Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1996

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1995 -9t::,

AUDIT REPORT HOUSTON COUNTY BOARD OF EDUCATION
PERRY, GEORGIA YEAR ENDED JUNE 30, 1996

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

HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

5

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

6

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

24

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

28

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

30

I

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

32

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

33

2 CASH AND CASH EQUIVALENTS

35

3 INVESTMENTS

36

4 ACCOUNTS RECEIVABLE

37

5 DEBT SERVICE REQUIREMENTS TO MATURITY

38

HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
V

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

SCHEDULE OF REVENUE

6

STATE

40

7

TAXES AND OTHER

42

SCHEDULE OF EXPENDITURES BY OBJECT

8

GENERAL AND SPECIAL REVENUE FUNDS

43

9

LOTTERY PROGRAMS

44

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

10

OVERALL

47

11

BY PROGRAM

48

12 SCHEDULE OF COMPENSATION OF BOARD MEMBERS

50

SECTION II
COMPLIANCE
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS

HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION III INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Houston County Board ofEducation
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARYINFORMATIONSCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
Ladies and Gentlemen:
We have audited the general purpose financial statements (Exhibits A through D) of the Houston County Board of Education, as of and for the year ended June 30, 1996, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
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.
96ARL-13

* The Board did not report compensated absences within the general purpose financial statements as required by generally accepted accounting principles.
V
* School activity accounts maintained at the individual schools are not included in the general purpose :financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 1996, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1996. Also funds received, subsequent to June 30, 1996, from the Georgia Department ofEducation 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, 1995, were improperly recorded in the year ended June 30, 1996. 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 Board has received $16,533,005.13 in local option sales tax collections for which revenue recognition has been deferred to future periods by the Board. If these amounts had been recorded as revenue as required by generally accepted accounting principles, the Board's fund balance would have increased by a like amount.
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 present fairly, in all material respects, the financial position of the Houston County Board of Education as of June 30, 1996, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. In accordance
with Government Auditing Standards, we have also issued a report dated April 1O; 1997, on our consideration
of the Board's internal control structure and a report dated April 10, 1997, on its compliance with laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the Houston County Board pfEducation taken as a whole. The combining and individual fund statements (Exhibits E through I) and the financial schedules (Schedules 1 through 12 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Houston County Board of Education. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effects ofthe 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.
96ARL-13

A copy ofthis report has been filed as a pennanent 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,

CLV:gp 96ARL-13

Claude L. Vickers State Auditor

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT
LOTTERY PROGRAMS YEAR ENDED JUNE 30, 1996

\(
EXPENDITURES
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Water, Sewer and Cleaning Services Communications Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures
Nonoperating Costs Principal Land and Land Improvements Building and Building Improvements Equipment

ALTERNATIVE SCHOOL PROGRAM

INSTRUCTIONAL TECHNOLOGY

PRE-KINDERGARTEN PROGRAM (1)

$

$

6,547.00 $

54,716.18

6,934.16

22,425.00

322,690.51

1,329,198.73 335,887.46 11,733.21
556.56
11,008.00 1,065.55
22,498.66 341,268.43
5,500.00 4,055.15
56,578.25 10,893.10 12,604.36
144,000.00
4,570.70
305,777.84

Total Expenditures

$

28,972.00 $

384,340.85 $ ====2=,5=97=,1=9=6=.o=o

(1) Expenditures in the amount of $326,122.00 associated with the inception of a capital lease have been excluded from this schedule.

See notes to the general purpose financial statements. - 44 -

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

SCHEDULE "8"

EXPENDITURES
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Property Services Insurance Communications Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures
Nonoperating Costs Principal and Interest Land and Land Improvements Building and Building Improvements Equipment

GENERAL
FUND

SPECIAL REVENUE
FUND

TOTAL

$ 58,953,966.34 $
16,651,488.48 179,211.86 240,445.63 18,100.00 201,218.22 285,490.19 11,964.04 115,050.55 179,747.00 214,893.57
9,078.26 332,035.79 3,242,175.30 2,291,223.29
1,144,776.11 200,173.87 98,495.40

5,232,220.24 $
1,195,021.16 53,964.59
183,416.14
17,898.00 25,850.98
8,486.50 25,817.90
42,064.96 1,127,298.29
5,500.00 2,513,524.73
123,459.90 28,450.54 53,731.03

64,186,186.58 17,846,509.64
233,176.45 423,861.77
18,100.00 219,116.22 311,341.17
11,964.04 115,050.55 179,747.00 223,380.07
25,817.90 9,078.26
374,100.75 4,369,473.59 2,296,723.29 2,513,524.73 1,268,236.01
228,624.41 152,226.43

573,208.63 285,122.35 1,477,871.14 2,827,242.97

144,000.00 4,570.70
1,770,792.97

717,208.63 289,693.05 1,477,871.14 4,598,035.94

Total Expenditures

$ 89,532,978.99 $ 12,556,068.63 $ 102,089,047.62

See notes to the general purpose financial statements. - 43 -

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

SCHEDULE "7''

,..
Taxes County Wide Bond Tax County Wide School Tax Local Option Sales Tax Railroad Car Tax Real Estate Transfer Tax
other Sources Compensation for Loss of Assets Contributions from All Funds For Workers' Compensation Insurance Donations Georgia Power Company Sam Nunn Campaign Committee Various Sources Interest Earned Lost and Damaged Books Rents Sales Adult Meals Breakfast Lunches Supplemental School Assets Sales of Supplies and Materials Less: Purchases for Resale Shared Service Contributions Houston County lnteragency Council Tuition Other

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

DEBT SERVICE
FUND

TOTAL

$ 16,374,233.95 9,506,384.56 7,269.02 106,819.15

$ 1,295,793.36 $ 1,295,793.36

16,374,233.95

9,506,384.56

564.82

7,833.84

8,300.10

115,119.25

22,332.08

447,000.00

3,000.00
$ 1,on,202.01
13,849.82 8,334.38

$ 65,000.00 170.00 49,006.90 54,730.86 448,829.40

14,095.00 888,539.93 -531,2n.10

253,821.15 27,339.15 1,673,674.91 111,n3.ao
2,059.60

24,491.44 643,335.51 184,214.30

19,945.54

43,854.13

22,332.08
447,000.00
3,000.00 65,000.00 49,176.90 1,624,616.46 13,849.82
8,334.38
253,821.15 27,339.15
1,673,674.91 111,n3.B0 16,154.60 888,539.93 -531,2n.10
24,491.44 643,335.51 204,159.84

$ 28,789,823.51 $ 2,149,515.01 $ 562,836.30 $ 1,348,512.41 $ 32,850,687.23

See notes to the general purpose financial statements.

- 42 -

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

SCHEDULE "6"

AGENCY/FUNDING
GRANTS Human Resources, Georgia Department of Family Connection
Office of Planning and Budget Georgia Challenge Program
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACTS Education, Georgia Department of Leadership Development Programs

GOVERNMENTALFUNDTYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 50,000.00

$

50,000.00

1,189,996.00

178,024.00

$

50,000.00

50,000.00

1, 189,996.00

178,024.00

11,000.00

11,000.00

$ 57,904,961.16 $ 3,798,842.28 $ 1,623,380.00 $ 63,327,183.44

(1) School of Excellence Awards

See notes to the general purpose financial statements.

- 41 -

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1996

SCHEDULE 6"

,..
AGENCY/FUNDING
GRANTS Administrative Services, Georgia Department of Distance Leaming/Telemedicine Grant
Children and Youth Services, Georgia Department of Project Peace
Community Affairs, Georgia Department of Local Assistance Grant
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-School Suspension Technology Training Counselors Grades 4 and 5 Mid-term Adjustment Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Programs Apprenticeship Program At-Risk Summer School Program Environmental Science Program Health Insurance Governor's Emergency Funds (1) Innovative Programs Mentor Teacher Program Mentoring Program Preschool Handicapped Program Remedial Summer School Program Teachers Retirement Lottery Programs Alternative School Program Instructional Technology Pre-Kindergarten Program Safe Schools Grant Technology Installation
Georgia State Financing and Investment Commission Reimbursement on Construction Projects Lottery

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$

1,000.00

$

1,000.00

$

19,305.98

19,305.98

40,000.00

$

5,000.00

45,000.00

34,753,693.00 5,946,9TT.OO 816,289.00 1,472,753.00 472,096.00 9,209,361.00
1,092,420.00 293,676.00
1,305,635.00 1, 167,008.00
381,666.00 180,355.00
97,723.00 884,191.00 -6,068,994.00 4,081,371.00
16,999.05
130,840.00 184,563.95
71,072.24 1,500.00
TT2,286.34 4,000.00 4,800.00
27,373.14 19,800.00 213,585.00 21,970.50 69,926.94

393,706.00
28,972.00 378,855.85 1,407,200.00
83,685.00 247,121.45

34,753,693.00 5,946,9TT.OO 816,289.00 1,472,753.00 472,096.00 9,209,361.00
1,092,420.00 293,676.00
1,305,635.00 1,167,008.00
381,666.00 180,355.00
97,723.00 884,191.00 -6,068,994.00 4,081,371.00 393,706.00
16,999.05
130,840.00 184,563.95
71,072.24 1,500.00
TT2,286.34 4,000.00 4,800.00
27,373.14 19,800.00 213,585.00 21,970.50 69,926.94
28,972.00 378,855.85 1,407,200.00
83,685.00 247,121.45

1,618,380.00

1 ,618,380.00

- 40 -

SCHEDULE "5"

GENERAL OBLIGATION BONDS

1988 ISSUE

INTEREST

PRINCIPAL

1987 ISSUE

INTEREST

PRINCIPAL

INTERGOVERNMENTAL CONTRACT

TRUST CERTIFICATES

1994 ISSUE

INTEREST

PRINCIPAL

$

21,420.00 $ 340,000.00 $

7,590.00 $ 110,000.00 $ 690,745.00 $

200,000.00

681,945.00

190,000.00

673,205.00

200,000.00

663,605.00

200,000.00

653,705.00

210,000.00

643,205.00 631,985.00 620,285.00 608,095.00 595,135.00

220,000.cio 225,000.00 230,000.00 240,000.00 255,000.00

581,110.00 566,550.00 550,875.00 471,812.50 393,606.25

260,000.00 275,000.00 1,375,000.00 1,455,000.00 1,535,000.00

311,100.00 213,600.00 110,100.00

1,625,000.00 1,725,000.00 1,835,000.00

$

211420.00 $ 3401000.00 $

71590.00 $ 1101000.00 $ 916601663.75 $ 1212551000.00

INTERGOVERNMENTAL
CONTRACT TRUST
CERTIFICATES 1994 ISSUE
$ 12,445,000.00
190,000.00

$ 1212551000.00

FEB 1 -AUG 1 FEB 1

- 39 -

PAYMENTS DUE "IN FISCAL YEAR
ENDING JUNE 30
1997 1998 1999 2000 2001
2002 2003 2004 2005 2006
2007 2008 2009 2010 2011
2012 2013 2014

HOUSTON COUNTY BOARD OF EDUCATION DEBT SERVICE REQUIREMENTS TO MATURITY
JUNE 30, 1996

TOTAL DEBT SERVICE

TOTAL INTEREST

TOTAL PRINCIPAL

1993 ISSUE

INTEREST

PRINCIPAL

$ 1,910,020.00 $ 1,165,020.00 $

1,903,220.00

1, 123,220.00

1,904,110.00

1,089,110.00

1,906,835.00

1,051,835.00

1,911,150.00

1,011,150.00

745,000.00 $ 780,000.00 815,000.00 855,000.00 900,000.00

445,265.00 $ 441,275.00 415,905.00 388,230.00 357,445.00

95,000.00 590,000.00 615,000.00 655,000.00 690,000.00

1,911,840.00 1,914,370.00 1,913,400.00 1,918,830.00 1,920,025.00

966,840.00 919,370.00 868,400.00 813,830.00 755,025.00

945,000.00 995,000.00 1,045,000.00 1,105,000.00 1,165,000.00

323,635.00 287,385.00 248,115.00 205,735.00 159,890.00

725,000.00 770,000.00 815,000.00 865,000.00 910,000.00

1,921,860.00 1,923,950.00 1,925,875.00 1,926,812.50 1,928,606.25

691,860.00 623,950.00 550,875.00 471,812.50 393,606.25

1,230,000.00 1,300,000.00 1,375,000.00 1,455,000.00 1,535,000.00

110,750.00 57,400.00

970,000.00 1,025,000.00

1,936,100.00 1,938,600.00 1,945,100.00

311,100.00 213,600.00 110,100.00

1,625,000.00 1,725,000.00 1,835,000.00

$ 3415601703.75 $ 131130;103.75 $ 2114301000.00 $ 314411030.00 $ 817251000.00

CHANGES IN GENERAL LONG-TERM DEBT Debt Payable at July 1, 1995 Debt Retired During Period
Debt Payable at June 30, 1996
MATURITY DATES Semi-Annual Interest Payment Dates Annual Debt Retirement Date

TOTAL $ 22,135,000.00 $
705,000.00

GENERAL OBLIGATION BONDS

1993 ISSUE

1988 ISSUE

1987 ISSUE

8,820,000.00 $ 655,000.00 $ 215,000.00

95,000.00

315,000.00

105,000.00

$ 21 i4301000.oo $

8;1251000.00 $ 3401000.00 $ 11opoo.oo

MAR 1 -SEPT 1 MAR 1 -SEPT 1 MAR 1 - SEPT 1

MAR 1

MAR 1

MAR 1

See notes to the general purpose financial statements.

- 38 -

HOUSTON COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30.1996

Children and Youth Services, Georgia Department of Project Peace
Defense, U. S. Department of Department of Air Force R.O.T.C. Program
Education, Georgia Department of Food Services School Breakfast Program National School Lunch Program Federal Programs Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Individuals with Disabilities Education Act Part B - Special Education Flow Through Preschool Safe and Drug-Free Schools
Georgia State Financing and Investment Commission Reimbursement on Construction Projects Regular Lottery
Houston County Tax Commissioner County Wide Bond Tax County Wide School Tax
Human Resources, Georgia Department of Family Connection
Office of Planning and Budget Georgia Challenge Program
Office of School Readiness Pre-Kindergarten Program
Various Sources Refunds Staff Development Charges Vendor Overpayments Rental of Facilities Returned Checks

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE PROJECTS

FUND

FUND

DEBT SERVICE
FUND

TOTAL

$ 6,404.17

$

6,404.17

$ 11,473.33

11,473.33

41,379.79 79,364.97

41,379.79 79,364.97

256,414.80
71,289.99 17,635.55
4,000.00

256,414.80
71,289.99 17,635.55 4,000.00

$ 285,314.00 344,352.15

285,314.00 344,352.15

429,510.41

$ 31,772.88

31,772.88 429,510.41

8,448.58

8,448.58

27,135.00

27,135.00

241,464.00

241,464.00

1,700.00 2,000.00
903.25

1,819.05 293.83

195.40

1,700.00 4,014.45
903.25 293.83

$ 472,721.99 $ 728,514.73 $ 629,861.55 $ 31,772.88 $ 1,862,871.15 !\

See notes to the general purpose financial statements.

- 37 -

HOUSTON COUNTY BOARD OF EDUCATION INVESTMENTS JUNE 30, 1996

SCHEDULE "3"

INVESTMENT POOL
State of Georgia, Office of Treasury and Fiscal Services Local Government Investment Pool (5.361 %)
PORTFOLIO ACCOUNTS
Reliance Trust Company, Atlanta, Georgia
Synovus Trust Company, Columbus, Georgia

$ 15,699,041.25

$ 4,793,575.07

406,912.29

5,200,487.36

$ 20,899,528.61

See notes to the general purpose financial statements. - 36 -

HOUSTON COUNTY BOARD OF EDUCATION CASH AND CASH EQUIVALENTS JUNE 30, 1996
INTEREST BEARING ACCOUNTS
C B & T of Middle Georgia, Warner Robins, Georgia
N.O.W. Accounts (Variable)

SCHEDULE "2"
$ 4,082,030.42

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

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

SCHEDULE "1"

v FUNDING AGENCY PROGRAM/GRANT
OTHER FEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program
Energy, U. S. Department of Direct Crude Oil Settlement
Health and Human Services, U. S. Department of Through Georgia Department of Medical Assistance Medicaid Assistance 1996 Grant

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

$ 1341723.53

(4)

$

11662.00

(5)

$

151339.05

(5)

Total Federal Financial Assistance

$ 6,839,253.24 $ 8,788,225.10

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

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

See notes to the general purpose financial statements.

- 34 -

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30. 1996

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Through Georgia Department of Education Food and Nutrition Program Child and Adult Care Food Program 1996 Contract Food Services School Breakfast Program 1996 Grant National School Lunch Program 1996 Grant Food Distribution Program (1)
Total U. S. Department of Agriculture
Education, U. S. Department of Direct P. L. 81-874 1991 Grant 1994 Grant 1995 Grant 1996 Grant Through Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1996 Grant State School Improvement Grants 1996 Grant Title II Eisenhower Professional Development 1995 Regular 1996 Grant Title VI Innovative Education Program Strategies 1996 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1996 Grant Preschool 1996 Grant Safe and Drug-Free Schools 1996 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1996 Grant Consumer and Homemaking Education 1996 Grant
Total U. S Department of Education

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10.558 $ 40,185.85

(2)

* 10.553

466,401.59

(2)

* 10.555 * 10.550

2,077,849.84 $ 5,643,300.53 (3)

423,645.31

423,645.31

$ 3,008,082.59 $ 6,066,945.84

* 84.041 $

4,998.73

(5)

* 84.041

57,040.00

(5)

* 84.041

48,484.00

(5)

* 84.041

845,695.00

(5)

* 84.010 84.218

1,600,614.80 $ 27,527.04

1,600,614.80 27,527.04

84.281 84.281

9,673.94 50,400.00

9,673.94 48,450.92

84.298

100,287.00

100,287.00

* 84.027 84.173 84.186

588,889.99 106,935.55
72,936.02

588,889.99 106,935.55
72,936.02

84.048

159,964.00

84.049

6,000.00

$ 3,679,446.07 $

159,964.00 _. .
6,000.00
2,721,279.26

- 33 -

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

EXHIBIT"!"

DEFERRED COMPENSATION PLAN
ASSETS Investments Held by Trustee

BALANCE JULY 1, 1995

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 1996

$ 5,911,692.29 $ 461,996.14 $

93,108.40 $ 6,280,580.03

LIABILITIES Deferred Compensation Plan

$ 5,911,692.29 $ 461,996.14 $

93,108.40 $ 6,280,580.03

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

EXHIBIT"H"

FINANCING AND INVESTMENT COMMISSION

PROJECT

PROJECT

PROJECT

95/96-676-40 96/96S-676-031 96/96S-676-032

LOTTERY PROJECT 96/95S-676-046

TOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995

$

0.00 $

$

0.00 $

0.00 $

0.00 $ 1,618,380.00 $ 1,623,380.00 $ 3,745,117.00

562,836.30

599,633.36

- - - - - 0.00 $

0.00 $ 1,618,380.00 $ 2,186,216.30 $ 4,344,750.36

$

0.00 $

$

0.00 $

$

0.00 $

0.00 $
0.00 $ 0.00 $

0.00

$

17,400.00 $

1,331.11

324.25

$ 3,651,239.69

6,515.50 9,908,502.40
9,066.00

800.00 61.20
958.50
8,625,102.97 18,867.78

3,870.50

0.00 $ 3,651,239.69 $ 9,947,009.76 $ 8,645,790.45

0.00 $ -2,032,859.69 $ -7,760,793.46 $ -4,301,040.09

$ 150,127.00 $

52,790.00 $ 1,853,039.69 $ 3,576,979.03 $ 3,410,261.83

-2,545,962. 74

-2, 113,462.36

$

150,127.00 $

52,790.00 $ 1,853,039.69 $ 1,031,016.29 $ 1,296,799.47

$

0.00 $ 150,127.00 $

20,257.00

0.00

52,790.00 $ 0.00

-179,820.00 $ -6,729,777.17 $ -3,004,240.62

179,820.00

8,555,566.71

12,468,402.11

-908,594.78

$ 20,257.00 $ 150,127.00 $

52,790.00 $ = = = =0.= 00 $ 1,825,789.54 $ 8,555,566.71

- 31 -

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

V

REGULAR

TRUST CERTIFICATE
FUND

GEORGIA STATE

PROJECT

PROJECT

94/95S-676-030 95/96-676-039

REVENUES

State Funds Taxes and Other Funds

$

5,000.00

114,006.90 $

$ 448,829.40

0.00 $

0.00

Total Revenues

$ 119,006.90 $

448,829.40 $

0.00 $

0.00

EXPENDITURES

Capital Outlay Salaries Employee Benefits Travel Professional and Technical Services Land and Land Improvements Building and Building Improvements Equipment
Debt Service Paying Agent Fees

$

17,400.00

$

1,331.11

324.25

6,515.50 1,741,851.19 $
9,066.00

4,515,411.52

3,870.50

0.00 $

0.00

Total Expenditures

$ 1,776,488.05 $ 4,519,282.02 $

0.00 $

0.00

Excess of Revenues over (under) Expenditures

$ -1,657,481.15 $ -4,070,452.62 $

0.00 $

0.00

OTHER FINANCING SOURCES (USES)

Operating Transfers In Operating Transfers Out

$ 1,521,022.34 $ -2,545,962.74

Total Other Financing Sources

(Uses)

$ 1,521,022.34 $ -2,545,962.74

Excess of Revenues and Other Financing

Sources over (under) Expenditures and

Other Financing Uses

$ -136,458.81 $ -6,616,415.36 $

0.00 $

0.00

FUND BALANCE JULY 1

619,733.41

7,653,742.30

0.00

82,014.00

Residual Equity Transfer

FUND BALANCE JUNE 30

$ 483,274.60 $ 1,037,326.94 $

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

0.00 $ 82,014.00

EXHIBIT"G"

FINANCING AND INVESTMENT COMMISSION

PROJECT

PROJECT

PROJECT

95/96-676-40 96/96S-676-031 96/96S-676-032

LOTTERY PROJECT 96/95S-676-046

TOTALS JUNE 30, 1996 JUNE 30, 1995

$ 20,257.00 $ 150,127.00 $

52,790.00

$ 788,267.20 $ 723,626.41

$ 2,771,838.01 4,791,751.47 10,531,036.12

344,352.15

629,861.55

1,220,757.00

5,000.00

$ 20,257.00 $ 150,127.00 $

52,790.00 $ 3,116,190.16 $ 6,209,880.22 $ 12,480,419.53

$ 2,683,846.25 $ 3,519,597.37 $

90,147.91

164,121.31

342,196.00

700,372.00

3,020,394.72 6,622.00
285,060.10 612,776.00

$ 3,116,190.16 $ 4,384,090.68 $ 3,924,852.82

$ 20,257.00 $ $ 20,257.00 $
0.00 $ 20,257.00 $

150,127.00 $ 150,127.00 $
0.00 150,127.00 $

52,790.00 52,790.00
0.00 $ 52,790.00 $

$ 1,037,326.94 $ 7,653,742.30

305,188.00

282,091.00

$ 1,342,514.94 $ 7,935,833.30

0.00

483,274.60

619,733.41

0.00 $ 1,825,789.54 $ 8,555,566.71

$ 20,257.00 $ 150,127.00 $

52,790.00 $ 3,116,190.16 $ 6,209,880.22 $ 12,480,419.53

- 29 -

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

ASSETS Cash and Cash Equivalents Investments Accounts Receivable Prepaid Expenses
Total Assets

REGULAR

TRUST CERTIFICATE
FUND

GEORGIA STATE

PROJECT

PROJECT

94/95S--676-030 95/96--676-039

$ 483,079.20

$

82,014.00

$ 2,019,913.46

195.40

$ 285,314.00

$ 483,274.60 $ 2,019,913.46 $

285,314.00 $

82,014.00

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Contracts Payable Retainages Payable

$ 550,437.12 $ 73,973.40
358,176.00

285,314.00

Total Liabilities

$ 982,586.52 $ 285,314.00

FUND EQUITY

Fund Balances Reserved For Purposes of Trust Certificates For State Capital Outlay Projects

$ 1,037,326.94 $

Unreserved Undesignated

$ 1,037,326.94

$

$ 483,274.60

o. oo $ _ _ ___,;;_o;.;o;,..::...o

Total Fund Equity

$ 483,274.60 $ 1,037,326.94 $

0.00 $

82,014.00 82,014.00
0.00 82,014.00

Total Liabilities and Fund Equity

$ 483,274.60 $ 2,019,913.46 $

285,314.00 $

82,014.00

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

EXHIBIT"F"

ACT TITLE VI
INNOVATIVE EDUCATION PROGRAM STRATEGIES

INDIVIDUALS WITH

DISABILITIES EDUCATION ACT

PARTS

SPECIAL EDUCATION

FLOW

THROUGH

PRESCHOOL

SAFE AND DRUG-FREE SCHOOLS

VOCATIONAL EDUCATION
FEDERAL

TOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995

$

100,287.00 $ 588,889.99 $

$

100,287.00 $ 588,889.99 $

106,935.55 $ 106,935.55 $

72,936.02 $

$ 165,964.00

3,798,842.28 $ 5,746,649.98 2,149,515.01

2,031,658.10 5,267,954.04 1,795,034.13

72,936.02 $ 165,964.00 $ 11,695,007.27 $ 9,094,646.27

$

98,306.12 $ 513,146.11 $

57,695.08

14,165.01

402.88

1,561.43

1,578.00

1,941.24 381.12

$

100,287.00 $ 588,889.99 $

$

0.00 $

0.00 $

78,944.46 $ 26,920.61
1,070.48
106,935.55 $

23,110.24 $ 158,408.85 $ 5,079,323.48 $ 2,894,287.22

277,047.44

189,309.10

48,471.72 202.55

791.15 64.00

229,067.58 111,797.74

234,803.40 494,746.41
69,731.06 5,744.51

1,076.51 75.00

6,700.00

347,273.24 109,630.08
6,700.00 75,681.75 6,071,000.99

232,797.60 23,289.50
6,929.92 5,303,105.23

99,975.63 4,570.70

167,585.33 4,832.89

144,000.00

72,936.02 $ 165,964.00 $ 12,556,068.63 $ 9,627,162.17

0.00 $

0.00 $

0.00 $ -861,061.36 $ -532,515.90

$

0.00 $

0.00 $

0.00

0.00

0.00 $ 0.00

0.00 $ 0.00

$ 326,122.00 39,497.00 $
$ 365,619.00 $

47,812.65 47,812.65

0.00 $ -495,442.36 $ -484,703.25

0.00

1,535,198.25 2,001,510.44

64,584.29 -2,606.10

12,177.83 22,147.52
-32,739.63 16,805.34

$

0.00 $

0.00 $

0.00 $

0.00 $

0.00 $ 1,101,734.08 $ 1,535,198.25

.'\

- 27-

f:!OUSTON COUNTY BOARD OF EDUCATION !::QMBINING S~TEMENT QF BE~EN!,.!!;:S EXPENDITUBES At:!Q Q!:!ANG!.;S IN FUND BAl,ANC!.;S
SPECIAi. Bs~i;N!,.!E F!,!NQ YEAR ENDED JUN!;: 30. 1996

ELEMENTARY AND SECONDARY EDUCATION

y

TITLE I

SCHOOL

GRANTS TO

STATE

TITLE II

FOOD

FAMILY

LOCAL

SCHOOL

EISENHOWER

SERVICES CONNECTION LOTTERY EDUCATIONAL IMPROVEMENT PROFESSIONAL

FUND

FUND

PROGRAMS

AGENCIES

GRANTS

DEVELOPMENT

REVENUES

State Funds Federal Funds Taxes and Other Funds

$ 393,706.00 $ 3.008,082.59 2,144,345.00

69,305.98 $ 3,335,830.30

15,339.05

$ 1,600,614.80 $

5,170.01

27,527.04 $

60,073.94

Total Revenues

$ 5,546,133.59 $ 89,815.04 $ 3,335,830.30 $ 1,600,614.80 $

27,527.04 $

60,073.94

EXPENDITURES

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

$ $ 6,066,945.84

$ 2,n8,352.83 s 1,420,263.23 $

187,282.78

5,148.97

54,442.89

37,847.19

38,920.54

70,536.58

430.60 99,975.63

345,332.00 106,593.31
3,887.10 4,055.15
4,570.70 144,000.00

78.06 66,740.n

8,791.64 15,334.52 $
3,400.88

58,015.10 109.76

Total Expenditures

$ 6,066,945.84 $ 100,406.23 $ 3,667,437.30 $ 1,600,614.80 $

27,527.04 $

58,124.86

Excess of Revenues over (under) Expenditures

$ -520,812.25 $ -10,591.19 $ -331,607.00 $

0.00 $

0.00 $

1,949.08

OTHER FINANCING SOURCES

Capital Leases Operating Transfers In

$ 326,122.00

$ 34,012.00

5,485.00

Total Other Financing Sources

$ 34,012.00 $ 331,607.00

Excess of Revenues and Other Financing

Sources over (under) Expenditures

$ -520,812.25 $

23,420.81 $

0.00 $

0.00 $

0.00 $

1,949.08

FUND BALANCE JULY 1

1,535,198.25

0.00

0.00

0.00

0.00

0.00

Food Inventory - Net Change in Period Donated Commodities Purchased Food
Supplies Inventory - Net Change in Period
Residual Equity Transfer

64,584.29 -2,606.10

FUND BALANCE JUNE 30

$ 1,076,364.19 $ 23,420.81 $

0.00 $

0.00 $

0.00 $

1,949.08

See notes to the general purpose financial statements.

- 26-

EXHIBIT"E"

ACT TITLE VI
INNOVATIVE EDUCATION PROGRAM STRATEGIES

INDIVIDUALS WITH

DISABILITIES EDUCATION ACT

PARTB

SPECIAL EDUCATION

FLOW

THROUGH

PRESCHOOL

SAFE ANO DRUG-FREE SCHOOLS

VOCATIONAL EDUCATION
FEDERAL

TOTALS JUNE 30, 1996 JUNE 30, 1995

$

0.00

$

426.12 $

0.00 $ 1,062,093.39 $ 1,700,833.21

$ 71,289.99 $

17,635.55

4,000.00

728,514.73

401,296.98

216,662.56 80,801.82

152,078.27 83,407.92

$

0.00 $ 71,289.99 $

17,635.55 $

4,426.12 $

0.00 $ 2,088,072.50 $ 2,337,616.38

$

3,905.59 $

14,140.50

53,243.90

$ 71,289.99 $

843.76 3,422.61 $ 13,369.18
17,635.55 $

643.14 2.n0.oo
1,003.98
4,426.12

$

22,062.73 $

19,838.71

197,164.26

218,307.40

766,107.45

516,168.85

1,003.98

48,103.17

$ 986,338.42 $ 802,418.13

$

0.00 $

0.00 $

$

0.00 $

0.00 $

0.00 $ 0.00 $

0.00 $ 0.00 $

$

1,949.08

216,662.56 $ 80,801.82

152,078.27 83,407.92

$ 299,413.46 $ 235,486.19

0.00

802,320.62 1,299,712.06

0.00 $ 1,101,734.08 $ 1,535,198.25

$ ====0==00= $ 71,289.99 $

17,635.55 $

4,426.12 $====0.=00= $ 2,088,072.50 $ 2,337,616.38

25 -

HOUSTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30 1996

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

SCHOOL FOOD
SERVICES FUND

FAMILY CONNECTION
FUND

LOTTERY. PROGRAMS

ELEMENTARY AND SECONDARY EDUCATION

TITLE I

GRANTS TO

STATE

TITLE II

LOCAL

SCHOOL

EISENHOWER

EDUCATIONAL IMPROVEMENT PROFESSIONAL

AGENCIES

GRANTS

DEVELOPMENT

$ 1,033,024.49 $

6,749.01 $ 19,944.69

$

0.00 $

1,949.08

121,038.59

16,671.80

241,464.00 $

256,414.80

216,662.56 80,801.82

Total Assets

$ 1,451,527.46 $

23,420.81 $ 261,408.69 $

256,414.80 $

0.00 $ ===1=,9=4=9.=08=

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 Federal Program For Inventories Food Donated Commodities Purchased Food
Unreserved Undesignated
Total Fund Equity

$

73,347.61

301,815.66

$ 375,163.27

$ $ 54,792.44
206,616.25

17,313.38 50,817.96 188,283.46

$ 261,408.69 $ 256,414.80

$ 216,662.56 80,801.82
$ 297,464.38 778,899.81 $
$ 1,076,364.19 $

23,420.81 $ 23,420.81 $

0.00 $ 0.00 $

0.00 $ 0.00 $

$

1,949.08

$ 0.00 0.00 $

1,949.08 0.00
1,949.08

Total Liabilities and Fund Equity

$ 1,451,527.46 $

23,420.81 $ 261,408.69 $

256,414.80 $

0.00 $ ====1='9=49==08=

See notes to the general purpose financial statements.

- 24-

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 13: RETIREMENT PLANS
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS)
PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia in accordance with State statute.
PSERS provides, in accordance with State statute, service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. If there are more than ten years of service, the beneficiary shall receive for life half of what the employee would have received upon retirement.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest.
There were 474 employees covered under PSERS for the year ended June 30, 1996.
PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees. Total contributions from employees ofthe Board made during fiscal year 1996 amounted to $15,588.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1996, was $9,817,769.80.
Note 14: SURETY BONDS
The School Superintendent, Mr. Tony Hinnant, is bonded in the amount of $50,000.00 with Zurich-American, Schaumburg, Illinois, their Bond No. CP06791772-00, on which premium was paid through November I, 1996.

- 23 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

. JUNE 30, 1996

Note 13: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1996 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.

Total contributions made during fiscal year 1996 amounted to $9,545,529.46, of which $6,706,287.97 was made by the Board and $2,839,241.49 was made by employees. These contributions represented 11.81% (Board) and 5% (employees) of covered payroll.

TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure ofthe pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers.

Total unfunded pension benefit obligation of TRS as of June 30, 1995, was as follows:

Total pension benefit obligation

$17,442,607,000.00

Net assets available for benefits, at cost

15,857,066,000.00

Unfunded pension benefit obligation

$ 1,585,541,000.00

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

Total contributions from all employers to TRS for fiscal year ended June 30, 1996 were $607,275,000.00. The Board's contribution for the year ended June 30, 1996 of $6,706,287.97 was actuarially determined and represented 1.1043% of total contributions made by all participating employers.

Ten year historical trend information is presented in the 1996 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due.

- 22 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 12: HOUSTON COUNTY SCHOOL DISTRICT BUILDING AUTHORITY
The Houston County School District Building Authority was created by House Bill 203 8 during the 1994 session of the Georgia General Assembly. The purpose of the Authority is to acquire, construct, own and convey real property and personal property for the benefit of the Houston County Board ofEducation. The members of the Authority consist of the Chairman of the Houston County Board of Education, the Superintendent ofthe Houston County Board ofEducation, and the Chairman ofthe Board of Commissioners of Houston County.
The Houston County School District Building Authority is a component unit of the Houston County Board ofEducation and as such the Authority's financial activity has been blended with the Houston County Board ofEducation's general purpose financial statements.
Note 13: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS).
TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. A member is eligible for service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest.
}\
The Board's payroll for employees covered by TRS for the year ended June 30, 1996, was $56,784,825.60; total payroll was $64,203,586.58.
- 21 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

V
Note 9: CONTINGENT LIABILITIES
Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position.
The Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the general purpose financial statements.
Note I 0: 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.
All amounts of compensation 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 of due care that would be required of an 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, Hartford Life, Prudential Retirement Services, Inc. and Variable Annuity Life Insurances. Under these plans, participants select from an investment option, or combination of investment options, determined by the Board.
Note 11: ACCUMULATED EMPLOYEES' LEAVE
Employees retiring under either the Teachers Retirement System of Georgia or the Public School Employees Retirement System will be paid for unused leave up to the one hundred days maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Houston County Board of Education, contiguous with retirement, in order to qualify.
Employees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Board, contiguous to a voluntary termination. See Note 1 - Compensated Absences

- 20 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 7: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $1,020,237.28 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department ofEducation Paid to the State Merit System ofPersonnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $772,286.34

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $69,926.94

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 $178,024.00

Note 8: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1996:

Project

Unearned Executed Contracts

Centerville Elementary Roof Perdue Elementary Addition Perry Annex Tabor Middle Roof Middle School #2 96/95S-676-046

$ 13,067.00 3,000.00 15,000.00
31,022.00 76,676.63 676,430.76

$ 815.196.39

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

- 19 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 5: GENERAL LONG-TERM DEBT

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

Intergovernmental

General

CaRital Leases

Contract

Obligation

GSBA

Other

Trust Certificates

Bonds

Total

Balance July 1, 1995

$

0.00 $ 839,847.34 $12,445,000.00 $ 9,690,000.00 $22,974,847.34

Additions

2,662,416.00

516,498.00

3,178,914.00

Deductions

670,556.15

190,000.00

515,000.00 1375.556.15

Balance June 30, 1996

$ 26624]6QQ $ 68518212 $12~55 QQQ QQ $ 2 115 QQQ,QQ $24J18JQS 12

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

Fiscal Year Ended June 30

Intergovernmental

General

CaRital Leases

Contract

Obligation

Total

GSBA

Other

Trust Certificates

Bonds

Debt

1997 1998 1999 2000 2001 2002 and thereafter

$ 419,170.43 $ 472,244.53

691,278.45

239,508.08

649,537.21

23,288.56

586,030.55

248,258.76

442,624.26

$ 890,745.00 871,945.00 873,205.00 863,605.00 863,705.00
17,552,458.75

$ 1,019,275.00 1,031,275.00 1,030,905.00 1,043,230.00 1,047,445.00 7,472.910.00

$ 2,801,434.96 2,834,006.53 2,576,935.77 2,492,865.55 2,159,408.76
25,467,993.01

Total Principal and Interest $ 3,036,899.66 $ 735,041.17 $ 21 215,66315 $12 645 04Q QQ $38 332 644 58

Deduct: Imputed Interest

374,483.66

49251.98

Net Present Value ofFuture Minimum Lease Payments $ 2 662416QQ $ 685 182.12

In the subsequent fiscal year, the Board issued general obligation bonds in the amount of $33,950,000.00 dated November 15, 1996. The proceeds will be used for costs of acquiring, constructing, and equipping school buildings and other buildings and facilities useful or desirable in connection therewith, adding to, renovating, repairing, improving, and equipping existing school buildings and other buildings and facilities useful or desirable in connection therewith, acquiring any necessary property therefore, both real, personal and acquiring any necessary or desirable rights in connection therewith, to pay capitalized interest incident thereto, and to pay expenses incidental to accomplishing the foregoing.

Note 6: PRIOR YEAR DEFEASEMENT OF DEBT

In fiscal year 1993, the Board defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all futJre debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 1996, $8,015,000.00 ofbonds are outstanding and are considered defeased.

- 18 -

HOUSTON COUNTY BOARD OF EDUCATION

EXI-llBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 4: RISK MANAGEMENT

1995 1996

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

EndofYear Liability

$

0.00 $

4,598.00 $

4,598.00 $

0.00

$

0.00 $

3,037.00 $

3,037.00 $

0.00

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Houston County Board ofEducation entered into an agreement on April 1, 1996, with the Georgia School Boards Association (GSBA), Incorporated for the lease of buses and portable classrooms. Under the terms of the lease agreement, the Board will make semi-annual payments through August 1, 2002. The lease includes an annual renewal clause.

The Houston County Board of Education has entered into various lease agreements as lessee for buses, vehicles, a computer mainframe and portable buildings. 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 BONDS OUTSTANDING General Obligation Bonds currently outstanding are as follows:

Purpose

Interest Rates

Amount

General Government - Series 1987 General Government - Series 1988 General Government - Refunding - Series 1993

6.90% 6.30% 4.20%- 5.60%

$ 110,000.00 340,000.00
8,725,000.00

$ 9,175,000.00

INTERGOVERNMENTAL CONTRACTS TRUST CERTIFICATES OUTSTANDING Intergovernmental Contracts Trust Certificates currently outstanding are as follows:

Purpose

Interest Rates

Amount

General Government-Series 1994

4.40% - 6.00%

$12,255,000.00

- 17 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

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

Note 4: RISK MANAGEMENT

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

The Board has obtained commercial insurance for risk of loss associated with assets, errors or omissions and natural disaster. 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 torts. The Board has not experienced any losses related to these risks in the past three years.

The Board has established a limited risk management program for workers' compensation claims. A premium is charged by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Board accounts for claims 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. These losses include an estimate of claims that have been incurred but not reported. An excess coverage insurance policy covers individual claims in excess of $250,000.00 loss per occurrence, up to the statutory limit.

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

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1995

$ 157 769.18 $ 279,240.77 $ 244,805.60 $ 192,204.35

1996

$ 192,204.35 $ 262,606.11 $ 146,857.85 $ 307,952.61

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:

- 16 -

HOUSTON COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

. JUNE 30, 1996

Note 2: DEPOSITS AND INVESTMENTS

CATEGORIZATION OF INVESTMENTS 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.
Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name.
Category 3 - 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.

At June 30, 1996, the carrying amount of the Board's total investments was $27,088,275.96 and the market value of these investments, excluding investments in the amount of $20,490,783.64 in the State of Georgia, Local Government Investment Pool and $6,280,580.03 in a Deferred Compensation Plan - Pooled Investments, was $316,912.29. The investments are classified as to risk categories as follows:

T)l)e of Investment

Risk Categories

2

3

Carrying Amount

Market Value

U. S. Government
Local Government Investment Pools

$======""0=.0'0= $

000 $ 316 912 29 $ 316,912.29 $ 316 912.29

20,490,783.64

*

Unclassified

Deferred Compensation Plan Pooled Investments

6,280,580.03

*

Total Investments

$27 088 275 96

* Undetenninable

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 of the State of Georgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool does not provide for investment in derivatives or similar investments. The investment policy of the Houston County Board of Education for its portfolio accounts does not provide for investments in ,. derivatives or similar investments.

- 15 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

V
Note 2: DEPOSITS AND INVESTMENTS

(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

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

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

(5) Bonds ofany public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,

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

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 1996, the bank balances were $9,262,312.74. The amounts of the 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, 1996, as follows:

Risk Category

Bank Balance

1

$ 1,247,469.26

2

6,869,980.00

3

1,144,863.48

Total

$ 9,262,312.74

- 14 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL OBLIGATION BONDS
The Board issues general obligation bonds and trust certificates to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized during the year bonds are issued. Issuance costs, whether or not withheld from actual net proceeds, are reported as capital project expenditures. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds and trust certificates 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 of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this 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 ofinsurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:
( 1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
- 13 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

V
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

P70.103. The Houston County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

Tax millage rates levied for the 1995 tax year (calendar year) for the Houston County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

12.87 mills 1.00 mills

13.87 mills

INVENTORIES

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

SUPPLY INVENTORIES Inventories of consumable supplies and materials are recorded as purchases for resale (contra-revenue account) at the time of purchase and are reported on the Combined Balance Sheet at cost (weighted average). The supply inventories reported on the balance sheet are equally offset with a reservation of fund balance which indicates that they do no constitute "available spendable resources" even though they are a component of net current assets.

COMPENSATED ABSENCES

Compensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements.

Howev~r, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources is material to the general purpose financial statements and has not been recorded in the General Long-Term Debt Account Group as required by generally accepted accounting principles.

- 12 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
( 1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
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 11 - Deferred Compensation Plan
RECEIVABLES
Receivables consist ofgrant reimbursements due from Federal, State or other grantors for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
PROPERTY TAXES
The Houston County Board of Commissioners fixed the property tax levy for the 1995 tax year (calendar year) on September 19, 1995 (levy date). Taxes were due on December 20, 1995. The lien date for property taxes was January 1, 1995. Taxes collected within the current fiscal year or within 60 days after year-end are ,.1 reported as revenue in fiscal year 1996 since their collection meets the criteria of GASB codification section

- 11 -

HOUSTON COUNTY BOARD OF EDUCATION

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Fund

Special Revenue
Fund

FUND BALANCE JULY 1, 1995

$ 5,444,534.39 $ 1,535,198.25

Adjustments Deferred - Sales Tax - July 1, 1995 Inventories - July 1, 1995 Food Donated Commodities Purchased Foods Supplies

15,219,072.66

-367,242.10

-152,078.27 -83,407.92

Fund Balance July 1, 1995 - Restated Budget Basis

$ 20,296,364.95 $ 1,299,712.06

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses

$ -1,544,960.40 $ -495,442.36

Adjustments Deferred - Sales Tax July 1, 1995 June 30, 1996

-15,219,072.66 16,533,005.13

$ -231,027.93 $ -495 442.36

FUND BALANCE JUNE 30, 1996 (Budget Basis) CASH AND CASH EQUIVALENTS

$20,065 337 02 $ 804,269.70

COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits (including N.O.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State.

INVESTMENTS

COMPOSITION OF INVESTMENTS Investments made by the Board are stated at cost. The Official Code of Georgia Annotated Section 3G-83-4 authorizes the Board to invest its funds. In selecting among avenues of investment or among institutional bids

- 10 -

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
of the Board were employed for a one hundred and ninety day period beginning in late August 1995 and ending in early June 1996. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1995 and ending in August 1996. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As ofJune 30, 1996, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1996, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1996. Also, the State's portion of the compensation paid in July and August 1996 was received and recorded as revenue in the fiscal year subsequent to June 30, 1996. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1995, were recorded in the year ended June 30, 1996. 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.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
BUDGET
The Houston County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
The Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit "B" of this report:

- 9-

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end.
A departure from the above definitions is the accounting treatment afforded the local option sales taxes. Georgia Laws 1982, House Resolution Nos. 699 and 700, proposed to amend the Constitution of the State of Georgia so as to provide for a local sales and use tax for the Houston County Board of Education whereby this tax would limit the amount of ad valorem taxes to be imposed, levied and collected for use by the Board. These resolutions were subsequently approved by the voters of Houston County in the General Election held November 2, 1982. Section I, Part 2B, of House Resolution 700 states:
"The maximum allowable mill rate for each government in each year shall be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the local government in the immediately preceding year from any local sales and use tax."
The Board's legal counsel has advised that the effect of this legislation places the sales tax collected in trust with the Board of Education for use in the following year upon the reduction of the mill rate. Accordingly, the Board has elected to record the amount of sales tax received for use in a subsequent period as a liability (unearned revenue) rather than as revenue. To conform to generally accepted accounting principles, the sales tax collections should be recorded as revenue when measurable and available.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1996, a substantial number of personnel
- 8-

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, 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 of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBT SERVICE FUND-the fund used to account for the accumulation of resources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPE - the agency fund 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. This fund includes:
AGENCY FUNDS - the funds used to account for assets held for other funds, governments, or individuals.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for general obligation bonds outstanding, material capital lease obligations and intergovernmental contract trust certificates.
}\
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
- 7-

HOUSTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

V
Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Houston County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board and Superintendent, both elected by the voters. With the exception ofthe departures from generally accepted accounting principles disclosed in these notes, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all of the fund types and account groups of the Board. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards.
The more significant of the Board's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the governmental unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the Houston County Board of Education.
Based upon the application of the above criteria, the Houston County Board of Education is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Houston County, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards.
Board members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval.
FUND ACCOUNTING
The Board uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
- 6-

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

EXHIBITc

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes and Other Funds

$ 56,926,651.74 $ 57,904,961.16

1, 126,240.00

1,092,603.26

30,531,952.00 30,103,755.98

Total Revenues

$ 88,584,843.74 $ 89,101,320.40

EXPENDITURES

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

$ 55,993,940.58 $ 56,356,708.82

3,345,769.00 4,064,863.79 2,617,566.00
332,528.00 5,388,905.00
859,293.00 7,254,512.00 2,494,906.36 1,732,950.00
292,994.00

3,377,454.82 4,008,548.85 2,612,235.90
334,054.80 5,425,947.08
920,885.46 7,429,733.19 3,809,039.54 1,217,923.31
297,145.82

1,370,722.00 612,228.00

1,372,684.71 1,797,408.06
573,208.63

Total Expenditures

$ 86,361,177.73 $ 89,532,978.99

Excess of Revenues over (under) Expenditures

$ 2,223,666.01 $ -431 ,658.59

OTHER FINANCING SOURCES {USES)

Other Sources Other Uses

$ 10,586,142.00 $ 13,438,769.96 -13,043,868.00 -13,238,139.30

Total Other Financing Sources (Uses)

$ -2,457,726.00 $

200,630.66

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Financing

Uses

$ -234,059.99 $ -231,027.93

FUND BALANCE JULY 1, 1995

20,814,725.43 20,296,364.95

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 3,810,791.64 $ 3,798,842.28

5,923,823.00

5,746,649.98

2,203,808.00

2,149,515.01

$ 11,938,422.64 $ 11,695,007.27

$ 5,130,341.16 $ 5,079,323.48

268,188.00 288,782.94

277,047.44 229,067.58

114,039.00

111,797.74

166,228.00 154,308.00
6,700.00 93,220.00 6,049,680.00 162,720.69
4,570.00

347,273.24 109,630.08
6,700.00 75,681.75 6,071,000.99 99,975.63
4,570.70 144,000.00

$ 12,438,777.79 $ 12,556,068.63

$ -500,355.15 $ -861 ,061.36

$

39,497.00 $ 365,619.00

$

39,497.00 $ 365,619.00

$ -460,858.15 $ -495,442.36

1,632,327.00

1,299,712.06

FUND BALANCE JUNE 30, 1996

$ 20,580,665.44 $ 20,065,337.02

$ 1,171,468.85 $ 804,269.70

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

1::!OUSTQN COUNTY BOARD OF EDUCATION
~QMBINED STATEMENI OF REVEN!,.!ES, EXPE!::jQITUBES AND CHANGES IN FUND !;!ALANCES
&.I. GQY!;;RNMENTB!,, FU!::!D TYPI; YEAA ENDED JUNE 30, 1996

EXHIBIT"B"

TOTALS

SPECIAL

CAPITAL

DEBT

~morandum On!Y}

\,'

GENERAL

REVENUE

PROJECTS

SERVICE

YEAR ENDED

FUND

FUND

FUND

FUND

JUNE 30, 1996 JUNE 30, 1995

BEVE!::!!,!ES
State Funds Federal Funds Taxes and Other Funds

$ 57,904,961.16 $ 1,092,603.26
28,789,823.51

3,798,842.28 $ 5,746,649.98 2,149,515.01

1,623,380.00

$

562,836.30 $ 1,348,512.41

63,327,183.44 $ 58,954,055.37

6,839,253.24

6,694,393.53

32,850,687.23 30,284,434.10

Total Revenues

$ 87,787,387.93 $ 11,695,007.27 $ 2,186,216.30 $ 1,348,512.41 $ 103,017,123.91 $ 95,932,883.00

l;XPl;!::!QIT!,.!BES

Current

Instruction

$ 56,356,708.82 $

Support Services

Pupil Services

3,377,454.82

Improvement of Instructional

Services

4,008,548.85

Educational Media Services

2,612,235.90

General Administration

334,054.80

School Administration

5,425,947.08

Business Administration

920,885.46

Maintenance and Operation of Plant

7,429,733.19

Student Transportation Services

3,809,039.54

Central Support Services

1,217,923.31

Other Support Services

297,145.82

Food Services Operation

Other Operations of Non-Instructional

Services

1,372,684.71

Capital Outlay

1,797,408.06

Debt Service

Principal

526,556.15

Interest

46,652.48

Escrow Agent

Paying Agent Fees

5,079,323.48

$

277,047.44

229,067.58

111,797.74

347,273.24 109,630.08
6,700.00 75,681.75 6,071,000.99

99,975.63 4,570.70 $ 9,943,139.26

144,000.00

$ 705,000.00 1,203,260.00

3,870.50

3,573.52

61,436,032.30 $ 53,938,491.02

3,654,502.26

3,297,635.82

4,237,616.43 2,612,235.90
445,852.54 5,425,947.08
920,885.46 7,777,006.43 3,918,669.62 1,224,623.31
372,827.57 6,071,000.99

4,026,162.82 2,772,622.46
327,469.02 4,897,632.50
788,475.27 7,234,086.43 2,058,183.43 1,380,215.04
44,494.25 5,303,105.23

1,472,660.34 11,745,118.02

1,542,509.39 9,174,125.08

1,375,556.15 1,249,912.48
7 444.02

932,780.86 1,116,828.13
2,514.51 55.78

Total Expenditures

$ 89,532,978.99 $ 12,556,068.63 $ 9,947,009.76 $ 1,911,833.52 $ 113,947,890.90 $ 98,837,387.04

Excess of Revenues over (under) Expenditures

$ -1,745,591.06 $ -861,061.36 $ -7,760,793.46 $ -563,321.11 $ -10,930,766.99 $ -2,904,504.04

OTHER FINANCING SOURCES (USES}

Capital Leases Operating Transfers In Operating Transfers Out

$ 2,852,792.00 $ -2,652,161.34

326,122.00 39,497.00 $

$ 1,723,939.34 $ 1,581,648.05 -692,923.05

3,178,914.00 $ 3,345,084.39 -3,345,084.39

110,970.00 2,393,390.20 -2,393,390.20

Total Other Financing Sources

(Uses)

$

200,630.66 $

365,619.00 $ 1,031,016.29 $ 1,581,648.05 $ 3,178,914.00 $

110,970.00

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses

$ -1,544,960.40 $

-495,442.36 $ -6,729,777.17 $ 1,018,326.94 $

-7,751,852.99 $ -2,793,534.04

FUND BALANCE JULY 1

5,444,534.39

1,535,198.25

8,555,566.71

769,630.12

16,304,929.47 19,025,694.10

Food Inventory - Net Change in Period Donated Commodities Purchased Food
Supplies Inventory Net Change in Period

-32,151.83

64,584.29 -2,606.10

64,584.29 -2,606.10
-32,151.83

12,177.83 22,147.52
38,444.06

FUND BALANCE JUNE 30

$ 3,867,422.16 $ 1,101,734.08 $ 1,825,789.54 $ 1,787,957.06 $ 8,582,902.84 $ 16,304,929.47

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

EXHIBIT"A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPE AGENCY FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS (Memorandum Onl~ JUNE 30, 1996 JUNE 301 1995

$ 1,754,360.58

$ 6,813,360.59 $ 5,260,637.98

1,823.60

20,899,528.61

27,763,802.54

$ 6,280,580.03

6,280,580.03

5,911,692.29

31,772.88

1,862,871.15

2,279,346.80

5,000.00

335,090.27

216,662.56 80,801.82

$

1,787,957.06

1,787,957.06

367,242.10
152,078.27 83,407.92
769,630.12

8,087,591.54 3,348,205.19 11,554,451.40

8,087,591.54 3,348,205.19 11,554,451.40

8,920,369.88 839,847.34
12,445,000.00

$ 1,787,957.06 $ 6,280,580.03 $ 24,778,205.19 $ 61,267,100.22 $ 64,798,055.24

$ 6,280,580.03 $
$ 6,280,580.03 $

$ 2,731,330.17 $ 2,296,768.31

799,479.59

518,009.96

860,221.29

626,795.94

1,003.98

48,103.17

285,060.10

700,372.00

612,776.00

6,280,580.03

5,911,692.29

3,348,205.19 9,175,000.00 12,255,000.00

10,795,118.76 5,737,886.37 3,348,205.19 9,175,000.00 12,255,000.00

9,506,384.56 5,712,688.10
839,847.34 9,690,000.00 12,445,000.00

24,778,205.19 $ 52,684,197.38 $ 48,493,125.77

$ 1,787,957.06

$

1,949.08

1,787,957.06 $

57,412.45

769,630.12 88,314.40

335,090.27

367,242.10

216,662.56 80,801.82
1,037,326.94 305,188.00

152,078.27 83,407.92 7,653,742.30 282,091.00

$ 1,787,957.06

$ 3,822,388.18 $ 9,396,506.11

1,112,959.65

910,701.77

3,647,555.01

5,997,721.59

}\

$ 1,787,957.06

$ 8,582,902.84 $ 16,304,929.47

$ 1,787,957.06 $ 6,280,580.03 $ 24,778,205.19 $ 61,267,100.22 $ 64,798,055.24

-3-

l::IQUTQN COUNTY BOARD QF l;DUCATIQN COMBl!jED BALANCE SHEET
81.L FUNQ TYPES AND ACCO!,!NT QRQUP JUNE 30, 1996

\{
~
Cash and Cash Equivalents
Investments
Investments Held by Trustee
Accounts Receivable
Prepaid Items
Inventories Consumable Supplies 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 Trust Certificates

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 4,018,969.35 $ 1,040,030.66

16,105,953.54

$ 4,791,751.47

472,721.99

728,514.73

629,861.55

335,090.27

216,662.56 80,801.82

Total Assets

$ 20,932.735.15 $ 2,oss,009.n $ 5,421,613.02

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft

Accounts Payable

Salaries Payable

Expired Grant Balances Payable

Contracts Payable



Retainages Payable

Deferred Compensation Plan

Unearned Revenue

Fiscal Year 1996

Fiscal Year 1997

Fiscal Year 1998

Capital Lease Agreements

General Obligation Bonds Payable

Intergovernmental Contracts Trust Certificates

Total Liabilities

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Program For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Consumable Supplies Food Donated Commodities Purchased Food For Purposes of Trust Certificates For State Capital Outlay Projects

Unreserved Designated for Self-Insurance Undesignated
Total Fund El. Jity

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

$ 2,731,330.17

$

438,194.02 $

197,164.26

164,121.31

94,113.84

766,107.45

1,003.98

700,372.00

10,795,118.76 5,737,886.37

$ 17,065,312.99 $ 964,275.69 $ 3,595,823.48

$

1,949.08

$

57,412.45

335,090.27

216,662.56 80,801.82
$

1,037,326.94 305,188.00

$

392,502.72 $

299,413.46 $ 1,342,514.94

1,112,959.65 2,361,959.79

802,320.62

483,274.60

$ 3,867,422.16 $ 1,101,734.08 $ 1,825,789.54

$ 20,932,735.15 $ 2,066,009.77 $ 5,421,613.02

HOUSTON COUNTY BOARD OF EDUCATION - 1-

SCHEDULE "9"

SAFE SCHOOLS
GRANT

TECHNOLOGY INSTALLATION

EXCEPTIONAL GROWTH CAPITAL OUTLAY

TOTAL

$

83,685.00 $ 247,121.45

$ 1,329,198.73 335,887.46 11,733.21
556.56
11,008.00 1,065.55
22,498.66 733,338.06
5,500.00 4,055.15
63,512.41 10,893.10 12,604.36

$ 3,651,239.69

144,000.00
4,570.70 3,651,239.69
650,893.35

$

83,685.00 $ 247,121.45 $ 3,651,239.69 $ 6,992,554.99

- 45 -

V
THIS PAGE LEn BLANK

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

SCHEDULE "1 O"

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

THIRTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR
OPERATIONS
PORTION OF THIRTEEN WEIGHTED
PROGRAMS

$ 43,707,781.00 $

1,370,571.00

$ 52,090,927.04 3,041,968.65 $ _ _2=,_49_6..:,.,2_6_6_.3_7
$ 55,132,895.69

-1,089,426.41 $ 54,043,469.28

$

0.00 $=====0.=00=

See notes to the general purpose financial statements. - 47 -

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

GENERAL AND CAR!;ER EDUCATION PROGRAMS Kindergarten (") Grades 1 - 3 (j Sub-Total K-3 Grades 4 - 5 (*) Grades 6 - 8 (") Grades 9 12 (*) High School Laboratories (") Vocational Education Laboratories (*) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category I (") Category II (") Category Ill (*) Category IV (*) Sub-Total - Regular Category V (Gifted) (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM(*} Total Thirteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs
Total Thirteen Weighted and Media Center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$ 3,282,606.00 8,808,082.00
$ 12,090,688.00 4,423,433.00 7,996,812.00 5,232,692.00 2,919,538.00 2,090,530.00
$ 34,753,693.00

$ 2,954,345.40 $

7,927,273.80

90 $ 10,881,619.20 $

90

3,981,089.70

90

7,197,130.80

90

4,709,422.80

90

2,627,584.20

90

1,881,477.00

$ 31,278,323.70 $

31,145.00 45,294.00 76,439.00 37,314.00
7,041.00 -33,020.00 554,917.50 -131,872.50 510,819.00

$ 4,790,912.00

$ 4,311,820.80 $

44,959.00

$ 4,790,912.00

1,156,065.00

$ 5,946,977.00

$

816,289.00

$ 41,516,959.00

90 $ 4,311,820.80 $

90

1,040,458.50

$ 5,352,279.30 $

90 $

734,660.10 $

$ 37,365,263.10 $

44,959.00 3,449.00
48,408.00 137,649.00 696,876.00

$ 1,177,679.00 90 $ 1,059,911.10 $

295,074.00 90

265,566.60

$ 1,472,753.00

$ 1,325,477.70 $

14,177.00 7,016.00
21,193.00

$ 42,989,712.00

$ 38,690,740.80 $

718,069.00

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Thirteen Weighted Programs. See notes to the general purpose financial statements.

$

116,473.00

355,623.00

$

116,473.00 $

355,623.00

3,023.00 0.00

$

472,096.00 100 $

472,096.00 $ ====3,=02=3=.0=0

- 48 -

SCHEDULE 11

"
TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDER EXPENDITURE
FOR REQUIRED ALLOTMENT

$ 2,985,490.40 $ 4,535,358.65 $

90,616.52 $ 4,625,975.17

7,972,567.80

9,700,797.82

311,239.91

10,012,037.73

$ 10,958,058.20 $ 14,236,156.47 $

401,856.43 $ 14,638,012.90 $

0.00

4,018,403.70

5,858,223.16

279,332.74

6,137,555.90

0.00

7,204,171.80

9,896,961.90

831,469.35

1o.728,431.25

0.00

4,676,402.80

6,261,472.22

459,336.93

6,720,809.15

0.00

3,182,501.70

3,156,193.15

124,538.83

3,280,731.98

0.00

1,749,604.50

2,085,965.41

212,785.32

2,298,750.73

0.00

$ 31,789,142.70 $ 41,494,972.31 $ 2,309,319.60 $ 43,804,291.91

$ 4,356,779.80 $

143,663.72 $ 940,910.41 4,051,102.02 643,730.47

5,007.12 $ 12,530.82 68,589.55 26,519.44

148,670.84 953,441.23 4,119,691.57 670,249.91

$ 4,356,779.80 $ 5,779,406.62 $

112,646.93 $ 5,892,053.55

0.00

1,043,907.50

1,795,863.58

62,029.24

1,857,892.82

0.00

$ 5,400,687.30 $ 7,575,270.20 $

174,676.17 $ 7,749,946.37

$

872,309.10 $

983,014.40 $

12,270.60 $

995,285.00

0.00

$ 38,062,139.10 $ 50,053,256.91 $ 2,496,266.37 $ 52,549,523.28

$ 1,074,088.10 $ 2,037,670.13

$ 2,037,670.13

0.00

272,582.60

$

545,702.28

545,702.28

0.00

$ 1,346,670.70 $ 2,037,670.13 $

545,702.28 $ 2,583,372.41

$ 39,408,809.80 $ 52,090,927.04 $ 3,041,968.65 $ 55,132,895.69 $

0.00

$

119,496.00

355,623.00

$ ==4=7=5,=11=9=.o=o

$

296,655.08 $

296,655.08

178,463.92

178,463.92

$

475,119.00 $

475,1,9.00 $======0.=00=

- 49 -

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION OF BOARD MEMBERS
YEAR ENDED JUNE 30, 1996
BOARD MEMBER ADDRESS
Mr. Alan S. Talbert, Chairman (*) 115 Freeman Drive Warner Robins, Georgia 31088
Mr. David L. Davidson (*)
P. 0. Box207
Bonaire, Georgia 31005
Mr. Gillis R. Dawkins (*) 2031 Highway 41 South Perry, Georgia 31069
Mrs. Robertiena R. Fletcher (*) 133 Stewart Drive Warner Robins, Georgia 31093
Mr. Hubert Hutcherson 201 Clifton Drive Perry, Georgia 31069
Ms. Shirley Lowery (*) 125 Gunsmoke Drive Warner Robins, Georgia 31093
Mr. Gary M. Mclure (*) 113 Heather Place Centerville, Georgia 31028
Mr. Fred Wilson (*) 114 Palm Drive Warner Robins, Georgia 31088

SCHEDULE "12"

$

3,550.00

2,650.00

1,100.00

2,500.00

900.00

2,400.00

2,450.00

2,550.00

$ ====18,=10=0.0=0

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

See notes to the general purpose financial statements. - 50 -

SECTION II COMPLIANCE

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Houston County Board ofEducation
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Houston County Board ofEducation as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. 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 Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to Houston County Board of Education is the responsibility ofthe Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.
Material instances of noncompliance consist of failures to follow requirements or violations of prohibitions, contained in laws, regulations, contracts, or grants, that cause us to conclude that the aggregation of the misstatements resulting from those failures or violations is material to the general purpose financial statements. The results of our tests of compliance disclosed a material instance of noncompliance, which is described in the Schedule of Findings and Improper or Questioned Costs.

96CRL-20X

As also described in the Schedule of Findings and Improper or Questioned Costs, the material instance of noncompliance noted above has been corrected in the financial statements.
.,. We considered this material instance ofnoncompliance in forming our opinion on whether the fiscal year 1996 general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated April 10, 1997 on those general purpose financial statements.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,

CLV:gp 96CRL-20X

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

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

SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. 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 have applied procedures to test the Houston County Board of Education's compliance with the following requirements applicable to each ofits Federal financial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996:

(1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-Up/Resolution

(4) Federal Financial Reports

(8) Administrative Requirements

Our procedures were limited to the applicable procedures described in the Office of Management and Budget's
flCompliance Supplement for Single Audits of State and Local Governments" and other additional procedures
as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Board's compliance with the requirements listed in the preceding
paragraph. Accordingly, we do not express such an opinion.

96CRL-50

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not test, nothing came to our attention that caused us to believe that the Houston County Board of Education had not complied, in all material respects, with those requirements. However, the results of our procedures disclosed an immaterial instance ofnoncompliance with those requirements, which is described in the Schedule of Findings and Improper or Questioned Costs.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,

CLV:gp 96CRL-50

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

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

SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. 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 have also audited the Houston County Board ofEducation's compliance with the requirements governing:

(1) Types of Services Allowed or Unallowed

(5) Applicable Special Tests and Provisions

(2) Eligibility
(3) Matching, Level of Effort, and/or Earmarking

(6) Other Requirement Claims for Advances and Reimbursements

(4) Reporting

These requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996. The management of the Houston County Board ofEducation is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit.

96CRL-80

We conducted our audit of compliance in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office of Management and Bupget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the Houston County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1996.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
c::t~~
Claude L. Vickers State Auditor
CLV:gp 96CRL-80

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Houston County Board ofEducation
SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. 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.
In connection with our audit of the fiscal year 1996 general purpose financial statements of the Houston County Board of Education and with our consideration of the Board's control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1996. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements govermng:
Types of Services Allowed or Unallowed
Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Houston County Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Houston County Boar-2 of Education hq_d not complied, in all material respects, with those requirements.
96CRL-120

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
//~
Claude L. Vickers
State Auditor
CLV:gp 96CRL-120

SECTION III INTERNAL CONTROL

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Houston County Board of Education
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. 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 Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
The management of the Houston County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.
96ICL-3

In planning and performing our audit ofthe general purpose financial statements of the Houston County Board ofEducation for the year ended June 30, 1996, we obtained an understanding of the internal control structure.
Wit!i respect to the internal control structure, we obtained an understanding of the design of relevant policies
and procedures and whether they have been placed in operation, and we assessed control risk in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. Accordingly, we do not express such an opinion.
We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements.
As described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category:
General Fixed Assets
A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.
Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition disclosed above is also considered to be a material weakness.
This condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Houston County Board of Education's financial statements and this report does not affect our report thereon dated April 10, 1997.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:gp 96ICL-3

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 10, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and ~uperintendent and Members of the Houston County Board ofEducation
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April I0, 1997. 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 have also audited the Houston County Board of Education's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated April 10, 1997.
We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Houston County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program.
In planning and performing our audit for the year ended June 30, 1996, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated April 10, 1997.
96ICL-5

The management of the Houston County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are reqired to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because ofinherent limitations in any internal control structure, errors, irregularities or instances of noncompliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.

For the purposes of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories:

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

(1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports

(1) Types of Services Allowed or Unallowed
(2) Eligibility
(3) Matching, Level of Effort, and/or Earmarking

(5) Allowable Costs/Cost Principles

(4) Reporting

(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution (8) Administrative Requirements

(5) Applicable Special Tests and Provisions
(6) Other Requirement Claims for Advances and Reimbursements

For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk.

During the year ended June 30, 1996, the Houston County Board of Education expended 89% of its total Federal financial assistance under major Federal financial assistance programs.

We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance wi~h general requirements and specific requirements as described above that are applicable to each of the Board's major Federal financial assistance programs, which

96ICL-5

are identified in the Schedule of Federal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly,
we 90 not express such an opinion.
Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might constitute material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more ofthe internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal granter agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,

CLV:gp 96ICL-5

Claude L. Vickers State Auditor

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996
V
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Inadequate Inventory Records Federal Financial Assistance Finding Resolved Audit Control Number 6761-93-03
The audit report for the year ended June 30, 1995, stated that the Board's property management records for the School Food Services Fund - National School Lunch Program (CFDA 10.555) were incomplete and failed to meet the property management standards as set forth in Chapter 41 of the Financial Management for Georgia Local Units of Administration or as outlined in 7 CFR 3015.169. For the year under review, the Board installed a property management system which meets the above property management standards as required.
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Finding Resolved Audit Control Number 6761-93-05
The audit report for the year ended June 30, 1993, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$30,901.95 for the Staff Development - Professional Development Stipends Program. For the year under review, an adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required.
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $57,412.45 Audit Control Number 6761-94-01
The audit report for the year ended June 30, 1994, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$57,412.45 for the Staff Development - Professional Development Stipends Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund this underexpenditure as required. The underexpenditure of $57,412.45 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period.
-1-

HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996
,, PRIOR YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6761-93-02
The audit report for the year ended June 30, 1995, noted that the management of the Houston County Board ofEducation had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.
FEDERAL FINANCIAL REPORTS Delinquent Financial Reports Federal Financial Assistance Major Programs Nonmaterial Noncompliance Audit Control Number 6761-94-02
The audit report for the year ended June 30, 1995, stated the Board failed to submit on a timely basis "System Claim and Requisition for Reimbursement" (DE 0107) for the School Breakfast Program (CFDA 10.553), National School Lunch Program (CFDA 10.555), and Food Distribution Program (CFDA 10.550) in accordance with regulations established by the Georgia Department of Education.
For the year under review, it was noted that the "School Nutrition Claim Data" (DE form O106) and "System Claim and Requisition for Reimbursement" (DE form 0107) were not submitted on a timely basis. The delay occurred because management neglected the specific requirements imposed by the Georgia Department of Education. Procedures should be established to ensure that Federal financial reports are submitted by the required filing date.
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HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1996
V
CURRENT YEAR GENERAL LEDGER Failure to Transfer Local Matching Funds Financial Statements Material Noncompliance Finding Resolved Audit Control Number 6761-96-01 For the year under review, the Board received approval for state capital outlay project funding, through Georgia State Financing and Investment Commission, for the 1996 fiscal year. Both the instructions in Chapter 41 ofthe Financial Management for Georgia Local Units of Administration and the agreement signed by the Board to receive this funding require that the Board transfer required local matching funds to the Capital Projects Fund by June 30, 1996, and designate those funds by project name and number. Transfers were not made by the Board at June 30, 1996, and correcting audit adjustments were necessary to transfer $150,127.00 to GSFIC Project No. 96/96S-676-03 l and $52,790.00 to GSFIC Project No. 96/96S-676-032, respectively, from the General Fund to the respective Capital Projects Fund as required. The failure to transfer these local matching funds was an oversight on the part ofthe Board. However, subsequent to June 30, 1996, the Board physically transferred the required local matching funds to the Capital Projects Fund and designated those funds by project name and number.
Note: The Houston County Board ofEducation was provided an opportunity to include pertinent comments from the Board's management concerning these audit findings, conclusions and recommendations. The Board has elected not to provide comments for inclusion in this report.
- 3-