Hart County Board of Education, Hartwell, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2000

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1

HART COUN1Y 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

6

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

7

ADDillONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

22

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

DEBT SERVICE FUND

I

COMBINING BALANCE SHEET

28

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

29

SCHEDULES

I SCHEDULE OF EXPENDITURES OF FEDERAL AW,ARDS

30

2 SCHEDULE OF STATE REVENUE

32

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

33

HART COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION!

FINANCIAL

SCHEDULES

ADDITTONAL FINANCIAL INFORMATION

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

35

5

BYPROGRAM

36

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

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

SECTIONN FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 \\lashington Strecl. S.W.. Suite 214 Atlanta, Georgia 30334-8400
April 4, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board ofEducation
and Superintendent and Members of the Hart 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 Hart County Board of

Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These

general purpose financial statements are the responsibility ofthe Hart County Board ofEducation's

management. Our responsibility is to express an opinion on these general purpose financial

statements based on our audit.



Exi;ept as discussed in the following paragraph, 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 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 opinion.

We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 2000, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.

2000ARL-13

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 foJJows:
* The general purpose financial statements of the Board did not contain a General Fixed
Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the
general purpose financial statements. To conform to generaJJy accepted accounting principles, these accounts should be included in the general purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 2000, a portion
of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2000. Also funds received, subsequent to June 30, 2000, 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, 1999, were improperly recorded in the year ended. June 30, 2000. 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 of such ;idjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as ta the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects on the general purpose financial statements ofthe 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 Hart County Board ofEducation as ofJune 30, 2000, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated April 4, 2001, on our consideration of the Hart County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions oflaws, 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 Hart County Board ofEducation taken as a whole. The accompanying combining statements (Exhibits E through J) and the financial schedules (Schedules 1 through 5), which
2000ARL-13

includes the Schedule ofExpenditures ofFederal Awards as required by U.S. Office ofManagement and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general purpose 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 effect of adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy ofthe food service inventories as discussed in the third paragraph, and except for the effects of the matters referred to in the fourth paragraph, such information is fairly 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,

RWH:jb 2000ARL-13

~l-0~
R ssell W. Hinton Stat~ Auditor

HART COUNTY BOARD OF EDUCATION

HART COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30 2000

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

364,081.63 $ 358,594.89 $

858,501.57

6,521,311.08

8,299,573.93

253,547.08

278,033.11

40,080.16 7,690.92

Total Assets

LIABlblTIE 6ND EUND l;QUITY '.

';

LIABILITIES

Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Capital Lease Agreements General Obligation Bonds Payable

Total Liabilities

FUND EQUITY
Fund Balances Reserved For Continuation of Other Programs For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue For State Capital OuUay Projects Unreserved Undesignated

Total Fund Equity

$ 7,138,939.79 $ 684,399.08 $ 9,158,075.50
,,

$

46,312.27

169,281.92

8,280.03

$

54,041.31

$ 223,874.22 $

54 041.31

$

2,174.31

$

18,814.50

7,120,125.29 $ 7,138.939.79 $

40,080.16 7,690.92 $
410 579.47
460,524.86 $

8,980,912.18 115,358.62
7 763.39
9104 034.19

Total Liabilities and Fund Equity

$ 7,138,939.79 $ 684,399.08 $

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

9,158,075.50

EXHIBIT"A"

DEBT SERVICE
FUND

$

113,702.67

1,078,361.01

434,533.01

ACCOUNT GROUP
GENERAL LONG-TERM
DEBT

TOTALS (Memorandum Only) JUNE 30, 2000 JUNE 30, 1999

$ 1,694,880.76 $

752,246.28

15,899,246.02

5,665,149.57

966,113.20

409,475.26

$ 1,626,596.69

40,080.16 . 7,690.92
1,626,596.69

36,967.34 8,588.80
507,214.76

9,443,403.31 167 106.86

9,443,403.31 167106.86

1,812,785.24 324 885.54

$ 1,626,596.69 $ 11.237,106.86 $ 29,845,117.92 $ 9,517,312.79

$

46,312.27 $

169,281.92

8,280.03

54,041.31

$

167,106.86

167,106.86

11,070,000.00

11,070,000.00

$ 11,237,106.86 $ 11,515,022.39 $

36,959.06 138,931.88
599.06
324,885.54 2,320,000.00
2,821,375.54

$ 1,626,596.69
0.00 $ 1,626,596.69

$

2,174.31

1,626,596.69 $

18,814.50

507,214.76

40,080.16 7,690.92
. 8,980,912.18 115,358.62
7,538,468.15
$ 18,330,095.53 $

36,967.34 8,588.80
164,555.56
5,978,610.79
6,695,937.25

$ 1,626,596.69 $ 11,237,106.86 $ 29.845,117.92 $ 9,517,312.79 -3-

HART COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30 2000

GENERAL FUND

SPECIAL REVENUE
FUND

REVENUES

::,

State Funds Federal Funds Taxes Other Funds

Total Revenues

., ~ ..

$ 13,425,929.31 $"' 288,555.57

1,942,817 .31

8,410,770.02

370 598.82

452,235.19

$ 22,207,298.15 $ 2,683,608.07

EXPENDITURES

Current Instruction

L \ .

\: .~

Support Services

Pupil Services

Improvement of Instructional Services

Educational Media Services General Administration

'

School Administration

Business Administration

Maintenance and Operation of Plant

;,_

Student Transportation Services

Central Support Services

Other Support Services

Food Services Operation

Capital Outlay

Debt Service

Principal

Interest

Paying Agent Fees

Total Expenditures

Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES\ ;

-
. -, .

Accrued Interest on Bonds Sold 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 in Period_ Donated Commodities Purchased Food

$ 13,999,547.84 $
626,264.72 379,868.95 522,414.88 290,282.27 . 1,358,365.08 166,093.47 1,614,100.66. 817,468.79
21,890.31 80,275.58
1,450.00
157,778.68 21,967.75

1,041,500.45
90,906.03 280,846.80
4,154.78 5,912.38
3,272.56
11,568.88 1,269,357.23
4,879.43

$ 20,057,768.98 $ $ 2,149,529.17 $

2,712,398.54 -28 790.47

$ -540 112.00

$

-540112.00

$ 1,609,417.17 $ 5,529,522.62

-28,790.47 487,100.39

-3,112.82 -897.88
'

FUND BALANCE JUNE 30

,,. '.

$ 7,138,939.79- -$

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

460,524.86

EXHIBIT"B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

(Memorandum Onl~l YEAR ENDED

JUNE 30, 2000

JUNE 30. 1999

$ 13,714.484.88 $ 13,162,162.18

1,942,817.31

1,704,565.19

$ 1,435,802.13

9,846,572.15

8,164,309.12

$

186 302.94

28 754.69

1.037.891.64

784 680.74

$

186 302.94 $ 1,464,556.82 $ 26,541,765.98 $ 23,815,717.23

$ 15,041,048.29 $ 14,135,172.82

$

129,456.13

665,024.10

717,170.75 660,715.75 526,569.66 296,194.65 1,358,365.08 295,549.60 1,614,100.66 820,741.35
21,890.31 91,844.46 1,269,357.23 671,353.53

614,972.32 579,792.05 537,703.22 242,599.40 1,276, 177.57 ' 195, 133.38 1,600,961.12 731,022.84 117,861.46 117,907.21 1,259,593.52 125.471.72

$

250,000.00

111,522.50

684.37

407,TT8.68 133,49025
684.37

381,722.14 156.434.67
1 377.80

$

794480.23 $

362,206.87 $ . 23.926,854.62 $ 22.073,903.24

$

-608 177.29 $ 1,102,349.95 $ 2,614,911.36 $ 1 741 813.99

$ .$ 9,000,000.00
540,112.00
$ 9,540,112.00 $

17,031.98 $ 17 031.98 $

17,031.98
9,000,000.00 540,112.00 $ -540.112.00
9,017,031.98 $

3,495.72 -3495.72
0.00

$ 8,931,934.71 $ 1,119,381.93 $ 11,631,943.34 $ 1,741,813.99

172,099.48

507,214.76

6,695,937.25

4,949,066.07

3,112.82 -897.88

4,549.44 507.75

$ 9104034.19 $ 1,626,596.69 $ 18,330,095.53 $ 6,695,937.25 - 5-

HART CQUND' BOARD OE EDUCATION COMBINED STATEMENT OF REVENUES EXPENPIIUBES ANP CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - CNON::GAAF' BASIS)
GENERAL AND SF'ECIAL REVENUE FUNDS YEAR ENDED JUNE 30 2000

EXHIBITC

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues

,.

$ 13,156,403.00 $ 13,425,929.31

; .~

7,910,609.00

8,410,770.02

170 000.00

370,598.82

$ 21,237,012.00 $ 22,207,298.15

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital OuUay Debt Service
Total Expenditures
Excess of Revenues over (under) Expenditures:
QTHEB F!N~C!NG USl;S
Othef Uses
Excess of Revenues over (under) Expenditures and Other Financing Uses
EUNQ BALeiNCE JULY 1 1999
Adjustments Food Inventory Net Change In Period
Donated Commodities Purchased Food

,s $ 15,022,073_.88, 13,999,547.84

- 556,856.00
353,041.06

626,264.72 379.868.95

530,408.00

522,414.88

278,800.00

290,282.27

1,339,852.00,

1,358,365.08

182,859.00

186,093.47

'

1,819,588.0<;l

1,614,100.66

972,518.00

817,468.79

20,131.00

21,890.31

105,028.00

80,275.58

900,000.00

1,450.00 179 748.43

$ 22,081,154.66 $ 20 057,788.98

$ -844, 142.88., $ 2,149,529.17

-540,112.00

$ -844, 142.88 $ 1,609,417.17

5,390,673.43. 23,900.78

5,529,,5, 22.62

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 339,180.00 $ 288,555.57

1,732,399.00

1,942.817.31

375,900.00

452,235.19

s 2 447 479.00 s 2:~83,608.07

$ 1,173,593.47 $ 1,041,500.45

153,939.00 240,354.00
4,624.00 1,220.00 5,357.00
r: i :
500.00

90,906.03 280,846.80
4,154.78 5,912.38
3,272.58

11,338.00 1,187,903.00

11,568.88 1,269,357.23
4,879.43

$ 2,778,828.47 $ 2,712,398.54 $ -331,349.47 $ -28,790.47

$ -331,349.47 $
.485,459.99
-19,998.02.

-28,790.47 487,100.39
3,112.82 -897.88

EUNQ BA!.ANCE JUNE JO 2QQQ

$
' - ' f
. -~. >

4 570 631.33 $

711381939.79

$

,, ., ' ,~ !

134112.50 $

4601524.86

. \

,o

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

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30.2000

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Hart County Board ofEducation (Board) was established under the laws ofthe State ofGeorgia 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 of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
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 tlie general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the 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.

-7-

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

I
I
Note!: 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.

"'~ :

. ' .. '

CAP_ITAL 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.

ACCOUNT GROUP.
GENERAL LONG-TERM DEBT ACCOUNT GROUP ~ A financial reporting device used to ,, . _ account for general obligation debt outstanding and capital lease obligations.

BASIS OF ACCOUNTING

Theaccounting 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 balll!lce 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. Thei_r_reported fund balance is considered a measure of available spendable resources..

.

. ' -;_ ' - .

..,- Li.abilities which are expected__to be financed from available.spendable resources are reported as

liabilities j 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.

' -:-,:

-

Governm. ental

funds

a- re.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 bedetermined 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 propertytaxes, local option 1

sales taxes, intergovernmental grants and investment income.

. r

I

~~penditures are generally recognized when the related fund liability is incurred.

A departure from the above definitions is the accounting treatment afforded the final two payinents 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 2000, a substantial number of personnel of the Board were employed for a one hundred and ninety day

' -8-

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30,2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
period beginning in late August 1999 and ending in early June 2000. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 2000, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2000, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 2000. Also, the State's portion ofthe compensation paid in July and August 2000 was received and recorded as revenue in the fiscal year subsequent to June 30, 2000. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were recorded in the year ended June 30, 2000. 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.
BUDGET
The Hart 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 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 ofbudget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper of general circu\ation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(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 of deposits in authorized financial institutions. Georgia Laws OCGA 45-8-14 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.

-9-

C

, HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

, ..NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30.2000

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES _

INVESTMENTS

., I

.

..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 of one 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 and equity investments are reported at fair value. The Official Code

,of Georgia Annotated Section 36-83-4-imthorizes the Board to invest its funds. In selecting among

options for investment or among institutional bids for deposits, the highest rate ofreturn shaH 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, -::



r .,

1 J

r. . r

. i ..

L

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

,:1

(5) Prime banker's acceptances,

(6). The Local Government Investment P.ool administered by the.State of Georgia; Office of . Treasury and Fiscal Services,

(7) Repurchase agreements,and

i

:t. i,..;

-..(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.

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30.2000

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PROPERTY TAXES

The Hart County Board ofCommissioners fixed the property tax levy for the 1999 tax year (calendar year) on November 11, 1999 (levy date). Taxes were due on February I, 2000. The lien date for property taxes was January I, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Hart 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.

Tax millage rates levied for the 1999 tax year (calendar year) for the Hart county Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

14.44 mills ___& mills

I 5.10 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 $1,037,883.95 and was recorded in the Debt Service Fund. The State will terminate collection of this tax once an additional $9,962,116.05 has been collected or on December 31, 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.

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. In addition, general obligation bonds have

- 11 -

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount ofthese _, bonds is ~~corded in the Gen~al Long-Term Debt Account.Group.

. INTERFUND.TRANSACTIONS

,;

- 'J . I j

1 f\ ,<

'.

The Bo!ll"d has the following types of interfund transactions:

-'

-:

. I

Reimbursements of expenditures initially made from a fund that are properly applicable to another

fund are rec_ordc:d as expenditures in the reimbursing fund and as reductions ofexpenditures in the

fundthati~reimbursed.

, .,__ , ,,,

.. ,;.

, .

Operating !ransfers 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. lilterfund eliminations have not been made in the-aggregation ofthi~ 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 of securities pledged shall be equal to not less than 110 percent ofthe public funds be4Ig secured after the deduction ofthe amount ofdeposit insurance. If a 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 Sc:ction 45-8-11 (b) provides an officer holding public funds may, in his discretion, . waive the requirement.for security in tJte case ofoperating funds placed in demand deposit checking
acc9unts.

Acceptable security for deposits consists of any o~e of or any combination of the following:

'
(I) Surety bond signed by a surety company duly qualified and authorized to transact business

--within

the

State

of
.

Georgia,

. (2) Insurance on !l-CC~unts provideg_by the _Federal Deposit Ins~an~eCorporation,

-; 12-

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

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 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 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 or debt obligations issued by the Federal Land Bank, the Federai 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.

CATEGORJZATION OF DEPOSITS
At June 30, 2000, the bank balances were $7,532,335.24. The amounts ofthe total bank balances are classified into three categories of credit risk:

Category I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.)

The Board's deposits are classified by risk category at June 30, 2000, as follows:

Risk Category
I
2 3
Total

Bank Balance
$ 900,777.15 5,904,921.82 726,636.27
$ 7.532.335 24

- 13 -

T

HART COUNTY BOARD OFEDUCATION

EXHIBIT "D"

: NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

;JUNE 30, 2000

Note 2: DEPOSITS AND INVESTMENTS

r.

'..',CATEGORIZATION OF INv:ESTMENI'S. Investments are classified as to risk by the three categories described below: .,

' Category I - ,Insured or registered; or securities held by the Board or the Board's agent in the

Board's name.

c' _ ,: . 1 ,:

Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust

c' .-~ Tdepartment or agent in the Board's mime.,

Category');_ Uninsured or unregistered;with-securities'held by the counterparty, or by its

trust department or agent but not in the Board!s name.

Funds invested in an investment pool managed by another government are not required to be

categorized unless the investing entity owns specific, identifiable investment securities in the pool.

; ~ ~ i--i C:'.~.: ~ 1

:, j ,_. 'r; .'i

J. ,. :- lJ. ,



.At Juhe:30, 2000, the carrying value of.the,Board's total.investmerits'was $12,632,894.02. The

investments.are classif1_ed as to,risk categories as:follows:

P ._, '.1 -

.-t

Type of Investment

' '

":.....:.""''c.-,-..;._--"R"'is,._k.,,.C"'at,.,eg.,.ouri.es._ _ _ __

2

3

Carrying. Amount

, Fair Value

U. S. Government

s,_ __.o..,o{.!lo s 4515 634 31 s _ _'"'o!!.oll!lo s 4,s,s,634.31 ,s 4,s,s,634.31

~ r .

'.1

_...,

Not Su,bject to Categoriz.ation

Reqtiirements

Local Government

Investment Pools

7,599,672.09 7,599,672.09

' .,

Mut-u~ a_.l .F, u'n.ds

214,587.62 . 214,587.62 '' i-

Total lnvesnnents .

$1263289402 $1263289402

. 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 mi identifiable

.. securities..The investment policy ofthe State of Georgia, Office ofTreasury and Fiscal Services for

the Local Government ;Investment Pool (Primary. Liquidity Portfolio) does not provide for

investment in derivatives or similar investments. A description ofthe Primary Liquidity Portfolio is

as follows: .,

'



...

'

The l',rim!ll"Y Liquidity Portfolio consists of Georgia Fund I, which is a combination local and state government investment pool, and Fund 6. Georgia Fund I is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. The pool is not registered with the Securities and Exchange Commission as an investment company but does operate Georgia Fnd I in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940 and is considered to be a 2a-7 like pool. 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 of management fees) on a monthly basis and values 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

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30,2000

Note 2: DEPOSITS AND INVESTMENTS
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 of funds 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 I 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. The weighted average maturity for Georgia Fund I on June 30, 2000, was 23 days. The average investment duration for Fund 6 on June 30, 2000, was .80 year.
Note 3: NON-MONETARY TRANSACTIONS
The Board receives food commodities from the United States Department ofAgriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note I - Inventories
Note 4: RISK MANAGEMENT
The Board is exposed to various risks ofloss 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 job related illness or injuries to employees. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years.
The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years.
The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund 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:

- 15 -

-
HART COUNTY BOARD OF EDUCATION
NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS - JUNE 30; 2000

EXHIBIT "D"

Note 4: RISK MANAGEMENT

' '

: ;J
1999 2000

, Beginning
ofYea~-
Liability

Claims and ~ Changes in Estimates ,

$

5,666.00 $

$

0.00 $

418.00 $
588.00 $

Claims
Paid

,. ; End of Year
Liability

- ,. 6 084.oo $_ ___,o=.o,.,,_o

58~.oo $_ _-"--'-'o=.o=o .

0

The Board has-ptircha1ed a suretfbo'nd tb provide additio'nal ins~~ce coverage as fcillo~s:

' . -~. . -. _ l

J. , ., i. , ' -~ #

. ' P'. osi.tion Covered

1'

'



'

"

.

, '

'

i -. Amount,

All Employees

.' '
50000 00

Note 5: GENERAL LONG-TERM DEBT

. CAPITAl:'LEASEs''

:

,

,--
. . '-

2

L


'

:- '1 ;



.

,_.

as ""The Hart' Cciiihty Board of Education has entered 'into various lease ~greements lesse~ 'tor 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 oftheir inception.



.. GENERAL OBLiGA',f!OlfDEBT Ol!I,~T~IN~\ . .. : . _. ' General Obligation Bonds currently outstanding are as follows:

Purpose
:' .
Ge~eral.Governmerit ~ Refundirtg ~ seric;s i993 .
. 1 General Government - Series 1999 . .

Interest Rates
2.50% - 5.25% 4.25% - 4.75%
. '

Amount
$. 2,010;000.00 9,000,000.00

.. _ ....

$ I 1,010,000.00

.

.

. - .: . '

! :: . . . '

~ .

. ; "_

. -. . . ,

The changes in General Long-Term Debt during the'fiscal year ended June 30, 2000, were as

follow~:

' . ,.; ,

'

.l .'

. .....

.. l' :~ J._;.

' -

-,, !

'.

-- 16 -

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30.2000

Note 5: GENERAL LONG-TERM DEBT

Balance July 1. 1999
Additions G. 0. Bonds
Deductions Debt Retired Payments
Balance June 30, 2000

Capital Leases

General Obligation
Bonds

Total

$ 324,885.54 $ 2,320,000.00 $ 2,644,885.54

9,000,000.00 9,000,000.00

157,778.68

250,000.00
'

250,000.00 157,778.68

$ 167,1Q6,86 $11,Q7Q,QQQ,QQ $1 J,:z:n, l Q6,86

At June 30, 2000, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

Capital Leases

General Obligation
Bonds

Total Debt

2001 2002 2003 2004 2005 2006 - 2010

$ 162,738.26 $ 1,829,473.54 $ 1,992,211.80 13,166.93 2,482,820.00 2,495,986.93 1,259.50 2,473,125.00 2,474,384.50 2,472,425.00 2,472,425.00 2,719,I 78.75 2,719,I 78.75 1,047.112.50 1.047.112.50

Total Principal and Interest $ 177,164.69 $ J3,Q24,134 79 $J3.2Ql,299.48

Deduct: Imputed Interest

10,057.83

Net Present Value ofFuture Minimum Lease Payments $ J67,JQ6,86

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $322,881.83 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department ofEducation Paid to the Georgia Department of Community-Health For Health Insurance of Non-Certified Personnel In the amount of$240;519.21

- 17 -

,

HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 6: ON-BEHALF PAYMENTS

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost . In the amount of$21,520.62

Office ofTre~sury and'Fisc~I Services

Paid to the Public School Employees Retirement System

.., .

., For Public. School Employees Retirement (PSERS) Employer's Cost

In the amount of $60,842.00

Note 7: SIGNIFICANT COMMITMENTS

' J

The following is an analysis ofsignifisapt o\ltstanding construction or renovation contracts executed

by the Board as of June 30, 2000, together with funding available:



Project 01 G/00S-673-027

Unearned Executed Contracts

. Funding Available From State

$ 2.262.449,26 $ 272,911.00

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

'

'

L -

I~-,

Note 8: CONTINGENT LIABILITIES ,, - '

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

Note 9: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION

Substantially all teachers, administrative and clerical personnel employed by local school systems

.are covered by the TeachersRetiremerit S'ystem 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.



HART COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30,2000

Note 9: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board 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

2000 1999 1998

100% 100% 100%

$ 1,474,966.11 $1,479,197.81 $1,349,989.43

- 19 -

. HART COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 2000

ASSETS
'l.
Cash and Cash Equivalents
Accounts Receivable
Inventories Food Donated Commodities Purchased Food

SCHOOL

, .

FOOD

. SERVICES

FUND

!~'

'i .

LOTTERY PROGRAMS

$ - 482;910.13

; I_

, 1;306.88 $

3,183.55

40,080.16 7 690.92

Total Assets

$

531,988.69 $ =====3=1=83...5=5=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Other Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity
See notes to the general purpose financial statements.

$

$

14,969.38

58,668.76

s

73 638.14 $

3,183.55 3183.55

$

40,080.16

7,690.92

410 579.47 $

0.00

$

458,350.55 $

0.00

$

531,988.69 $ ==='3=,1=8=3=.5=5=

EXHIBIT "E"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

JUNE 301 2000

JUNE 30, 1999

$

2,174.31 $

485,085.04 $

507,067.99

$

273,542.68

278,033.11

116,299.53

40,080.16 7 690.92

36,967.34 8 588.80

$

273,542.68 $

2,174.31 $

810,889.23 $ ==6=6=8..9.=2=3.6..6=

$

123,306.60

31,342.89

110,613.16

8 280.03

$

273,542.68

$

126,490.15 $

5,333.27

46,312.27

36,959.06

169,281.92

138,931.88

8 280.03

599.06

$

350 364.37 $

181,823.27

$

$

0.00 $

$

273 542.68 $

2,174.31 $

2,174.31

0.00 2 174.31 $

40,080.16 $ 7,690.92

36,967.34 8,588.80

410 579.47

441 544.25

460 524.86 $ _ _4~8'-'7-'-'1"'0"'0.""39'"-

2,174.31 $

810,889.23 $ ===66..,8==,9=2=3.=66..,

- 21 -

HART COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2000

-- --- - --

I

' :,\

REVENUES
State Funds Federal Funds Other Funds

.
,1_,1_ -
,
.l .

SCHOOL _FOOD 'SERVICES
FUND

. LOTTERY PROGRAMS

-'

$

97,264.00 $

688,893.26

452,235.19

~
92,878.57

Total Revenues .- - -
EXPENDITURES

-- ----

Current

Instruction

Support Services

Pupil Services

Improvement of Instructional Services

Educational Media Services

General Administration

Student Transportation Services

Other Support Services

,.,

Food Services Operation

,_., .. " '

Capital Outlay

. l

Total Expenditures

e.

Excess of Revenues over (under) Expenditures

.. -
~
:

$ 1,238,392.45 $
. -~
$

$ 1,269,357.23

$ 1,269,357.23 $

$

-30,964.78 $

92 878.57 92,878.57
92,878.57 0.00

OTHER FINANCING SOURCES

Operating Transfers In

1:

r::. ::\'" "

Excess of Revenues and Other Financing Sources over (under) Expenditur!ls.

$

39,964.78 $

0.00

FUND BALANCE JU...L. Y,,1..

. -

487,100.39

0.00

Food Inventory: Net Change in Period

Donated Commodities

~! : .- -- - .-.. - - ~

3,112.8~ r

Purchased Food

-897.88

-
FUND BALANCE JUNE 30

$

458,350.55 $

0.00

See notes to the general purpose financial statements. ~-22-

EXHIBIT "F"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

YEAR ENDED

JUNE 301 2000

JUNE 301 1999

$ $ 1,253,924.05
$ 1,253,924.05 $

98,413.00 $ 98 413.00 $

288,555.57 $ 1,942,817.31
452 235.19
2,683,608.07 $

283,925.94 1,704,565.19
433 487.01
2,421,978.14

$

872,408.26 $

90,906.03 265,701.16
4,154.78 5,912.38 3,272.56 11,568.88

$ 1,253,924.05 $

$

0.00 $

76,213.62 $ 1,041,500.45 $

15,145.64 4 879.43

90,906.03 280,846.80
4,154.78 5,912.38 3,272.56
11,568.88
1,269,357.23 4 879.43

96,238.69 $ 2,174.31 $ .

2,712,398.54 $ -28,790.47 $

892,942.87
'
71,500.28 154,422.53
23,978.24
2,519.92 691.73
9,653.51 1,259,593.52
2,415,302.60
6,675.54

3 495.72

$

0.00 $

2,174.31 $

-28,790.47 $.

10,171.26

0.00

0.00

487,100.39

471,871.94

3,112.82 -897.88

4,549.44 507.75

$

0.00 $

===="===== 2 174.31 $,

460,524.86 $

487,100.39

- 23 -

_ HART COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND
JUNE 30. 2000

ASSETS : Cash and Ci!sh Equivalents Investments
.,,; ....
Total A.ssets ~-; :

- . - -

. ,:

,..

,.
----

--

' C REGULAR

BOND .PROCEEDS

$

7,763.39 $

681,338.25

8,299,573.93

$'

7 763.39 $ .. 8,980,912.18

LIABILITIES AND FUND EQUITY
LIABILITIES
Contracts Payable .. ::' :. - :
FUND EQUITY
Fund Balances Reserved For Purposes of Bond_lssue_ Fcir State Capital OuUay Projects Unreserved . Undesignated
Total Fund Equity
-
Total Liabilities and Fund. Equity

,... ',...

. -- $... _8,980,912.18
. _.-, ..

$ _ ____,:_71.:,7.::;;63e:,.3::,:9:....

i, I.-

$

7 763.39 $

0.00 8,980,912.18

$

7 763.39 $ 8,980,912.18

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

EXHIBIT "G"

GEORGIA STATE FINANCING AND
INVESTMENT
COMMISSION

$

115,358.62 $

LOTTERY PROJECT

TOTALS

JUNE30, 2000

JUNE 30, 1999

54,041.31 $

858,501.57 $

172,099.48

8,299,573.93

$

115,358.62 $

54 041.31 $ 9,158,075.50 $ ==.;,17~2;;;0~9;;;9;;;.4;;,,8

$

54 041.31 $ ___5"-4"'04'-'-"1."'3-'-1

$

115,358.62

$ 8,980,912.18 $ 115,358.62 .

164,555.56

0.00 $ _ _ _ _0,,,.::;0b::....

7 763.39

7 543.92

$

115,358.62 $

0.00 $ 9,104,034.19 $ _ _.,:.17:..:2..,,0,=9.::;9c:.48::_

$

115,358.62 $

54041.31 $ 9,158,075.50 $ ==.;,17~2;;;,0~9,;;,9;;;48~

-25-

HART COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND
YEAR ENDED JUNE 30. 2000

REVENUES Other Funds

- ...
- C ,

. (
-:
.' ....' ' ' '

REGULAR

"BOND PROCEEDS

$

219,47 $

186 083,47

EXPENDITURES

Current

,\ '

.

Support Services _

Business Administration

Capital OuUay

Land and Land Improvements

Building and Building Improvements

Total Expenditures
'. --
Excess of Revenues over (under) Expenditures

$

0.00 $

129,456.13

$

0.00 $

129456.13

$

219,47 $

56,627.34

OTHER FINANCING SOURCES {USES)

Proceeds from General Obligation Bonds

Par Value

' .

Operating Transfers In

\ ~- . ;

- Operating

Transfe. rs

Out
.- .

-- -

-- --

Total Other Financing Sources (Uses)

.

. .

, : :i1 ''

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Fin;mcing Uses

FUND BALANCE JULY 1'

' . - .. ,.

,-

--- ~

': (

$

;:-,,

$ 9,000,000.00

-240,270. 72

0

- .. - -

$ 8.759,729.28

~

219.47 $ 8,816,356.62

7 543.92

164,555.56

FUND BALANCE JUNE 30

$

7 763.39 $ 8,980,912.18

See notes to the general purpose financial statements.

EXHIBIT "H"

GEORGIA STATE FINANCING AND
INVESTMENT
COMMISSION

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

0.00 $

0.00 $

186,302.94 $ _ _~7~9~7~7-=27~

$

129,456.13 $

$

391,827.85

112 213.24 $

160,983.01

391,827.85 273,196.25

$

504,041.09 $

160,983.01 $

794,480.23 $

$

-504 041.09 $

-160,983.01 $

-608,177.29 $

0.00
0.00 7 977.27

$ 9,000,000.00

$

619,399.71 $

160,983.01

780,382.72

-240,270. 72

$

619 399.71 $

160,983.01 $ 9,540,112.00

$

115,358.62 $

0.00

0.00 $ 0.00

8,931,934.71 $ 172,099.48

7,977.27 164,122.21

$

115,358.62 $

0.00 $ 9,104,034.19 $ ===17=2..0.=9.9..,,.48..,

- 27 -

HART COUNTY BOARD OF EDUCATION
l.
COMBINING BALANCE SHEET
DEBT SERVICE FUND
JUNE 30. 2000

EXHIBIT "I"

ASSETS

PROPERTY
- -- . - . TAXES FOR-

-.-

. BOND DEBT -

SPECIAL PURPOSE LOCAL OPTION -sALESTAX

' ' ...
.TOTALS
JUNE30,2000 . JUNE 30., 1999

Cash and Cash Equivalents $

96,670.69 $

17,031.98 $

113,702.67 $

57,839.70

Investments Accounts Receivable

459,523,.05 .. 10,213.98

618,837.96
'
424,319.03

1,078,361.01, 434,533.01

439,705.51 9 669.55

Total Assets

$

566,407.72 $ 1,060,188.97 $ 1,626,596.69 $

507 214.76

... ,,
. '
FUND EQUITY

.. r '
-- -

Fund Balances Reserved For Debt Service Unreserved Undesignated

., 0

$

566,407.72 $ 1,060,188.97 $ . 1,626,?96.69 $- . 507,214.76

0.00

0.00

0.00

0.00

Total Fund Equity $

566407.72 $

1,060,188.97 $ 1,626,596.69 $ r

507,214.76
--,

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

HART COUITTY BOAR!' OF EDUCATION COMBINING STATEMENT OF RE)(ENUES EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND YEAR ENDED JUNE 30 2000

EXHIBIT"J"

REVENUES
Taxes Other Funds
Total Revenues
EXPENDITURES
Debt Service Principal Interest Paying Agent Fees
Total Expenditures
Excess or Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Accrued Interest on Bonds Sold
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED JUNE 30. 2000 JUNE 30. 1999

$

397,918.18 $ 1,037,883.95 $ 1,435,802.13 $

398:552.30

23 481.65

5 273.04

28 754.69

24 826.73

$

s 421,399.83 $ 1.043.156.99

1.464.556.82 $

423.379.03

$

250,000.00 $

111,522.50

684.37

s o.ilo

250,000.00 $ 111,522.50
684.37

235,000.00 121,392.50
1 377.80

$

362.206.87 $

s 0.00

362,206.87 $

357 770.30

$

s 59,192.96 $ 1,043,156.99 $ 1,102,349.95

65,608.73

17 031.98

17.031.98

$

59,192.96 $ 1,060,188.97 $ 1,119,381.93 $

65,608.73

507 214.76

0.00

507 214.76

441 606.03

FUND BALANCE JUNE 30

s

s s s _ 5661401.12

110001188.97

116261596.69

_,5:::o,_10;2,:;14,_.1:..:6:..

See notes to the general purpose financial statements.

29-

HART COUNTY BOARD Oi= EDUCATION
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS _YEAR ENDED JUNE 30 2000

FUNDING AGENCY

r,

PROGRAM/GRANT

Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From GeorgiaDepartment of Education. Food and Nutrition ~rog~m Food Services School Breakfast Program National SChooi Lunch Program

Total Child Nutrition Cluster

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD
'. -

10.553 10.555

NIA s
NIA
s

157,655.44
439 023.74 s
s 596,679.18

(2) 1,177 143.15 (3)
1,177,143.15

Other Programs Pass-Through From Georgia Department of Education F?OO and Nutrition Program Food Distribution Program (1)
Total U. S. Department of AgriCulture
Corporation for National and Community Service , Pass-Through From Georgia Department of Education Learn and Serve America School and Community Based Programs

10.550 94.004

NIA

92,214.08

92 214.08

$

s 688,893.26

,,

1,269,357.23

NIA s

s 8 176.91

8 176.91

Education, U. S. Department of Special Education Cluster Pass-Through From Georgia OepSrtment of Educatio~ Individuals with Disabilities Education Act Part B - Special Education Capacity Building lmprov8ment Flow Through Preschool
Total Special Education Cluster

84.173 84.027 84.173

~'. ' .

s NIA
NIA NIA
s

s 4,094.73
265,187.42 24 808.93
s 294,091.08

4,094.73 265,187.42
24,808.93
294,091.08

Other Programs Pass-Through From Georgia Department of Education Comprehensive School Refonn Demonstration Project Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development
Title III Technology Literacy Challenge Fund Grants
TltleVI Innovative Education Program Strategies Class Size Reduction
Goats2000 State and Local Education Systemic Improvement Grant

84.332
84.010 84.281 84.318 84.298 84.340
. 84.276

Total U.S. Department of Education

NIA

60,000.00

60,000.00

_NIA

562,337.42

562,337.42

NIA

16,279.00

16,279.00

NIA

125,000.00

125,000.00

NIA

20,731.12

20,731.12

NIA

75,103.52

75,103.52

NIA

92,205.00

92,205.00

s

s 1 245 747.14

1 245 747.14

Total Federal Financial Assistance NIA= Not Available

s

1 942,817.31 S _..,:2.::,5~2.:3,;:;2::8,:;1-,:;28::,

- 30-

HART COUNTV BOARD OE EDUCATION SCHEDULE OE EXPENDITURES OF FEDERAL AWARDS
YEAR ENPEP JUNE 30 2000

SCHEDULE "1"

Notes to the Schedule of Exoonditurns 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) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2000 Natlonal School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
c> .Major Programs are identified by an asterisk in front of the CFDA number.
The Board did not provide Federal Assistance to any Subrecipienl.
The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Hart County Board of Education and Is presented on the modified accrual basis of accounting which Is the basis of accountinQ used in the presentation of the general purpose financial statements.

See notes to the general purpose financial statements.

- 31

HART COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 2000

SCHEDULE"2"

I
AGENCY/FUNDING
GRANTS Education. Georgia Department of Quality Basic Education General and career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School lnce~live Program Special Instructional Assistance In-School Suspension Counselors Technology Specialist Local Five Mill Share Educational Equalization Formula Food Services Vocational Education Other State Programs Alternative Program At-Risk Summer School Program Health Insurance Mentoring Program Mentor Teachers Pay for Performance Preschool Handicapped Program Remedial Summer School Special Education Low Incidence Grant Teachers' Retirement Tuition for the Multi-Handicapped Year 2000 Project Funding Lottery Programs Assistive Technology Computers in the Classroom
Georgia Department of Community Affairs Local Assistance Grant
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Reading First Grades 1-3

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND.

FUND

TOTAL

$ 8,163,867.00
2.494,842.00 . 174,842.00 351,987.00 96,170.00
2,198,610.00
436,759.00 141,659.00 274,151.00 380,543.00
73,272.00 30,774.00 57,685.00 -2,545.218.00 434,326.00
$
6,160.39
91,147.00 10,470.16 240,519.21
3,825.44 972.00
56,000.00 38,844.00
6,508.62 23,418.51 21,520.62 98,514.70
2,917.66
60,842.00

$ 8,163,867.00 2,494,842.00 174,842.00 351.987.00 96,170.00 2,198,610.00

97,264.00

436,759.00 141,659.00 274,151.00 380,543.00
73,272.00 30,774.00 57,685.00 -2,545.218.00 434,326.00 97.264.00
6,160.39

91,147.00 10,470.16 240,519.21
3.825.44 972.00
56,000.00 38,844.00
6.508.62 23,418.51 21,520.62 98.514.70
2,917.66

15,822.11 77.056.46

15,822.11 77.056.46

11,250.00

11,250.00

60.842.00

87163.00

87163.00

$ 13,425,929.31 $

288,555.57 $ 13,714,484.88

See notes to the general purpose financial statements.

-32-

HART COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30 2000

SCHEDULE 3

PROJECT

ORIGINAL ESTIMATED
COST (1)

For the purpose of funding, in whole

or in part, the acquisition, construction,

furnishing and equipping of two new

elementary schools, parking areas and

grounds, induding the acquisition of

all necessary real and personal property;

the acquisition, construction, furnishing

and equipping of additional dassrooms,

instructional and support space and the

modification of existing space at Hart

County Middle School; the renovation

and modification of existing school

district facilities: the acquisition of any

necessary personal property, induding

oomputers and other technology, and

the payment of expenses Incident

thereto (collectively, the "Projects"), the

maximum cost of such Projects not to

exceed $11,000,000.00

$

11,000,000.00 $

CURRENT ESTIMATED
COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

1e1so1 1ss2.s1 $

665,024.10 $

AMOUNT EXPENDED
IN PRIOR YEARS
0.00

(1) The Board's original cost estimate as specified In the resolution calling for the Imposition of the Local Option Sales Tax.
(2) The Board's current estimate of total cost for the projects. Includes all cost from project Inception to completion.
(3) :he voters of Hart County approved the Imposition of a 1% sales tax to fund the above projects. Amounts expended for these projects may include sales tax proceeds, state, local property
taxes and/or other funds over the life of the project

See notes to the general purpose financial statements.

.33.

HART COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 2000

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
Expenditures per Audit
Amount of Underexpenditure for Total Allotment

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

11,185,538.00 $

316 456.00

$

12,443,659.71

576,655.22 $

$

13,020,314.93

509,157.26

-162,117.73

$

12,858,197.20

$

o.oo s=======o=.o=o

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

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

HART COUNTY BOARD OF EDUCATION ,

ANALVSIS QF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM

GENERAL FUND QUALITY BASIC EDUCATION PROGRAMS -

. '

YEAR ENDED JUNE 30 2000

,t
GENEBeib ,!NQ CAREER EDUC.!TIQ~ PROGRAMS

Kin~e_rgarte~ () Grades 1 - 3 (')

j-,- l"'
I , ..

Sub-Total K-3

Grades 4 - 5 (*)

Grades 6 - 8 (')

Grades 9 - 12 (')

,High School Laboratories_{*)_
-
Vocational Education Laboratories (*)

Total General and Career Education Programs

SPSCIAb EPUCATIQ~ PRQGBAMS
.. Regular Programs ' '

Category I(")

Category II(') Category Ill (')

'-

Category rv (')

Sub-Total Regular

'' Category VI (Gifted)(')
Total Special Education Programs

REMEP16L EPUCAIID~ PRDGBAM 11 Total Fourteen Weighted Programs

MEDIA C!;t:iI:EB PBQGBeiMS
Salaries Operations

Total Media Center Programs

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL ..lL

ORIGINAL

MIO-TERM

$

896,392.00

$

806,752.80 $

0.00

2,442,703.00

2,198,432.70

$ 3,339,095.00 90 $ 3,005,185.50 $

0.00

916,71 LOO 90-

825,039.90

1,686,284.00 90

1,517,655.60

1,171,388.00 90

1,054,249.20

456,103.00 90

410,492.70

594,286.00 90

534.857.40

$ 8,163,867.00

$ 7,347,480.30 $

0.00

$ 1,958,357.00

$ 1,762,521.30 $

0.00

$ 1,958,357.00 90 $ 1,762,521.30 $

0.00

536,485.00 90 .

482,838.50

$ 2,494,842.00

$ 2,245,357.80 $

0.00

$

174,842.00 90 $

157,357.80 $

0.00

$ 10,833,551.00

$ 9,750,195.90 $

0.00

$

285,434.00 90 $

256,890.60 $

0.00

66,553.00 100

66,553.00

$

351,987.00

$

323,443.60 $

0.00

Total Fourteen Weighted and Media Center Programs $ 11,1es.s38.oo

s 10,073,639.50 $

0.00

STAFF DEYEbQPMENI PBDGBAMS Cost of Instruction Professional Development
Total Staff Development Programs
cJ Identifies Fourteen Weighted Programs.
See notes to the general purpose financial statements.

$

31,180.00

$

31,180.00 $

0.00

84,990.00

64,990.00

0.00

$

96,170.00 100 $

96,170.00 $

0.00

C

'! I

r,

- 36--

SCHEDULE 5

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

s

s s 806,752.80

1,032,764.33

s 23,686.91

1,056,451.24

2,198,432.70

2,643,041.26

104,756.04

2,747,797.30

s s s 3,005, 185.50

3,675,805.59

s s 128,442.95

3,804,248.54

0.00

825,039.90

1,636,913.95

69,993.87

1,706,907.82

0.00

1,517,655.60

1,812,390.42

66,170.09

1,878,560.51

0.00

1,054,249.20

1,332,547.21

61,893.93

1,394,441.14

0.00

410,492.70

540,850.06

15,280.23

556,130.29

0.00

534,857.40

574,701.46

61,839.28

636,540.74

0.00

s 7,347,480.30 $

s 9,573,208.69

s 403,620.35

9,976,829.04

s 1,762,521.30 s
s s 1,762,521.30

s 33,291.23
265,023.25 1,438,514.49
95 910.94
s 1,832,739.91

482,836.50

453,619.76

s s s 2,245,357.80

2,286,359.67

s

s 157,357.80

s 137,484.58

s s s 9,750,195.90

11,997,052.94

s 3,953.60
4,615.39 17,217.93 7 809.13
s 33,596.05

37,244.83 269,638.64 1,455,732.42 103,720.07
1,866,335.96

70 882.14

524,501.90

s 104 478.19

2,390,a37.88

s 1 056.72

138,543.30

s 509,157.26

12,506,210.20

0.00 0.00
18,814.50

s

s 256,890.60

66,553.00

446,606.77
s

s
67 497.96

446,606.77 67 497.96

0.00 0.00

s

323,443.60 .S

s 446,606.77

s 67 497.96

514,104.73

s s s 10,073,639.50

12,443,659.71

s s 576,655.22

13,020,314.93

18,814.50

s

31,180.00

64 990.00

s===9=6=1,.1.,0.=o=o

s

52,204.96 $

52,204.96

45 397.99

45,397.99

s

97,602.95 $

e1.so2.95 ~=-=--==-o=.oo=

37

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS
(

RusSELL W. HtNTON
STATE AUDITOR (404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.W.. Suite 214
Atlanta. Georgia 30334-8400
April 4, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
. and Superintendent and Members of the Hart County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements of Hart County Board of Education as of and for the year ended June 30, 2000, and have issued our report thereon dated April 4, 2001. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted . auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
We did not observe the taking ofeither the Federal donated commodities inventory or the purchased foods inventory at June 30, 2000, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
Compliance
As part of obtaining reasonable assurance about whether Hart County Board ofEducation'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 of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour 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.

2000YB-40

Internal Control Over Financial Reporting
In planning and performing our audit, we considered Hart 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 control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. 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 Hart County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-6731-00-01 . and FS-6731-00-03.
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, ofthe reportable conditions described above, we consider item FS-6731-0003 to be a material weakness.
This report is intended solely for the information and use of management, members of the Hart 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:jb 2000YB-40

State Auditor

RussELL W. H1NTON
STATE AUDITOR
{404) 656-2\74

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W.. Suite 214
Atlanta. Georgia 30334-8400
April 4, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Hart 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 ofHart County Board ofEducation with the types of compliance 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, 2000. Hart County Board of Education's major Federal programs are identified in the accompanying Schedule ofFindings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicableto each of its major Federal programs is the responsibility ofHart County Board ofEducation's management. Our responsibility is to express an opinion on Hart County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance 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 0MB Circular A-133, 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 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 Hart 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 Hart County Board of Education's compliance with those requirements.
2000SA-10

In our opinion, the Hart County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 2000.
Internal Control Over Compliance
The management ofHart County Board ofEducation 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 Hart County Board of Education'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 oflaws, 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 of management, members of the Hart 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,
? "" ~-~ ~inton State Auditor
RWH:jb 2000SA-10

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

HART COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 2000

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6731-98-01 FS-6731-99-01

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-6731-99-01

It is the intent of the Hart County School System to employ, as soon as practical, the services of an outside agency to develop a system-wide General Fixed Assets Account Group to include an inventory ofland, buildings and equipment owned by the Board. Such program should include date acquired, acquisition cost, estimated replacement cost, location and description. After the program is established, detailed records will be maintained.

SECTION IV FINDINGS AND QUESTIONED COSTS

HART COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000

I SUMMARY OF AUDITOR'S RESULTS

I. Type of Report Issued on the Financial Statements
The auditor's opinion on the Hart County Board of Education's financial statements was qualified for a scope limitation and 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 Hart County Board of Education disclosed financial statement reportable conditions related to the following control categories.

Cash and Cash Equivalents

General Fixed Assets

Of the reportable conditions described above, General Fixed Assets is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit ofthe Hart County Board of Education 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 Hart 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 Hart 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 .5JO{a) ofOMB Circular A-133 The Hart County Board ofEducation's audit did not disclose audit findings required to be reported by section .5lO(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 84.010 Elementary and Secondary Education Act - Title I - Grants to Local Educational Agencies 84.276 Goals 2000 - State and Local Education Systemic Improvement Grant
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Hart County Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.

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HART COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000

Il FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

CASH AND CASH EQUNALENTS Uncollateralized Deposits Reportable Condition - . ,
Nonmaterial Noncompliance Finding Control Number: FS-6731-00-01

,,

r .

.

.

,;.

.

'..

-

-

As of June 30, 2000, the Hi!rt County Board of Education failed to jl_ave its bank balances fully

collateralized as provided for by the Official Code of G\:orgia Annotated s_ectjon 45-8-12 which

states, in part, as follows:

- . '

. ~, ~



r ~ i. , ,. :

.,

"The collecting officer or officer holding public funds may not have on deposit at any one

time in any d~ository for a tim_e Long~ than tendays a sum of money belonging to the

public body when such depository has not given bond to the public body as set forth in this

code section ... The aggregate of the face value of such surety bond and the market value of

securities pledged shall be equal to not less than 110 percent of the public funds being

secured after the deduction of the amount of deposit insurance".'

,

., 1' ',
The Hart County Board of Education should implement procedures to monitor the collateralization of bank balances to ensure compliance at all times with State laws governing deposits and investments.

Management's Response:

. The auditor is in possession of a correspondenc~-fr~m Michael T. Starrett, Vice President ofPinnacle Banks indicating collateralizing of school system deposits.

Mr. Starrett suggests that the bank may have made a mistake in failing to collateralize all funds, It is

~

_my
,

understanding

'

,

that

the

funds

found

to

not

be

collateral.ized

were

in

a

checking

account.

Mr: . Assurance have been given by Starrett that all funds de~osited in theschool sys;em;s account(s)

will be collateralized as required by law now and in the future.

EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Nonmaterial Noncompliance Amount: $18,814.50 Finding Control Number: FS-6731-00-02

The Hart County Board of Education had an underexpenditure of Quality Basic Education (QBE) funds of $18,814.50 for Remedial Education Programs. This underexpenditure of.funds occurred becau.se management expended less than the required minimum amc,>unt for *is QBE program. The

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HART COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Nonrnaterial Noncompliance Amount: $18,814.50 Finding Control Number: FS-6731 ~00-02
underexpenditure of$ l 8,8 l 4.50 should be returned to the Georgia Department ofEducation through an increase in the Board's local five mill share for the QBE programs in a subsequent fiscal period.
Management's Response:
The underexpenditure ofremedial funds did occur. In the future, the accounting director, remedial program supervisor, and finance director will evaluate, such expenditures periodically in order to prevent future occurrence of such.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-6731-00-03
The Hart 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 ofa 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.
Management's Response:
It is the intent of the Hart County School System to employ, as soon as practical, the services of a outside agency to develop a system-wide General Fixed Assets Account Group to include an inventory ofland, buildings and equipment owned by the Board. Such program should include date acquired, acquisition cost, estimated replacement cost, location, and description. After the program is established, detailed records will be maintained.
ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
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