Audit report, Fannin County Board of Education, Blue Ridge, Georgia, year ended June 30, 1996

GA
Aioo
,RI
E~b

F;)...

''

i c1q5 _cl(:>

AUDIT REPORT FANNIN COUNTY BOARD OF EDUCATION
BLUE RIDGE, GEORGIA YEAR ENDED JUNE 30, 1996

STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET
ATLANTA. GEORGIA 30334

FANNIN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

Page

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

ALLFUNDTYPESANDACCOUNTGROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

5

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

7

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDMDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

22

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

25

I

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

26

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

27

2 CASH AND CASH EQUIVALENTS

29

3 ACCOUNTS RECEIVABLE

30

FANNIN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

SCHEDULE OF REVENUE

4

STATE

31

5

TAXES AND OTHER

32

SCHEDULE OF EXPENDITURES BY OBJECT

6

GENERAL AND SPECIAL REVENUE FUNDS

33

7

LOTTERY PROGRAMS

34

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

8

OVERALL

35

9

BY PROGRAM

36

10 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS

38

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 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
February 26, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe 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, 1996, 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 of Management 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, 1996, 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:
96ARL-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 of Education as of June 30, 1996, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued a report dated February 26, 1996, on our consideration of the Board's internal control structure and a report dated February 26, 1996, on its compliance with laws and regulations.
Our audit was conducted for the purpose of forming 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 (Exhibits E through I) 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 of Education. 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.

CLV:gp 96ARL-13

Claude L. Vickers State Auditor

FANNIN COUNTY BOARD OF EDUCATION - 1-

FANNIN COUNTY BOARD OF EDUCATION
COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP
JUNE 30. 1996

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Prepaid Items
Inventories
Food Donated Commodities Purchased Food
Amount to be Provided in Future Years For Payment of: Capital Lease Agreements Compensated Absences

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

$ 2,403,358.24 $ 350,881.24 $ 580,598.09

1,225,868.49

98,517.12

17,280.66 12,595.37

Total Assets

$ 3,629,226.73 $

- - - - - 479,274.39 $ 580,598.09

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts 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 Project
Unreserved Undesignated
Total Fund Equity

$ 445,218.16 $ 1,262,906.30 1,354.83

$ 1,709,479.29 $

$

70.12

$

$

70.12 $

1,919,STT.32

$ 1,919,747.44 $

Total Liabilities and Fund Equity

$ 3,629,226.73 $

The notes to the general purpose financial statements are an integral part of this statement. -2-

51,636.34 $ 122,003.78
5,014.60

140.00

11s,s54.72 s _ _ _1_40_.oo_

17,280.66 12,595.37
$
29,876.03 $
270,743.64
300,619.67 $

314,322.24 314,322.24 266,135.85 580,458.09

------- 479,274.39 $ 580,598.09

EXHIBIT"A"

FibUCIARY FUND TYPE AGENCY FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS (Memorandum Only} JUNE 30, 1996 JUNE 30, 1995

$

0.00

$ 3,334,837.57 $ 2,371,946.20

1,324,385.61

1,321,790.47

3,058.07

17,280.66 12,595.37

19,042.26 12,334.55

$

400,468.92

400,468.92

397,547.05

254,407.16

254,407.16

236,491.87

$

0.00 $

654,876.08 $ 5,343,975.29 $ 4,362,210.47

$ 496,994.50 $ 500,635.02

1,384,910.08

1,248,613.18

6,369.43

4,189.75

3,000.00

622.10

$

400,468.92

400,468.92

397,547.05

254,407.16

254,407.16

236,491.87

$

654,876.08 $ 2,543, 150.09 $ 2,391,098.97

$

0.00

$

0.00

$

70.12 $

14,880.67

17,280.66 12,595.37 314,322.24

19,042.26 12,334.55

$ 344,268.39 $

46,257.48

2,456,556.81

1,924,854.02

$ 2,800,825.20 $ 1,971,111.50

$

0.00 $

654,876.08 $ 5,343,975.29 $ 4,362,210.47

-3-

FANNIN COUNTY BOARD OF EDUCATION
COMBINED SWEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENPEP JUNE 30 1996

EXHIBITB

REVENUES
State Funds Federal Funds Taxes and Other Funds
Total Revenues

GENERAL FUND

SPECIAL REVENUE
FUND

CAPITAL PROJECTS
FUND

TOTALS
{Memorandum On~ YEAR ENDED
JUNE 301 1996 JUNE 301 1995

$ 9,474,202.09 $ 308,384.27

$ 9,782,586.36 $ 9,597,987.02

69,227.79 1,232,058.36

1,301,286.15

1,310,no.43

4,523,187.14

283,551.91 $ 437,554.85

5,244,293.90

4,433,337.93

$ 14,066,617.02 $ 1,823,994.54 $ 437,554.85 $ 16,328,166.41 $ 15,402,095.38

EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services
Capital Outlay Debt Service
Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES}

$ 8,580,1n.22 $ 768,687.46

719,218.04 91,773.74
357,520.81 295,885.32 967,150.85
85,309.01 1,175,882.75
974,215.82 33,657.76 4,478.97 7,840.98

70,128.32 226.25
10,099.83 34,378.63
7,285.81 $
1,062,299.15

79,283.26 97,663.09

194,534.13 26,538.17

$ 13,691,129.72 $ 1,953,105.45 $

$ 9,348,864.68 $ 8,301,141.81

5,188.76

789,346.36 91,999.99 367,620.64 330,263.95 967,150.65 85,309.01 1, 188,357.32 974,215.82 33,657.76
4,478.97 1,070,140.13

623,905.25 86,816.99
336,405.93 312,688.86 821,740.96
80,788.00 1,051,412.13
958,411.36 47,156.52 2,n1.28
1,002, 180.37

44,984.00

79,283.26 142,647.09

79,895.09 1,325,792.20

194,534.13 26,538.17

181,339.53 26,647.12

50,172.76 $ 15,694,407.93 $ 15,239,093.40

$

375,487.30 $ -129,110.91 $ 387,382.09 $

633,758.48 $

163,001.98

Capital Leases Operating Transfers In Operating Transfers Out

$

197,456.00

$

-280,936.07

$ 87,860.07 $ 193,076.00

197,456.00 $ 280,936.07 -280,936.07

190,267.00 783,751.80 -783,751.80

Total other Financing Sources

(Uses)

$

-83480.07 $

87,860.07 $ 193'76.00 $

197,456.00 $

190,267.00

Excess of Revenues and other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1

$

292,007.23 $ -41,250.84 $ 580,458.09 $

831,214.48 $

353,268.98

1,627,740.21

343,371.29

0.00

1,971,111.50

1,613,718.49

Food Inventory - Net Change in Period Donated Commodities Purchased Food

-1,761.60 260.82

-1,761.60 260.82

2,577.02 1,547.01
:;:

FUND BALANCE JUNE 30

$ 1,919,747.44 $ 300,619.67 $ 580,458.09 $ 2,800,825.20 $ 1,971 ,111.50

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

FANNIN COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 1996

EXHIBITc

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes and Other Funds

$ 8,501,685.00 $ 9,474,202.09

272,410.00

69,227.79

3,445,282.35 4,523,187.14

Total Revenues

$ 12,219,3n.35 $ 14,066,617.02

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services
Capital Outlay Debt Service

$ 8,441,448.29 $ 8,580,1TT.22

500,562.00 265,818.00 339,824.99 306,375.08 940,548.00
88,400.00 1,095,237.56 1,025,891.53
89,600.00 116,512.00

719,218.04 91,TT3.74
357,520.81 295,885.32 967,150.65
85,309.01 1,175,882.75
974,215.82 33,657.76 4,478.97 7,840.98 79,283.26 97,663.09 221,072.30

Total Expenditures

$ 13,210,217.45 $ 13,691,129.72

Excess of Revenues over (under) Expenditures

$ -990,840.10 $ 375,487.30

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$ 197,456.00

$ -265,412.00

-280,936.07

Total Other Financing Sources (Uses)

$ -265,412.00 $ -83,480.07

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -1,256,252.10 $

292,007.23

FUND BALANCE JULY 1, 1995

1,871,163.66 1,627,740.21

Adjustments

3,205.97

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 86,370.00 $ 308,384.27

1,138,634.00 1,232,058.36

281,420.00

283,551.91

$ 1,506,424.00 $ 1,823,994.54

$ 513,698.00 $ 768,687.46

42,995.00 25,110.00
16,498.00

70,128.32 226.25
10,099.83 34,378.63

2,000.00

7,285.81

1,118,671.00 1,062,299.15

$ 1,718,972.00 $ 1,953,105.45 $ -212,548.00 $ -129,110.91

$ 101,412.00 $ 87,860.07

$ 101,412.00 $ 87,860.07

$ -111,136.00 $ 352,583.76 -71,633.68

-41,250.84 311,994.48

FUND BALANCE JUNE 30, 1996

$ 618,117.53 $ 1,919,747.44

$ 169,814.08 $ 270,743.64

The notes to the general purpose financial statements are an integral part of this statement. -5-

THIS PAGE LEn BLANK

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note "1: 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 ofthe departures from generally accepted accounting principles disclosed in these notes, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all of the fund types and account groups of the Board. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards.
The more significant of the Board's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the governmental 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 of Education.
Based upon the application of the above criteria, the Fannin County Board of Education 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.
- 7-

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note I: 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 confonn to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements. .
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control 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 ofa Board's educational activities, Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes, These funds are 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.
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, private organizations, other government units and/or other funds. 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,
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 t)lis 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.
- 8-

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 resource~, 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 1995 and ending in early June 1996. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1995 and ending in August 1996. State grants to fund the State's share of these 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.
BUDGET
The Fannin County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper 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
- 9-

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

budget. This final budget is then submitted, in accordance with provisions ofthe Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.

The Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit "B" ofthis report:

Special Revenue
Fund

FUND BALANCE JULY 1, 1995

$ 343,371.29

Adjustments Inventories - July 1, 1995 Food Donated Commodities Purchased Foods

-19,042.26 -12,334.55

Fund Balance July 1, 1995 (Budget Basis)

$ 311,994.48

Excess ofRevenues and Oth~r Financing Sources over (under) Expenditures and Other Financing Uses

-41,250.84

FUND BALANCE JUNE 30, 1996 (Budget Basis)

$ 270,743.64

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 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

- 10 -

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1": SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 1995 tax year (calendar year)

on September 7, 1995 (levy date). Taxes were due on December 20, 1995. The lien date for property taxes

was January 1, 1995. Taxes collected within the current fiscal year or within 60 days after year-end are

reported as revenue in fiscal year 1996 since their collection meets the criteria of GASB codification section

P70. l 03. The Fannin County Tax Commissioner bills and collects the property taxes for the Board of

Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes

collected to the Board.



The tax millage rate levied for the 1995 tax year (calendar year) for the Fannin County Board ofEducation was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

12 50 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 (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

COMPENSATED ABSENCES

Compensated absences represent obligations of the 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.

- 11 -

FANNIN COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUM;MARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERFUND TRANSACTIONS
The Board has the following types ofinterfund transactions:
Reimbursements ofexpenditures initially made from a fund that are properly applicable to another _fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than 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 comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis 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, or by collateral. The aggregate ofthe face value of such surety bond and the market value ofsecurities shall be equal to not less than 110 percent of the public funds being secured after the deduction of the 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 ofthe 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 ofindebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities of the State of Georgia,

- 12 -

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATE1\1ENTS

JUNE 30, 1996

.,,.
Note 2: DEPOSITS

(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 of the bonds for this purpose,

(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and

(7) Bonds, bills, notes, certificates of 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 Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 1996, the bank balances were $4,137,189.82. The amounts of the total bank balances are classified into three categories of credit risk:

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent 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, 1996, as follows:

Risk Category

Bank Balance

1

$ 100,144.09

2

4,037,045.73

3

0.00

Total

$4,137,189.82

Note 3: NON-MONETARY TRANSACTIONS

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

- 13 -

FANNIN COUNTY BOARD OF EDUCATION

EXI-IlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 4: RISK MANAGEMENT

The Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster; and unemployment compensation.

The Board has obtained commercial insurance for risk of loss associated with torts, assets and errors or omissions. However, the errors or omissions policy excludes coverage for sexual harassment and discrimination. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years.

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

The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated.

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

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1995 1996

$

0.00 $

1,625.00 $

1,625.00 $

0.00

$

0.00 $

1,720.00 $

1,720.00 $

0.00

The Board participates in the Georgia School Boards Association Workers' Compensation Fund, a public entity risk pool organized on July 1, 1992 to develop, implement, and administer a program of workers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Fund for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Fund with the Safety National Casualty Corporation to provide coverage for potential losses sustained by the Fund in excess of $250,000.00 loss per occurrence, up to the statutory limit. Also, should losses within the retained limit of $250,000.00 aggregate to more than eighty-five percent (85%) of the standard experience rated premium during the policy term, the policy with Safety National Casualty Corporation will pay the next $1,000,000.00 ofloss.

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.

- 14 -

FANNIN COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30~ 1996

Note 5": GENERAL LONG-TERM DEBT

The changes in General Long-Term Debt during the fiscal year ended June 30, 1996, were as follows:

Capital Leases

Compensated Absences

Total

Balance July 1, 1995

$ 397,547.05 $ 236,491.87 $ 634,038.92

Additions Annual Leave Earned and Utilized (Net)

197,456.00

17,915.29

197,456.00 17,915.29

Deductions Payments

194,534.13

194,534.13

Balance June 30, 1996

$ 400,468.92 $ 254,407.16 $ 654,876.08

At June 30, 1996, payments due, by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30
1997 1998 1999 2000
Total Principal and Interest
Deduct: Imputed Interest
Net Present Value ofFuture Minimum Lease Payments
Note 6: ON-BEHALF PAYMENTS

Capital Leases
$ 179,943.06 139,251.78 87,047.81 43,868.28
$ 450,110.93
49,642.01
$ 400,468.92

The Board has recognized revenues and expenditures in the amount of $287,642.00 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department ofEducation Paid to the State Merit System ofPersonnel Administration For Health Insurance ofNon-Certified Personnel In the amount of$220,901.72

- 15 -

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 6: ON-BEHALF PAYMENTS

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$27,279.28

Office ofTreasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $39,46I.00

Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as ofJune 30, 1996, together with funding available:

Project

Unearned Executed Contracts

Funding Available From State

97/96S-655-017

$ 38,413.68 $ 261,688.00

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

Note 8: 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.

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

Note 9: 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. When the Superintendent terminates employment, he may be paid at his daily rate for all unused sick leaveup to a maximum of 40 days. See Note-1 - Compensated Absences

- 16 -

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

.,,
Note 10: 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 in accordance with State statute. A member is eligible for service retirement after 30 years of creditable service, regardless ofage, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable 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 of the 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 of disability 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 contributions 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, 1996, was $8,371,946.34; total payroll was $9,601,612.00.
TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1996 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.
Total contributions made during fiscal year 1996 amounted to $1,407,321.76, of which $988,723.70 was made by the Board and $418,598.06 was made by employees. These contributions represented 11.81% (Board) and 5% (employees) of covered payroll.

- 17 -

FANNIN COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1O: RETIREMENT PLANS

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, 1995, was as follows:

Total pension benefit obligation

$17,442,607,000.00

Net assets available for benefits, at cost

15,857,066,000.00

Unfunded pension benefit obligation

$ 1,585.541,000.00

The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1995. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers.

Total contributions from all employers to TRS for fiscal year ended June 30, 1996 were $607,275,000.00. The Board's contribution for the year ended June 30, 1996 of $988,723.70 was actuarially determined and represented .1628% of total contributions made by all participating employers.

Ten year historical trend information is presented in the 1996 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.

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 of Georgia in accordance with State statute.

PSERS provides, in accordance with State statute, service retirement, disability retirement and surviv~rs benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment ofage 65. A member applying for service retirement with IO years of service and retires between

- 18 -

FANNIN COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note "10: RETIREMENT PLANS
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 ofyears 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. lfthere are less than ten years of service, a lump sum refund ofthe 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 of what 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 91 employees covered under PSERS for the year ended June 30, 1996.
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 determined and approved and certified by the PSERS' Board of Trustees. Total contributions from employees ofthe Board made during fiscal year 1996 amounted to $3,160.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1996, was $9,817,769.80.
Note 11: 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 was paid through December 31, 1996.

- 19 -

ASSETS Cash and ~ Equivalents Accounts Receivable Inventories
Food Donated Commodities Purchased Food
TotalAssets

FANNIN COUNTY BOARD OF EDUCATION
COMBINING BALANCE SHEET
SPECIAL REVENUE FUND JUNE 30.1996

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

STATE PRESCHOOL HANDICAPPED
PROGRAM

ELEMENTARY ANO SECONDARY

TITLEI

GRANTS TO

TITLEII

LOCAL

EISENHOWER

EDUCATIONAL PROFESSIONAL

AGENCIES DEVELOPMENT

$ 349,846.50 $ 4,801.57

8,637.45

1,519.76 $

4,707.12 $

69,888.02 $

241.56

17,280.66 12,595.37

$ 388,359.98 $ 6,321.33 $

4,707.12 $

69,888.02 $ _ _ _ _2_4_1..5..6...

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

$ 24,110.13 $ 63,630.18

6,321.33 $

$ 87,740.31 $ 6,321.33 $

$ 17,280.66 12,595.37
$ 29,876.03 270,743.64 $
$ 300,619.67 $

0.00 $ 0.00 $

$ 1,054.12 3,653.00

11,299.15 $ 14,090.82 43,971.92
526.13

4,707.12 $

69,888.02 $

0.00 $ 0.00 $

0.00 $ 0.00 $

241.56 241.56
0.00 0.00

Total Liabilities and Fund Equity

$ 388,359.98 $ 6,321.33 $

4,707.12 $

69,888.02 $

241.56

See notes to the general purpose financial statements.

-20-

EXHIBIT"E"

EDUCATION ACT THLEVI
INNOVATIVE EDUCATION PROGRAM STRATEGIES

INDIVIDUALS WITH DISABILITIES EDUCATION ACT
PARTS SPECIAL EDUCATION FLOW THROUGH PRESCHOOL

SAFE
AND DRUG-FREE
SCHOOLS

VOCATIONAL JOB TRAINING

EDUCATION PARTNERSHIP

TOTALS

FEDERAL

ACT

JUNE 30, 1996 JUNE 30, 1995

$

1n.99 $ 5,648.06 $

2,108.14

$

7,265.76

$ 369,848.02 $ 396,936.76

4,597.38

$

887.31

93.50 $

7,945.02

98,517.12

137,699.41

----- $

1n.99 $ 10,245.44 $

17,280.66 12,595.37

19,042.26 12,334.55

2,108.14 $

887.31 $

7,359.26 $

7,945.02 $ 498,241.17 $ 566,012.98

$

65.31

$

7,360.76 $

18,966.78 $

32,540.60

$ 2,729.30 $

460.36

125.36 $

2,160.66

584.26

51,636.34

58,263.17

7,466.14

1,647.78

646.96

987.80

122,003.78

130,755.68

$

1n.99

50.00

49.68

4,210.80

5,014.60

460.14

622.10

$

1n.99 $ 10,245.44 $

2,108.14 $

887.31 $

7,359.26 $

7,945.02 $ 197,621.50 $ 222,641.69

$

17,280.66 $

19,042.26

12,595.37

12,334.55

$ 29,876.03 $ 31,376.81

$

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $

0.00

270,743.64

311,994.48

$

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $ 300,619.67 $ 343,371.29

$

1n.99 $ 10,245.44 $

2,108.14 $

887.31 $

7,359.26 $

7,945.02 $ 498,241.17 $ 566,012.98

- 21 -

FANNIN COUNTY BOARD OF EDUCATION
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND
YEAR ENDED JUNE 30, 1996

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

STATE PRESCHOOL HANDICAPPED
PROGRAM

ELEMENTARY AND SECONDARY

TITLEI

GRANTS TO

TITLEII

LOCAL

EISENHOWER

EDUCATIONAL PROFESSIONAL

AGENCIES DEVELOPMENT

REVENUES
State Funds Federal Funds Taxes and Other Funds

$ 55,830.00 $ 229,071.37 $ 596,465.03 283,551.91

23,482.90 $

400,684.75 $

6,234.85

Total Revenues

$ 935,846.94 $ 229,071.37 $

23,482.90 $ 400,684.75 $

6,234.85

EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services Operation

$ 224,444.26 $ 7,285.81

23,482.90 $

383,084.29
658.80 $
16,941.66

$ 1,062,299.15

226.25 6,008.60

Total Expenditures

$ 1,062,299.15 $ 231,730.07 $

23,482.90 $ 400,684.75 $

6,234.85

Excess of Revenues over (under) Expenditures

$ -126,452.21 $ -2,658.70 $

0.00 $

0.00 $

0.00

OTHER FINANCINQ SQURCES (USES)
Operating Transfers In Operating Transfers Out

$ 85,201.37 $ 2,658.70

Total Other Financing Sources (Uses) $ 85,201.37 $ 2,658.70

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Financing

Uses

$ -41,250.84 $

0.00 $

0.00 $

0.00 $

0.00

F!.!ND BALANCE JULY 1

343,371.29

0.00

0.00

0.00

0.00

Food Inventory - Net Change in Period Donated Commodities Purchased Food

-1,761.60 260.82

FUND BALANCE JUNE 30

$ 300,619.67 $

0.00 $

0.00 $

o.oo $-===---=o_.oo==

See notes to the general purpose financial statements.

-22-

EXHIBITP

EDUCATION ACT TITLE VI
INNOVATIVE EDUCATION PROGRAM STRATEGIES

INDIVIDUALS WITH DISABILITIES EDUCATION ACT
PARTS SPECIAL EDUCATION FLOW THROUGH PRESCHOOL

SAFE AND DRUG-FREE SCHOOLS

VOCATIONAL JOB TRAINING

EDUCATION PARTNERSHIP

FEDERAL

ACT

TOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995

$

18,014.01 $ 132,806.72 $

$

18,014.01 $ 132,806.72 $

s 33,000.00 $ 11,as2.n

18,199.20 $

s 33,000.00 $ 11,as2.n

18,199.20 $

$ 14,801.03

308,384.27 $ 244,862.47

1,232,058.36 1,283,331.68

283,551.91

295,450.27

14,801.03 $ 1,823,994.54 $ 1,823,644.42

$

7,875.47 $ 84,461.32 $

47,921.56

10,099.83 38.71

423.84

$

18,014.01 $ 132,806.72 $

$

0.00 $

0.00 $

19,498.42 $ 13,501.58

3,762.42 $ 8,046.38

18,199.20 $

43.97

33,000.00 $ 0.00 $

11,ss2.n $ 0.00 $

18,199.20 $ 0.00 $

3,879.18 $ 768,687.46 $ 633,765.08

10,921.85

70,128.32 226.25
10,099.83 34,378.63
7,285.81

1,062,299.15

86,297.72
10,485.08 30,812.26
1,667.16 11,142.73 999,355.30

14,801.03 $ 1,953,105.45 $ 1,n3,525.33

0.00 $ -129,110.91 $

50,119.09

$

a1,860.01 s 11,9n.96

-142,016.41

$

87,860.07 $ -70,038.45

$

0.00 $

0.00 $

0.00

0.00

0.00 $ 0.00

0.00 $ 0.00

0.00 $ 0.00

0.00 $ 0.00

-41,250.84 $ 343,371.29

-19,919.36 359,166.62

-1,761.60 260.82

2,sn.02 1,547.01

$

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $ 300,619.67 $ 343,371.29

-23-

FANNIN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND
JUNE 30, 1996

EXHIBIT NG"

ASSETS Cash and Cash Equivalents

REGULAR

GEORGIA STATE FINANCING AND INVESTMENT
COMMISSION PROJECT
97/968-655-017

TOTALS
JUNE 301 1996 JUNE 301 1995

$ 266,135.85 $

314,462.24 $ 580,598.09 $

3,000.00

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Contracts Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For State Capital Outlay Project Unreserved Undesignated
Total Fund Equity

$ $
$ $ 266,135.85 $ 266.135.85 $

140.00 $ 140.00 $

140.00 $
140.00 $

314,322.24 $ 0.00
314,322.24 $

314,322.24 266.135.85 $ 580,458.09 $

3,000.00 3.000.00
0.00 0.00

Total Liabilities and Fund Equity

$ 266,135.85 $

314,462.24 $ 580,598.09 $

3,000.00

See notes to the general purpose financial statements.

- 24-

FANNIN COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 1996

EXHIBIT "H"

"
REVENUES State Funds Taxes and Other Funds Total Revenues
EXPENDITURES Current Support Services Maintenance and Operation of Plant Capital Outlay Building and Building Improvements Total Expenditures
Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES
Operating Transfers In Excess of Revenues and Other Financing
Sources over (under) Expenditures FUND BALANCE JULY 1

REGULAR

GEORGIA STATE FINANCING AND INVESTMENT
COMMISSION PROJECT
97/96S-655-017

TOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995

$ 102, 135.85 $ $ 102,135.85 $

335,419.00 $ 335,419.00 $

$ 437,554.85
437,554.85 $

502,565.96 502,565.96

$
$ $ 102,135.85 $

5,188.76 $ 44,984.00 50,172.76 $ 285,246.24 $

5;188.76 44 984.00 $ 1,273,374.12 50,172.76 $ 1,273,374.12 387,382.09 $ -770,808.16

164,000.00
$ 266,135.85 $ 0.00

29,076.00

193,076.00

569,757.43

314,322.24 $ 0.00

580,458.09 $ -201,050.73

0.00

201,050.73

FUND BALANCE JUNE 30

$ 266,135.85 $

314,322.24 $ 580,458.09 $ -=====0=.0=0

See notes to the general purpose financial statements.

-25-

FANNIN COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30, 1996

EXHIBIT"!"

RETIREE INSURANCE FUND ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for others

BALANCE JULY 1, 1995

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 1996

$

0.00 $

4,547.73 $

4,547.73 $ = = = =0.=00

$

0.00 $

4,547.73 $

4,547.73 $ = = = =0.=00

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

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30, 1996

SCHEDULE "1"

FUNDI"NG AGENCY
PROGRAM/GRANT
Agriculture, U. S. Department of Through Office of Treasury and Fiscal Services National Forest Reserve Funds Through Georgia Department of Education Food and Nutrition Program Child and Adult Care Food Program 1996 Grant Food Services School Breakfast Program 1996 Grant National School Lunch Program 1996 Grant Nutrition Education and training Program 1996 Grant Food Distribution Program (1)
Total U. S. Department of Agriculture
Education, U. S. Department of Through Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1996 Grant Title II Eisenhower Professional Development 1996 Grant Title VI Innovative Education Program Strategies 1996 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1996 Grant Preschool 1996 Grant Safe and Drug-Free Schools 1996 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1996 Grant Consumer and Homemaking Education 1996 Contract
Total U. S. Department of Education

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10.665 $ 50,420.03

(5)

10.558

2,026.08

(2)

10.553
10.555

162,184.59

(2)

366,429.46 $ 1,001,444.25 (3)

10.564 10.550

4,970.00 60,854.90

(2) 60,854.90

$ 646,885.06 $ 1,062,299.15

84.010 $ 400,684.75 $

400,684.75

84.281

6,234.85

6,234.85

84.298

18,014.01

18,014.01

84.027 84.173 84.186

132,806.72 33,000.00 11,852.77

132,806.72 33,000.00 11,852.77

84.048

22,461.33

84.049

14,545.63

$ 639,600.06 $

(4) (4) 602,593.10

- 27 -

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30, 1996

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Labor, U. S. Department of Through North Georgia Private Industry Council Job Training Partnership Act Contract Number 95040102 Contract Number 96050101
Total U. S. Department of Labor

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

17.250 $ 17.250
$

6,856.01 $ 7,945.02
14,801.03 $

6,856.01 7,945.02
14,801.03

Total Federal Financial Assistance

$ 1,301,286.15 $ 1,679,693.28

Major Programs are identified by an asterisk (*) in front of the CFDA number.

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the Child and Adult Care Food Program, the School Breakfast Program and the Nutrition Education and Training Program were not maintained separately and are included in the 1996 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Expenditures on this program were not maintained by fund source. (5) Funds earned on this program do not require reporting of expenditures.

See notes to the general purpose financial statements.

- 28 -

FANNIN COUNTY BOARD OF EDUCATION CASH AND CASH EQUIVALENTS JUNE 30, 1996
INTEREST BEARING ACCOUNTS
Peoples Bank of Fannin County, Blue Ridge, Georgia
N.O.W. Accounts (5.92%)

SCHEDULE "2" $ 3,334,837.57

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

FANNIN COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30, 1996

Associated Landscape Contractors of America Refund of Overpayment
Education, Georgia Department of Quality Basic Education Deferred Summer Salaries - FY 96 Food Services School Breakfast Program National School Lunch Program Lottery Program Applied Technology Labs Other State Program Preschool Handicapped Program Federal Programs Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development Individuals with Disabilities Education Act Part B - Special Education Flow Through Safe and Drug-Free Schools
Fannin County Tax Commissioner County Wide School Tax
Gilmer County Board of Education Shared Services
North Georgia Private Industry Council Job Training Partnership Act

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

93.50 $

$ 1,092,694.00

2,135.21 6,502.24
1,519.76
4,707.12

128,694.37 4,480.12

69,888.02 241.56
4,597.38 887.31
7,945.02

TOTAL
93.50
1,092,694.00 2,135.21 6,502.24 1,519.76 4,707.12
69,888.02 241.56
4,597.38 887.31
128,694.37
4,480.12 7,945.02

$ 1,225,868.49 $

98,517.12 $ 1,324,385.61

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

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30, 1996

SCHEDULE 4

"
AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Technology Training Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Mid-term Adjustment Local Fair Share Deferred Summer Salaries - FY 95 Deferred Summer Salaries - FY 96 Educational Equalization Funding Grant Food Services Vocational Education Other State Programs At-Risk Summer School Program Health Insurance Mentor Teacher Program Preschool Handicapped Program Teachers' Retirement Lottery Programs Applied Technology Labs Instructional Technology Safe Schools Grant Technology Installation
CONTRACTS Community Affairs, Georgia Department of Governor's Emergency Funds To Purchase Materials for the Blue Ridge Elementary School
Education, Georgia Department of Implementation of School-Based Leadership Development Activities Governor's School Leadership Institute
1994-1995
OTHER Office of the Treasury and Fiscal Services Public School Employees Retirement Education, Georgia Department of Reimbursement for Student Information System Project
See notes to the general purpose financial statements.

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 5,698,839.00 817,479.00 111,422.00 236,052.00 76,403.00
1,001,m.oo
400,126.00
136,929.00 51,530.00 211,379.00
436,493.00
75,127.00
16,423.00
137,146.00 -1,381,058.00 -1,018,017.00 1,092,694.00
446,497.00 $
10,838.10
13,514.68 220,901.72
3,510.00
27,279.28

$ 5,698,839.00 817,479.00 111,422.00
236,052.00 76,403.00
1,001,m.oo

55,830.00

400,126.00 136,929.00
51,530.00
211,379.00 436,493.00
75,127.00 16,423.00 137,146.00 -1,381,058.00
-1,018,017.00 1,092,694.00
446,497.00 55,830.00 10,838.10

23,482.90

13,514.68 220,901.72
3,510.00
23,482.90
27,279.28

98,962.57 75,000.00 5,125.00 49,983.80

98,962.57 75,000.00 5,125.00 49,983.80

9,956.31

9,956.31

1,000.00

1;000.00

39,461.00 500.00

39,461.00 500.00

$ 9,474,202.09 $ 308,384.27 $ 9,782,586.36

- 31 -

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF TAXES AND OTHER REVENUE
YEAR ENDED JUNE 30, 1996

SCHEDULE "5"

Taxes County Wide School Tax Railroad Car Tax Real Estate Transfer Tax
Other Sources Donations Indirect Cost Special Revenue Fund Insurance Recovery Interest Earned Revenue in Lieu of Taxes Tennessee Valley Authority Sales Adult Meals Contracted Meals Lunches Supplemental Shared Service Contributions Gilmer County Board of Education Other

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE PROJECTS

FUND

FUND

FUND

TOTAL

$ 3,612,545.41 2,807.59
25,170.11

$ 3,612,545.41 2,807.59
25,170.11

1,800.00

4,633.00 29,076.00 156,844.24 $

$ 437,554.85 18,127.57

645,399.18

44,970.06 5,384.34
194,200.55 20,869.39

29,109.04 15,802.57

1,800.00
4,633.00 466,630.85 174,971.81
645,399.18
44,970.06 5,384.34
194,200.55 20,869.39
29,109.04 15,802.57

$ 4,523,187.14 $ 283,551.91 $ 437,554.85 $ 5,244,293.90

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

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 1996

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

$ 8,820,746.15 $
2,760,971.61 29,791.62 38,206.93 13,003.09 52,778.95 72,170.54 13,314.02 49,028.49 35,427.33 26,194.50
37,257.76 42,775.82 415,774.26 444,352.74
127,440.82 16,584.90
23,555.22

780,865.85 $
232,926.76 3,164.10
60,474.85
270.00 2,298.55
61.29
4,765.80
231,814.72
448,625.08 4,072.93 6,111.81 4,633.00 1,295.50

9,601,612.00 2,993,898.37
32,955.72 98,681.78 13,003.09 53,048.95 74,469.09 13,314.02 49,028.49 35,488.62 26,194.50
4,765.80 37,257.76 42,775.82 647,588.98 444,352.74 448,625.08 131,513.75 22,696.71
4,633.00 24,850.72

221,072.30 84,981.95
365,700.72

171,725.21

221,072.30 84,981.95
537,425.93

Total Expenditures

$ 13,691,129.72 $ 1,953,105.45 $ 15,644,235.17

See notes to the general purpose financial statements. - 33 -

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT
LOTTERY PROGRAMS YEAR ENDED JUNE 30. 1996

SCHEDULE "7"

EXPENDITURES
Operating Costs Supplies
Nonoperating Costs Equipment

APPLIED

TECHNOLOGY INSTRUCTIONAL

LABS

TECHNOLOGY

SAFE SCHOOLS
GRANT

TECHNOLOGY INSTALLATION

TOTAL

$

88,172.60

10.789.97 $

751497.89 $ 71285.81 $

$ 88,172.60 49.983.80 143.557.47

Total Expenditures $

98,962.57 $

75,497.89 $ 7,285.81 $

49,983.80 $ 231,730.07

See notes to the general purpose financial statements.

- 34 -

FANNIN COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1996

SCHEDULE "8"

Minimum Expenditure Requirements (Total Allotment)
Expenditures on Combined Program Basis Salaries (1) (2) Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expenditures per Audit

THIRTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF THIRTEEN WEIGHTED PROGRAMS

$ 7,000,938.00 $

208,811.00

$ 7,249,403.90 366,646.40 $ _ _ _31_3..:,.,8_4_9_.0_8
$ 7,616,050.30

-77,770.35 $ 7,538,279.95

Amount of Underexpenditure for Total Allotment

$

Note: (1) Salary accruals (July and August 1996 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 1995 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 $ ======0.0=0

See notes to the general purpose financial statements. - 35 -

FANNIN COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM ExpENDITURE REQUIREMENTS BY PROGRAM
GENERAL FUND QUALITY BASIC EDUCATION PROGRAMS
YEAR ENDED JUNE 30 1996

G!i;NERAL ANQ CARE!i;R E121,!CATION PROGRAMS Kindergarten (*) Grades 1 3 (*) Sub-Total K-3 Grades 4 5 (*) Grades 6 8 (*) Grades 9 12 (*) High School Laboratories (*) Vocational Education Laboratories (*) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs category 11 (*) category 111 (*l cateQOIY IV (*) Sub-Total Regular category V (Gifted) (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM (*l Total Thirteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs
Total Thirteen Weighted and Media Center Programs
STAFF DEl,'.!;;LOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Thirteen Weighted Programs. (1) Salary accruals (July and August 1996 Deferred
Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
See notes to the general purpose financial statements.

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

506,435.00

$

455,791.50 $

1,451,773.00

1,306,595.70

$ 1,958,208.00 90 $ 1,762,387.20 $

732,067.00 90

658,860.30

1,257,910.00 90

1,132,119.00

726,455.00 90

653,809.50

546,429.00 90

491,786.10

477,770.00 90

429,993.00

$ 5,698,839.00

$ 5,128,955.10 $

137,146.00 137,146.00
137,146.00

$

743,734.00

$

669,360.60 $

0.00

$

743,734.00 90 $

669,360.60 $

73,745.00 90

66,370.50

$

817,479.00

$

735,731.10 $

$

111,422.00 90 $

100,279.80 $

$ 6,627,740.00

$ 5,964,966.00 $

0.00
0.00 0.00 137,146.00

$

188,124.00 90 $

169,311.60 $

0.00

47,928.00 90

43,135.20

$

236,052.00

$

212,446.80 $

0.00

$ 6,863,792.00

$ 6,177,412.80 $

137,146.00

$

22,581.41

53,821.59

$

22,581.41 $

53 821.59

$

76,403.00 100 $

76,403.00 $

(2) Salary accruals (July and August 1995 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
0.00

- 36

SCHEDULE "9"

ITOTAL REQUIRED

ACTUAL EXPENDITURES SALARIES (1 )(2) OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

592,937.50 $

11306,595.70

$ 1,899,533.20 $

658,860.30

1,132,119.00

653,809.50

491,786.10

429,993.00

$ 5,266,101.10 $

635,530.76 $ 1,626,636.80 2,262,167.56 $
816,265.50 1,352,552.72
756,390.97 486,435.79 397,609.99 6,071,422.53 $

16,066.38 $

651,597.14

59 667.03

1,686,303.83

75,733.41 $ 2,337,900.97 $

30,766.31

847,031.81

55,260.21

1,407,812.93

47,791.46

804,182.43

36,855.70

523,291.49

35 524.64

433,134.63

281,931.73 $ 6,353,354.26

0.00 0.00 0.00 0.00 0.00 0.00

$

669,360.60

$

$

669,360.60 $

66,370.50

$

735 731.10 $

$

100,279.80 $

$ 6,102,112.00 $

107,898.43 578,109.74 $
28 525.74
714,533.91 $
96,521.90
811 055.81 $
105 900.53 $
6,988,378.87 $

$ 27,854.98
27,854.98 $ 2,394.91
30,249.89 $ 1,667.46 $
313,849.08 $

107,898.43 605,964.72
28,525.74
742,388.89
98,916.81
841,305.70
107,567.99
7,302,227.95

0.00 0.00
0.00

$

169,311.60 $

43,135.20

$

212,446.80 $

261,025.03 $
261,025.03 $

$ 52 797.32
52,797.32 $

261,025.03 52,797.32
313,822.35

0.00 0.00

$ 6,314,558.80 $ 7,249,403.90 $

366,646.40 $ 7,616,050.30 $

0.00

$

22,581.41

53,821.59

s _ _1_s_,4_o_3._oo_

$

22,581.41 $

22,581.41

53,821.59

53,821.59

$

76,403.00 $

76,403.oo s _ _ _ _ _ _o.o..o_

- 37 -

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS
YEAR ENDED JUNE 30, 1996

SCHEDULE "10"

BOARD MEMBER ADDRESS
Mr. Lewis Deweese, Chairman (*) P. 0. Box395 Blue Ridge, Georgia 30513
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
Mr. C. Anthony Walden (*) P. 0. Box 1596 Blue Ridge, Georgia 30513

COMPENSATION

TRAVEL

$

2,600.00 $

85.96'

2,100.00

150.50

2,500.00

93.00

2,700.00

306.63

2,400.00

67.00

$

12,300.00 $

703.09

======

(*) Denotes Board Members Serving as of June 30, 1996

See notes to the general purpose financial statements. - 38 -

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
February 26, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Fannin County Board ofEducation
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, 1996, and have issued our report thereon dated February 26, 1997. 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, 1996, 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 of Education 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.

96CRL-10

The results ofour tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards.
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,

CLV:gp 96CRL-10

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
February 26, 1997

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, 1996, and have issued our report thereon dated February 26, 1997. 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 of Federal Financial Assistance, for the year ended June 30, 1996:

( 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 of State 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.

96CRL-40

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 of this report. With respect to items not tested, nothing came to our attention that caused us to believe that Fannin County Board of Education 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 granter agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.

CLV:gp 96CRL-40

Respectfully submitted,
~~~
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
February 26, 1997

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 OPINION ON COMPLIANCE WITH SPECIFIC REOUIRE1\.1ENTS 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, 1996, and have issued our report thereon dated February 26, 1997. 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, 1996. 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.

96CRL-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 of Management 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 ouropmmn.
We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1996, 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 ofthis 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, 1996.
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:gp 96CRL-80

CLAUDE L. VICKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 26, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board ofEducation
and Superintendent and Members of the Fannin County Board of Education

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 ofEducation as of and for the year ended June 30, 1996, and have issued our report thereon dated February 26, 1997. 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.

In connection with our audit ofthe fiscal year 1996 general purpose financial statements of the Fannin County Board of Education and with our consideration of the Board's control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1996. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements goverrung:

(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.

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.

96CRL-120

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,

CLV:gp
96CRL-120

Claude L. Vickers State Auditor

SECTION III INTERNAL CONTROL

CuuoE L. V1cKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 26, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Fannin County Board ofEducation
REPORT ON INTERNAL CONTROL STRUCTURE 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, 1996, and have issued our report thereon dated February 26, 1997. 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, 1996, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
The management ofthe Fannin County Board of Education 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, 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
96ICL-3

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.
In planning and perfonning our audit ofthe general purpose financial statements of the Fannin County Board ofEducation for the year ended June 30, 1996, we obtained an understanding of the internal control structure. With respect to the internal control structure, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. 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 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.
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 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 ofEducation's financial statements and this report does not affect our report thereon dated February 26, 1997.
96ICL-3

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:gp 96ICL-3

CLAUDE L. VICKERS
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 26, 1997

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
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN 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, 1996, and have issued our report thereon dated February 26, 1997. 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 February 26, 1997.
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 Office of Management 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 ofEducation 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, 1996, 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, 1996, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions 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
96ICL-7

0MB 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 financlal statements in a separate report dated February 26, 1997.

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 of Effort, 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

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, 1996, the Fannin County Board of Education expended 61 % of its total Federal financial assisfance under major Federal financial assistance programs.

96ICL-7

We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements and specific requirements as descrioed above that are applicable to each of the 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 a certain matter involving the internal control structure and its operation that we consider to be a reportable condition 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, a reportable condition was 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 condition described above is also considered to be a material weakness.
This condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Fannin County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance programs for the year ended June 30, 1996, and this report does not affect our report thereon dated February 26, 1997.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal granter agencies and should not be used for any other purpose. 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:gp 96ICL-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, 1996
PRIO"R YEAR
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Finding Resolved Audit Control Number 6551-93-04
The audit report for the year ended June 30, 1993, reported 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, an 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 Finding Resolved Audit Control Number 6551-93-05
The audit report for the year ended June 30, 1993, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$10,387.99 for the StaffDevelopment - Professional Development Stipends Program. For the year under review, an 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: $70.12 Audit Control Number 6551-94-01
The audit report for the year ended June 30, 1994, reported that 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 ofthe Vocational Education Laboratories Program and $38.34 for the operations portion ofthe Remedial Education Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund these underexpenditures as required. The underexpenditure of$70.12 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE program in a subsequent fiscal year.
- 1-

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Excessive Lottery Cash Balances Financial Statements Finding Resolved Audit Control Number 6551-95-02
The audit report for the year ended June 30, 1995, reported that the Board had cash draws in excess of actual expenditures for the Lottery - Instructional Technology and Distant Learning programs. During the year under review, procedures were implemented to ensure that excess funds were not retained in these programs at year end. Subsequent to June 30, 1996, a review by the Georgia Department of Education has determined that a reclaim of funds is not appropriate.
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, 1995, stated that the Board did not provide for adequate separation of employee duties in the performance ofaccounting functions and related procedures for all funds. For the year under review, some improvement in adequate separation of employees duties was noted, however, the Board still did not attain an adequate separation of employee duties. This condition was a result of management'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 of internal control with existing staff.
Note: The Federal financial assistance program affected by this finding is the Elementary and Secondary Education Act - Title I Grants to Local Educational Agencies 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, 1995, 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 formal 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 formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in
- 2-

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996
PRIOll YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6551-93-03
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 ofland, 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.
EXPENDITURES/LIABILITIES/DISBURSEMENTS Unearned Per Diem Payments Financial Statements N onmaterial Noncompliance Amount: $11,000.00 Audit Control Number 6551-95-01
The audit report for the year ended June 30, 1995, stated that payments totaling $6,700.00 were made to Board members in excess of authorized limits. The Official Code of Georgia Annotated Section 20-2-55 provides, in part, as follows:
"members of the county board shall, when approved by the county board affected, receive a per diem of $50.00 for each day of attendance at meetings of the board... "
These questioned costs resulted from management making payments in the amount of $100.00 per meeting to each Board Member, however, local legislation providing for this amount was not enacted until April 9, 1996. During the year under review, additional payments in the amount of $4,300.00 were made to Board Members in excess of authorized limits.
The following Board members received per diem payments in excess of amounts authorized:
- 3-

FANNIN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996

PRIOR YEAR/CURRENT YEAR

EXPENDITURES/LIABILITIES/DISBURSEMENTS Unearned Per Diem Payments Financial Statements Nonmaterial Noncompliance Amount: $11,000.00 Audit Control Number 6551-95-01

Board Members

Prior Year Excess Payments

Current Year Excess Payments

Total Excess Payments

Culpepper, Marcella K.
Deweese, Lewis Sisson, Jim Staver, Isabell Sutton, Larry Walden, C. Anthony

$ 1,150.00 1,400.00 1,450.00 450.00 1,400.00 850.00

$ 750.00 950.00 900.00
850.00 850.00

$ 1,900.00 2,350.00 2,350.00 450.00 2,250.00 1,700.00

$ 6,200.Q0

$ 4,300.00

$ 11,000.00

Reimbursement of$11,000.00 should be secured and deposited to the Board's General Fund.

- 4-

SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

FANNIN COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30, 1996
ACCO" UNTING 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 cannot 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 staffthe Board has decided not to pursue the recording of general fixed assets on the financial statements.
EXPENDITURES/LIABILITIES/DISBURSEMENTS Unearned Per Diem Payments Financial Statements Nonmaterial Noncompliance Amount: $11,000.00 Audit Control Number 6551-95-01
We concur with this finding.