess of Revenues over (under) Expendrtures
OTHER FINANCING SOURCES /USES!
Operabng Transfers In Operabng Transfers Out
Total Other F1nanang Sources (Uses)
Excess of Revenues and Other F1nanc:mg Sources over (under) Expenditures and Other Finanang Uses
FUND BALANCE JULY 1
Food Inventory - Net Change 1n Penod Donated Commochlles Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

85.790 00 $

943,332 74

147 634 76

$ 1 176 757 50 $

584,597 06 584 597 06

$

479,533 79

54,844 29 32.282 89

s

46214

12,321 60 5,539 80

1,281,365 02

$ 1 281 827 16 $

$

-105 069 66 $

74 71 584 597 08
-002

$

o 02

$

o 02

$

,105,069 66 $

000

2.216 44

o oo

5,212 95 -5 544 98

s -103.18525 s---=o-=oo...

See notes to the general-purpose finanaal statements

-24-

EXHIBIT"F"

FEDERAL
PROGRAMS

TOTALS

YEAR ENDED

JUNE 30. 2002

JUNE 30. 2001

$

9,289 54 $

679,676 60 $

627,796 05

1,603,149 58

2,546,482 32

2,183,905 29

147 634 76

149 784 47

$

161243912 $

s 3.373.193 68 _""'2""95=1'"'48""5"'8""'1""

$ 1,372,030 90 $ 1,851,564 69 $ 1,447,965 94

48,647 25 110,470 23
2,995 93 43,69928
3,526 40
8,248 38
25,08332 2152 50

103,491 54 142,75312
2,995 93 43,699 28
3,526 40 12,783 74 13,78818
25,083 32 1.283.592 23

88,838 98 177.380 80
3,614 44 36,553 38
17,916 45 3,853 92
31,617 69
1257204 06

$ 1.616,85419 $ 3 483 278 43 $ 3,064,945 66

$

-441507 $

-109 484 75 $

-103 459 85

$

4,415 07 $

4,415 09 $

5,215 64

-16172 22

$

4 415 07 $

4 415 09 $

-10 956 58

$

000 $

-105,069 66 $

-114,41643

000

2,216 44

99,641 09

5,212 95 -5 544 98

9,640 30 7 351 48

$

0 00 $

s_ _ -103 185 2s

....:.2i=2.:.;16'-44""-

-25 -

EARLY COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30. 2002

EXHIBIT "G"

ASSETS Cash and Cash Equivalents

BOND

TOTALS

REGULAR

PROCEEDS JUNE 30, 2002 JUNE 30, 2001

$

81287 78 $

511067 $

------ 13 398 45 $

13 088 78

FUND EQUITY
Fund Balances Reserved For Purpose of Bond Issue Unreserved Undes,gnated

s
$ ----"'8'-=2.:.87'-'-'78'-

5,11067 $ 000

5,11067 S 8 287 78

4,993 11 8 095 67

Total Fund Equity

$ 8 287 78 $

511067 $

13 398 45 $ ~....1.,..3i,;;0.;.;8.8.7_B_

See notes to the general-purpose financial statements - 26 -

EARLY COUNTY BOARD OF EDUCAT(ON

EXHIBIT "H"

COMBINING STATEMENT OF REVENUES. EXPENDIJURES AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

YEAR ENDED JUNE 30. 2002

REGULAR

BOND PROCEEDS

TOTALS YEAR ENDED JUNE 30, 2002 JUNE 30, 2001

REVENUES
Other Funds

$

19211 $

117 56 $

309 67 s

505 67

EXPENDIJURES

Capital Outlay

$

000 $

0 00 $

000 $

0 00

Excess of Revenues over (under) Expenditures

$

192 11 $

117 56 $

30967 $

505 67

OTHER FINANCING USES

Operating Transfers Out

-1B 35

Excess of Revenues over (under) Expenchtures and Other

Frnanang Uses

$

192 11 $

117 56 $

309 67 $

4B7 32

FUND BALANCE JULY 1

B 095 67

499311

13 0BB 78

12 601 46

FUND BALANCE JUNE 30

$ 8 28778 $ 511067 $

13 398 45 $ _ _1_3__08_8_7_8_

See notes to the general-purpose fill8ndal statements

27

EARLY COUNJY BOARD OF EDUCATION
COMBINING BALANCE SHEET
DEBT SERVICE FUND
JUNE 30 2002

EXHIBIT"!"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets
FUND EQUITY
Fund Balances Reserved For Debt Serv1ce Unreserved Undes1gnated
Total Fund Equrty

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$ 209,67240 $

115,315 05 $

324,987 45 $

212,79915

12,205 OB

797,201 68

809,406 96

1,161,811 89

126 11

225 624 89

225 751 00

300 675 42

$ 222,003 59 $ 113814182 $ 136014541 S 167528646

$ 222,003 59 $ 000

1,138,14182 $ 000

1,360,14541 $ 000

1,675,28646 000

$ 222,003 59 $ 113814182 $ 136014541 $ 1,675,28646

See notes to the general-purpose financial statements

-28-

EARLY COUNTY BOARD OF EDUCATION

EXHIBIT "J"

COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES

DEBT SERVICE FUND

YEAR ENDED JUNE 30. 2002

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED JUNE 30, 2002 JUNE 30 2001

REVENUES Taxes Other Funds
Total Revenues EXPEND[TURES

$

32568 $ 1,347,059 44 $ 1,347,385 12 $ 1.598 51973

5 592 64

3011969

3571233

BB 63932

$

s 5 918 32 $ 137717913 $ 1,383,097 45

1,687.159 05

Debt Service Pnncipal Interest Pay,ng Agent Fees

s $ 1,490,000 00

1,490,000 00 $ 1,395,000 00

206,012 50

206,012 50

264.360 00

$

2,226 00

2 226 00

4 452 00

Total Expenditures

$

2 226 00 $ 1,696,012 50 $ 1,698,238 50 $ 1,663,812 00

Excess of Revenues over (under) E>cpend1tures

$

3,692 32 $ -318,833 37 $ -315,141 05 $

23,34705

OTHER FINANCING SOURCES Operating Transfers In

18 35

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$

3,692 32 $ -318,833 37 $ -315,141 05 $

23,365 40

FUND BALANCE JULY l

21831127

1 456 975 19

1 675 286 46

1,651,921 06

FUND BALANCE JUNE 30

$ 222,00359 $ 113814182 $ 136014541 $ 1,675,28646

See notes to the general-purpose flnenoal statements

- 29 -

EARLY COUNJY BOARD OF EDUCATION
COMBINING BALANCE SHEET
FIDUCIARY FUND TYPES - EXPENDABLE TRUST FUNDS
JUNE 30. 2002

EXHIBIT "K"

ASSETS
Cash and Cash Equivalents lnvesbnents Accounts Receivable
Total Assets

EARLY COUNTY LEARNING CENTER
ENDOWMENT FUND

ROBERT L STEELE, MD
OCT SCHOLARSHIP
FUND

TOTALS JUNE 30, 2002 JUNE 30, 2001

$

6,408 17

$

6.408 17 $

6,408 17

$

6136 12

6.136 12

5 682 31

222 62

$

640817 $

613612 S

12 544 29 s_ac,:,1..2..,3.1..=3=1o=-

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft

$

FUND EQUITY

Fund Balances Unreserved Undes,gnated

$ _ _-"-6.:,408=.1e.,:7_

470 00 $

47000 $

500 00

5 66612

12 074 29

1181310

Total l.Jab1lrt1es and Fund Equity $

640817 $

613612 $

12 544 29 $ ___1_2._3,.13==10'=,

See notes to the general-purpose financial statements

- 30-

EARLY COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30 2002

EXHIBIT ''L"

REVENUES Other Funds
EXPENDITURES
Current Support Services General Aclmmlstration
Excess of Revenues over (I.D"lder) Expendltw"es
FUND !!8"81,!CE JULY 1

EARLY COUNTY LEARNING CENTER
ENDOWMENT FUND

ROBERT L STEELE, M D
DCT SCHOLARSHIP
FUND

TOTALS YEAR ENDED JUNE 30. 2002 JUNE 30, 2001

$

0 00 $

261 19 $

26119 $

406 20

$

0 00 $

000 $

0 00 $

500 00

$

000 s

261 19 $

26119 $

-93 80

6 408 17

5 404 93

11 81310

11.90690

FUND BALANCE JUNE 30

$

640817 S

566612 $

s_ _ 12 014 29

1_1_a_1_3_10.,_

See notes to the general-pwpose finanoal statements

- 31 -

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

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agnculture, U S Department of Child Nutrition C\uster Pass--Through From Georgia Department of Education Food and Nutrttlon Program
Food Services School Breakfast Program National Sdlool Lunch Program
Total Child Nutrlbon Cluster
Other Programs Pass-Through From Georgia Department of Educatton Food and Nutntion Program Food Dls1r1bubon Program (1)
Total U S Department of Agnculture
Education, U S Department of Special EducaUon Cluster Pass-Through From Georgia Department of Education lndMduals wrth Dsabtlltles Education Act Part 8 - Special Education Flow Through Preschool Capacity Building Improvement
Total Speewil Education Cluster
Other Programs Pass-Through From Georgia Department of EducaUon Elementary and secondary Educalton Act Trtle I Accoun\ablllly Granto Grants to Local Educational Agencies Trtle II Eisenhower Professl0fl81 Development Trtle VI lnnovabve Education Program Strategies Class Size Recluctlon Vocational Education - Basic Grants to States High School Program Baste Grant
Total U S Department of Education
Health and Human SeMces, U S Department of Pass-Throogh From Office of the Governor ChUdren and Youth COOrdinatlng Council Abstinence Educatlon Block Grant

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10 553 10 555

NIA $ 215,364 90

(2)

NIA

672,651 10 s

1 226 510 42 (3)

$ 688 016 00 $ 1,226,510 42

10 550

NIA

55 316 74

55 316 74

s 843.332 74 s 1 281 827 18

84 027 84173 84 173

NIA $ 233,053 58 s

NIA

34,415 30

NIA

5 985 00

s 273,453 88 $

233 053 58 34 415 30 5 985 00
273,453 88

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

NIA

168 120 64

168,120 64

NIA

868,779 21

868,779 21

NIA

25 848 00

25,991 50 (3)

NIA

28,682 00

30 289 90 (3)

NIA

140 816 00

140,816 00

NIA

62,299 00

62 554 00 (3)

$ 1,568 098 73 s 1 570 005 13

93 235

NIA s 35 050 85 S

46 849 06 (3)

Total Federal Fmanaal Assbtance NIA Not Avalleble

s 2.548 482 32 s _...:;2.:saa9a.8"68"'1"'3'"5"

32

EARLY COUNTY BOARD OF EDUCATION SCHEDULE Of EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30 2002

SCHEDULE "1"

Notes to the Schedule of Exoandltures of Federal Awargs
{1) The amount5 shown for the Food Distribution Program represents the Federally esS1gned value of nonmonetary assistance for donated commodities received and/or consumed by the system durtng the current fiscal year
(2) Expendrtwes for the Sdlool Breakfast Program were not maintained separatety and are mcJuded l:n the 2002 National Sdlool Lunch Program
(3) Expenditures for this program include State, and/or Other Funds Expendlturas are not maa,tamed by fund source
Ma1or Programs are identified by an astensk (9) in front of the CFDA number
The Sdlool O1stnd did not provide Federal Assistance to any SubreciplBflt
The accompanying schedule of expenditures of Federal awards Includes the Federal grant activity of the Early County Board of Education and 1s presented on the modified acaual basis of accounting which ls the basis of accounting used In the presentation of the general-purpose financial statements

See notes to the general-purpose financial statements

- 33 -

----------

EARLY COUNTY BOARD OF EDUCATION
SCHEDULE OF STATE REVENUE YEAR ENPEP JUNE 30 2002

SCHEDULE "2"

AGENCV/FUNPING
GRANTS Education, Georgia Department of Ouakty BaslC Educabon D1red. Instructional Cost Kindergarten Program Kindergarten Program Earty lntervenbon Program Pnmary Grades (1-3) Program Pnmary Gradel - Early Intervention (1-3) Program
Uppef Elementary Grades (4-5) Program
Upper Elementary Grades (4-5) Program - Early Intervention Program
Middle SchooS (8-8) Program High School General Education (Q-12) Program Vocallonal Laboratofy (Q-12) Program Students wrth Olsabllrtles
Category I Category II
Category Ill Category"' Categcxy V Gifted Student Category V\ Remedial Education Program Altematlve Educabon Program Media Center Program Staff and ProfeUIOnBI Development Indirect Cost Twenty Daye Addrtlonal lnstrucbon Categor1cal Grants Pupjl Transportation Regular Bus Replacement Sparsity Nursing Services Prlndpel Supplements Vocatk>nal Supervisors Mld-tenn AdJustment Hok:1-Harmless Deferred Summer Salanes (Current Year) Education EquallUltlon Funding Grant Food Services Vocational Educatlon Other State Programs Health Insurance K-3 StatewkSe Reading Prog~ 4-8 Statewide After School Reading Program
Post Secondary Options
Preachool Handicapped Program Student AchN!lvement- 4th thru 8th Grade Tests Student AchN!lvement NCEE Sludenl AchN!lvement - Travel Lottery Programs AsSISbve Technology Computers In the c1a11room
Human Resources Georgi.a Departmenl of Abstinence Educabon Grant
Office of School Readlness Pre-Klnclergar18n Program
Office of Treasury 11nd Fiscal Services Public School Employees RatJrement

See notes to the genera~purpoae financ&al statements

34-

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 449 679 00 361156 00
1 283,667 00 566 171 00 646 733 00
305 goo oo
1 484 478 00 1 231 217 00
429,569 00
5 566 00 569 423 00 434,692 00
76,430 00 6 4Sl4 00
171 259 00 146 257 00 115,151 00 249 574 00
46 539 00 1 540 237 00
77 716 00

s 449 679 00
361 156 00 1 283,667 00
566 171 00 646 733 00
305,900 00 1,484 478 00 1 231 217 00
429 569 00
5 566 00 569 423 00 434,692 00
76 430 00 6 494 00
171 259 00 146 257 00 115 151 00 249 574 00
46 539 00 1 540 237 00
77 716 00

357 236 00 11032000 20,000 00 68,TT5 00
1126500 16 734 00 16 470 00 1,480 715 00 490 330 00
s
123 251 00

85 790 00

166 052 67 40 986 71 28 670 60 1 287 00 28 655 00 1131200 100 000 00 6,328 05

6 901 00 67 550 00

357,236 00 110 320 00
20 000 00 68 775 00 1126500 16 734 00 16 470 00 148071500 490 330 00 65 790 00 123,251 00
166 052 67 40 986 71 28 670 60
1 267 00 28 655 00 1131200 100 000 00
e 328 05
6 SI01 00 67 550 00

9 289 54

9 28!il 54

510 146 06

510 146 06

25 975 00

25 975 00

s $ 13 302.271 03

679 676 60 $ 1398194763

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

SCHEDULE 3"

PROJECT
The retirement of prev,ously Incurred general obhgatton debts ol capital outlay pro,ects of the Ear1y County School OlStnd: are ap8Clfically the Senes 1995 Bonds corrung due on August 1 1&~ through and 1ndudng February 1, 2003 and to repay 811 unpaid Senes HliS Bonda no later than April 1, 2003
AcqUJSlbon. consttucbon and eq,upplng ol the renovabon of Mangum Auchtorlum, renovattons. modiflcabons and amp.rovements to Earty County High School Hammock Gym construcbon or a chorus room restroom 1acllfbes for the baseball field, con.strucbon and eqLJ1Ppmg ol a bus stop on the Ellfly County Elementary School Campus and other addttlonI lmprovei11e11ts, renovabons roodlflcattons and equipping or other achoo! fadlrtles 1ndudlng the acqulalbon of all neceuary property,
both"'"' and -

ORIGINAL ESTIMATED
COST (11

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3) {4)

AMOUNT EXPENDED
IN PRIOR YEARS (3) (4)

PROJECT STATUS

$ 3 645,000 00 $ 3 645 000 00 $ 232,002 SO $ 649,727 50 Ongoing

5,375 000 00 5 375,000 00

-4 763 244 75 Ongomg

s 9 020 ooo oo s 9 020 ooo oo s 1

2321002 50 s 5,.c12 972 25

(1) The School Di11trk:f1 ong1!"181 cost esUmate aa specified m the resolubon call:ng for the I1l'\PO,SrtlOn of the Local OpUon Sales Tax.

(2) The School Dlatnct's current esbmate of total coat for the projects Includes all cost from pro,ect mcepbon to completion

(3) The voters of Earty County approved the 1mpoaltlon of a 1% l8lea tax to fund the above pr0f8dS and retire 8SSOC1ated deb! Amoulta expended tor these proJacb may include aaJe, tax proceeds 1tate local property taxn andlcr other fuid1 over the hie or the Pfllleda

(-4) In addrtlon to the expenditures shown above the School Dtstnct has incurred :nterast to provide advance funding for the above proJecta as follows

Pnor Years

$ ,4g5 B23 33

Current Year

59 010 00

Total

S 554 833 33

See notes to the general-purpose finanaal 1tatementa

35-

EARLY COUNTY BOARD OF EDUCATION GENERAL FUND QUALITY BASIC EDUCATION PROGRAM !QBE}
ALLOTMENTS AND EXPENDITURES BY PROGRAM
YEAR ENDED JUNE 30 2002

SCHEDULE "4"

DESCRIPTION

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1}

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

Dlred. lnstn.tctlonal Programs

Kindergarten Program

$

Kindergarten Program-Earty Intervention Program

Pranary Grades (1-3) Program

Pnmary Grades-Earty Intervention (1-3) Program

Upper Elementary Grade,, (4-5) Program

Upper Elementary Grades-Early Intervention (4-5)

Program

Middle School (6-8) Program

High School General Educabon (1)-12) Program

Vocatlonal Laboratory (9-12) Program

Students with DisabUHles

Category t

category 11

category Ill

Category IV

Gifted Student - Category VI

Remedlal EducaUon Program

AttematNe Educatson Program

TOTAL DIRECT INSTRUCTIONAL PROGRAMS

$

516,396 00 $ 414,739 00 1,474,118 00 650,171 00 742 685 00

522,913 96 $ 548,104 63 1,519 370 89 662,639 27 648,504 66

351 285 00 1,704 723 00 1,413 887 00
493 302 00 1,254,710 00

375 815 22 1,831 334 09 2,079 971 43
536,999 61

764,707 52 469 992 65

196,668 00 167,956 00 132 235 00

253,937 24 168 724 09 146 916 35

9,512,875 00 $ 10,749,93161 s

7,741 00 s
4 874 27 31,261 55
9,281 00 16,199 59

530 654 96 552,978 90 1 550 632 44 671 920 27 864,704 25

3 931 00 34,164 55 58,561 37 45,514 75

379,746 22 1,865,498 64 2,138,532 80
582,514 36

238 00 1145529
8,817 76 3,342 41 4,11180 1 813 65 2 955 68

238 00 796 162 81 478,810 41
3,342 41 258,049 04 170,537 74 149 872 03

s 244,263 67

10 994,195 28

Media Center Program Slaff and Professk>nal Development

286,603 00 53 445 00

323,640 81 22 147 93

68 829 08 31 296 97

392,469 89 53 444 90

TOTAL QBE FORMULA FUNDS

$

985292300 $ 11,095.72035 $ 34438972 $ 1144011007

(1) Comprised of State Funds plus Local Frve MUI Share

See notes to the general-purpose financial statements

- 36 -

EARLY COUNTY BOARD OF EDUCATION GENERAL FUND - QUAUJY BASIC EDUCATION PROGRAM /QBE}
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30. 2002

SCHEDULE "5"

filf
Early County Elementary School Early County Middle School Early County High School Early County Altemat1ve School Central Office (Altemabve Education Program)
TOTAL
(1) Comprlsed of State Funds plus Local Five Mill Share

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

4,917,249 00 $

5,346,017 39

2,049,359 00

2,213,453 64

2,414,032 00

3,287,255 99

147,468 26

132,235 00

$

9,512,875 00 $ 1099419528

See notes to the general-purpose flnanclal statements - 37 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

USSFI L W. HINTON
STATE AUDITOR
{404) 56-;, /4

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Wa,hmgton Street,~ W Suite 214 AtlJntJ, Georgia 30314-8400
Apnl I 6, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Supenntendent and Members of the Early 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 Early County Board ofEducat10n as of and for the year ended June 30, 2002, and have issued our report thereon dated Apnl 16, 2003 This report was qualified for vanous departures from generally accepted accounting pnnc1ples, as identified m the auditor's report on the general-purpose financial statements We conducted our audit m accordance with aud1tmg standards generally accepted m the Umted States of Amenca and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the Umted States
Comphance
As part ofobtaining reasonable assurance about whether Early County Board ofEducation's financial statements are free of matcnal misstatement, wc performed tests of tts compliance with certain prov1s1ons oflaws, regulat10ns, contracts and grants, noncompliance with which could have a direct and matenal effect on the determinatton of financial statement amounts However, providing an opinion on comphance with those prov1s1ons was not an objective of our audit, and accordingly, we do not express such an opinion The results ofour tests disclosed no instances ofnoncomphance that are reqmred to be reported under Government Auditing Standards
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Early County Board ofEducat10n's internal control over financial reporting m order to determine our auditing procedures for the purpose of expressing our op1ruon on the financial statements and not to provide assurance on the internal
2002YB-41

control over financial reporting However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable cond1t10n Reportable conditions involve matters coming to our attention relating to s1gruficant defic1enc1es in the design or operation ofthe internal control over financial reporting that, in ourJudgment, could adversely affect Early County Board of Education's ab1hty to record, process, summarize and report financial data consistent with assert10ns of management in the financial statements The reportable cond1t10n 1s descnbed in the accompanying Schedule ofFindings and Quest10ned Costs as item FS-6491-02-01
A matenal weakness 1s a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the nsk that misstatements m amounts that would be matenal in relation to the financial statements being audited may occur and not be detected within a timely penod by employees in the normal course of performing their assigned funct10ns. Our cons1derat1on of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable cond1hons that are also considered to be matenal weaknesses However, we consider item FS-6491-02-01 to be a matenal weakness
This report 1s intended solely for the information and use of the audit committee, management, members of the Early County Board of Education, Federal awarding agencies and pass-through entitles and 1s not intended to be and should not be used by anyone other than these specified parties
Respectfully submitted,
-- ~.4~;;~
Hinton State Auditor
RWH.as 2002YB-41

{u,,~ 1 1 W. H11ffoN
STATE AUDITOR (-104) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 W.l:)hmgton Street.SW Suuc 214 ALl,tnLJ. Georg1J 30334-8400
Apnl 16, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Supcnntcndent and Members of the Early County Board of Education
REPORT ON COMPLIANCE WITH REOUlREMENTS 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 Early County Board of Education with the types of compliance requirements descnbed in the US Office of Management and Budget (0MB) Circular A-133 Comp/ranee Supplemem that are applicable to each of1ts maJor Federal programs for the year ended June 30, 2002 Early County Board of Educatwn's maJor Federal programs arc 1dent1fied in the Summary of Auditor's Results Section of the accompanymg Schedule of Findings and Questioned Costs Compliance with the requirements of laws, regulatwns, contracts and grants applicable to each of its maJor Federal programs 1s the respons1b1llty of Early County Board of Educatwn's management Our respons1b1llty 1s to express an op1mon on Early County Board of Education's compliance based on our audit
We conducted our audit of compliance in accordance with aud1tmg standards generally accepted in the Umted States of Arnenca, the standards applicable to financial audits contained in Government Aud1tmg Standards, issued by the Comptroller General of the Umted States, and 0MB CJTcular Al 33, Audas of States, Local Govemmellls. and Non-Profit Orgamzatwns 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 matenal effect on a maJor Federal program occurred An audn includes examining, on a test basis, evidence about the Early County Board of Education's compliance with those requirements and performmg such other procedures as we considered necessary m the circumstances Wc believe that our audit provides a reasonable basis for our opinion Our audit does not provide a legal determinatwn on Early County Board of Education's compllancc with those reqmrements
2002SA-10

In our opm10n, the Early County Board of Education complied, m all material respects, with the reqmrements referred to above that are applicable to each of1ts maJor Federal programs for the year ended June 30, 2002.
Internal Control Over Comphance
The management ofEarly County Board ofEducation 1s responsible for establtshmg and mamtammg effective mtemal control over comphance with reqmrements of laws, rcgulat1ons, contracts and grants apphcable to Federal programs. In planrung and performmg our audit, we considered Early County Board of Education's mtemal control over compliance with reqmrements that could have a chrect and material effect on a maJor Federal program m order to deterrnmc our aud1tmg procedures for the purpose of expressmg our opm1on on compliance and to test and report on mtemal control over compliance m accordance with 0MB Circular A-133.
Our cons1derat10n ofthe mtemal control over compliance would not necessarily disclose all matters m the mternal control that rmght be material weaknesses A matenal weakness 1s a cond1tJon m which the design or operation ofone or more ofthe mtemal control components does not reduce to a relatlvely low level of nsk that noncomphance with apphcable reqwrements of laws, regulations, contracts and grants that would be matenal m relation to a maJor Federal program bemg audited may occur and not be detected w1thm a timely penod by employees m the normal course ofperformmg their assigned functions. We noted no matters mvolvmg the mternal control over comphance and its operation that we consider to be matcnal weaknesses.
This report 1s mtended solely for the mformat1on and use of the audit committee, management, members of the Early County Board of Education, Federal awardmg agencies and pass-through entitles and 1s not mtended to be and should not be used by anyone other than these specified parties
Respectfully submitted,
Lo~
RWH.as 2002SA-10

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

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

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

F1NDING CONTROL NUMBER AND STATUS

FS-649 I -00-0 I FS-6491-00-02 FS-6491-01-0 I FS-6491-01-02 FS-6491-01-03

Further Action Not Warranted Further Action Not Warranted Previously Reported Corrective Action Implemented Umesolved - See Corrective Act10n/Responses Umesolved - Sec Corrective Act10n/Responses

CORRECTIVE ACTION/RESPONSES

BUDGET PREPARATION/EXECUTION Deficit Fund Balance Fmdmg Control Number. FS-6491-01-02

The millage rate was increased to 16 nulls and the deficit was s1gmficantly reduced However, expenses were not reduced enough to completely ehmmate the deficit

BUDGET PREPARATION/EXECUTION Failure to Adopt a Balanced Budget Fmdmg Control Number FS-6491-01-03

The School D1stnct raised the millage rate three mills m fiscal year 200 I and has begun a budget reduction plan so that we may ehnunate this findmg

SECTION IV FINDINGS AND QUESTIONED COSTS

EARLY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 2002

I SUMMARY OF AUDITOR'S RESULTS

1 Type of Report Issued on the Financial Statements The auditor's op1mon on the Early County Board of Education's financial statements was qualified for vanous departures from generally accepted accounting pnnc1ples

2 Reportable Cond1t1ons m Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Early County Board of Education disclosed financial statement reportable cond1t10ns related to the followmg control categones

Cash and Cash Equivalents Employee Compensation

Expend1tures/L1ab1Iltles!Di sburscments General Ledger

All of the reportable cond1t1ons descnbed above are considered to be matenal weaknesses

3 Noncompliance Matenal to the Fmanc1al Statements The audit ofthe Early County Board ofEducallon disclosed no instances ofnoncompliance that were deemed to be matenal to the financial statements

4 Reportable Cond1tJons m Internal Control Over Ma10r Programs The audit report for the Early County Board of Educallon did not disclose any reportable cond1tJons in mtemal control over maJor programs

5 Type of Report Issued on Compliance for Ma1or Programs The auditor's op1mon on the Early County Board ofEducat10n's report on compliance with reqwremcnts applicable to maJor programs was unqualified

6 Audit Findmgs Regmred to be Reported by Secllon .51 O(a) of 0MB Circular A-133 The Early County Board ofEducallon's audit did not disclose audit findmgs required to be reported by sect10n 510(a) ofOMB Circular A-133

7 Mawr Programs Federal awards audited as maJor programs are as follows 1O553 Food and Nutnllon Program - Food Services - School Breakfast Program 10 555 Food and Nutnt10n Program - Food Services - National School Lunch Program

8 Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000 00

9 Low Risk Aud1tee The Early County Board of Educallon qualified as a low nsk aud1tee as defined by Secllon .530 ofOMB Circular A-133.

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EARLY COUNTY BOARD OF EDUCATION SCHEDULE OF Fll\'DINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
CASH AND CASH EQUIVALENTS EXPENDITURES/LIABILITIES/DISBURSEMENTS EMPLOYEE COMPENSATION GENERAL LEDGER Inadequate Accountmg Procedures Reportable Cond1t10n - Malena! Weakness Finding Control Number FS-6491-02-01
Accountmg procedures of the Early County Board of Educalion were msuffic1ent to provide adequate internal controls for the followmg control categories
Cash and Cash Equivalents
The monthly bank statements for the general operaling account were not properly reconciled to the general ledger dunng the year under review Umdenll tied reconc1lmg items were adJusted to the School D1stnct's fund balance account several limes dunng the year to reconcile the bank statements A receipt for $74 84 was found that had been deposited mto the operating bank account, but not recorded on the general ledger A receipt for $46,554 00 that was received in June 2002 was not recorded on the general ledger unlit July 2002 and was not hsted as a reconc1lmg item on the June bank reconc1hallon These defic1enc1es occurred because of management's failure to establish procedures to analyze and reconcile cash balances on the general ledger with supportmg records in a timely manner
Expend1tures/Liab1l11ies/D1sbursements
Testmg of operating expenditures revealed five mstances where the vendor name on the check issued was altered by the School D1stnct when the vendor billed under a different name than hsted on the purchase order These d1screpanc1es occurred because management did not follow proper accounting procedures to correct the vendor name pnor to issuing the check
Employee Compensation
A sample of eighteen employees was selected for testmg of employee compensation Results ofth1s testing revealed the following d1screpanc1es
I) One employee was overpaid m the amount of$1,857 21 This overpayment was the result of the employee not being paid at the correct rate of pay
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EARLY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
CASH AND CASH EQUNALENTS EXPENDITURES/LIABILITIES/DISBURSEMENTS EMPLOYEE COMPENSATION GENERAL LEDGER Inadequate Accounting Procedures Reportable Cond1hon - Malena! Weakness Findmg Control Number. FS-6491-02-01
2) One employee was overpaid $995 52 for After School tutonng and was underpaid $1,009 71 for teaching summer school resultmg in a net underpayment rn the amount of$!4 19 The overpayment and underpayment were the result of the employee not bemg paid at the correct rate of pay for add1t1onal work performed
General Ledger
The School D1stnct failed to record on the general ledger all ofthe ac11v1ty occumng dunng the year in the U S Bank escrow account. Procedures were performed by the auditors to reconcile the statements to the general ledger at June 30, 2002 It was noted that receipts of $206,842 67 and disbursements of 5261,507 50 were not recorded on the General Ledger AdJustments were made to the financial statements for the above revenues and expend!tures
The School D1stnct should estabhsh appropnate procedures to ensure that the general ledger 1s posted, balanced, and reviewed on a monthly basis. The School D1stnct should also implement procedures to make certain that all payroll disbursements are based on approved salary schedules The School D1stnct should seek reimbursement from the employee that was overpaid and issue a check to the underpaid employee.
EXPENDI11JRES/LIABJLITIES/DISBURSEMENTS Improper Expenditure Nonmatenal Noncompliance Amount $4,580 00 Findmg Control Number. FS-6491-02-02
In the year under review, an expenditure of$4,580 00 was made from the School D1stnct's General Fund for audit fees of school achv1ty accounts An opuuon of the Attorney General, No 76-72 proVJdes, in part, as follows
" a county school board cannot expend county school funds for a pnvate audit of funds denved from extracumcular achv11Ies and that any audit of these funds must be paid for from such funds themselves "
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EARLY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURES/LIABILITIES/DISBURSEMENTS hnproper Expenditure Nonmatenal Noncompliance Amount $4,580 00 Fmdmg Control Number. FS-6491-02-02
Expenditures of this nature are considered to be beyond the customary scope of expenditures for "educat10nal purposes" These improper expenditures occurred because management d!sregarded the specific hm1tat1ons imposed upon the School D1stnct by Georgia Laws The School D1stnct secured reimbursement m the amount of$4,580.00 m the subsequent year for deposit to the School D1stnct's General Fund.
BUDGET PREPARATION/EXECUTION Deficit Fund Balance Nonmatenal Noncompliance Repeated from Pnor Year Fmdmg Control Number- FS-6491-02-03
At June 30, 2002, the hab1ht1es and the designated and reserved fund balances exceeded assets available for the General Fund by S3 I 7,867 61 and for the School Food ServJce Fund by $140,240 69 0 CG.A 20-2-67(b) requ!fes that the Supenntendent submit to the Georgia Department of Education both a response to this cond1t1on and a corrective action plan designed to correct the budget deficits The School D1stnct should establish budgetary procedures to ensure that fundmg 1s available pnor to the School D1stnct commltlmg to expenditures
BUDGET PREPARATION/EXECUTION Failure to Adopt a Balanced Budget Nonmatenal Noncompliance Repeated from Pnor Ycar Fmdmg Control Number FS-6491-02-04
An exammatlon of the School D1stnct's budget revealed that the School D1stnct failed to adopt balanced budgets for the General Fund and School Food Service Fund. Chapter 32 ofthe Fmanc1al Management for Georgia Local Umts of Adm1mstrat10n issued by Georgia Department ofEducat10n states m part
"The budget must be balanced for all budgeted funds Total anticipated revenues should equal total estimated expenditures In the event ant1c1pated revenues are msuftic1ent to fund anllc1pated essential expenditures, a portion of unreserved fund balance from previous years must be used to fund the shortfall In the event there 1s msuftic1ent unreserved fund balance from prev10us years to fund anllc1pated expenditures, then such expend!tures must be reduced to equal anticipated revenues plus available unreserved fund balance "
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EARLY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 2002 II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS BUDGET PREPARATION/EXECUTION Failure to Adopt a Balanced Budget Nonmatenal Noncompliance Repeated from Pnor Year Fmdmg Control Number- FS-6491-02-04 This condition occurred because management neglected the specific hm1tat10ns imposed upon the School D1stnct by the Georgia Department of Education Appropnatc procedures should be implemented by the School D1stnct to ensure that the adopted budget for all budgeted funds 1s balanced as required III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported
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