AUDIT REPORT GREENE COUNTY BOARD OF EDUCATION
GREENSBORO, GEORGIA YEAR ENDED JUNE 30, 1998

GREENE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

8

ADDmONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

21

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

23

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILmES

AGENCY FUND

24

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

25

2 SCHEDULE OF STATE REVENUE

27

3 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

28

GREENE COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

SCHEDULES

ADDmONAL FINANCIAL INFORMATION

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

29

5

BY PROGRAM

30

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

SECTION ill 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

RUSSELL W. HINTON
STAlE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
March 29,1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Greene County Board ofEducation
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 of the Greene County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility of the Greene 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 generally accepted auditing standards and the standards !lPplicable to financial audits contained in 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 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.
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:
* 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.

98ARL-13A

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 puryose financial statements.
The Board did not recognize as expenditures, in the year ended June 30, 1998, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, 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, 1997, were improperly recorded in the year ended June 30, 1998. 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.
Govermnental Accounting Standards Board Technical Bulletin 98-1, Disclosures About Year 2000 Issues, requires disclosure of certain matters regarding the year 2000 issue in order for financial statements to be prepared in conformity with generally accepted accounting principles. Such required disclosures include:
(> Any significant amount of resources committed to make computer systems and other electronic equipment year 2000 compliant;
(> A general description of the year 2000 issue, including a description of the stages of work in process or completed as of the end of the reporting period to make computer systems and other electronic equipment critical to conducting operations year 2000 compliant.
(> The additional stages of work necessary for making the computer'systems and other electronic equipment year 2000 compliant.
Greene County Board of Education has omitted such disclosures. We do not provide assurance that Greene County Board of Education is or will be year 2000 ready, that Greene County Board of Education's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Greene County Board of Education does business will be year 2000 ready.
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 of the Greene County Board ofEducation as of June 30,1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Govermnent Auditing Standards, we have also issued our report dated March 29,1999, on our consideration of the Greene County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions oflaws, regulations, contracts and grants.
98ARL-13A

Our audit was performed for the purpose offorming an opinion on the general purpose financial statements
n of the Greene County Board of Education taken as a whole. The accompanying combining and individual
fund statements (Exhibits E through and the fmancial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes ofadditional analysis and are not a required part ofthe general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe 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 presented in all material respects in relation to the general purpose financial statements taken as a whole.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
Respectfully submitted,
~ tlJ.~=ih Russell W. Hinton State Auditor
RWH:jb 98ARL-13A

GREENE COUNTY BOARD OF EDUCAnON

GREENE COUNTY BOARD OF EDUCATION COMBINEP BALANCE SHEET
AlL FUND TYPES AND ACCOUNT GROUP JUNE 30 1998

Cash and Cash Equivalents
Invesbnents
Investments Held by Trustee
Accounts Receivable
Prepaid Items
Inventories Food Donated Commodities Purchased Food
Amount Available in Debt Servloe Fund
Amount to be Provided in Future Years For Payment at Bond Debt Capital Lease Agreements

GENERAL FUND
197,423.66
2,402,352.49

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

164,820.73

425.01

103,433.25

6,209.689.22

154.361.19 19.169.45

136.357.52 3.974.05

16.377.79 6.164.87

Total Assets
LIABILITIES ANp FUND EqUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balanoes Payable Contracts Payable Defened Compensation Plan Capital Lease Agreements . General Obligation Bonds Payable
Total Uabllllles
FUND EqUITY .
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Debt Service For Inventories Food Donated Commodllles Purchased Food For Purposes of Bond Issue For State Capital Outiay Projects Unreserved Undesignated
Total Fund Equity

2.773.306.79

433.128.21

6.210.114.23

32.763.20 153.229.00 22.516.09

37.151.34

208508.29 $ _ _-,3",7...1..5. ",1",..3.4.

Total L1abilllles and Fund Equity The notes to the general purpose financial statements are an integral part of thIs statement.
-2-

EXHIBIT "A"

DEBT SERVICE
FUND
15,472.80

FIDUCIARY FUND TYPE AGENCY FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

473,827.03

TOTALS (Memorandum OnM JUNE 30 1998 JUNE 30, 1997

378.142.00 $

427,811.78

8.715.474.98

2.118,420.88

473,827.03

390,882.91

292,718.71

275,321.03

23,143.50

18,377.79 8,164.87

20,258.42 8,164.33

$

15,472.80

15,472.80

8,234,527.40 279,848.88

8,234,527.40 279846.88

7,051.78

$

15472.80 $

473827.03 $

8,529 848.88 $ 18,435.495.64 $ 3245710.91

473,827.03 $
473,827.03

$
279.848.88 8250000.00 8.529.846.88 $

89,914.64 153,229.00
22,518.09
473,827.03 279,848.88 8.250,000.00
7.249.133.34 $

54,733.51 143,804.08 38.822.29
8,980.00 390.882.91
.7,051.78
839,674.57

$

15,472.60

0.00

$

15.472.60

$

15.472.60

0.00 0.00
473,627.03

113,708.33 $ 9,325.65 15.472.60

50.501.91 24,113.16

16.377.79 6.164.87 5.872,962.89 500.000.00
2.852,350.07
9.186.362.20

20.258.42 6,164.33
500,000.00
2.004,998.52
2.608,036.34

6.529 848.88

16.435495.64

3.245,710.91

-3-

GREENE COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOIIERNMENTAL FUND TYPES YEAR ENDED JUNE 30 1998

EXHIBIT"B"

CAPITAl PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$

6,000,00

7,076,33 $

$

13,076.33 $

$
8,16 8.16

8,490,161,82 .$ 1,985,539.18 4,712,327,09
524,567,47
15,712,595,66 $

8,398,036.66 1,797,533.15 4,237,908.14
535,587,10
14,969,065.05

$

84,113.44

6,000.00

$

$

90,113.44 $

$

-77,037.11 $

$
15.00 15,00 $ -6.84 $

9,162,396,33 $
748,761.81 669,086.72 624,323.97 435,227,29 972,214.58 247,911.41 1,005,867.53 847,126.52
88,655.71 63,392.92 958,113.12 20,908.04 13,704.00
119,884,01 6,959.00 15.00
15.786.527.96 $
-73,932.40 $

8,476,877.74
432,360,02 500,733,50 286,679.11 327,605.01 965,344,74 208,247.40 1,002,225.49 655,659.50 62,346,27 66,372.43 953,442,57
826.96 153,410.65
60,457.84 4,559.83
14,157,149,06
811,915.99

$ $ 6,250,000,00
-500,000.00 $ 5,750,000,00
$ 5,672,962.89 500,000.00

15,479.44 $ 15.479.44 $

15,479.44
6,250,000,00 392,658.91 500,000.00 -500,000,00
6,658,138.35

15,472.60 $ 0.00

6,584,205.95 2,606,036.34

-3,880,63 0.54

811,915.99 1,785,837,60
6,245,37 2,037.38

$ 6,172,962.89 $

15.472.60 $ 9,186,362,20 $ 2,606,036.34 -5-

GREENE COUNJY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL INON.(3AAP BASIS)
GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30 1998

EXHIBIT"C"

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

GREENE COUNTY BOARD OF EDUCATION

EXlllBIT "0"

NOTES TO TIlE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Greene County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board 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 Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board 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 fmancial 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.
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 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 ofspecific 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 ofEducation and from the Federal government to accomplish specific educational objectives.
-8

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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, generallong-tenn 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:
AGENCY FUND - the fund used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding 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 this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (Le., revenues and other financing sources) and decreases (Le., expenditures and other fmancing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be fmanced 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-Tenn Debt Account Group.
Agency funds are purely custodial in nature and do not involve measurement of results ofoperations.
Governmental funds are accounted for using the modified accrual basis ofaccounting 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 detennined 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.
Expenditures are generally recognized when the related fund liability is inciuTed.
- 9-

GREENE COUNTY BOARD OF EDUCATION

EXlllBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in early June 1998. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. State grants to fimd the State's share ofthese contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months, As of June 30, 1998, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30,1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were recorded in,the year ended June 30, 1998. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incuiTed, rather than when fimds are received or disbursed.

Agency fimds are accounted for using the modified accrual basis of accounting in recognizing assets and

liabilities.

'

BUDGET

The Greene County Board ofEducation's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable fimding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental fimds is prepared by fimd, fimction and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental fimds 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 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, 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.

10

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits 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.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations ofany 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.
INVESTMENTS HELD BY TRUSTEE
Investments held by trustee consist of contributions from employees who have elected to participate in the Board's deferred compensation plan. See Note 9 Deferred Compensation Plan
- 11 -

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RECEIVABLES

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

PROPERTY TAXES

The Greene County Board ofCommissioners fixed the property tax levy for the 1997 tax year (calendar year) on September 15,1997 (levy date). Taxes were due on November 15, 1997. The lien date for property taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1998. The Greene County Tax Commissioner bills and collects the property taxes for the Board ofEducation, withholds 2.5% oftaxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

The tax millage rate levied for the 1997 tax year (calendar year) for the Greene County Board ofEducation was as follows (a mill equals $1 per thousand dollars of assessed value):

School ()perations

ll..QQmills

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 offund 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, 1998, are recorded as prepaid items.

- 12-

GREENE COUNTY BOARD OF EDUCATION

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL OBLIGATION BONDS
The Board issues general obligation bonds to provide funds for the acquisition and construction of major 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 of the government. The outstanding amount ofthese bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements of expenditures 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 ofoperations 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 of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the 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 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 ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists ofanyone ofor any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
- 13-

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 2: DEPOSITS AND INVESTMENTS

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,

(4) Bonds, bills, notes, certificates ofindebtedness or other obligations ofthe counties or municipalities of the State of Georgia,

(5) Bonds ofany public authority created by the laws of the State ofGeorgia, 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, 1998, the bank balances were $1,292,586.84. The amounts of the total bank balances are classified into three categories ofcredit risk:

Category 1 - Cash that is insured (e.g., Federal depository insiJrance) 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, 1998, as follows:

Risk Category

Bank Balance

I

$ 204,104.74

2

1,088,482.10

3

0.00

Total

$ 1 292 586.84

- 14-

GREENE COUNTY BOARD OF EDUCATION

EXlllBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 2: DEPOSITS AND INVESTMENTS
CATEGORIZATION OF INVESTMENTS At June 30, 1998, the carrying amount ofthe Board's total investments was $9,189,101.99 which consisted of $8,715,474.96 invested in the Local Government Investment Pool and $473,627.03 in Deferred Compensation Plan pooled investments.
The carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy ofthe State of Georgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool (primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. Deferred Compensation Plan pooled investments are categorized as unclassified pool investments. A description ofthe Primary Liquidity Portfolio is as follows:
The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool is not registered with the SEC as an investment company. The pool's primary
objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings
(net ofmanagement fees) on a monthly basis and determines participant's shares sold and redeemed based
on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which
approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist offunds from local governments; operating and trust funds ofGeorgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.
Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its
agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. Fund 6 maintains a duration of approximately one year. The weighted average maturity for Georgia Fund 1 on June 30, 1998 was 29 days. The average investment duration for Fund 6 on June 30, 1998 was .96 years.
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

- 15 -

GREENE COUNTY BOARD OF EDUCATION

EXlllBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

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 ofloss associated with torts, assets, errors or omissions and natural disaster. The Board has not significantly reduced coverage for these risks in any ofthe past three years.

For the 1996 fiscal year, a gender discrimination lawsuit settled by the Board exceeded commercial insurance coverage by $200,000.00. Under the terms of the settlement agreement, $565,000.00 was awarded to the defendant The National Union Fire Insurance Company ofPittsburgh paid $355,000.00 of the total sum, and the former Superintendent paid $10,000.00, with the remainder of the loss being absorbed by the Board. Settled claims did not exceed commercial insurance for the 1997 fiscal year or the current fiscal year.

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 of that loss can be reasonably estimated.

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

1997 1998

Beginning ofYear Liability

Claims and Changes in Estimates

$

0.00 $

5.094.00 $

$

0.00 $

6.513.00 $

Claims Paid

End ofYear Liability

5.094.00 $

0.00

6.513.00 $

0.00

The Board participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December I, 1991 to develop,.implement and administer a program of workers' compensation self-insurance for its member organizations. The Board pays an armual premium to the Trust for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Trust with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust in excess of $250,000.00 loss per occurrence, up to $2,000,000.00.

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

Position Covered

Superintendent All Other Employees

$ 100,000.00 $ 100,000.00

- 16 -

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Greene County Board of Education has entered into various lease agreements as lessee for buses and equipment. 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.

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

Purpose

Interest Rates

Amount

General Govermnent - Series 1998

3.75% - 4.15 % $ 6 250 000 00

The changes in General Long-Term Debt during the fiscal year ended June 30,1998, were as follows:

Balance July 1, 1997 Additions Deductions Balance June 30, 1998

Capital Leases $ 7,051.78
392,658.91 119,864.01 $ 27984668

General Obligation
Bonds

$

0.00

6,250,000.00

$ 6 250000 00

Total $ 7,051.78
6,642,658.91 119,864.01
$ 6 529 846 68

At June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30
1999 2000 2001 2002 2003 2004
Total Principal and Interest
Deduct: Imputed Interest
Net Present Value of Future Minimum Lease Payments

Capital Leases
$ 121,647.90 121,647.90 34,004.54 34,004.54 491.33
$ 311,796.21
31.949,53

General Obligation
Bonds
$ 211,083.33 498,612.50
1,371,212.50 1,521,500.00 1,613,750.00 2,041.500.00
$ 7,257 658 33

Total Debt
$ 332,731.23 620,260.40
1,405,217.04 1,555,504.54 1,614,241.33 2,041.500.00
$7 569 454 54

$ 27984668

- 17 -

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 6: ON-BEHALF PAYMENTS
The Board has recognized revenues and expenditures in the amount of$226,883.03 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.
Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $162,502.80
Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$31 ,424.23
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 $32,956.00
Note 7: SIGNIFICANT COMMITMENTS
Governmental Accounting Standards Board Technical Bulletin 98-1 requires certain disclosures in the Notes to the General Purpose Financial Statements concerning an entity's computer related year 2000 readiness. These disclosures, which are necessary to comply with generally accepted accounting principles, have not been made by the Board.
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 iInn!.aterial 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: DEFERRED COMPENSATION PLAN
The Board offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Board employees, permits them to defer a portion of their salary until future years. Participation in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency.
- 18 -

GREENE COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1998

Note 9: DEFERRED COMPENSATION PLAN

All amounts ofcompensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the propertY and rights of the Board subject only to the claims of the Board's general creditors. Participants' rights under the plan are equal to those of general creditors of the Board in an amount equal to the fair market value of the deferred account for each participant.

It is the opinion of the Board that the Board has no liability for losses under the plan but does have the duty ofdue care that would be required ofan ordinary prudent investor. The Board believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future.

Investments are managed by the plan's trustees, Variable Annuity Life Insurance Company and Hartford Insurance Company. Under this plan, participants select from an investment option, or combination of investment options.

On August 20, 1996, Federal laws governing Internal Revenue Code Section 457 plans were changed to require all assets and income of the plan to be held in trust for the exclusive benefit of the participants and their beneficiaries. The Board is required to comply with this requirement by January 1, 1999.

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 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 fmancial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% oftheir 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. The required employer contribution rate is 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year
1998 1997 1996

Percentage Contributed
100% 100% 100%
- 19-

Required Contribution
$ 1,006,103.62 $ 921,359.09 $ 853,630.87'

GREENE COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30 1998

EXHIBIT"E"

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Prepaid Items
Inventories Food Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS JUNE 30,1998 JUNE 30, 1997

122.442.75 $

41,038.22 $

1,339.76 $

164,620.73 $

237,255.75

103,433.25

103,433.25

7,40624

130.951.28

138,357.52

150,708.85

3,974.05

3.974.05

16,37779 6,164.87

16.377.79 6,164.87

20.256.42 6.164.33

Total Assets

259.798.95 $

41,038.22 $

132.291.04 $

433.128.21 $

414,387.35

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable Salaries Payable Expired Grant Balances Payable

Total Liabilities

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignaled

Total Fund Equity

$

2,870.70 $ 41,633.98 44,504.68 $
16,377.79 6,164.87 192,751.61 $ 215,294.27 $

9,052.38 $ 31,985.64
41,038.22 $

20.640.12 $ 79.609.18 22.516.09
122,985.39 $

32.783.20 $ 153.229.00 22,516.09
208,508.29 $

49,348.57 141,508.81 36,622.29
227,47767

0.00 0.00 $

9,325.85 $

9.325.65 $

24,113.16

0.00 9,325.65 $

16.377.79 6.164.87
192,751.61
224,619.92 $

20.258.42 6,164.33
136,373.77
186.909.68

Total Liabilnies and Fund Equity

259,798.95 $

41.038.22 $

132,291.04 $

433,128.21 $

414,387.35

See notes to the general purpose financial statements.

- 20-

GREENE COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30 1998

EXHIBIT"P

REVENUES
State Funds Federal Funds other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil services Improvement of Instructional Services Educational Media Services General Adminisb'ation School Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay Debt Service
Principal
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Capital Leases 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 in Period Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30 1998 JUNE 30, 1997

71,306.00 $ 841,926.41 101,258.55
1,014,490.96 $

368,726.21 368,726.21

$ 1,114,859.92

440,032.21 $ 1,956,786.33
101,258.55

1,114,859.92 $' 2,498,077.09 $

400,n9.87 1,738,098.48
106,471.09
2,245,349.44

958,113.12
958,113.12 $ 56,377.84 $

300,157.13 $ 34,695.33 2,998.21 17,218.30 1,680.09 11,240,80 736.35
368,726.21 $ 0.00 $

963,234.65 $
22,144.55 64,896.41
43,708.50 53,713.72
8,350.83 26,412.55 46,396.34
1,245.54 7,704.00
24,102.61
1,261,909.70 $
-147,049.78 $

1,263,391.78 $
56,839.88 67,894.62
60,926.80 53,713.72 10,030.92 37,653.35 47,132.69 958,113.12
1,245.54 7,704.00
24,102.61
2,588,749.03 $
-90,671.94 $

897,688.75
65,262.42 60,714.33 11,560.02 41,643.45 52,909.01 15,484.22 45,318.79
46,909.09 953,442.57
826.96
2,191,759.61
53,589.83

56,377.84 $ 162,796.52
-3,880.63 0.64

66,856.88 $ 65,405.93
-0.54

66,856.88 65,405.93
-0.54

$

132,262.27 $

132,262.27

0.00 $ 0.00

-14,787.51 $ 24,113.16

41,590.33 $ 166,909.68

53,589.83 125,037.10

-3,880.63 0.54

6,245.37 2,037.38

FUND BALANCE JUNE 30

215r294.27 $

0.00 $

9,325.65 $

224,619.92 $

186,909.68

See ootes to the general purpose financial statements.

-21 -

GREENE COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30 1998

EXHIBIT"G"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

BOND PROCEEDS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

TOTALS

JUNE 30, 1998

JUNE 30, 1997

$

425.01

$

425.01

5,709,689.22 $

500,000.00

6,209,689.22 $

500,000.00

6,980.00

Total Assets

$ 5,710,114,23 $

500,000.00 $ 6.210,114.23 $

50M80,00

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable Contracts Payable

$

37,151.34

Total Liabilities

$

37,151.34

FUND EQUITY

Fund Balances Reserved For Purposes of Bond Issue For Stale Capital Ouaay Projects Unreserved Undesignated

$ 5,672,962.89 $
0.00

Total Fund Equity

$ 5,672,962.89 $

$

37,151.34

$

$

37,151.34 $

$ 500,000.00
0.00
500.000.00 $

5,672,962.89 500,000.00 $
0,00
6,172,962,89 $

6,980.00 6,980.00
500,000.00 0,00
500,000,00

Total Liabilities and Fund Equity

$ 5?10,114.23 $

500,000.00 $ 6,210,114,23 $

506,980.00

See notes to the general purpose financial statements.

-22-

GREENE COUNTY BOARD OF EPUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PRQJECTS FUND YEAR ENDED JUNE 30 1998

EXHIBIT"H"

BOND PROCEEDS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

TOTALS

YEAR ENDED

JUNE 30, 1998

JUNE 30, 1997

~
Stale Funds other Funds

$

6,000.00 $

6,000.00

$

7,076,33

7,076.33

16,980,00

Total Revenues

7,076,33

6,000.00

13,076,33

16,980.00

EXPENDITURES

Current Support SelVices Business Administration
Capital Outlay Professional and Technical Services

$

84,113.44

$ 6,000.00

84,113.44 6,000.00

16,980.00

Total Expenditures

84,113.44

6,000.00 $

90,113.44

16,980.00

Excess of Revenues over (under) Expenditures

$

-77,037.11 $

0.00

-77,037.11

0.00

OTHER FINANCING SOURCES (USES)

Proceeds from General Obligation Bonds Par Value
Operatin9 Transfelll Out

$ 6,250,000.00 -600,000.00

$ 6,250,000.00 -600,000.00

Total Other Financing Sources (Uses)

5,750,000.00

$

6,750,000.00

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

5,672,962.89 $ 0.00

0,00 500,000.00

5,672,962.89 500,000.00

0,00 500,000.00

FUND BALANCE JUNE 30

$ 5,672,962.89 $

500,000.00 $ 6,172,962,89

500,000.00

See notes to the general purpose financial statements.

- 23-

GREENE COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNp YEAR ENPED JUNE 30 1998

EXHIBIT "I"

See notes to the general purpose financial statements.

-24-

GREENE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENPED JUNE 30 1998

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

AgricuRure, U. S. Department of Pass-Through from Office of Treasury and Fiscal Services National Forest Reserve Funds Pass-Through from Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1998 Grant National School Lunch Program 1998 Grant Food Distribution Program (1) Pass-Through from Office of School Readiness Food and Nutrition Program Child and AduR Care Food Program 1998 Contract

10.665
10.553 10.555 10.550
10.558

Total U. S. Department of AgriCUlture

Education, U. S. Department of Pass-Through from Georgia Department of Education Elementary and Secondary Education Act Tille I Grants to Local Educational Agencies 1998 Grant THleli
Eisenhower Professional Development 1997 Granl 1998 Granl
Title VI Innovative Education Program Strategies 1998 Granl
Goals 2000 State and Local Education Systemic Improvement Grant 1997 Granl 1998 Grant
Individuals with Disabilities Education Act Part B - Special Education Flow Through 1998 Grant Preschool 1998 Granl
Safe and Drug-Free Schciols 1998 Granl
Vocalional Education Basic Grants to States High School Program Basic Granl 1998 Grant Tech-Prep Education 1998 Granl

. 84.010
64.281 64.281 84.298
84.276 84.276
64,027 64.173 84.186
84.048 84,243

Total U. S. Departmenl of Education

PASS THROUGH
ENTITY ID
NUMBER
N/A $
N/A N/A N/A
N/A $
N/A $ N/A N/A N/A
N/A N/A
NlA NlA NlA
N/A N/A
$

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

20,695.55

(4)

199,439.15
560,327.79 $ 57,272.59

(2)
900,840.53 (3) 57,272.59

24,886.88 862,621.98 $

(2) 958,113.12

698,647.51 $ 12,872.17 18,728.00

698,647.51
13,863.16 3,546.52
18,728.00

41,603.17

10,250.00 41,602.63 (5)

181,950.69 69,466.78 14,561.09

181,950.69 (6) 69,466.78 (6) 14,561.09

44,539.00 5,000.00
1,087,368,41 $

44,539.0,0 5.000.00
1.102,155.38

25

GREENE COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEPERAL AWARDS
YEAR ENPED JUNE 30 1998

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
OTHER FEDERAL ASSISTANCE
Defense. U. S. Department of Direct Department of the Air Force R.O.T.C. Program 1998 Grant Department of the Anny Troops to Teachers 1998 Grant
Total U. S. Department of Defense

CFDA ~

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

$

27,491.51 $

92.897.44 (3)

8.057.30

(4)

$

35,548.81 $ _ _....:::92"",8:::9::..7."'44..:..

Total Federal Financial Assistance N/A=Not Available

$ 1,985,539.18 $ 2,153.165.94

Notes to !he Schedule of Expenditures of Federal Awards
(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) Expendijures for the Child and Adult Care Food Program and the School Breakfast Program were not maintained separately and are included in the 1998 National School Lunch Program.
(3) Expenditures for this program include State. and/or Other Funds. Expenditures are not maintained by fund source.
(4) Funds earned on this program do not require reporting of expenditures. (5) Expenditures in the amount of $ 66,856.68 associated with the inception of a capijallease
have been excluded from this schedule. (6) Includes Federal Assistance in the amount of,$ 12.065.00 provided to subrecipients.
Major Programs are identified by an asterisk (") in front of the CFDA number.
The accompanying schedule of expenditures of Federal awards includes the Federal grant activijy of the Greene County Board of Education and is presented on the modified accrual basis of accounting which is the same besis of accounting used in the presentation of the general purpose financial statements.

See notes to the general purpose financial statements.

26

GREENE COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 1998

SCHEDULE?

AGENCYIFUNDING
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 Middle School Incentive Program Special Instructional Assistance In-$chool Suspension Mid-tenn Adjustment Counselors Grades 4 and 5 Technology Training Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Ad Valorem Tax Adjustment Alternative Program Apprenticeship Program At-Risk Summer School Program Health Insurance Mentor Teacher Program Preschool Handicapped Program Remedial Summer School Program Teachers' Retirement Tuition lor the Multi-Handicapped Lottery Programs Atternative School Program Instructional Technology Assistive Technology Classroom Technology
Georgia Slale Financing and Investment Commission Reimbursement on Construction Projects
OffICe of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 4,264,438.00 1,577,000.00 242.587.00 189.718.00 68.208.00 1,363,458.00
364,711.00 91,315.00
130,674.00 189,721.00
78,007.00 81,565.00 15,918.00 43,263.00 -1,456,723.00 224,441.00
856.00
57,045.00 91,545.00 70,000.00 12,280.54 162,502.80
1,692.00 31,514.00
7,066.04 31,424.23 76,947.00
32,956.00

71,306.00
4,132.00 7,050.00 63,518.00
$ 294,026.21

$ 4,264,438.00 1,577,000.00 242,587.00 189,718.00 68,206.00 1,363,458.00
364.711.00 91,315.00
130,674.00 189,721.00 78,007.00 81,565.00
15,918.00 43,263.00 -1,456,723.00 224,441.00 71,306.00
858.00
57,045.00 91,545.00 70,000.00 12,280.54 162,502.80
1,692.00 31,514.00
7,066.04 31,424.23 76,947.00
4,132.00
7,050.00 63,518.00

6,000.00

6,000.00 294,026.21
32,956.00

8,044,129.61

440,032.21

6,000.00 $ 8,490,161.82

See notes to the general purpose financial statements.

-27-

GREENECOUNTYBQARDQFEDUQATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30 1998

SCHEDULE~

EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Student T"",sportation Services other Support SeNices

ALTERNATIVE SCHOOL PROGRAM

INSTRUCTIONAL TECHNOLOGY

ASSISTIVE

CLASSROOM

TECHNOLOGY TECHNOLOGY

PREKlNDERGARTEN PROGRAM

3.132.00 1.000.00

7.050.00

83.518.00

228,457.13
34.695.33 1,998.21
17.218.30 1.680.09
11.240.80 738.35

TOTAL
300.157.13
34,695.33 2,998.21
17.218.30 1.680.09 11.240.80
738.35

Total Expenditures

4132.00 $

7.050.00 $ _.....83=,5.18._.00""

294 026.21 $ _...3.8"8"'.7"'26,,._2.1.

RECAP:
Salaries and Benefits Pre-Kindergarten Program
Other Expenditures Alternative School Program Instructional TecI1nology Assistive Technology Classroom TecI1nology Pre-Kindergarten Program

278,232.24
4.132.00
7.050.00 63,518.00 15.793.97

368,726.21

See notes to the general purpose financial statements.

-26-

GREENE COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION pROGRAMS YEAR ENDED JUNE 30 1998

SCHEDULE "4"

Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis
Salaries Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expend~ures per Audit
Amount of Underexpend~ure for Total Allotment

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$ 6,355,308.00 $

197,956.00

$ 6,690,840.42 806,574.62 $
$ 7,497,415.04

725,282.42

-104,685.14 $ 7,392,729.90

$

0.00 $

0.00

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

GREENE COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM eXPENDITURE REQUIREMENTS _BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNe 30 1998

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (0) Grades 1 3 (0)
Sub-Total K3
Grades 4 5 rJ Grades 6 8 rJ Grades 9 12 rl
High SChool Laboratories (0) Vocational Education Laboratories (0)
Total General and Career Education Programs SPECIAL EDUCATION PROGRAMS
Regular Programs Category I (0)
Category II rJ
Category III (OJ category IV rl
category V (oJ
Sub-Total - Regular
Category VI (Gifted) rJ
Total Spedal Education Programs REMEDIAL EDUCATION PROGRAM tl
Total Fourteen Weighted Programs MEDIA CENTER PROGRAMS
Salaries Operations
Total Media center Programs
Total Fourteen Weighted and Media center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

ORIGINAL ..JL.

REQUIRED ORIGINAL

MID-TERM

440,727.00 1,086,127.00 1,526,854.00
475,294.00 1,072,609.00
416,600.00 363,082.00 409,999.00 4,264,438.00

90 $ 90 90 90 90 90

396,854.30 977,514,30 1,374,168.60 427,764.60 965,348.10 374,940.00 326,773.80 368,999.10 3,837,994.20

0.00 0.00
81,565.00 81,565.00

$ 1,510,474.00

1,359,426.60 $

0.00

1,510,474.00 66,526.00
1,577,000.00 242,587.00
6,084,025.00.

90 90
90 $

1,359,426.60 59,673.40
1,419,300.00 218,328.30 $
5,475,622.50

0.00
0.00 0.00 81,565,00

152,095.00 90

136,885.50

0.00

37,623.00 90

33,860.70

189,718.00

$

170,746.20

0.00

6,273.743.00

5.646.368.70

81.565.00

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development

19,736.00 48,470.00

19,736.00

0.00

48,470.00

0.00

Total Steff Development Programs
rJ Identifies Fourteen Weighlad Programs.
See notes to the general purpose financial statements.

$

68,206.00 100

68,206.00

0.00

- 30 -

SCHEDULE "5" .

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

396,654.30 $

451,002.40

35,240.39

486,242.79

977,514.30

986,503.78

118,945.14

1,105,448.92

1,374,168.60

1,437,506.18

154,185.53

1,591,691.71

0.00

427,764.60

508,780.40

66,560.79

575,341.19

0.00

965,348.10

1,116,467.76

114,347.34

1,230,815.10

0.00

374,940.00

629,362.22

111,015.97

740,378.19

0.00

326,773.80

425,209.98

63,280.23

478,490.21

0.00

450,664.10

402,341.69

49,269.68

451,611.27

0.00

3,919,559.20

4,519,668.13

548,659.54 $ 5,068,327.67

1,359,426.60

200,338.00 511,870.80 684,392.53
19,784.49 59,364.85

3,249.01 7,324.15 157,969.44
791.76 350.07

203,587.01
519,194.95 842,361.97
20,576.25 59,714.92

$ 1,359,426.60

1,475,750.67

169,684.43

1,645,435.10

0.00

59,873.40

92,821.41

3,392.38

96,213.79

0.00

$ 1,419,300.00

1,56lI,572.08

173,076.81 $ 1,741,648.89

218,328.30 $

389,489.27

3,546.07 $

393,035.34

0.00

5,557,187.50 $ 6,477,729.48

725,282.42 $ 7,203,011.90

136,885.50 $

213,110.94

$

213,110.94

0.00

33,860.70

81,292.20

81,292.20

0.00

170,746.20

213,110.94

81,292.20

294,403.14

5,727,933.70 $ 6,690,840.42 $

806,574.62 $ 7.497:415.04

0.00

19,736.00 48,470.00
68,206.00

25,205.38 43,001.47

25,205.38 43,001.47

68,206.85

68,206.85

0.00

31

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214
Atlanta, Georgia 30334-8400
March 29, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board of Education
and Superintendent and Members ofthe Greene County Board ofEducation
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Greene County Board of Education as of and for the year ended
June 30, 1998, and have issued our report thereon dated March 29, 1999. 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 generally accepted auditing standards 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 Greene County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could luive 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
of our tests disclosed no instances of noncompliance that are required to be reported under Govermnent Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Greene County Board of Education's internal control over fmancial 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 control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its
98YB-40

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 of the internal control over financial reporting that, in our judgement, could adversely affect Greene County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the fmancial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6661-98-01.
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, the reportable condition described above is also considered to be a material weakness.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
?M.s.L(J2 ~.~~. Russell W. Hinton State Auditor
RWH:jb 98YB-40

RUSSELL W. HINTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
March 29,1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Greene County Board of Education
REPORT ON COMPLIANCE WITH REOUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM ANDlNTERNALCONTROLOVERCOMPLIANCElNACCORDANCEWITHOMBCIRCULARA-l33
Ladies and Gentlemen:
Compliance
We have audited the compliance of Greene County Board of Education with the types of compliance
requirements described in the u.s. Office ofManagement and Budget (OMB) Circular A-133 Compliance
Supplement that are applicable to its major Federal program for the year ended June 30, 1998. Greene County Board of Education's major Federal program is identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major Federal program is the responsibility of Greene County Board of Education's management. Our responsibility is to express an opinion on Greene County Board ofEducation's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-l33, Audits ofStates, Local Governments, andNon-Profit Organizations. Those standards and OMB Circular A-l33 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance 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 Greene County Board of Education's compliance with those requirements and perfonning 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 Greene County Board of Education's compliance with those requirements.

98SA-IO

In our opinion, the Greene County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to its major Federal program for the year ended June 30, 1998.
Internal Control Over Compliance
The management of Greene 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 Greene 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 OMB Circular A-B3.
Our consideration of the 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 ofrisk 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 of performing 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 for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,
~w.~ Russell W. Hinton State Auditor
RWH:jb 98SA-IO

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

GREENE COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

6661-93-01 FS-666 1-97-01

Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6661-97-01

Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional
administrative staff, the Board has decided not to pursue the recording of general fixed assets on the financial statements.

SECTION IV FINDINGS AND QUESTIONED COSTS

GREENE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS
YEAR ENDED JUNE 30. 1998

SUMMARY OF AUDITOR'S RESULTS

I. Type ofReport Issued on the Financial Statements The auditor's opinion on the Greene 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 ofthe Financial Statements The audit report for the Greene 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 of the Greene County Board of Education disclosed no instances of noncompliance that were deemed to be material to the fmancial statements.

4. Reportable Conditions in Internal Control Over Major Programs

The audit report for the Greene 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 Greene County Board of Education's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Reported by Section .5IOCa) ofOMB Circular A-133 The Greene County Board of Education's audit did not disclose audit findings required to be reported by section .5 IO(a) ofOMB Circular A-B3.

7. MajorProgram The Federal award audited as a major program is as follows: 84.010 Elementary and SecondaryEducation Act - Title I - Grants to Local Educational Agencies

8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.

9. Low Risk Auditee The Greene County Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.

- 1-

GREENE COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS
YEAR ENDED JUNE 30,1998
II FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-666l-98-01 The Greene County Board ofEducation 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 Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. ill FEDERAL AWARD FINDINGS AND OUESTIONED COSTS No matters were reported.
-2-