~ A800 .Rl E:.2~ F"~ \'\9'3-'\ L-{ STATE OF GEORGIA DEPARTMENT OF AUDITS 254 WASHINGTON STREET ATLANTA. GEORGIA 30334 AUDIT REPORT FANNIN COUNTY BOARD OF EDUCATION BLUE RlDGF, GEORGIA YEAR ENDED JUNE 30, 1994 FANNIN 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 FEDERAL FINANCIAL ASSISTANCE 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 GOVERNMENTAL FUND TYPES 4 C COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ACTUAL AND BUDGET GOVERNMENTAL FUND TYPES 5 D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 6 ADDITIONAL FINANCIAL INFORMATION COMBINING AND INDIVIDUAL FUND STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 18 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 20 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 22 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 24 FIDUCIARY FUND TYPE STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCYFUND 27 FANNIN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION! FINANCIAL ADDITIONAL FINANCIAL INFORMATION SCHEDULES I SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 28 2 ANALYSIS OF CASH AND CASH EQUIVALENTS 30 3 ACCOUNTS RECEIVABLE 31 SCHEDULE OF REVENUE 4 STATE FUNDS 32 5 LOCAL AND OTHER FUNDS 33 SCHEDULE OF EXPENDITURES BY OBJECT 6 GOVERNMENTAL FUND TYPES 35 7 LOTTERY PROGRAMS 36 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 8 OVERALL 38 9 BY PROGRAM 40 IO SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS 42 SECTION II COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS FANNIN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION III INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board ofEducation and Superintendent and Members of the Fannin County Board ofEducation INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE Ladies and Gentlemen: We have audited the general purpose financial statements (Exhibits A through D) of the Fannin County Board of Education, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards issued by the Comptroller General of the United States, and the provisions of the Office ofManagement and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: 94ARL-13 * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. * School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material. In our opinion, except for the effects ofsuch adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements present fairly, in all material respects, the financial position of the Fannin County Board ofEducation as of June 30, 1994, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles. Our audit was conducted for the purpose offorming an opinion on the general purpose financial statements of the Fannin County Board of Education taken as a whole. The combining and individual fund statements n (Exhibits E through and the financial schedules (Schedules 1 through 10 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements ofthe Fannin County Board ofEducation. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effect of adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects of the matters referred to in the fourth paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. A copy ofthis report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24. Respectfully submitted, ~ ~.:::/4~ Claude L. Vickers State Auditor CLV:djf 94ARL-13 FANNIN COUNTY BOARD OF EDUCATION - 1- FANNIN COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP JUNE 30 1994 ASSETS Cash and Cash Equivalents Accounts Receivable Inventories Food Donated Commodities Purchased Food Amount to be Provided in Future Years For Payment of: Capital Lease Agreements Compensated Absences Total Assets GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND $ 1,555,992.13 $ 374,737.35 $ 256,456.83 1,029,923.95 155,525.43 112,724.94 16,465.24 10,787.54 $ 2,585,916.08 $ 557,515.56 $ 369,181.77 LIABILITIES AND FUND EQUITY LIABILITIEl:l Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Deferred Revenue Capital Lease Agreements Compensated Absences Total Liabilities FUND EQUITY Fund Balances Reserved For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity $ 479,731.59 $ 1,052,683.35 53,883.66 $ 113,522.29 3,801.51 27,141.48 10,000.00 26,080.97 132,050.07 $ 1,532,414.94 $ 198,348.94 $ 168,131.04 $ 14,880.67 $ $ 14,880.67 $ 1,038,620.47 $ 1,053,501.14 $ 16,465.24 10,787.54 $ 27,252.78 $ 331,913.84 359,166.62 $ 201,050.73 201,050.73 0.00 201,050.73 Total Liabilities and Fund Equity $ 2,585,916.08 $ 557,515.56 $ 369,181.77 The notes to the general purpose financial statements are an integral part of this statement. -2 - EXHIBIT"A" FIDUCIARY FUND TYPE AGENCY FUND $ 0.00 ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Onl~) JUNE 30, 1994 JUNE 30, 1993 $ 2,187,186.31 $ 1,239,876.78 1,298,174.32 1,314,751.55 16,465.24 10,787.54 27,729.57 11,172.12 $ 396,701.35 396,701.35 358,008.87 239,270.40 239,270.40 175,005.75 $ 0.00 $ 635,971.75 $ 4,148,585.16 $ 3,126,544.64 $ 543,615.25 $ 309,665.88 1,166,205.64 1,105,396.20 3,801.51 3,666.71 26,080.97 132,050.07 130,000.00 27,141.48 $ 396,701.35 396,701.35 358,008.87 239,270.40 239,270.40 175,005.75 $ 635,971.75 $ 2,534,866.67 $ 2,081,743.41 $ 0.00 $ 0.00 $ 14,880.67 $ 15,008.16 16,465.24 10,787.54 201,050.73 27,729.57 11,172.12 425,332.61 $ 243,184.18 $ 479,242.46 1,370,534.31 565,558.77 $ 1,613,718.49 $ 1,044,801.23 $ 0.00 $ 635,971.75 $ 4,148,585.16 $ 3,126,544.64 -3- FANNlN COUNTY RQABP OE EQUCATION COMBINED STATEMENT OF BFVfNlJES EXPENPIDIBES AND CHANGES IN FUND BAlANCES GOVERNMJ;NTAL FUNP TVPES VEAR ENPEP JUNE 30 1PP4 EXHIBIT"B" ~ State Funds Federal Funds Local and other Funds Total Revenues EXPENDITURES Current Instruction Support Services PupilSeMoe& lmpn,,vment al Instructional SeMceo Educational Madia Service& General AdmKlistration School Administration Business Administration Maintenance and Operation of Piant Student Transportation Services Central Support Services Other Suppon SeMceo Food SeMceo 0peIServic:e Total Expenditures Excess ol Rewnues over (under) Expendi1ures QIBEB FINANClt:K? SOURC~ l\JSE~} other Sources other Uses Total other Financing Soun:es (Uses) Excess ol Rewnues and other Financing Sources """(under) Expendi!ures and other Financing Uses E!.!tlCl BALANC~ JULY 1 !993 ~l!TMENT PriorYoar (Net) FQQQ l~filQBY - NET g ~ g IN ~R!QQ eon..d Ccmmodities Purchased Food ACTUAi. PER EXHIBIT"B" ACTUAL PER ADJUSTMENTS BUDGET BASIS BUDGET VARIANCE FAVORABLE (!!NFAVORABLE) 9,403,037.53 $ 1,209,825.97 4,428,322.62 15,041186.12 $ 0.00 $ 0.00 $ 9,403,037.53 $ 8,862,550.00 $ 1,209,825.97 1,381,524.00 4,428 322.62 3,549,915.00 15,041,186.12 $ 13 793 989.00 $ 540,487.53 -171,698.03 878,407.62 1,247,197.12 7,957,396.93 $ 369,432.94 275,127.78 404,584.98 196,n7.19 752,964.33 92,596.20 955,222.69 908,088.47 42,693.14 2,107.89 928,640.00 71,984.62 1,516,885.00 216,421.79 14,690,853.95 $ 350,332.17 $ 0.00 $ 0.00 $ 0.00 $ 7,957,396.93 $ 7,813,667.99 $ 369,432.94 275,127.78 404,584.98 195,n1.1s 752,964.33 92,596.20 955.222.69 908,088.47 42,693.14 2,107.89 928,640.00 71,984.62 1,516,885.00 216,421.79 391,371.00 266,145.00 317,343.00 255,902.00 761,814.00 91,210.00 912,158.00 896,019.00 33,000.00 2,500.00 937,6TT.OO 71.536.00 1,258,029.00 14,690,853.95 $ 14,010 371.99 $ 350,332.17 $ -216,382.99 $ -143,n8.94 21,938.06 -6,982.78 -87,221.98 59,174.81 8,849.67 -1,386.20 -43,064.69 -12,069.47 -9,693.14 392.11 9,037.00 -448.62 -258,856.00 -216,421.79 -680,481.96 566,715.16 639,769.19 $ -409 ,535.19 230,234.00 $ 0.00 $ 0.00 $ 639,769.19 $ -409,535.19 230,234.00 $ 357,000.00 $ -357 ,000.00 0.00 $ 282,769.19 -52,535.19 230,234.00 580,566.17 $ 1,044,801.23 0.00 $ -38,901.69 580,566.17 $ -216,382.99 $ 1,005,899.54 1,411,399.24 796,949.16 -'105,499,70 2,631.85 -2,631.85 -11,264.33 11,264.33 0.00 0.00 -384.58 384.58 0.00 0.00 E.UMQ a&.~E ~UME ~ 1994 $ 1,613,718.49 $ -27,252.78 $ 1,586,465.71 $ 1,197,648.10 $ 388,817.61 The notes to the general purpose finardal statements are an integral part c:A this statement. -5- FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30 1994 Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Fannin County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board and Superintendent, both elected by the voters. With the exception of the departures from generally accepted accounting principles disclosed in the following paragraphs, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards. The more significant ofthe Board's accounting policies are described below. REPORTING ENTITY In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the Fannin County Board ofEducation. Based upon the application ofthe above criteria, the Fannin County Board ofEducation is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Fannin County, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards. Board members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval. FUND ACCOUNTING The Board uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources. General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types. - 6- FANNIN COUNTY BOARD OF EDUCATION EXIDBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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, Local and Other Funds under control ofthe Board, 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 Board's general activities. Governmental Fund Types include: GENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a board of education. SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. Also included are proceeds received from State, Federal, Local and Other sources for operations of the school food services fund. This fund could be accounted for as an enterprise fund; however, the Board chooses not to provide for depreciation, but to maintain the fund on a modified accrual basis and to report the fund as a special revenue fund under governmental fund types, which is acceptable under generally accepted accounting principles for governmental entities. CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. FIDUCIARY FUND TYPE - the agency fund used to account for assets held by a government unit as an agent for individuals. This fund includes: AGENCY FUND - the fund used to account for assets held for individuals. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for material accrued compensated absences and material capital lease obligations. - 7- FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources. Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group. Agency funds are purely custodial in nature and do not involve measurement of results of operations. 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 ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. Property taxes are considered available ifthey are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end. Expenditures are generally recognized when the related fund liability is incurred. A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1993 and ending in early June 1994. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1993 and ending in August 1994. State grants to fund the State's share ofthese contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements. Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities. - 8- FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BUDGET The Fannin County Board of Education has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure of the aggregate budget. The budget process begins when the Board's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education. The Board prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements. The budget comparison on Exhibit "C" presents actual and budget data for all governmental funds on a combined basis. To facilitate comparison with the budget, donated and purchased food inventories as reflected on Exhibit "B" have been eliminated from fund balance. CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofdeposits (including N.0.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State. RECEIVABLES Receivables consist ofgrant reimbursements due from Federal, State or other grantors 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 Fannin County Board ofCommissioners fixed the property tax levy for the 1993 tax year (calendar year) on October 20, 1993 (levy date). Taxes were due on December 20, 1993. The lien date for property taxes was January 1, 1993. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1994 since their collection meets the criteria of GASB codification section P70.103. The Fannin County Tax Commissioner bills and collects the property taxes for the Board of - 9- FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Education, withholds 2.5% of taxes collected as a fee for tax collection, and remits the balance of taxes collected to the Board. The tax millage rate levied for the 1993 tax year (calendar year) for the Fannin County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): School Operations 12 75 mills INVENTORIES FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost. Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets. COMPENSATED ABSENCES Compensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements. INTERFUND TRANSACTIONS The Board has the following types ofinterfund transactions: Reimbunements ofexpenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed. Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY -TOTAL COLUMNS Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data - 10 - FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Note 2: DEPOSITS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, orby collateral in an amount of not less than 110 percent of the public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 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: (1) 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 ofindebtedness or other obligations ofthe counties or municipalities ofthe State ofGeorgia, (5) Bonds ofany public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use ofthe 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 indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Banlc, the Federal Home Loan Bank, the Federal Intermediate Credit Banlc, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 1994, the bank balances were $3,307,221.45. The amounts of the total bank balances are classified into three categories of credit risk: - 11 - FANNIN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 2: DEPOSITS Category I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.) The Board's deposits are classified by risk category at June 30, 1994, as follows: Risk Category I 2 3 Bank Balance $ 100,203.83 0.00 3 207 017.62 Total Note 3: NON-MONETARY TRANSACTIONS $ 3 307 221 45 The Board receives food commodities from the United States Department of Agriculture (USDA) for scnool breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories Note 4: RISK MANAGEMENT The Board has established a limited risk management program for Unemployment Compensation. Estimated claims are budgeted by management based on known claims and prior experience. During fiscal year 1994, a total of$2,405.00 was paid in claims. Note 5: GENERAL LONG-TERM DEBT CAPITAL LEASES The Fannin County Board ofEducation has entered into various lease agreements as lessee for school buses. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. - 12 - FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Notes: GENERALLONG-TERMDEBT The changes in General Long-Term Debt during the fiscal year ended June 30, 1994, were as follows: Capital Leases Compensated Absences Total Balance July 1, 1993 $ 358,008.87 $ 175,005.75 $ 533,014.62 Additions Annual Leave Earned and Utilized (Net) Salaries and Wages Related Fringe Benefits (*) Current Year Leases 230,234.00 47,261.23 17,003.42 47,261.23 17,003.42 230,234.00 Deductions Principal Payments 191 541.52 - - - - 191 541.52 Balance June 30, 1994 $ 396 701 35 $ 239 270 40 $ 635 97) 75 (*) Includes related fringe benefits applicable to compensated absences at July 1, 1993. At June 30, 1994, payments due, by fiscal year which includes principal and interest for these items: Fiscal Year Ended June 30 Capital Leases 1995 1996 1997 1998 $ 172,888.89 134,024.49 92,895.25 52 203.97 Total Principal and Interest $ 452,012.60 Deduct: Imputed Interest 55 311.25 Net Present Value ofFuture Minimum Lease Payments $ 396 70) 35 - 13 - FANNIN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS JUNE30 1994 Note 6: SIGNIFICANT COMMIT:MENTS At June 30, 1994, the Board had encumbrances in the amount of$143,650.83 for the unperformed portion of purchase orders, contracts and other commitments for goods and services associated with the Lottery Programs. Lottery funds in the amount of $143,619.35 are available to fund these encumbrances. Encumbrances outstanding do not constitute expenditures or liabilities in the current year because these commitments will be honored during the subsequent fiscal year. These encumbrances are identified by lottery program as follows: Algebra Classrooms Computers In Classrooms Distant Learning Media Center and Library Equipment Safe Schools Grant $ 1,061.73 26,079.75 2,000.00 84,840.45 29 668.90 $ 143 650 83 The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as ofJune 30, 1994, together with funding available: -Project 93/94-655-040 93/94-655-041 Unearned Executed Contracts Fundin Availabfe From State $ 299,181.81 851 407.17 $ 502 565.96 $ I 150 588 28 $ 502 565 26 The amounts described in this note are not reflected in the general purpose financial statements. Note 7: CONTINGENT LIABILITIES Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position. - 14 - FANNIN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 8: ACCUMULATED EMPLOYEES' LEAVE The employees ofthe Fannin County School System earn 1 1/4 working days of sick leave for each completed school month ofservice up to a maximum accumulation of 60 days. At retirement employees are paid for all unused sick leave, up to the maximum accumulation, at one-half the amount paid to substitute personnel. In the event the Superintendent leaves office, he may be paid at his daily rate for all unused sick leave up to a maximum of 40 days. See Note 1 - Compensated Absences. Note 9: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS). TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement after 30 years ofcreditable service, regardless ofage, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years ofcreditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time ofdisability or death. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contnbutions occurs, but the member's contributions are refunded with interest. The Board's payroll for employees covered by TRS for the year ended June 30, 1994, was $7,192,519.48; total payroll was $8,143,714.98. TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required to contribute 6% of their gross earnings to - 15 - FANNIN COUNTY BOARD OF EDUCATION EXfllBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 9: RETIREMENT PLANS TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1994 that rate for employer contributions was 11.81%. The interest rate assumption (rate ofreturn on investments) was 7.50"/4. Total contributions made during fiscal year 1994 amounted to $1,280,989.11, of which $849,436.44 was made by the Board and $431,552.67 was made by employees. These contnbutions represented 11.81% (Board) and 6% (employees) of covered payroll. TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure ofthe pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers. Total unfunded pension benefit obligation ofTRS as of June 30, 1993, was as follows: Total pension benefit obligation $13,912,014,000.00 Net assets available for benefits, at cost Unfunded pension benefit obligation 12 821 722 000.00 $ I 090 292 ooo oo The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements ofassets and pension benefit obligation for individual employers. Total contributions from all employers to TRS for fiscal year ended June 30, 1994 were $521,550,000.00. The Board's contribution for the year ended June 30, 1994 of$849,436.44 was actuarially determined and represented .1629% of total contributions made by all participating employers. Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due. - 16 - FANNIN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 9: RETIREMENT PLANS PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS) PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State ofGeorgia. PSERS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life half ofwhat the employee would have received upon retirement. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. There were 88 employees covered under PSERS for the year ended June 30, 1994. PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially detennined and approved and certified by the PSERS' Board ofTrustees. Total contributions from employees ofthe Board made during fiscal year 1994 amounted to $3, 152.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1994, was $9,150,000.00. Note 10: SURETY BONDS The School Superintendent, Mr. Morgan B. Arp, is bonded in the amount of$100,000.00 with the Allstate Insurance Company, Northbrook, Illinois, their Bond No. 074-013-432-SB, on which premium is paid through December 31, 1996. - 17 - lllli Cash and Cash Equivalents Aooounts Receivabkt Inventories Food Donated Commodities Purchased Food Tola!- uaeJLmr;s ~Q EU~Q ~!IY ~ Caho-draft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue Total Liabilities FUNPEQUITY Fund Balances R-..d For Inventories Food Donated Commodities Pun:hasad Food Unreserved Unde&ignaled Total Fund Equity Total Liabilities and Fund Equity ~~IN QQ!JtfiY ~AB(;;! OF ~~CATI~ ~ N m Ml ~Cl;; iHl;(;T ~P~QW RMNUE F!JNQ JUNE3Q 1994 ELEMENTARY SCHOOL FOOD SERVICES FUND LOTTERY PROGRAMS STATE PRESCHOOL HANDICAPPED PROGRAM DRUG-FREE SCHOOLS AND C0M'.4UNITIES ACT EDUCATION OF CHILDREN IN STATE SCHOOLS 396,502.99 0.00 0.00 19,841.74 $ 36,868.43 2,90824 16,46524 10,787.54 $ 443,397.51 $ 36,868.43 $ 0.00 $ 2,908.24 $ 0.00 $ 29,36622 54,884.67 84,230.89 $ 9,078.93 548.02 27,141.48 36,868.43 1,478.88 305.06 1,124.30 2,90824 16,465.24 10,787.54 27,252.78 331,913.84 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 359,166.62 $ ~ $ 0.00 $ 0.00 $ 0.00 $ 443,397.51 $ 36,868.43 $ 0.00 $ 2,908.24 $ 0.00 See notes to the general purpose financial statements. EXHIBIT"E" ANO SECONDARY EDUCATION ACT CHAPTER1 EDUCATION OF DEPRIVED CHILDREN CHAPTER2 BLOCK GRANTFLOW THROUGH mLEHEISENHOWER MATHEMATICS ANO SCIENCE EDUCATION 569.87 $ 1,475.08 71,223.74 lNllMOUAI.S WITH OISABIUTIES EDUCATION /lC.T mLEVl,B FLOV\I PRESCHOOL THROUGH PROGRAM JOB TRAINING PARTNERSHIP ACT 13,701.98 $ 3,459.34 $ 1,n1.96 TOTALS JUNE 30, 1994 JUNE 30, 1993 398,547.94 $ 297,558.34 155,525.43 130,936.11 71,223.74 $ 569.87 $ 1,475.08 $ 13,701.98 $ 3,459.34 $ 16,-465.24' 10,787.54 27,729.57 11,172.12 s 7.n1.96 581,326.15 $ <467,396.14 2-. Operattng Transfers In EXC8M cl Rewmues and Other Financing Sources N OF DEPRIVED CHILDREN CHAPTER2 BLOCK GRANT FLCfN THROUGH mLEUEISENHOWER MATHEMATICS ANO SCIENCE EDUCATION INOMOUALS WITH DISABILITIES EDUCATION N::T mLEVl,B FLCfN PRESCHOOL THROUGH PROGRAM JOB TRAINING PARTNERSHIP N::T TOTALS YEAR ENDED JUNE30, 1 - JUNE 30 1993 58,297.31 $ 58,297.31 $ 22,815.13 $ 22,815.13 $ 10,79 .00 $ 10,79 .00 $ 69,931.73 $ 69,931.73 $ 14,611.59 $ 14,611.59 $ $ 13,011.61 13,011.61 $ 241,"463.93 $ 1,133,061.71 332,93 .51 1,707,60.15 $ n,215.01 1,166,114.03 324,167.66 1,567,496.70 35,907.21 $ 800.00 21,590.10 $ 58,297.31 $ 0.00 $ 0.00 $ 0.00 0.00 $ 7,567.$ $ 168.69 15,007.00 51.85 22,815.13 $ 0.00 $ 6,151.74 $ 4,614.62 27.6 50,995.03 15,565.91 $ 96.18 2,874.61 5,65.36 8,824.23 10,79 .00 $ 0.00 $ 69,931.73 $ 0.00 $ 14 611.59 $ 0.00 $ 5,946.10 $ 1,665.78 5,1gg_73 13,011.61 $ 0.00 $ 608,823.73 $ 0,69 .85 6,669.09 15,039.95 27,08.36 50,28 .00 36,096.61 8,824.23 897,308.29 1,691,149.11 $ 16,311.04 $ 58 ,063.42 20,624.811 21,351,05 15,616.03 28,359.8 3,758.37 16,67.78 798,650.16 1 88,8111.18 78,605.52 60,043.70 8.6 0.00 $ 0.00 0.00 $ 0.00 0.00 $ 0.00 0.00 $ 0.00 0.00 $ 0.00 76,354.74 $ 294,60.79 78,613.98 211,220.10 -11,26 .33 -384.58 3,797.53 829.18 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 359,166.62 $ 294,60.79 -21 FANNIN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30 1994 Cash and Cash Equivalents Accounts Receivable Total Assets REGULAR GEORGIA STATE FINANCING AND PROJECT PROJECT 91/91$-655-013 93/92$-655-038 $ 0.00 $ 0.00 $ 10,000.00 $ 0.00 $ o.oo s _ _....;.10;;,:,,o;;.;o;.;;o;.;;.o.;.o LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Contracts Payable Retainages Payable Total Liabilities FUND EQUITY Fund Balances Reserved For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity Total Liabilities and Fund Equity $ 10,000.00 s _ _ _1'""'0"',o'"'o""o"'.o-'--0 $ 0.00 $ $ 0.00 $ 0.00 $ _ _ _ _.....:;0:.::.0-=-0 0.00 $ _ _ _ __.:::0:.::.0.=..0 $ o.oo s _ _ _ _o_._oo_s _ _ _1_0_.o_o_o._o_o See notes to the general purpose financial statements. -22- EXHIBIT"G" INVESTMENT COMMISSION PROJECT PROJECT 93/94-655-040 93/94-655-041 TOTALS JUNE 30, 1994 JUNE 30, 1993 $ 166,197.10 $ 80,259.73 $ 256,456.83 $ 391,224.56 83,802.90 28,922.04 112,724.94 213,267.65 $ 250,000.00 $ 109,181.77 $ 369,181.77 $ 604,492.21 $ $ 129,209.00 $ 129,209.00 $ $ 26,080.97 2,841.07 28,922.04 $ $ 10,000.00 26,080.97 132,050.07 168,131.04 $ 49,159.60 130,000.00 179,159.60 $ 120,791.00 $ 0.00 $ 120,791.00 $ 80,259.73 $ 0.00 80,259.73 $ 201,050.73 $ 425,332.61 0.00 0.00 201,050.73 $ _ _~42=5~,3~3=2~.6~1 $ 250,000.00 $ 109,181.77 $ 369,181.77 $ ___604....,.4_9_2_.2_1 -23- FANNIN COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES CAPITAL PROJECTS FUND YEAR ENDED JUNE 30 1994 REGULAR GEORGIA STATE FINANCING AND PROJECT PROJECT 91/915-655-013 93/925-655-038 REVENUES State Funds Local and Other Funds $ 0.00 $ 0.00 $ 0.00 Total Revenues $ 0.00 $ 0.00 $ 0.00 EXPENDITURES Capital Outlay Building and Building Improvements $ 16,804.10 $ 0.00 $ -10,000.00 Excess of Revenues over (under) Expendnures $ -16,804.10 $ 0.00 $ 10,000.00 OTHER FINANCING SOURCES (USESl Operating Transfers In Operating Transfers Out $ 16,804.10 $ -3,513.61 $ -10,000.00 Total Other Financing Sources (Uses) $ 16,804.10 $ -3,513.61 $ -10,000.00 Excess of Revenues and other Financing Sources over (under) Expenditures and Other Financing Uses $ 0.00 $ -3,513.61 $ 0.00 FUND BALANCE JULY 1 0.00 3,513.61 0.00 FUND BALANCE JUNE 30 $ 0.00 $ 0.00 $ 0.00 See notes to the general purpose financial statements. -24- EXHIBIT"H" INVESTMENT COMMISSION PROJECT PROJECT 93/94-655-040 93/94-655-041 TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993 $ 803,920.95 $ $ 803,920.95 $ 49,768.04 $ 49,768.04 $ 853,688.99 $ 1,051,649.23 8,880.92 853,688.99 $ 1,060,530.15 $ 1,348,566.34 $ $ -544,645.39 $ 72,091.92 $ 1,427,462.36 $ 1,902,847.59 -22,323.88 $ -573,773.37 $ -842,317.44 $ 272,687.39 $ $ 272,687.39 $ $ -271,958.00 $ 392,749.00 73,513.61 $ 73,513.61 $ 363,005.10 $ -13,513.61 349,491.49 $ 885,842.12 885,842.12 51,189.73 $ -224,281.88 $ 29,070.00 425,332.61 43,524.68 381,807.93 $ 120,791.00 $ 80,259.73 $ 201,050.73 $ 425,332.61 -25- FANNIN COUNiY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30 1994 EXHIBIT"!" RETIREE INSURANCE FUND ASSETS Cash and Cash Equivalents BALANCE JULY1, 1993 ADDITIONS DEDUCTIONS BALANCE JUNE 30, 1994 $ 0.00 $ 4 021.57 $ 4 021.57 $ 0.00 LIABILITIES Funds Held for Others $ 0.00 $ 4,021.57 $ 4,021.57 $ 0.00 See notes to the general purpose financial statements. -27 - EAHHlti ~YtlD'.: ~BC! QF EQV~IOM QHEQYI.E QF FEQEML EINaNQlaL AlTANQI; YEAR ENDED JUNE 30 1994 SCHEDULE 1 FUNDING AGENCY PRQGRAWQRANT CFDA NUMBER AWARDS IN PERIOD FEDERAL FUNDS RECEIVED IN PERIOD(NET OFREFUNDSl FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD Agriculture, U. S. Department ol Through Georgia Department ol Education Food and Nutrition Program Child and Adult Care Food Program 1994 Contract Food Services School Breakfast Program 1993 Grant 1994Grant National School Lunch Program 1993 Grant 1994 Grant Food Distribution Program (1) Through Office d Treasury and Fiscal Services National Forest Reserve Funds 10.558 $ 1,451.02 $ 10.553 10.553 10.555 10.555 10.550 10.665 102,396.34 352,583.90 60,653.56 50057.26 1,427.10 $ 1,451.02 364.52 101,212.20 2,853.55 349,035.62 N/A 50 057.26 102,396.34 352,583.90 $ 60,653.56 50 057.26 (2) (2) 836,654.73 (3) 60,653.56 {l Total U.S. Department ol Agriculture $ 567142.08 $ 504 950.25 $ 5671.Q.08 $ 897308.29 Education, U.S. Department ol Through Georgia Department ol Education Drug-Free Schools and Communities Act 1993Grant 1993Carry-0Yer 1994 Grant Elementary and Secondary Education Act Chapter 1 Education d Children in State Schools 1992 Carry-Over 1993 Carry-Over 1994 Regular Eduoation ol Deprived Children 1993 Regular 1993 Carry-Over 1994 Regular 1994Summer Chapto, 2 Block Grant Flow Through 1993 Carry-Over 1994 Regular Tlllell Eisenhoww Mathematico and Scienee Education 1994 Regular lndiYicluals with Disabilities Education Act TllleVl,B Flow Through 1991 Regular 1993 Regular 1993 Carry-Over 1994 Regular Preschool Program 1992 Carry-Over 1993 Regular 1993 Carry-Over 1994 Regular 84.186 84.186 $ 84.186 84.009 84.009 84.009 84.010 84.010 84.010 84.010 84.151 84.151 84.164 84.027 84.027 84.027 84.027 84.173 84.173 84.173 84.173 $ 498.00 26,607.00 2,085.00 3,540.00 136,358.00 410,131.00 18,500.00 2,519.00 20,866.00 10,794.00 35,191.00 84,760.00 8,508.00 23,048.00 7,968.37 498.00 $ 17,626.28 498.00 $ 20,534.52 498.00 20,534.52 698.00 2,085.00 3,540.00 78,006.13 136,358.00 252,189.45 2,085.00 3,540.00 136,358.00 321,939.31 2,085.00 3,540.00 136,358.00 321,939.31 2,519.00 20,866.00 2,519.00 20,296.13 2,519.00 20,296.13 10,794.00 10,794.00 10,794.00 -28.00 s,636.n 34,079.56 23,259.93 10,591.91 1,501.64 8,508.00 2,502.25 35,191.00 34,740.73 8,508.00 5,961.59 35,191.00 34,740.73 8,508.00 5,961.59 28 FANNIN QQUNTY BOARD OF liDUCATION SCHEDULE OF FEDERAi FJNANCIAI ASSISTANCE YEAR EN PED JUNE 30 1994 SCHEDULE 1 FUNDING AGENCY PROGRAM/GRANT CFDA ~ Education, U. S. llepartnww of Through Georgia Department of Education Vocational Education Basic Grants to Stat High School Program Basic Grant 1994 Grant 64.048 Community Sued Organizations Vocational Educational Support Program 1993 Contract 64.174 AWARDS IN PERIOD FEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS) FEDERAL REVENUE IN PERIOD 11,707.00 $ 15000.00 11,707.00 $ 11,707.00 15 000.00 15000.00 EXPENDITURES IN PERIOD (4) Total U.S. Department of Education Labor, u. s. llepartnww of Through North Georgia Private lndust,y Council Job Training Parlnetship Act Contract Number 81020303 Contract Number =20203 Contract Number 84012804 $ 810112.00 $ 17250 17.250 17.250 $ $ 14 240.00 649,!!2724 $ 629672.28 $ 602965.28 -817.32 10,510.80 $ 5,289.65 $ 1n1.96 5,289.65 1n1.96 Total U. S. Department of Labor 14240.00 $ 9593.48 $ 13011.61 $ 13011.61 Total Federal Financial Assistance $ 1,391,464.08 $ 1,164,450.97 $ 1,209,825.97 $ Major Programs are identified by an asterisk r) in front of the CFDA number. (1) T h e . - shown for the Food Distribution Program - the Federally assigned value of nonmonetary assistance for donated commodities .......-..cl and/or consumed by the - during the current fiocal year. (2) ~lturos for the Child and Adult Care Food Program and the School Braaklast Program - . not meinteined separately and re included in the 1994 National School Lunch Program. (3) ~ltures for this program include s - . and/or Loc I and Other Funds. ~ re not mintained by fund source. (4) ~ " " " ' on this program - not maintained by fund oouroe. (5) Funds earned on this program do not require reporting of expenditures. 1,513,285.18 See notes to the general purpose financial statements. 29. FANNIN COUNTY BOARD OF EDUCATION ANALYSIS OF CASH AND CASH EQUNALENTS JUNE30 1994 INTEREST BEARING ACCOUNTS Fannin County Bank, Blue Ridge, Georgia N.O.W. Accounts (3.00%) Peoples Bank of Fannin County, Blue Ridge, Georgia N.O.W. Accounts (4.20%) SCHEDULE "2" $ 1,000,000.00 1,187,186.31 $ 2,187,186.31 See notes to the general purpose financial statements. - 30 - FANNIN COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30 1994 SCHEDULE "3'' Education, Georgia Department of Quality Basic Education Deferred Summer Salaries - FY 1994 Child and Adult Care Food Program Food Services State Funds - House SHI 782 School Breakfast Program National School Lunch Program Lottery Programs Distant Learning Media Center and Library Equipment Safe Schools Grant Federal Programs Drug-Free Schools and Communities Act ESEA- Chapter 1 Education of Deprived Children Individuals with Disabilities Education Act Titie VI, B - Flow Through Trtle VI, B - Preschool Program Fannin County Recreation Department Reimbursement for Meals Fannin County Tax Commissioner County Wide School Tax Georgia State Financing and Investment Commission Reimbursement on Construction Projects North Georgia Private Industry Council Job Training Partnership Act Other Vendor Rebates GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND TOTAL $ 962,484.00 $ 23.92 10,050.00 1,184.14 3,548.28 3,031.48 32.95 33,804.00 2,908.24 71,223.74 13,701.98 3,459.34 $ 962,484.00 23.92 10,050.00 1,184.14 3,548.28 3,031.48 32.95 33,804.00 2,908.24 71,223.74 13,701.98 3,459.34 4,785.90 4,785.90 67,439.95 67,439.95 $ 112,724.94 112,724.94 7,721.96 7,721.96 49.50 49.50 $ 1,029,923.95 $ 155,525.43 $ 112 724.94 $ 1 298,174.32 See notes to the general purpose financial statements. - 31 - FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 1994 SCHEDULE "4" AGENCY/FUNDING GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Progra": Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Special Instructional Assistance In-School Suspension Mid-term Adjustment Local Fair Share Deferred Summer Salaries - FY 1993 Deferred Summer Salaries - FY 1994 Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Preschool Handicapped Program Supervision and Assessment of Student and Beginning Teachers and PerformanceBased Certification Teachers' Retirement Lottery Programs Algebra Classrooms Computers in Classrooms Distant Leaming Media Center and Library Equipment Safe Schools Grant GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND TOTAL $ 4,991,410.00 689,344.00 120,415.00 210,812.00 67,779.00 1,462,318.00 377,209.00 127,682.00 129,042.00 393,433.00 67,873.00 298,508.00 -1, 190,206.00 -897,978.56 962,484.00 464,507.00 $ 10,357.00 63,600.00 23,048.00 1,350.00 20,546.17 648.30 62,862.20 3,031.48 32.95 83,506.00 $ 4,991,410.00 689,344.00 120,415.00 210,812.00 67,779.00 1,462,318.00 377,209.00 127,682.00 129,042.00 393,433.00 67,873.00 298,508.00 -1,190,206.00 -897,978.56 962,484.00 464,507.00 63,600.00 10,357.00 23,048.00 1,350.00 20,546.17 648.30 62,862.20 3,031.48 32.95 83,506.00 Financing and Investment Commission, Georgia State Reimbursement on Construction Projects Georgia Public Telecommunication Commission, Lottery Program Distant Leaming OTHER Education, Georgia Department of Reimbursement of Student Information System Project $ 853,688.99 853,688.99 4,735.00 4,735.00 1,000.00 1 000.00 $ 8,307,884.61 $ 241,463.93 $ 853688.99 $ 9,403 037.53 See notes to the general purpose financial statements. - 32 - FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF LOCAL AND OTHER REVENUE YEAR ENDED JUNE 30 1994 SCHEDULE "5" GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL Taxes County Wide School Tax Railroad Car Tax Real Estate Transfer Tax $ 3,278,397.56 76.40 18,104.98 $ 3,278,397.56 76.40 18,104.98 Other Compensation for Loss of Assets Donations Levi Strauss Foundation Indirect Cost Special Revenue Fund Interest Earned Reimbursement for Salaries Blue Ridge Cannery Gilmer County Board of Education Rents Revenue in Lieu of Taxes Tennessee Valley Authority Sales Lunches, Breakfast and Contracted Meals School Assets Tuition Other 24,142.59 30,400.00 5,086.00 63,410.11 $ 10,830.54 660.00 26,235.13 5,077.55 629,392.73 140.00 8,600.00 5,665.06 320,751.79 1,202.18 150.00 24,142.59 30,400.00 5,086.00 74,240.65 660.00 26,235.13 5,077.55 629,392.73 320,751.79 1,342.18 8,600.00 5,815.06 $ 4,095,388.11 $ 332,934.51 $ 4,428,322.62 See notes to the general purpose financial statements. - 33 - FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30 1994 SCHEDULE "6" EXPENDITURES Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Insurance Communications Tuition Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Federal Indirect Costs Other Expenditures Nonoperating Costs Principal and Interest Building and Building Improvements Equipment GENERAL FUND SPECIAL REVENUE FUND TOTAL $ 7,402,999.16 $ 740,715.82 $ 8,143,714.98 2,130,288.68 209,145.05 2,339,433.73 29,971.48 2,594.28 32,565.76 28,705.57 24,403.37 53,108.94 11,058.67 11,058.67 37,324.60 5,405.43 42,730.03 19,000.74 1,753.01 20,753.75 1,986.90 130.04 2,116.94 55,850.93 55,850.93 29,122.83 13.89 29,136.72 27,766.90 27,766.90 3,860.80 3,860.80 8,824.23 8,82423 65,018.41 6,305.25 71,323.66 417,071.70 96,454.27 513,525.97 401,193.64 401,193.64 393,754.41 393,754.41 106,29822 5,069.91 111,368.13 13,430.28 2,170.55 15,600.83 5,086.00 5,086.00 19,425.87 6,618.61 26,044.48 216,421.79 89,244.64 470061.47 178,844.19 216,421.79 89,244.64 648,905.66 Total Expenditures $ 11,572,242.48 $ 1,691,149.11 $ 13,263,391.59 See notes to the general purpose financial statements. - 35 - FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT LOTTERY PROGRAMS YEAR ENDED JUNE 30 1994 EXPENDITURES Operating Costs Supplies Nonoperating Costs Equipment Total Expenditures ALGEBRA CLASSROOMS COMPUTERS IN CLASSROOMS DISTANT LEARNING $ 648.30 $ 4,480.20 $ 3,031.48 58,382.00 $ 648.30 $ 62,862.20 $ 3,031.48 See notes to the general purpose financial statements. - 36 - SCHEDULE "7" MEDIA CENTER AND LIBRARY EQUIPMENT SAFE SCHOOLS GRANT G.P.T.C. DISTANT LEARNING TOTAL $ 32.95 $ 6,000.00 $ 4,735.00 $ 18,927.93 77,506.00 135,888.00 $ 32.95 $ 83 506.00 $ 4,735.00 $====1=54=,8=1=5=.9=3 - 37 - FANNIN COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30 1994 SCHEDULE a Minimum Expenditure RequiremenlJ; (Total Allotment) Expenditures on Combined Program Basis Salaries Operations Less: Expenditures for Media Center Programs in Excess ofTotal Media Allotment Expenditures for Staff Development Programs in Excess of Total Staff Development Allotment for: Cost of Instruction Expenditures per Aud~ (1) (2) THIRTEEN WEIGHTED AND MEDIA CENTER PROGRAMS STAFF DEVELOPMENT PROGRAM $ 6,310,490.00 $ 67,779.00 $ 6,309,506.85 294,531.01 $ $ 6,604,037.86 $ 67,780.54 67,780.54 -69,543.06 $ 6,534,494.80 $ -1.54 67,779.00 Amount of Underexpenditure for Total Allotment $ Note: (1) Salary accruals (July and August 1994 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines. (2) Salary accruals (July and August 1993 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines. 0.00 $=====0.=00= See notes to the general purpose financial statements. - 39 - FANNIN COI.JNTV BQABP OF EQI. ICATION ANAJ YSIS Of MIN1MlJM EXPENQIDJBE BfiCllJIBSMENTS RY PROGRAM GENFBAI AINP-OUAUIY BASIC EQI. K?ADON PBQGBAMS VEAR ENOf.;P JUNE 30 1994 GENERA[ AND CARf:fR fpl,JCATIQN PROGRAMS Kindergarten (1 Grade& 1-3 r) Sub-Total - K--3 Grade64-5 r) Grade& 6 - 8 r) Grade& 9 - 12 (1 High School Laboratories (1 VocatlOnat Education Laboratories (") Total General and Career Education Programs SPECIAL EDUCATION PROGRAMS Regular Programs Category I r) Category II (1 Categor; Ill r) Category IV (") Itinerant Supplemental Speech Sub-Total - Regular Category V (Gifted) r) Total Special Education Progralll6 RMfQlAl fQl.}CATION PROGRAM 0 MfQIA CENTER PROGRAM Total Thirteen Weighted and Media Center - I ~ STAFF PfVfl QPMffNT PRQGRAMS (1) Coat cl Instruction TotalStatr~ (") ldentffie& Thirteen Weighted Programs. Note: (1) $5,486.52dtheallotmentforProressional [)ewk)pment has been transfened to Cost d Instruction as authorized by OCGA 20-2-182. See notes to the general purpose financial statements. ALLOTMENTS FROM DEPARTMENT OF EDUCATION REQUIRED TOTAL ORIGINAL ~ ORIGINAL MID-TERM REQUIRED 498,902.00 449,011.80 1229037.00 1,727,1139.00 90 s 1106 133.30 $ 1,555,145.10 $ 692,071.00 90 622,863.90 1,090,057.00 90 981,051.30 630,864.00 90 567,597.60 441,278.00 90 397,150.20 409401.00 90 368 460.90 4991 410.00 4 492 269.00 $ 449,011.80 2,000.00 1108133.30 2,000.00 $ 1,557,145.10 622,863.90 136,800.00 1,117,851.30 92,553.00 660,150.60 838.00 397,988.20 3 900.00 372 360.90 236,091.00 $ 4 728 360.00 605,128.00 544,615.20 $ 62,418.00 $ 607,033.20 605,128.00 84216.00 689344.00 120415.00 210 812.00 90 $ 90 90 $ 90 s 544,615.20 $ 75 794.40 620 409.60 $ 108 373.50 $ 189 730.80 $ 62,418.00 $ 62 418.00 $ 0.00 $ 0.00 $ 60"Z,OJ3.20 75 794.40 682,827.60 108,373.50 189 730.80 s 6011981.00 s 5,410,782.90 $ 298,509.00 $ 5,709,291.90 20,723.52 100 S 47 055.48 100 20,723.52 $ 47 055.48 67 n9.oo 67 779.00 $ 0.00 $ 20,723.52 47 055.48 o.oo s_ _s_1,..,17_9..,.o.o. $ 6 079,760.00 5,478,561.90 $ 29B,5o9.oo s 5.n1,010.oo (2) Salary accruals (July and August 1994 Deferred Salaries) reported as expenditures in the General Purpo&e Financial Statements are not included on this analysis in order to comply with program guidelines. - 40 - SCHEDULE ''9" REQUIRED ALLOTMENT SALARIES AC"TUAL (2) (3) DISTRIBUTION BY RESPECTIVE PORTIONS AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT REQUIRED ALLOTMENT OPERATIONS AMOUNT OF UNDER EXPENDITURE FOR REQUIRED ACTUAL ALLOTMENT 437,887.80 $ 1072881.00 1,510,768.80 $ 604,782.90 1,086,428.90 630,837.40 381,480.40 322 914.60 4 537 213.00 $ 525,907.10 1 391 921.05 1,917,828.15 $ 737,736.99 1,210,068.12 655,850.23 412,974.51 387 735.23 5 322 193.23 $ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 11,124.00 $ 35 252.30 46,376.30 $ 18,081.00 31,422.40 29,313.20 16,507.80 49 446.30 191147.00 $ 9,182.02 37 549.58 46,731.60 $ 18,050.48 31,430.38 30,651.10 17,760.66 49,445.04 194 069.26 $ 0.00 30.52 0.00 0.00 0.00 1.26 31.78 $ 27,896.70 117,473.40 $ 135,846.14 366,518.70 416,336.85 40,724.10 3,217.48 2,397.60 389.70 555,400.20 $ 555,400.47 $ 73-811.70 86 806.13 $ 629 211.90 $ 642 206.60 106 565.40 $ 109 442.50 $ 148163.40 $ 235 664.52 $ 5,421,153.70 $ 6,309,506.85 $ 0.00 0.00 0.00 0.00 0.00 38,524.50 2,373.30 $ 9,419.40 1,315.80 76.51 51,560.92 51,633.00 $ 1 982.70 53 615.70 $ 1,808.10 $ 41 567.40 $ 51,637.43 $ 2 364.02 $ 54001.45 1 769.76 $ 44690.54 $ 288,138.20 $ 294,531.01 $ 0.00 0.00 38.34 0.00 70.12 5,421,153.70 $ 6,309,506.85 $ , 0.00 (3) Salary accruals (July and August 1993 Deferred Salaries) reported as expenditure& in the prior year General PurfX)Ge Financial Statements. are included on this analysis as required by program guidelines. 20,723.52 $ 47 055.48 20,725.06 $ 47 055.48 67,779.00 $ 67 780.54 $ 355,917.20 $ 362,311.55 $ ~ 41 0.00 0.00 0.00 70.12 FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS YEAR ENDED JUNE 30 1994 SCHEDULE "10" BOARD MEMBER ADDRESS Mr. Lewis Deweese, Chairman (") P. 0. Box395 Blue Ridge, Georgia 30513 Mr. Joe Clement P. 0. Box 115 Mineral Bluff, Georgia 30559 Ms. Marcella K. Culpepper (*) P. 0. Box839 Copperhill, Tennessee 37317 Mr. Jim Sisson (*) P. 0. Box29 Blue Ridge, Georgia 30513 Mr. Larry Sutton (*) P. 0. Box664 Morganton, Georgia 30560 COMPENSATION TRAVEL $ 1,400.00 $ 425.19 1,800.00 2,440.56 1,100.00 119.40 1,150.00 355.95 1,400.00 867.57 Note: As of June 30, 1994, one vacant position had not been filled. (*) Denotes Board Members Serving as of June 30, 1994 $ 6 850.00 $ 4,208.67 See notes to the general purpose financial statements. - 42 - SECTION II COMPLIANCE CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Fannin County Board of Education COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements of the Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. Compliance with laws, regulations, contracts, and grants applicable to Fannin County Board ofEducation is the responsibility of the Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. 94CRL-10 The results ofour tests indicate that, with respect to the items tested, the Fannin County Board ofEducation complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects, with those provisions. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~x~ Claude L. Vickers State Auditor CLV:djf 94CRL-10 CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Fannin County Board ofEducation SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements of the Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have applied procedures to test the Fannin County Board of Education's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1994: (1) Political Activity (5) Allowable Costs/Cost Principles (2) Civil Rights (6) Audit Follow-Up/Resolution (3) Cash Management (7) Administrative Requirements (4) Federal Financial Reports Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits ofState and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression ofan opinion on the Fannin County Board ofEducation's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. 94CRL-60 Material instances of noncompliance consist offailures to follow the general requirements that caused us to conclude that the misstatements resulting from those failures are material to the Federal financial assistance programs. The results of our tests of compliance disclosed a material instance of noncompliance that is described in the Schedule ofFindings and Improper or Questioned Costs. We considered this material instance ofnoncompliance in forming our opinion on whether the Fannin County Board of Education general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated May 12, 1995, on those financial statements. Except as described above, the results of our procedures to determine compliance indicate that, with respect to the items tested, the Fannin County Board of Education, complied, in all material respects, with the requirements listed in the second paragraph of this report, and with respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects with those requirements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter ofpublic record. Respectfully submitted, ~7~ Claude L. Vickers State Auditor CLV:djf 94CRL-60 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Fannin County Board ofEducation SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements of the Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Fannin County Board of Education's compliance with the requirements governing: (1) Types of Services Allowed or Unallowed (5) Applicable Special Tests and Provisions (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (6) Other Requirement Claims for Advances and Reimbursements (4) Reporting These requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994. The management of the Fannin County Board of Education is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. 94CRL-80 Except as discussed in the following paragraph, we conducted our audit of compliance in accordance with generally accepted auditing standards; Government Auditing Standards issued by the Comptroller General of the United States; and Office ofManagement and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Fannin County Board of Education's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. However, this matter has no affect on the Board's compliance with the requirements listed in the second paragraph of this report. In our opinion, the Fannin County Board ofEducation complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1994. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. ~ / ? ; ~ Respectfully submitted, Claude L. Vickers State Auditor CLV:djf 94CRL-80 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Fannin County Board ofEducation SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS Ladies and Gentlemen: We have audited the general purpose financial statements of the Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. Thisreport was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. In connection with our audit ofthe fiscal year 1994 general purpose financial statements of the Fannin County Board of Education and with our consideration of the Board's internal control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, "Audits ofState and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing: ( 1) Types of Services Allowed or Unallowed (2) Eligibility Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Fannin County Board ofEducation's compliance with these requirements. Accordingly, we do not express such an opinion. 94CRL-120 With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Fannin County Board ofEducation had not complied, in all material respects, with those requirements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:djf 94CRL-120 SECTION III INTERNAL CONTROL CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Fannin County Board of Education REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. In planning and performing our audit of the general purpose financial statements of the Fannin County Board of Education for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management ofthe Fannin County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estinrates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, 94ICL-3 assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness ofthe design and operation of policies and procedures may deteriorate. For the purposes ofthis report, we have classified the significant internal control structure policies and procedures in the following categories: (1) Cash and Cash Equivalents (6) Employee Compensation (2) Inventories (7) General Ledger (3) Revenue/Receivables/Receipts (8) General Fixed Assets (4) Procurement (5) Expenditures/Liabilities/ Disbursements For all ofthe internal control categories listed above, we obtained an understanding of the design ofrelevant policies and procedures and whether they have been placed in operation, and we assessed control risk. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories: (1) Accounting Controls (Overall) (2) General Fixed Assets A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. 94ICL-3 Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses. These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit of the Fannin County Board of Education's financial statements and this report does not affect our report thereon dated May 12, 1995. This report is intended for the information of management, the Federal cognizant audit agency and other This Federal grantor agencies. restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, CLV:djf 94ICL-3 Claude L. Vickers State Auditor CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 12, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Fannin County Board ofEducation SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED 1N ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements of the Fannin County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated May 12, 1995. This report was qualified.for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Fannin County Board of Education's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated May 12, 1995. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions ofOffice ofManagement and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Fannin County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. In planning and performing our audit for the year ended June 30, 1994, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB 94ICL-7 Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated May 12, 1995. The management ofthe Fannin County Board ofEducation is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that, assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection ofany evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories: GENERAL REQUIREMENTS SPECIFIC REQUIREMENTS (1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (1) Types of Services Allowed or Unallowed (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (5) Allowable Costs/Cost Principles (4) Reporting (6) Audit Follow-Up/Resolution (7) Administrative Requirements (5) Applicable Special Tests and Provisions (6) Other Requirement Claims for Advances and Reimbursements 94ICL-7 For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1994, the Fannin County Board of Education expended 70% of its total Federal financial assistance under major Federal financial assistance programs. We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and bperation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements and specific requirements, as described above that are applicable to each ofthe Board's major Federal financial assistance programs, which are identified in the Schedule ofFederal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the Board's ability to.administer Federal financial assistance programs in accordance with applicable laws and regulations. As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control category: Administrative Requirements A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable conditions described above are also considered to be material weaknesses. These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit of the Fannin County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance programs for the year ended June 30, 1994, and this report does not affect our report thereon dated May 12, 1995. 94ICL-7 This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution ofthis report which is a matter of public record. Respectfully submitted, c:J~ Claude L. Vickers State Auditor CLV:djf 94ICL-7 SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Finding Resolved Audit Control Number 6551-93-01 The audit report for the year ended June 30, 1991, stated that the Board had an underexpenditure of Quality Basic Education (QBE) funds of $197.61 for the Staff Development Program. For the year under review, adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund the underexpenditure as required. AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $4,422.56 Audit Control Number 6551-93-04 The audit report for the year ended June 30, 1993, noted that the Board had an underexpenditure of Quality Basic Education (QBE) Funds of$4,422.56 for the salaries portion of the High School Laboratories Program. For the year under review, no adju_stment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditure of $4,422.56 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for QBE programs in a subsequent fiscal year. AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $10,387.99 Audit Control Number 6551-93-05 The audit report for the year ended June 30, 1993, disclosed that the Staff Development - Professional Development Stipends Program had an underexpenditure of Quality Basic Education (QBE) funds of $10,387.99 for the required minimum allotment. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund this underexpenditure as required. The underexpenditure of$10,387.99 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for QBE programs in a subsequent fiscal period. FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR AUDIT FOLLOW-UP/RESOLUTION Failure to Transfer Local Matching Funds Financial Statements Finding Resolved Audit Control Number 6551-93-06 The audit report for the year ended June 30, 1993, stated that the Board failed to transfer local matching funds from the General Fund to the Capital Projects Fund as required for the approved State Capital Outlay Project for the 1993 fiscal year. Both the instructions in Chapter 70 of the Georgia Financial Accounting Handbook for Local School Systems and the agreement signed by the Board to receive funding through Georgia State Financing and Investment Commission require that the Board transfer local matching funds by year end and designate those funds by project name and number. In the year under review, local funds were transferred as required. AUDIT FOLLOW-UP/RESOLUTION Failure to File Corrective Action Plan Federal Financial Assistance Finding Resolved Audit Control Number 6551-93-07 The audit report for the year ended June 30, 1993, disclosed that the Board failed to submit a corrective action plan for the 1992 audit report as required by 0MB Circular A-128 to the North Georgia Private Industry Council from whom the Board received Job Training Partnership Act Funds (CFDA 17.250). After further review, it was determined submission of a corrective action plan was not required. AUDIT FOLLOW-UP/RESOLUTION Inadequate Documentation Federal Financial Assistance Major Program Finding Resolved Audit Control Number 6551-93-08 The audit report for the year ended June 30, 1993, disclosed that the Board included five schools as participating schools in the Elementary and Secondary Education Act, Chapter 1 Program (CFDA 84.010) when determining eligible school attendance areas utilizing the "25% Rule" as provided for in 34 CFR Part 200.30 (b) (2) (I). However, the Board could not provide documentation that fiscal year 1993 aggregate per student expenditures in those school attendance areas either equaled or exceeded aggregate per student expenditures in those attendance areas in fiscal year 1992. In the year under review, the Georgia Department ofEducation conducted a review and determined the Board was not required to meet the criteria of the "25% Rule". FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR/CURRENT YEAR ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 6551-93-02 The audit report for the year ended June 30, 1993, stated that the Board had not provided for adequate separation ofemployee duties in the performance of accounting functions and related procedures for all funds. For the year under review, our audit noted no improvement in the separation of employee duties. This deficiency was a result ofmanagement's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree ofintemal control with existing staff. Note: Federal financial assistance programs affected by this finding are as follows: School Food Service Fund (CFDA 10.550, 10.553, 10.555 and 10.558) Chapter 1 Program (CFDA 84.010) GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial. Statements Reportable Condition - Material Weakness Audit Control Number 6551-93-03 The audit report for the year ended June 30, 1993, noted that the management of the Fannin County Board ofEducation had chosen not to maintain a system-wide General Fixed Assets Account Group within the foimal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the foimal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the Board and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 CURRENT YEAR EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $70.12 Audit Control Number 6551-94:01 For the year under review, the Board had underexpenditures of Quality Basic Education (QBE) funds of $30.52 for the operations portion of the Grades 4-5 Program, $1.26 for the operations portion of the Vocational Education Laboratories Program and $38.34 for the operations portion of the Remedial Education Program. These underexpenditures were the results of the Board's failure to meet the minimum expenditure requirements of the Official Code of Georgia Annotated Section 20-2-167. These funds should be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. ADMINISTRATIVE REQUIREMENTS Inadequate Inventory Records Federal Financial Assistance Major Program Reportable Condition - Material Weakness Material Noncompliance Audit Control Number 6551-94-02 Property management records maintained by the Board for the Elementary and Secondary Education Act Chapter 1 - Education ofDeprived Children Program (CFDA 84.010) were incomplete and failed to meet the property management standards as set forth in Chapter 8 of Part I of the Georgia Financial Accounting Handbook for Local School Systems (GFAH). Inventory records maintained by the Board and presented for examination that did not contain acquisition cost and date, percentage of Federal participation in the cost of the items and disposition, when applicable. This condition occurred because management was not aware of the provisions of GFAH. An inventory system should be implemented that provides for the identification of all equipment purchase as outlined in GFAH. Perpetual inventory records should include historical information regarding additions and deletions made to the equipment inventory during each fiscal year, when applicable. Periodic physical inventory counts should be made and reconciled to the property records to ensure the accuracy ofthe Board's inventory records. SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEARENDEDJUNE30 1994 ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 6551-93-02 We concur with this finding, however, due to current budgetary constraints, the Board is unable to hire the additional staff required to clear this finding. The Board feels it has provided for the most appropriate assignment ofduties with the number of personnel available to perform the accounting functions. With staff limitations, this finding can not be totally resolved. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6551-93-03 We concur with this recommendation. Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff the Board has decided not to pursue the recording of general fixed assets on the financial statements. EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $70.12 Audit Control Number 6551-94-01 We concur with this finding. This finding will be resolved by Georgia Department ofEducation through future increase in the Board's local fair share portion of QBE Allotments. ADMINISTRATIVE REQUIREMENTS Inadequate Inventory Records Federal Financial Assistance Major Program Reportable Condition - Material Weakness Material Noncompliance Audit Control Number 6551-94-02 We concur with this finding. In the future, inventory records will be made in accordance with instructions in Chapter 8 of the Georgia Financial Accounting Handbook for Local School Systems.