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

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GRADY 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 EXPENDITURES OF FEDERAL AWARDS

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE lRUST FUNDS

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE lRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE lRUST FUND

9

F NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

11

ADDillONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

28

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

30

FIDUCIARY FUND TYPES

K

COMBINING BALANCE SHEET

32

L

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

EXPENDABLElRUSTFUNDS

34

GRADY COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION I

FINANCIAL

ADDmONAL FINANCIAL INFORMATION

SCHEDULES

I SCHEDULE OF EXPENDTI1JRES OF FEDERAL AWARDS

36

2 SCHEDULE OF STATE REVENUE

38

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

39

ALLOTMENTS AND EXPENDTI1JRES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

40

5

BY SITE

41

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDmNG STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133

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

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

w. RUSSELL

HINTON

STATE AUDITOR

1404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 2, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members ofthe Grady County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements ofthe Grady County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility ofthe Grady County Board ofEducation's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opm1on.
As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

2001ARL-13

The general-purpose financial statements of the Board of Education did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles.
School activity accounts maintained at the individual schools are not included in the general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
The Board of Education did not recognize as expenditures, in the year ended June 30, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were improperly recorded in the year ended June 30, 2001. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Grady County Board ofEducation as of June 30, 2001, and the results of its operations and the cash flows of its nonexpendable trust fund for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated July 2, 2002, on our consideration ofthe Grady County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements ofthe Grady County Board ofEducation taken as a whole. The accompanying combining statements (Exhibits G through L) and the financial schedules (Schedules 1 through 5), which includes the Schedule ofExpenditures ofFederal Awards as required by U.S. Office ofManagement and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Pro.fit Organizations, are presented for purposes of additional analysis and are not a required part of the general-purpose
2001ARL-13

financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general-purpose financial statements and in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,
~-~
State Auditor
RWH:as 2001ARL-13

GRADYCOUNTYBOARDOFEDUCATION

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

ASSETS
Cash and Cash EquM1lents
Investments
Accounts ReceMlble
Prepaid Items
lnventones Food Donated Commodities Purchased Food
Amount Available in Debt SeMce Fund
Amount to be ProVKled In Future Years For Payment of Bond Debt

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 2,103,448 71 $ 364,914.86 $

459,535.23

33,000.00

6,421,364.00

218,351.05

540,463 81

334,877 34

21,963.49

16,019.65 14,83316

Total Assets

$ 2,376:76325 $ 936,231 48 $ 1,215,776 57

LIABILITIES AND FUND EQU!IY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retalnages Payable General Obhgation Bonds Payable
Total Uabihtres
FUND EQUITY
Fund Balances Reserved For Debt Service For Endowment Corpus For lnventones Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST ProJects For State Capital Outlay ProJects Urveserved Undeslgnated
Total Fund Equity

s

554,746 05 $ 171,457 38 $

266,530.88

2,308.59

7,149.25

17,982 04
47,994 67 94,152.63

$

557,054 64 $ 445,137 51 $

160,129.34

$
$ 1,819,708 61
s 1,819,708.61 $

16,019 65 14,833.16
$
460,241 16 491.093 97 $

5,758,087 22 925,327 01 172,715 00
199,518.00
7,055.647 23

Total Uablhbes and Fund Equity

$ 2.376.763.25 $ 936,231 48 $ 7,215,776 57

The notes to the general-pixpose financial statements are an Integral part of this statement -2-

EXHIBIT"A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST FUNDS

$

18,574.90

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 30. 2001

JUNE 301 2000

$ 2,946,473 70 $ 2,179,876.55

$

134,400.00

78,500.00

6,667,264.00

320,222.44

1,093,692.20

751,962.57

21,963.49

$

110,400.00

5,889.600 00

16,019 65 14,833.16 110,400.00
5.889.600.00

25,443.88 16,488.81

$

1341400 00 $

97074 90 $

610001000 00 $ 16?60.246 20 $ 3.293.994.25

$

24,000.00

$

24,000.00

$

768,185.47 $

619,627.25

266,530.88

293,113.63

9,457 84

91,722 95

47,994.67

94,152.63

$

6,000.000 00

6,000.000 00

s

6,000.000 00 $ 7.186.32149 $ 1,004,463.83

$

110,400.00

$

7,500 00

0.00

$

110.400.00 $

89,574.90 97 074 90

$

110,400.00

7,500.00 $

7,500.00

16,019.65 14,83316 5,758,087.22 925,327.01 172,715 00

25,443 88 16,488 81
10,182 00

2.569.042.67

2.229.915.73

$ 9.573.924 71 $ 2,289.530 42

$

1341400 00 $

97 074 90 $

s 610001000.00

16?601246.20 $ 3.2931994 25

-3-

----------------------- ----------- -------- -
GRADY COUNTY BOARD OF EDUCATION
COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS
YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of lnstrud1onal Services Educatlonal Media Se1V1ces General Adm1mstrat1on School Admimstratlon Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support SelVlces Food Services Operation Community Servu:es Operations
Capital Outlay Debt Service
Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES}
Proceeds from General Obligation Bonds Par Value
Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change 1n Penod Donated Commodities Purchased Food

GENERAL F.UND

GOVERNMENTAL FUND

SPECIAL REVENUE

CAPITAL PROJECTS

FUND

FUND

$ 19,861,091.69 $ 11,199 77
5,446,742 48 246,622 37
$ 25,565,656.31 $

821,775 22 $ 3,761,003.13
367,251.35
4,950,029 70 $

107,839.00
1,716,049 86 35411.99
1,859,300 85

$ 17,340,533 91 $
804,258.69 985,135 76 840,764.31 239,092.77 1,452,15317 182,000.30 2,160,078.19 1,019,245 59 154,319 51
324.87 24,615.93 65,376.10

2,386,370.60
93,802 02 483,850.28
13,703.34 134,097.26
$ 5,199 18 44,100.07
181,257.44 1,526,427.95
43,876.73

18,043 04 995,310.58

$ 25,267,899.10 $

$

297,757 21 $

4,912,684 87 $ 37,344 83 $

1,013,353.62 845 947 23

$

$

-10 670 44

$

-10,670 44 $

$ 5,670 44

6,000,000 00 5,000.00

5 670 44 $ 6,005,000 00

$

287,086.77 $

1,532,621 84

43,015.27 $ 459,158.58

6,850,947 23 204,700.00

-9,424 23 -165565

FUND BALANCE JUNE 30

$ 11819?0861 $

4911093.97 $

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

EXHIBIT"B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUNDS

TOTALS

{Memorandum Only)

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ 20,790,705.91

3,772,202.90

$

134,400.00

7,297, 192.34

649,285.71 $

$

134,400.00 $ 32,509,386.86 $

$ 10,330 67

20,790,705.91 $ 3,772,202.90 7,297, 192.34 659,616.38

19,460,951.13 3,355,247.24 5,416,568.95
619,772 06

10,330.67 $ 32,519,717 53 $ 28,852,539 38

$ 19,726,904.51

898,060.71 1,468,986 04
854,467.65 373,190 03 1,452,153.17 200,043.34 2,165,277.37 1,063,345.66 154,319 51 $ 181,582.31 1,551,043.88 109,252.83 995,310.58

$

24,000 00

24,00000

$

24,000.00 $ 31,217,937.59 $

$

110,400.00 $ 1,291,449.27 $

$ 19,726,904.51 $ 18,163,467.00

4,319.00 2,459.96

898,060.71 1,468,986 04
854,467 65 373,190.03 1,452,15317 200,043.34 2,165,277.37 1,063,345.66 158,658.51 181,582.31 1,551,043.88 111,712.79 995,310.58

1,245,290 23 1,329,231.00
804,518 55 368,918.28 1,351,829.40 190,742.42 2,075,808 43 944,112.99 168,230.02 190,013 77 1,617,972.65 76,817.50 68,300.00

24,000.00

6,778.96 $ 31,224,716 55 $ 28,595,252 24

3 551 71 $ 1,295,000 98 $

257,287 14

$ 6,000,000.00 10,670 44 -10 670.44
$ 6,000,000.00

$

110,400.00 $ 7,291,449.27 $

0.00

2,196,480.42

-9,424.23 -1,655.65

$ 6,000,000.00 10,670.44 $ -10 670.44
$ 6,000,000 00 $

63,174.00 -63,174.00
000

3,551.71 $ 84,967 07

7,295,000.98 $ 2,281,447 49

257,287.14 2,027,077.63

-9,424 23 -1,655 65-

-2,515 41 -401.87

$

110,400 00 $ 9,476,849.81 $

-5-

GRADY COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - tNON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30 2001

EXHIBIT "C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 19,156,585 00 $ 19,861,091 89

11,199 77

5,508,931 00

5,446,742 48

49,560 00

248,622 37

Total Revenues

$ 24,715,076 00 $ 25,565,656 31

EXPENDITURES

Current lnstrucbon Support SeMCes Pupil SeMceS Improvement of lnstrudlonal SeMCeS Educallonal Media SelVIC8s General Admin1strabon
School Adm1mstrabon
Business Adrmmstrabon Maintenance and Operabon of Plant Student Transportabon SelVIC8s Central Support SelVIC8S Other Support Services Food Services Operabon Community Services Operabons

$ 17,418,236 00 $ 17,340,533.91

746,850 00 871,623 00 831,375 00 239,400 00 1,475,135 00 189,725 00 1,854,732.00 907,750.00 175,450 00

804,25869 985,135 76 840,784 31 239,092 77 1,452,15317 182,000.30 2,160,078 19 1,019,245 59 154,319 51
324 87 24,615 93 65 376 10

Total Expenditures

$ 24,710,076 00 $ 25,267,899 10

Excess of Revenues over (under) Expenditures

$

5,00000 $

297 757 21

QTt!ER FltW:!CING SOURCES {USES)

Other Sources Other Uses

$

-5,000 00 $

-10 670 44

Total Other Financing Sources (Uses) $

-5,000 00 $

-10 670 44

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Fmanang

Uses

$

0 00 $

287,086 77

FUND B&,8NCE JULY l 2Q.QO

1,275,785 89

1,532,621 84

Food Inventory - Net Change 1n Penod Donated Commodities Purchased Food

FUND BALANCE JUNE 30 2001

s

1 215i755 89 s __1..,a.,.1..,e.,.1..,oa....,61__ 1

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 646,817 80 $ 821,775 22

2,851,207 00

3,761,003 13

363,500 00

367,251 35

$ 3,661,524 60 $ 4,950,029 70

s 1,577,289 60 $ 2,386,370 60

105,084 00 123,328 00
134,223 00

93,802 02 483,850 28
13,703 34 134,097 26

4,000 00 43,800 00

5,199 18 44,100 07

178,300 00 1,495,500 00

181,257 44 1,526,427 95
43 876 73

$ 3,661,524 60 $ 4,912,684 87

s

000 $

37 344 83

$

5,67044

$

5 670 44

$

0 00 $

43,015 27

280,879 45

459,158 58

-9,424 23 -1 655 65

s

280,879 45 $

491 093 97

The notes to the general-purpose financial statements are an integral part of 1h18 statement
-7-

GRADY COUNTY BOARD OF E0UCATION STATEMENT OF REVENUES. EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 2001

EXHIBIT "D"

OPERATING REVENUES None Recorded
OPERATING EXPENSES None Recorded Operating Income
NONOPERATING REVENUES Interest Earned Net Income
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

MILDRED PELHAM SCHOLARSHIP
FUND

TOTALS

{Memorandum Onl~)

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

0.00 $

0.00 $

0.00

$

0.00 $

0.00 $

0.00

$

0.00 $

0.00 $

0.00

473.19

473.19

360.11

$

473.19 $

473.19 $

360.11

8,082.93

8.082.93

7.722.82

$

8.556.12 $

8,556.12 $ ====a:!:::,o..a.2. ==93=

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

GRADYCOUNTYBOARDOFE0UCATION STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND
YEAR ENDED JUNE 30. 2001

EXHIBIT"E"

Cash Flows from Investing ActiVJties Interest Received on Investments Purchase of Investments
Net Increase (Decrease) in Cash
Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

MILDRED PELHAM SCHOLARSHIP
FUND

TOTALS

{Memorandum Onl::tl YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

47319 $

47319 $

360.11

-277.56

-277.56

-338 68

$

195.63 $

195.63 $

21.43

86049

860.49

83906

$

105612 $

1 05612 $-=-===8=6=-0...,49=

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

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Grady County Board ofEducation (School District) was established under the laws ofthe State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The School District uses funds and an account group to report on its financial position and the results ofits 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 School District. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School District, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of a School District's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.

- 11 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPES-the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUND Mildred Pelham Scholarship Fund - the fund used to account for an endowment ofwhich the corpus is to be invested and preserved intact with the resultant income to be used to provide college scholarships.
EXPENDABLE TRUST FUNDS Eleanor Kelley Scholarship Fund - the fund used to account for principal and earnings which may be expended to provide college scholarships.
Kenridge Fund - the fund used to account for the principal and earnings which may be expended to provide drug education programs.
Martin Lincoln Beller Trust Fund - t.l1e fund used to account for the principal and earnings which may be expended to provide deserving and/or needy children assistance in treatment ofeye diseases and blindness.
Wight Nurseries Scholarship Fund - the fund used to account for principal and earnings which may be expended to provide scholarships to graduating seniors.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding.

- 12 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO 1HE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE30,2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
All nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation of these funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2001, a substantial number ofpersonnel ofthe School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning

- 13 -

GRADY COUNIY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
in September 2000 and ending in August 2001. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the School District in the same twelve months. As of June 30, 2001, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30, 2001. Also, the State's portion ofthe compensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
The accrual basis ofaccounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis ofaccounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
BUDGET
The Grady County Board ofEducation's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure 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 School District's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.

- 14 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVESTMENTS

COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:

(1) Obligations issued by the State of Georgia or by other states,

(2) Obligations issued by the United States government,

(3) Obligations fully insured or guaranteed by the Uriited States government or a United

States government agency,



(4) Obligations of any corporation of the United States government,

(5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,

(7) Repurchase agreements, and

(8) Obligations of other political subdivisions of the State of Georgia.

RECEIVABLES

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

- 15 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 200 I

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PROPERTY TAXES

The Grady County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on October 8, 2000 (levy date). Taxes were due on December 20, 2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Grady County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% oftaxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $5,364,566.99.

The tax millage rate levied for the 2000 tax year (calendar year) for the Grady County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

13.7 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $1,850,449.86 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection ofthis tax once an additional $10,149,550.14 has been collected or on June 30, 2005 whichever occurs first.

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 2001, are recorded as prepaid items.

- 16 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL OBLIGATION BONDS
The School District issues general obligation bonds to provide funds for the acquisition and construction ofmajor capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The School District has the following types of interfund transactions:
Reimbursements of expenditures/expenses initially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
Operating transfen 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, results ofoperations or cash flows in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data.
Note 2: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13 .1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:

- 17 -

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

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 2: DEPOSITS AND INVESTMENTS
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities ofthe State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws ofthe 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 or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZATION OF DEPOSITS At June 30, 2001, the bank balances were $5,052,534.93. The amounts ofthe total bank balances are classified into three categories of credit risk:
Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the School District or by the School District's agent in the School District's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the School District's name.)
The School District's deposits are classified by risk category at June 30, 2001, as follows:

- 18 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 2: DEPOSITS AND INVESTMENTS

Risk Category

Bank Balance

1

$ 428,042.32

2

1,769,970.77

3

2,854,521.84

Total

$ 5.052.534.93

CATEGORIZATION OF INVESTMENTS At June 30, 2001, the carrying value of the School District's total investments was $6,555,764.00 which is materially the same as fair value. These investments were uninsured or unregistered with securities held by the counterparty's trust department or agent but not in the School District's name. These investments consisted solely of repurchase agreements.

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: RISK MANAGEMENT

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

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

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

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

- 19 -

GRADY COUNfY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 4: RISK MANAGEMENT

2000 2001

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

$

0.00 $

1,102.00 $

1,102.00 $

0.00

$

0.00 $

1,633.68 $

1,633.68 $

0.00

The School District participates in the Georgia School Boards Association Workers' Compensation Fund, a public entity risk pool organized on July I, 1992, to develop, implement, and administer a program ofworkers' compensation self-insurance for its member organizations. The School District 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 United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Fund in excess of $350,000.00 loss per occurrence, up to the statutory limit.

The School District has purchased surety bonds to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent All Other Employees

$ 15,000.00 $ 100,000.00

Note 5: OPERATING LEASES

Grady County Board ofEducation hac; entered into various leases as lessee for copiers. These leases are considered for accounting purposes to be operating leases. Lease expenditures for the year ended June 30, 2001, amounted to $103,525.46. Future minimum lease payments for these leases are as follows:

Year Ending

Amount

2002 2003 2004 2005

$ 107,380.24 17,255.34 16,500.00 5,500.00

Total

$ 146,635.58

Note 6: GENERAL LONG-TERM DEBT

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

-20-

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2001

Note 6: GENERAL LONG-TERM DEBT

Purpose

Interest Rate

Amount

General Government - Series 2001

3.60%

$ 6,000,000.00

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

General Obligation
Bonds

Balance July 1, 2000

$

0.00

Additions G.O. Bonds
Balance June 30, 2001

6.000.000.00
$ 6.000.000.00

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

Fiscal Year Ended June 30

General Obligation
Bonds

2002 2003 2004 2005

$ 275,000.00 2,300,000.00 2,040,000.00 1.385.000.00

Total Principal and Interest

$ 6,000,000.00

Note 7: SHORT-TERM DEBT

The School District obtains temporary loans in advance of property tax collections, depositing the proceeds in its General Fund. This short-term debt is to provide cash for operations until property tax collections are received by the School District. Article IX, Section V, Paragraph V of the Constitution of the State of Georgia limits the aggregate amount ofshort-term debt to 75 percent of the total gross income from taxes collected in the preceding year and requires all short-term debt to be repaid no later than December 31 of the calendar year in which the debt was incurred.

- 21 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 7: SHORT-TERM DEBT

Beginning Balance

Additions

Payments

Endmg Balance

Temporary Loans

$==-o~.o:!!,o $ 4so,ooo.oo $ 4so,ooo.oo $====="0""'.0..,.0

Note 8: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of $404,466.52 for health insurance and retirement contributions paid on the School District's behalfby the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $337,969.52

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $66,497.00

Note 9: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the School District as of June 30, 2001:

Project

Unearned Executed Contracts

00G/99S-665-025 Lottery Grady County Schools Re-roofing Projects

$ 75,663.94 42,525.84

$ 118, l 82.:Z8

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

Note 10: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.

- 22 -

GRADY COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 10: CONTINGENT LIABILITIES

The Grady County Board of Education is the defendant in a civil action, which is in the process of being reviewed by the Georgia Supreme Court. This potential claim arises from legal action being filed by a previous school superintendent to be compensated for the remaining term ofthis contract after being terminated by the Grady County Board of Education. On January 17, 2002, the School District was ordered by the Superior Court ofGrady County to designate an account or certificate in the amount of $300,000.00 for the purpose of paying damages that may accrue to the plaintiff.

Note 11: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school districts are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2001 2000 1999

100% 100% 100%

$ 1,984,151.53 $ 1,920,043.29 $ 1,940,267.05

- 23 -

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

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

517,091.16 $

84,896.29

16,337.06

16,019.65 14.83316

Total Assets

$

564.281 .03 $ ==-8=4=8=9=6.=29==

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

$

32,740.28 $

26,158.79

40,446.78

58,737.50

$

73.187.06 $

84.896 29

$

16,019.65

14,833.16

460.241.16 $

0.00

$

491.093.97 $

0.00

$

564,281.03 $-====84::::::lii:,8=96==29=

See notes to the general-purpose financial statements. - 24-

EXHIBIT"G"

FEDERAL PROGRAMS

TOTALS JUNE 30, 2001 JUNE 30, 2000

$

601,987.45 $ 569,507.29

$

524,126.75

540,463.81

513,524.57

16,019.65 14,833.16

25,443.88 16,488.81

$

524,126.75 $ 1,173,304.07 $ 1,124,964.55

$

237,072.59 $

237,072.59 $ 83,443.11

112,558.31

171,457.38

197,889.09

167,346.60

266,530.88

293,113.63

7,149.25

7,149.25

91,360.14

$

524,126.75 $

682,210.10 $ 665,805.97

$

$ ____o__.o__o____

$

0.00 $

16,019.65 $ 14,833.16
460,241.16
491,093.97 $

25,443.88 16,488.81
417,225.89
459,158.58

$

524,126.75 $ 1,173,304.07 $ 1,124,964.55

- 25-

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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation Community Services Operations
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
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

116,256.00 $

1,085,720.87

367,251.35

$ 1,569,228.22 $

663,722.75 663,722.75

$ $ 1,526,212.95

597,101.59
45,191.15 8,216.74
1,416.68 4,460.68 7,191.75
215.00

$ 1,526,212.95 $

$

43,015.27 $

663,793.59 -70.84

$

43,015.27 $

459,158.58

-9,424.23 -1,655 65

70.84
0.00 0.00

$

491,093.97 $ ==-==0==00=

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

EXHIBIT"H"

FEDERAL
PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

41,796.47 $

821,775.22 $

770,906.05

2,675,282.26

3,761,003.13

3,355,247.24

367,251.35

355,735.26

$ 2,717,078.73 $ 4,950,029.70 $ 4,481,888.55

$ 1,789,269.01 $ 2,386,370.60 $ 2,151,198.66

48,610.87 475,633.54
13,703.34 132,680.58
738.50 36,908.32 181,257.44
43,876.73

93,802.02 483,850.28
13,703.34 134,097.26
5,199.18 44,100.07 181,257.44 1,526,427.95 43,876.73

59,151.95 328,247.09
6,865.12 125,280.35
6,541.59 39,976.87 189,529.91 1,593,450.33 25,082.15

$ 2.722,678.33 $ 4,912,684.87 $ 4,525,324.02

$

-5,599.60 $

37,344.83 $

-43,435.47

5,599.60

5670.44

174.00

$

0.00 $

43,015.27 $

-43,261.47

0.00

459,158.58

505,337.33

-9,424.23 -1.655.65

-2,515.41 -401.87

$

0.00 $

491,093.97 $ -==4=5-=9=1'=58=.5=8==

-27 -

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

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Accounts Payable Contracts Payable Retainages Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity
Total Liabilities and Fund Equity

REGULAR

BOND PROCEEDS

$

199,518.00

$ 5,981,721.00

18354.17

$

199,518.00 $ 6,000,075.17

$

224,005 91

17,982.04

$

241,987.95

$ 5,758,087.22

$

199,518.00

0.00

$

199,518.00 $ 5,758,087.22

$

199,518.00 $ a 1000,01s.11

See notes to the general-purpose financial statements. - 28-

EXHIBIT"!"

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$

172,715.00 $

204,759.66 $

439,643.00

316,523.17

LOTTERY PROJECT

TOTALS

JUNE 30, 2001

JUNE 301 2000

106,548.48 $

683,541.14 $

204,700.00

6,421,364.00

334,877.34

$

172,715.00 $

960,925.83 $

106,548.48 $ 7,439,782.48 $====2=04====,7=00==00=

$

224,005.91

17,982.04

$

47,994.67

47,994.67

$

35,598.82

58,553.81

94,152.63

$

35,598.82 $

106,548.48 $

384,135.25

$

925,327.01

$

172,715.00

0.00

0.00 $

$

172,715.00 $

925,327.01 $

$
0.00 0.00 $

5,758,087.22 925,327.01 172,715.00 $
199,518.00
7,055,647.23 $

10,182.00 194,518.00 204,700.00

$

172.715.00 $

960,925.83 $

106,548.48 $ 7,439,782.48 $====2=04==,1=00=-=oo=

-29-

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

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

REGULAR

BOND PROCEEDS

$

0.00

$

28,390.35

$

0.00 $

28,390.35

$

18,043.04

$

0.00

$

0.00 $

18,043.04

$

0.00 $

10,347.31

$ 6,000,000.00

$

5,000.00

-252,260.09

$

5,000.00 $ 5,747,739.91

$

5,000.00 $ 5,758,087.22

194,518.00

0.00

$

199,518.00 $ 5,758,087.22

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

EXHIBIT"J"

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

SPECIAL PURPOSE LOCAL OPTION SALES TAX

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

0.00

$

107,839.00 $

107,839.00 $

0.00

$ 1,716,049.86

1,716,049.86

7,021.64

35,411.99

$

0.00 $ 1,723,071.50 $

107,839.00 $ 1,859,300.85 $

0.00

$ _ _ _ _0=._0_0__ $ $ _ _ _ _o_._oo_ $
$ _ _ _ _0.;;;.;.;;..0_0_ $

371,787.49 $ 371,787.49 $
1,351,284.01 $

$ 623,523.09 623,523.09 $ -515,684.09 $

18,043.04 995,310.58 $ ____s.,.a.s..._,3_o_o"'""._o__o__ 1,013,353.62 $ _ _ _s_8_,3_oo_._oo_ 845,947.23 $ _ _...;;-6'"""8""",3..;;.oo==ooa...

$ 6,000,000.00

$

172,715.00

$

505,502.09

683,217.09 $

$

-425,957.00

-678,217.09

$

172,715.00 $

-425,957.00 $

505,502.09 $ 6,005,000.00 $

63,000.00 63,000.00

$

172,715.00 $

925,327.01 $

-10,182.00 $ 6,850,947.23 $

-5,300.00

0.00

0.00

10,182.00

204,700.00

210,000.00

$

112.115.oo $

9251321.01 $====o=.o=o= $ 7,055,647.23 $====2=04==,1=00==00=

- 31 -

-- - - - - - - - - - - -
GRADY COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30, 2001

ASSETS Cash and Cash Equivalents Investments

NON EXPENDABLE TRUST FUND MILDRED PELHAM SCHOLARSHIP
FUND

ELEANOR KELLEY SCHOLARSHIP
FUND

$

1,056.12 $

2,504.02

7 500.00

25,000.00

Total Assets

$

8 556.12 $ ====2=7=1=,5=04==02=

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable
FUND EQUITY
Fund Balances Reserved For Endowment Corpus Unreserved Undesignated
Total Fund Equity

$

7,500.00

1 056.12 $ _ _..:2:.:..7..::,5c=.04..:..:..::.:02=-

$

81556.12 $ _ _....;;2;;.;.7..i..::,5=04...;.;.=02~

Total Liabilities and Fund Equity

$

8 556 12 $-=====2=7=,5=04==02=-

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

EXHIBIT"K"

EXPENDABLE TRUST FUNDS

MARTIN

LINCOLN

KENRIDGE

BELLER

FUND

TRUST FUND

WIGHT NURSERIES SCHOLARSHIP
FUND

TOTALS

JUNE 301 2001

JUNE 30, 2000

$

6,778.46 $

4,238.79 $

3,997.51 $

18,574.90 $

15,977.56

46,000.00

78,500.00

77,222.44

$

6,778.46 $

50,238.79 $

3,997.51 $

97,074.90 $===9=3=,2=0=0.,..00=

$ _ _ _....;1.;:;.so;:..;=00~

$

7,500.00 $

7,500.00

$

6,778.46 $

50,238.79 $ _ _ _3._,9_9_7_._51_

89,574.90

85,550.00

$

6,778.46 $

50,238.79 $

3,997.51 $

97,074.90 $ _ _ _9_3_,o_s__o___._oo_

$

6,778.46 $

3,997.51 $

97,074.90 $ =-====9-=3"=,2-=00==00=

- 33-

GRADY COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - EXPENDABLE TRUST FUNDS
YEAR ENDED JUNE 30, 2001

REVENUES
Other Funds EXPENDITURES
Current Support Services Central Support Services Community Service Operations
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1

ELEANOR KELLEY
SCHOLARSHIP FUND

KENRIDGE FUND

$

1,545.58 $

3,800.00

$

500.00

$

$

500.00 $

$

1,045.58 $

26,458 44

2,459.96 2,459.96 1,340.04 51438.42

FUND BALANCE JUNE 30

$

27,504.02 $ ===-=6=7=78==46=

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

EXHIBIT"L"

MARTIN LINCOLN BELLER TRUST FUND

WIGHT NURSERIES SCHOLARSHIP
FUND

TOTALS

YEAR ENDED

JUNE 301 2001

JUNE 30, 2000

$

2,925.23 $

2,059.86 $

10,330.67 $ _ _--'-7..a,5_5_"'""'1.;..9_1__

$

1,819.00 $

2,000.00 $

4,319.00 $

5,077.00

2,459.96

3,889.59

$

1,819.00 $

2,000.00 $

6,778.96 $

8,966.59

$

1,106.23 $

59.86 $

3,551.71 $

-1,414.68

49,132.56

3,937.65

84,967.07

86,381.75

$

50,238.79 $

3,997.51 $

88,518.78 $ --====--=84::::::!::,,9,..67==07_

- 35 -

- GRADY COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30 2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agnculture, U S Department of Child Nutnbon Cluster Pass-Through From Georgia Department of Educabon Food and Nutnbon Program Food SeMces School Breakfast Program Nabonal School Lunch Program

. 10 553 . 10,555

NIA $ NIA

269,961 97 730,833 86 $

(2) 1 441 287 91 (3)

Total Child Nutnt1on Cluster

$ 1,000,795 83 $

1,441,287 91

Other Programs Pass-Through From Georgia Department of Education Food and Nutnbon Program Food D1stnbubon Program (1) Fresh Produce Program (1)

10 550

NIA

10 550

NIA

72,925 04 12 000 00

72,925 04 12,000 00

Total U S Department of Agnculture

$ 1,085,720 87 $

1,526,212 95

Educabon, U S Department of Special Education Cluster Pass-Through From Georgia Department of Educabon lnd1v1duals with D1sab1hbes Educabon Act Part B - Special Educabon Flow Through Capacity Building Improvement Grant Preschool

84027 84173 84 173

NIA $ NIA
NIA

431,395 65 $ 6,066 14
34 133 72

431,395 65 6,066 14
34 133 72

Total Special Education Cluster

$

471,595 51 $

471,595 51

01her Programs

Pass-Through From Chattahoochee-Flint Regional

Educabonal Service Agency

Elementary and Secondary Educabon Act

T1Ue I

Migrant Education

84 011

NIA

Pass-Through From Georgia Department of Educabon

Elementary and Secondary Education Act

T1Ue I

Grants to Local Educational Agencies

84 010

NIA

Tltlell

Eisenhower Professional Development Trtlelll
Technology Literacy Challenge Fund Grants

. 84.281 84 318

NIA
NIA

T1UeVI Innovative Education Program Strategies

84 298

N/A

Class Size Reduction

84 340

N/A

Goals 2000

State and Local Education Systemic Improvement Grants 84 276

NIA

Vocational Educallon - Basic Grants to States

High School Program

Basic Grant

84048

NIA

118,889 73

118,889 73

961,510 73 31,069 73
417,645 44 34,296 52
133,993 00 44,313 95
61 491 10

961,510 73 31,069 73
417,645 44 34,296 52
134,535 51 (3) 45,052 38 (3)
61 491 10

Total U S Department of Education

$ 2,274,805 71 $

2,276,086 65

- 36 -

GRADY COUNTY BOARD OF EDUCATION

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

.

YEAR ENDED JUNE 30 2001

SCHEDULE "1"

FUNDING AGENCY
PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Labor, U S Department of Pass-Through From Georgia Department of Labor Job Training Partnership Act Workforce Investment Act Employment Service One-Stop Pass-Through From SOWEGA Councll on Aging, Incorporated Title V - Senior Community Service Employment Program

17 250 17 259 17 207
17 235

NIA $ N/A NIA

14,108 74 $ 29,767 99 11,19977

NIA

322,798 63

14,108 74 29,767 99 11,199 77
322,798 63

Total U S Department of Labor

$

377 875 13 $

377 875 13

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

$

33 801 19 $

38119 85 (3)

Total Federal Financial Assistance
NIA = Not Ava:lable

$ 3?721202 90 $ ~-4;,i21,_8.i,.29_,4;...58;;.

Notes to the Schedu\e of Expenditures of Federal Awards

(1) The amounts shown for the Food D1stnbut1on and Fresh Produce Programs represents the Federally assigned value of nonmonetary assistance for donated commod1t1es received and/or consumed by the system dunng the current fiscal year
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2001 National School Lunch Program
(3) Expenditures for this program include State, and/or Other Funds Expenditures are not maintained by fund source

MaJor Programs are

identified

by an

astensk

(0 )

in

front

of the

CFDA

number

The School D1stnct did not provtde Federal AsS1stance to any Subrec1p1ent

The accompanying schedule of expenditures of Federal awards mdudes the Federal grant act:vrty of the Grady County Board of Education and 1s presented on the modified accrual bas:s of accounting which 1s the bas:s of accounting used m the presentation of the general-purpose financial statements

See notes to the general-purpose financial statements

- 37 -

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

SCHEDULE "2"

AGENCYLfUNDING
GRANTS Education, Georgia Department of Quahty Basic Educallon Direct Instructional Cost Kindergarten Program Kindergarten Program - Early lntervenbon Program Pnmary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocabonal Laboratory (9-12) Program Students with D1sabdrtles Category I Category II Category Ill Category IV CategoryV Supplemental Speech Gifted Student - Category VI Remedial Educabon Program Altemallve Educabon Program Media Center Program Staff and Professional Development Indirect Cost Categoncal Grants Pupil Transportabon Regular Bus Replacement Nursing Services Pnnapal Supplements Vocabonal Supervisors Migrant Education Mid-term AdJustment Hold-Harmless Education Equalizabon Funding Grant Food Services VocabonalEducatlon Other State Programs Apprenticeship Program At-Risk Summer School Program Health Insurance lnnovabve Programs Mentoring Program Next Generation Schools Preschool Handicapped Program Remedial Summer School Lottery Programs Computers in the Classroom Exceptional Growth-Capital Outlay
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Pubhc School Employees Retirement
CONTRACTS Education, Georgia Department of Georgia's Reading Challenge Reading First Program

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 1,005,717 00 155,129 00
2,631,073 00 411,330 00
1,542,292 00 647,794 00
1,853,466 00 1,988,229 00 1,082,219 00
8,078 00 899,492 00 781,874 00
99,905 00 6,615 00 2,107 00
87,309 00 194,729 00 201,440 00 431,414 00 108,191 00 2,542,048 00

$ 1,005,717 00 155,129 00
2,631,073 00 411,33000
1,542,292 00 647,794 00
1,853,466 00 1,988,229 00 1,082,219 00
6,076 00 899,492 00 781,874 00
99,905 00 6,615 00 2,107 00
87,309 00 194,729 00 201,440 00 431,414 00 108,191 00 2,542,048 00

518,436 00 160,698 00 101,716 00
16,085 00 38,962 00
5,128.00 123,372 00 1,473,260 00
$ 116,256 00 76,245 81
48,798 26 5,991 46
337,969 52 5,000 00 3,165 08
75,000 00 61,478 00
4,840 76
92,633 00 $ 107,839 00

516,436 00 160,698 00 101,716 00
18,085 00 38,962 00
5,128 00 123,372 00 1,473,260 00 116,256 00
76,245 61
46,798 28 5,991 46
337,969 52 5,000 00 3,165 08
75,000 00 61,478 00
4,840 76
92,633 00 107,839 00

571,089 75

571,089 75

66,497 00

66,497 00

60,000 00

4179647

60,000 00 41 796 47

See notes to the general-purpose financial statements

e, $ 101e51 1oe1 69 $ e21i715 22 $ 1071839 00 $ 2oi70oi7os
- 38 -

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

SCHEDULE "3"

PROJECT
The construction of addlbonal dassrooms at the vanous schools within Grady County excepting Carro Hrgh School and the renovation of eXJstrng faahtres at each of the schools Within Grady County and to provide furnishings, equipment, and fixtures to be used In the above-desaibed renovated and expanded facilrtres. Also, the issuance of general obllgabon debt of the Grady County School Distnd in an amount not to exceed $6,000,000.00 for the purpose of financing the cost of the capital outlay projects of the Grady County School Drstrid descnbed
above

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS(2\

AMOUNT EXPENDED IN CURRENT YEAR (3) (4)

AMOUNT EXPENDED
IN PRIOR YEARS(3)

PROJECT STATUS

s $ 121000,000.00

12,000,000 00 $ 995,310.58 $

0.00 Ongoing

(1) The School Drstnct's original cost esbrnate as speafied in the resolution calhng for the 1mpos1bon of the Locat Opbon Sales Tax.
(2) The School Distnct's current esbmate of total cost for the proJect lndudes all cost from prOJed inception to completron.
(3) The voters of Grady County approved the rmposrtron of a 1% sales tax to fund 1he above proiect and retire assoaated debt Amounts expended for this proJect may mdude sales tax proceeds, state, local property taxes and/or other funds over the life of the projed
(4) In addrtron to the expenditures shown above, the School District incurred current year Interest expenditures In the amount of $24,000 00 to provide advanced funding for the above pro)8ct.

See notes to the general-purpose finanaal statements

-39-

GRADY COUNTY BOARD OF EDUCATION
GENERAL FUND QUALITY BASIC EDUCATION PROGRAM IOBEl ALLOTMENTS AND EXPENDITURES - BY PROGRAM
YEAR ENDED JUNE 30, 2001

SCHEDULE "4"

DESCRIPTION

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

Direct Instructional Programs

Kindergarten Program

$

Kindergarten Program-Early lntervenbon Program

Pnmary Grades (1-3) Program

Pnmary Grades-Early Intervention (1-3) Program

Upper Elementary Grades (4-5) Program

Middle Grades (6-8) Program

Middle School (6-8) Program

High School General Education (9-12) Program

Vocational Laboratory (9-12) Program

Students wrth Dlsabihties

Category I

Category II

Category Ill

Category IV

Gifted Student Category VI

Remedial Education Program

Alternative Education Program

1,117,03500 $ 172,300.00
2,922,295.00 456,859.00
1,713,003.00 719,496.00
2,058,618.00 2,208,298.00 1,202,005.00 1,994,869.00
96,974.00 216,284.00 223.737.00

1,201,168.49 $ 123,353.97
3,129,115.08 417,795.88
1,847,24947 746,476.97
2,344,635.95 2,641,452.34
948,774.94
20,044.91 730,645 38 880,278.27 102,224.81 112,758.44 132,519.06 226,475 08

27,311.48 $
136,766.63
75,264 41 32,566.86 82,939.78 160,387.52 57,023.18
80416 6,878.82 8,019.28 1,354 87 2,321.88
71.00 1,480 21

1,228,479.97 123,353 97
3,265,881.71 417,795.88
1,922,513 88 779,043 83
2,427,575.73 2,801,839.86 1,005,798 12
20,849.07 737,524.20 888,297.55 103,579.68 115,080.32 132,590.06 227,955.29

TOTAL DIRECT INSTRUCTIONAL PROGRAMS

$

15,101,773.00 $ 15,604,969 04 $ 593,190.08 $ 16,198,159 12

Medi& Center Program Staff and Professional Development

479,164.00 120,167.00

597,395.55 70,026 43

132,330 49 56,413 74

729,726.04 126,440.17

TOTAL QBE FORMULA FUNDS

$

(1) Compnsed of State Funds plus Local Frve Mill Share.

See notes to the general-purpose financial statements.

-40-

GRADY COUN1Y BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2001

SCHEDULE ~5"

SITE
Washington Middle School Eastside Elementary School Cairo High School Whigham Elementary School Northside Elementary School Southside Elementary School Shiver Elementary School Central Office (Alternative Education Program) Other Auxiliary Facility
TOTAL
(1) Comprised of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

2,613,038.00 $

3,110,370.46

1,949,239.00

2,172,989.23

4,022,905.00

4,320,147.91

1,286,377.00

1,409,352.24

1,277,818.00

1,357,068.87

2,450,697.00

2,408,881.55

1,277,962.00

1,270,474.79

223,737.00

57,330.80

91,543.27

$ 15,101,773.00 $ 16,198,159.12

See notes to the general-purpose financial statements. - 41 -

SECTIONil COMPLIANCE AND INTERNAL CONTROL REPORTS

w. RUSSELL

H1NTON

STATE AUDITOR

(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, SW., Suite 214 Atlanta, Georgia 30334-8400
July 2, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Grady County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the :financial statements ofGrady County Board ofEducation as ofand for the year ended June 30, 2001, and have issued our report thereon dated July 2, 2002. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose :financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Grady County Board of Education's :financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Grady County Board of Education's internal control over :financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2001YB-41

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Grady County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6651-01-01.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-6651-01-01 to be a material weakness.
This report is intended solely for the information and use ofthe management, members ofthe Grady County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
~-~ .--...R_espectfully submitted,

RWH:as 200IYB-41

State Auditor

R.ussELL W. H1NTON
STATE AUDITOR 1404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S. W., Suite 214 Atlanta, Georgia 30334-8400
July 2, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Grady County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance ofGrady County Board ofEducation with the types ofcompliance requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2001. Grady County Board of Education's major Federal programs are identified in the Summary ofAuditor's Results Section of the accompanying Schedule ofFindings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Grady County Board of Education's management. Our responsibility is to express an opinion on Grady County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and 0MB Circular A133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and 0MB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Grady County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Grady County Board of Education's compliance with those requirements.
2001SA-10

In our opinion, the Grady County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 2001.
Internal Control Over Compliance
The management of Grady County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Grady County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with 0MB Circular A-133.
Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course ofperforming their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use ofthe management, members ofthe Grady County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:as 2001SA-10

State Auditor

SECTIONIB AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

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

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6651-99-02 FS-6651-00-01

Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6651-00-01

The School District has, during the subsequent period, employed a valuation services organization to assist them with set up of a General Fixed Assets System to be utilized in subsequent periods.

SECTION IV FINDINGS AND QUESTIONED COSTS

GRADY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENJ?ED JUNE 30, 2001
I SlJM?v1ARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Grady County Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Grady County Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit ofthe Grady County Board ofEducation disclosed no instances ofnoncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Grady County Board of Education did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Grady County Board ofEducation's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .510{a) ofOMB Circular A-133 The Grady County Board ofEducation's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.318 Elementary and Secondary Education Act - Title ill - Technology Literacy Challenge Fund Grants 17.235 Title V - Senior Community Service - Employment Program
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Grady County Board of Education qualified as a low risk auditee based on a waiver granted by the U.S. Department of Education.
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GRADY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 2001
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-6651-01-01 The Grady County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements ofthe School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the School District and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained ofall additions and deletions to the General Fixed Assets Account Group. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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