Jasper County Board of Education, Monticello, Georgia, annual financial report for the fiscal year ended 2019 June 30 (including independent auditor's reports)

JASPER COUNTY BOARD OF EDUCATION
MONTICELLO, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2019
(Including Independent Auditor's Reports)

JASPER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S REPORT

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

EXHIBITS

BASIC FINANCIAL STATEMENTS

GOVERNMENT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET POSITION

B

STATEMENT OF ACTIVITIES

FUND FINANCIAL STATEMENTS

C

BALANCE SHEET

GOVERNMENTAL FUNDS

D

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET POSITION

E

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES

GOVERNMENTAL FUNDS

F

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT

OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES TO THE STATEMENT OF ACTIVITIES

G

STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS

H

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FIDUCIARY FUNDS

I NOTES TO THE BASIC FINANCIAL STATEMENTS

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND
4 SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA 5 SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND 6 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION

Page
i
1 2
4 5 6 7 8 9 11
33 34 35 36 37 38

JASPER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I
FINANCIAL
SCHEDULES
REQUIRED SUPPLEMENTARY INFORMATION
7 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL GENERAL FUND
SUPPLEMENTARY INFORMATION
8 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 9 SCHEDULE OF STATE REVENUE 10 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

Page
39 40 41 43

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE

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

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

SECTION I FINANCIAL

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400

INDEPENDENT AUDITOR'S REPORT

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Jasper County Board of Education
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Jasper County Board of Education (School District), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also

includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2019, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 6, 2020 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.
Respectfully submitted,

March 6, 2020

Greg S. Griffin State Auditor

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

INTRODUCTION
The Jasper County Board of Education's (School District) financial statements for the fiscal year ended June 30, 2019 includes a series of basic financial statements that report financial information for the School District as a whole, its funds, and its fiduciary responsibilities. The Statement of Net Position and the Statement of Activities provide financial information about all the School District's activities and present both a short-term and long-term view of the School District's finances on a global basis. The fund financial statements provide information about all the School District's funds. Information about these funds, such as the School District's general fund, is important, but will also give insight into the School District's overall soundness as reported in the Statement of Net Position and the Statement of Activities.
FINANCIAL HIGHLIGHTS
Key financial highlights for fiscal year 2019 are as follows:
On the Government-wide financial statements:
The School District's net position at June 30, 2019 was $7.9 million. Net position reflects the difference between all assets and deferred outflows of resources of the School District (including capital assets, net of depreciation) and all liabilities, both short-term and long-term, and deferred inflows of resources. The net position at June 30, 2019 of $7.9 million represented an increase of $2.3 million when compared to the prior year. The primary cause of the increase in net position was the addition of renovation projects to capital assets.
The School District had $27.7 million in expenses relating to governmental activities; $18.2 million of the $27.7 million in expenses were offset by program specific charges for services, grants and contributions. However, general revenues (primarily property and sales taxes) of $11.8 million were adequate to provide for these programs.
As stated above, general revenues accounted for $11.8 million or about 39.4% of all revenues totaling $30.0 million. Program specific revenues in the form of charges for services, grants, and contributions accounted for the balance of these revenues. (Percentages in table below have been rounded to one decimal place.)

Source of Revenues
Program Revenues
60.6%

General Revenue - Property Taxes
28.1%
General Revenue - Sales Taxes 4.0%

General Revenue - All Other 7.3%

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
On the fund financial statements:
Among major funds, the general fund had $28.7 million in revenues and $26.5 million in expenditures. The general fund also transferred $0.6 million to the debt service fund for debt service expenditures. The general fund balance of $7.1 million at June 30, 2019 increased $1.5 million from the prior year.
OVERVIEW OF THE FINANCIAL STATEMENTS
These financial statements consist of three parts; management's discussion and analysis (this section), the basic financial statements including notes to the financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the School District. These include the government-wide and fund financial statements.
The government-wide financial statements include the `Statement of Net Position' and `Statement of Activities'. These statements provide information about the activities of the School District presenting both short-term and long-term information about the School District's overall financial status.
The fund financial statements focus on individual parts of the School District, reporting the School District's operation in more detail. The `governmental fund' statements disclose how basic services are financed in the short-term as well as what remains for future spending. The `fiduciary fund' statements provide information about the financial relationships in which the School District acts solely as a trustee or agent for the benefit of others. In the case of the School District, the general fund, capital projects fund, and debt service fund are all considered to be major funds.
The financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements.
Government-Wide Statements
Since the School District has no operations that have been classified as "Business Activities", the government-wide financial statements are basically a consolidation of the School District's operating funds into one column called governmental activities. In reviewing the government-wide financial statements, a reader might ask the question, are we in a better financial position now than last year? The `Statement of Net Position' and the `Statement of Activities' provides the basis for answering this question. These financial statements include all School District's assets, deferred outflows, deferred inflows and liabilities and uses the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into account all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the School District's net position and any changes in net position. The change in net position is important because it tells the reader that, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the results of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs, student-teacher ratios, and other factors.
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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
When analyzing government-wide financial statements, it is important to remember these statements are prepared using an economic resources measurement focus (accrual accounting) and involve the following steps to format the Statement of Net Position:
Capitalize current outlays for capital assets Depreciate capital assets Report long-term debt, including pension and postemployment obligations, as a liability Calculate revenue and expense using the economic resources measurement focus and the
accrual basis of accounting Allocate net position as follows:
o Net Investment in capital assets o Restricted net position is amounts with constraints placed on the use by external
sources such as creditors, grantors, contributors or laws and regulations. o Unrestricted
Fund Financial Statements
The School District uses many funds or sub-funds to account for a multitude of financial transactions during the fiscal year. The fund financial statements presented in this report provide detail information about the School District's significant or major funds.
The School District has two kinds of funds as discussed below:
Governmental Funds Most of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the modified accrual method of accounting which measures cash and all other financial assets that can be readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The differences between government activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements.
Fiduciary Funds The School District is the trustee, or fiduciary, for assets that belong to clubs, organizations and others within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the governmentwide financial statements because it cannot use these assets to finance its operations.
FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE
Net position, which is the difference between total assets and deferred outflows of resources, and total liabilities and deferred inflows of resources, is one indicator of the financial condition of the School District. When revenues exceed expenses, the result is an increase in net position. When expenses exceed revenues, the result is a decrease in net position. The relationship between revenues and expenses can be thought of as the School District's operating results. The School District's net position, as measured in the Statement of Net Position is one way to measure the School District's financial health, or financial position. Over time, increases or decreases in the School District's net position, as measured in the Statement of Activities, are one indicator of whether its financial health
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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

is improving or deteriorating. However, the School District's goal and mission is to provide success for each child's education, not to generate profits as private corporations do. For this reason, many other nonfinancial factors should be considered in assessing the overall health of the School District.

In the case of the School District, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $7.9 million at June 30, 2019. To better understand the School District's actual financial position and ability to deliver services in future periods, it is necessary to review the various components of the net position category. For example, of the $7.9 million of net position, $5.1 million was restricted for continuation of various state and Federal programs, debt service and ongoing capital projects. Accordingly, these funds were not available to meet the School District's ongoing obligations to citizens and creditors.

In addition, the School District had $31.1 million net invested in capital assets (e.g., land, buildings,
and equipment). The School District uses these capital assets to provide educational services to
students within geographic boundaries served by the School District. Because of the very nature and
on-going use of the assets being reported in this component of net position, it must be recognized that this portion of the net position is not available for future spending.

Because of the restrictions on net position as discussed above, the School District had an unrestricted
deficit of $28.3 million at June 30, 2019. The reader should remember this deficit includes pension
related charges recorded because of the implementation (fiscal year 2015) of GASB No. 68, Accounting and Financial Reporting for Pensions and GASB No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date on Amendment to GASB No. 68; and also includes charges recorded because of the implementation (fiscal year 2018) of GASB Statement No. 75, Accounting and Financial reporting for Postemployment Benefits Other than Pensions. The School District believes it is also meaningful to view the School District's net position in the following
manner:

Net position associated with pension obligations $ (14,557,137)

Net position associated with postemployment benefits other than pension obligations

(20,636,634)

Net position exclusive of pension obligations and postemployment benefits

43,118,040

Net position, June 30, 2019

$ 7,924,269

The above analysis reflects, despite pension obligations and postemployment benefits, the School District's net position is a positive $7.9 million, and management believes the School District's financial position is sound.

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

Table 1 provides a summary of the School District's net position for this fiscal year as compared to the prior fiscal year.
Table 1 Net Position

Assets Current and Other Assets Capital Assets, Net

Governmental Activities

Fiscal Year

Fiscal Year

2019

2018

$ 18,993,267 $ 13,450,282

40,667,764

33,881,991

Total Assets

59,661,031

47,332,273

Deferred Outflows of Resources Related to Defined Benefit Pension Plan Related to OPEB Plan

4,874,284 1,543,131

3,844,768 1,353,237

Total Deferred Outflows of Resources

6,417,415

5,198,005

Total Assets and Deferred Outflows of Resources

66,078,446

52,530,278

Liabilities Current and Other Liabilities Long-Term Liabilities Net Pension Liability Net OPEB Liability

3,411,929 13,131,062 18,876,399 18,604,830

3,373,139 3,025,000 18,518,029 20,279,290

Total Liabilities

54,024,220

45,195,458

Deferred Inflows of Resources Related to Defined Benefit Pension Plan Related to OPEB Plan

555,022 3,574,935

197,320 1,544,216

Total Deferred Inflows of Resources

4,129,957

1,741,536

Total Liabilities and Deferred Inflows of Resources

58,154,177

46,936,994

Net Position Net Investment in Capital Assets Restricted Unrestricted (Deficit)

31,090,239 5,125,076
(28,291,046)

30,669,677 4,281,850
(29,358,243)

Total Net Position

$ 7,924,269 $ 5,593,284

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

Total net position increased $2.3 million in fiscal year 2019 from the prior year, primarily due to the increase of capital asset as a result of renovation projects.

In connection with unrestricted deficit shown above, management presents the following additional information:

Total unrestricted net position (deficit)

$

Less:

Unrestricted deficit in net position resulting from

recognition of net pension obligations

(28,291,046) 14,557,137

Unrestrictd deficit in net pension resulting from recognition of postemployment benefits other than pension obligations

20,636,634

Unrestricted net position, exclusive of the net pension

obligation and postemployment benefits effect

$

6,902,725

The above analysis shows that the recognition of liabilities for pension obligations and postemployment benefits on the financial statements had a severe effect on the School District's unrestricted net position. However, despite these obligations, management believes the School District's financial position is sound.

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

Table 2 provides a summary of the School District's net position for this fiscal year as compared to the prior fiscal year.
Table 2
Change in Net Position

Revenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions

Governmental Activities

Fiscal Year

Fiscal Year

2019

2018

$

327,657

17,582,285

286,094

$

258,587

16,910,431

1,577,214

Total Program Revenues
General Revenues: Property Taxes Sales Taxes Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Special Item Loss of Disposal of Capital Assets

18,196,036
8,417,269 1,208,831 1,687,838
125,966 383,732
(14,966)

18,746,232
7,925,597 1,118,356 1,365,719
26,895 371,798
(7,295)

Total General Revenues and Special Item

11,808,670

10,801,070

Total Revenues
Program Expenses 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 Other Support Services Operations of Non-Instructional Services Enterprise Operations Food Services Interest on Short-Term and Long-Term Debt

30,004,706
15,819,096
1,255,690 1,073,705
422,624 480,452 1,572,328 429,769 1,776,731 2,093,591 418,472 140,876
120,380 1,669,673
400,334

29,547,302
15,260,699
1,393,663 1,047,930
327,575 454,254 1,582,189 281,702 1,899,473 1,997,397 466,258 136,346
91,238 1,833,707
142,737

Total Expenses

27,673,721

26,915,168

Increase in Net Position

$

2,330,985 $

2,632,134

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

Cost of Providing Services

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting these services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. Net cost of services can be defined as the total cost less fees generated by the activities and intergovernmental revenue provided for specific programs. The net cost reflects the financial burden on the School District's taxpayers by each activity as compared to the prior fiscal year.

Table 3 Cost of Services

Total Cost of Services

Fiscal Year

Fiscal Year

2019

2018

Total Cost of Services

Fiscal Year

Fiscal Year

2019

2018

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 Operations of Non-Instructional Services Enterprise Operations Food Services Interest on Short-Term and Long-Term Debt
Total Expenses

$ 15,819,096 $ 15,260,699 $ 3,616,618 $ 2,619,310

1,255,690 1,073,705
422,624 480,452 1,572,328 429,769 1,776,731 2,093,591 418,472 140,876

1,393,663 1,047,930
327,575 454,254 1,582,189 281,702 1,899,473 1,997,397 466,258 136,346

820,908 256,250 123,577 (52,463) 855,035 422,038 946,133 1,487,530 404,587 105,827

852,223 264,623
29,182 (118,105) 826,530 275,013 1,040,737 1,543,475 454,462 102,862

120,380 1,669,673
400,334

91,238 1,833,707
142,737

37,309 54,002 400,334

11,774 144,113 142,737

$ 27,673,721 $ 26,915,168 $ 9,477,685 $ 8,188,936

Overall, School District expenses increased $0.8 million from the prior year, while the net costs of services increased $1.3 million. The increase in the net costs of services in fiscal year 2019 occurred primarily because program revenues for capital grants and contributions from the State of Georgia decreased $1.3 million from the prior year.

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS

Information about the School District's governmental funds is presented starting on Exhibit "C" of this report. Governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues of $30.7 million and total expenditures of $35.5 million in fiscal year 2019. The expenditures of $35.5 million in fiscal year 2019 represented an increase of $5.0 million from the prior year, primarily attributable to an increase in capital outlay expenditures associated with an ongoing capital projects. Total governmental fund balances increased $6.3 million from the prior year to $15.1 million at June 30, 2019. The increase in fund balance was associated, in part, with the School District selling bonds in the amount of $9.9 million and receiving associated premiums of $1.1 million.

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

General Fund Budget Highlights

The School District's budget is prepared according to Georgia Law. The most significant budgeted fund is the general fund. During the course of fiscal year 2019, the School District amended its general fund budget as needed. The School District budget is adopted at the aggregate level and maintained at the program, function, object, and site levels to facilitate budgetary control. The budgeting systems are designed to control the total budget but provide flexibility to meet the ongoing programmatic needs. The budgeting systems are also designed to control total site budgets but provide flexibility for site management as well.

For the general fund, the final actual revenues of $28.7 million exceeded the final budgeted revenues by $1.2 million. The primary reason revenues exceeded the budget was revenues for property taxes exceeded the final budget amount by $843,000. Additionally, the School District did not prepare a budget for the revenues associated with the various principal's accounts; hence miscellaneous revenues from the schools contributed to the fact miscellaneous revenues exceeded the final budget by $298,000.

The general fund's final actual expenditures of $26.5 million were under the final budget by $628,000 or 2.3%. The budget's expenditures were distributed over various functional areas so no one function can be singled out for causing the total budget surplus.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

At fiscal year ended June 30, 2019, the School District had $40.7 million invested in capital assets, net of accumulated depreciation, all in governmental activities. These assets are made up of a broad range of items including buildings; land; land improvements; and instructional; food service, transportation and maintenance equipment. Table 4 reflects a summary of these balances, net of accumulated depreciation and amortization, as compared to the prior fiscal year.

Table 4 Capital Assets at June 30
(Net of Depreciation)

Governmental Activities

Fiscal Year

Fiscal Year

2019

2018

Land Construction in Progress Land Improvements Buildings and Improvements Equipment

$ 1,000,886 $ 1,000,886

6,952,202

4,261,157

285,829

317,882

30,936,230

27,059,191

1,492,617

1,242,875

Total

$ 40,667,764 $ 33,881,991

Additional information about the School District's capital assets can be found in the Notes to the Basic Financial Statements.

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JASPER COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

Long-Term Debt
At June 30, 2019, the School District had $13.1 million in total debt outstanding, which consisted of about $12.0 million in bond debt and $1.1 million in unamortized bond premiums. Table 5 summarizes the School District's debt as compared to the prior fiscal year.
Table 5 Change in Long-Term Debt

General Obligation Bonds Payable Unamortized Bond Premiums

Governmental Activities

Fiscal Year

Fiscal Year

2019

2018

$ 12,050,000 $ 3,025,000

1,081,062

-

Total

$ 13,131,062 $ 3,025,000

Additional information about the School District's debt can be found in the Notes to the Basic Financial Statements.

FACTORS BEARING ON THE SCHOOL DISTRICT'S FUTURE

Currently known circumstances that are expected to have a significant effect on financial position or results of operations in future years are as follows:

The School District is financially stable. The School District's operating millage for fiscal year 2019 was 17.99 mills, which produced over $465,000 per mill. The School District is in the process of a major renovation of its middle school which is primarily being funded with the one percent local sales tax revenue and state capital outlay grants.

The economy showed moderate improvement from the prior year. Operating revenues from property taxes increased about $0.4 million or 5.0% from the prior year revenues, despite a lower millage rate for calendar year 2018. Additionally, revenues from the State of Georgia increased by $1.1 million or 7.3% from the prior year. The general fund had an unassigned fund balance of $6.7 million at June 30, 2019, which is an increase of about $1.5 million from the prior year. The School District anticipates significant financial challenges going forward due to expected continued higher health insurance and benefit costs for employees. Despite these challenges, the School District will continue to be a good steward of tax dollars while providing a quality educational opportunity.

CONTACTING THE SCHOOL DISTRICT'S FINANCIAL MANAGEMENT

This financial report is designed to provide our citizens taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Ms. Anne Harrison, Director of Finance, Jasper County Board of Education, 1411 College Street, Monticello, Georgia 31064. You may also email your questions to Ms. Harrison at aharrison@jasper.k12.ga us.

x

JASPER COUNTY BOARD OF EDUCATION

JASPER COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2019
ASSETS
Cash and Cash Equivalents Investments Accounts Receivable
Taxes State Government Federal Government Local Inventories Capital Assets-Non Depreciable Capital Assets-Depreciable
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to Defined Benefits Pension Plan Related to Defined Benefits OPEB Plan
LIABILITIES
Accounts Payable Interest Payable Salary and Benefits Payable Contracts Payable Retainages Payable Proportionate Share of Collective Net Pension Liability Proportionate Share of Collective Net OPEB Liability Long-Term Debt
Due within one Year Due in more than one Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to Defined Pension Plan Related to Defined OPEB Plan
NET POSITION
Net Investment in Capital Assets Restricted
Continuation of State and Federal Programs Debt Service Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES
$ 14,649,187.19 49,000.00
1,668,830.60 2,128,621.27
425,317.79 17,305.25 55,004.75
7,953,088.00 32,714,676.00
59,661,030.85

4,874,284.00 1,543,131.00
6,417,415.00
29,614.80 46,649.17 2,681,730.13 158,203.00 495,731.73 18,876,399.00 18,604,830.00
1,020,122.94 12,110,939.06
54,024,219.83

555,022.00 3,574,935.00
4,129,957.00
31,090,238.52
176,740.31 3,214,832.38 1,733,503.61 (28,291,045.80)

$

7,924,269.02

The notes to the basic financial statements are an integral part of this statement.

- 1 -

JASPER COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2019

GOVERNMENTAL ACTIVITIES
Instruction Support Services
Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance And Operation of Plant Services Student Transportation Service Support Services - Central Other Support Services Operations of Non-Instructional; Services Enterprise Operations Food Services Interest On Short-Term And Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes For Maintenance and Operations For Debt Service Sales Tax Special Purpose Local Option Sales Tax For Capital Projects/Debt Services Other Sales Taxes Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Special Item Loss on Disposal of Capital Assets
Total General Revenues and Special Item
Change in Net Position
Net Position - Beginning of Year
Net Position - End of Year

EXPENSES

CHARGES FOR SERVICES

$

15,819,096.78 $

-

1,255,690.08 1,073,705.34
422,624.39 480,451.68 1,572,328.12 429,769.37 1,776,730.80 2,093,590.59 418,471.50 140,875.88

338.00 -

120,379.50 1,669,673.12
400,333.71

83,070.62 244,248.19
-

$

27,673,720.86 $

327,656.81

The notes to the basic financial statements are an integral part of this statement.

- 2 -

EXHIBIT "B"

PROGRAM REVENUES

OPERATING GRANTS AND CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET(EXPENSES) REVENUES AND
CHANGES IN NET POSITION

$

12,086,581.48 $

115,897.20 $ (3,616,618.10)

434,781.71 817,455.45 299,047.00 531,043.94 712,735.24
7,731.24 827,410.95 451,620.41
13,884.17 35,049.26

1,871.19 4,557.96 2,848.75 154,440.00 -

(820,908.37) (256,249.89) (123,577.39)
52,463.45 (855,034.92) (422,038.13) (946,133.10) (1,487,530.18) (404,587.33) (105,826.62)

1,364,944.08
-

6,479.28
-

(37,308.88) (54,001.57) (400,333.71)

$

17,582,284.93 $

286,094.38

(9,477,684.74)

$

8,385,711.63

31,557.38

8,417,269.01

$

1,046,415.91

162,414.55

1,208,830.46 1,687,838.00
125,966.04 383,732.30

(14,966.00)

11,808,669.81

2,330,985.07

5,593,283.95

$

7,924,269.02

- 3 -

JASPER COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2019

EXHIBIT "C"

ASSETS
Cash and Cash Equivalents Investments Receivables, Net
Taxes State Government Federal Government Local Inventories

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 6,245,051.22 $ 5,243,786.44 $ 3,160,349.53 $ 14,649,187.19

49,000.00

-

-

49,000.00

1,567,698.58 1,855,724.18
425,317.79 17,305.25 55,004.75

272,897.09
-

101,132.02 -

1,668,830.60 2,128,621.27
425,317.79 17,305.25 55,004.75

Total Assets
LIABILITIES
Accounts Payable Salaries and Benefits Payable Contracts Payable Retainages Payable
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - Property Taxes Unavailable Revenue - State Revenue
Total Deferred Inflows of Resources
FUND BALANCES
Nonspendable Restricted Assigned Unassigned
Total Fund Balances

$ 10,215,101.77 $ 5,516,683.53 $ 3,261,481.55 $ 18,993,266.85

$

29,614.80 $

2,681,730.13

-

-

2,711,344.93

- $ 158,203.00 495,731.73
653,934.73

- $ -
-

29,614.80 2,681,730.13
158,203.00 495,731.73
3,365,279.66

384,678.68 -
384,678.68

99,134.31
99,134.31

-

384,678.68

-

99,134.31

-

483,812.99

55,004.75 121,735.56 252,324.25 6,690,013.60
7,119,078.16

4,763,614.49
-
4,763,614.49

3,261,481.55
-
3,261,481.55

55,004.75 8,146,831.60
252,324.25 6,690,013.60
15,144,174.20

Total Liabilities, Deferred Inflows of Resources, and Fund Balances

$ 10,215,101.77 $ 5,516,683.53 $ 3,261,481.55 $ 18,993,266.85

The notes to the basic financial statements are an integral part of this statement.

- 4 -

JASPER COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION
JUNE 30, 2019

EXHIBIT "D"

Total fund balances - governmental funds (Exhibit "C")
Amounts reported for Governmental Activities in the Statement of Net Position are different because: Capital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of:
Land Construction in progress Land improvements Accumulated depreciation - land improvements Buildings Accumulated depreciation - buildings Equipment Accumulated depreciation - equipment
Certain revenues that are not available to pay for current year expenditures are deferred in the funds.
Unavailable property taxes Unavailable state revenues (GSFIC)
Some liabilities, are not due and payable in the current period, and therefore are not reported in the funds.
Net pension liability Net OPEB liability
Deferred outflows and inflows of resources related to pensions/OPEB are applicable future periods and, therefore are not reported in the governmental funds.
Related of pensions Related to OPEB
Some liabilities do not require the use of current financial resources, and therefore are not reported in the funds.
Accrued interest
Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds.
Bonds payable Unamortized bond premiums

$ 15,144,174.20

$

1,000,886.00

6,952,202.00

819,087.00

(533,258.00)

39,849,724.00

(8,913,494.00)

4,521,965.00

(3,029,348.00)

40,667,764.00

$

384,678.68

99,134.31

483,812.99

$ (18,876,399.00) (18,604,830.00)

(37,481,229.00)

$

4,319,262.00

(2,031,804.00)

2,287,458.00

(46,649.17)

$ (12,050,000.00) (1,081,062.00)

(13,131,062.00)

Net position of governmental activities (Exhibit "A")

$ 7,924,269.02

The notes to the basic financial statements are an integral part of this statement.

- 5 -

JASPER COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2019

EXHIBIT "E"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
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 Enterprise Operations Food Services Operation
Capital Outlay Debt Services
Principal Interest
Total Expenditures
Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Proceeds of Bonds Premiums on Bonds Sold Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

8,377,272.40 $

162,414.55

15,630,044.82

3,753,610.11

327,656.81

25,422.72

383,732.30

28,660,153.71

- $ 892,843.76 -
892,843.76

- $ 1,046,415.91
100,543.32 -

8,377,272.40 1,208,830.46 16,522,888.58 3,753,610.11
327,656.81 125,966.04 383,732.30

1,146,959.23

30,699,956.70

15,207,458.28
1,238,000.08 1,071,144.34
437,036.39 467,419.63 1,562,016.72 276,253.14 1,777,381.41 2,217,457.29 412,353.50 138,927.88 120,379.50 1,560,369.30
-
-
26,486,197.46
2,173,956.25

-
155,492.23 7,538,607.46
-
7,694,099.69
(6,801,255.93)

-
-
875,000.00 438,178.61
1,313,178.61
(166,219.38)

15,207,458.28
1,238,000.08 1,071,144.34
437,036.39 467,419.63 1,562,016.72 431,745.37 1,777,381.41 2,217,457.29 412,353.50 138,927.88 120,379.50 1,560,369.30 7,538,607.46
875,000.00 438,178.61
35,493,475.76
(4,793,519.06)

(639,880.91)
(639,880.91)
1,534,075.34
5,585,002.82

9,900,000.00 1,148,263.15
(312,905.28)
10,735,357.87
3,934,101.94
829,512.55

952,786.19 -
952,786.19
786,566.81
2,474,914.74

9,900,000.00 1,148,263.15
952,786.19 (952,786.19)
11,048,263.15
6,254,744.09
8,889,430.11

Fund Balances - Ending

$

7,119,078.16 $

4,763,614.49 $

3,261,481.55 $ 15,144,174.20

The notes to the basic financial statements are an integral part of this statement.

- 6 -

JASPER COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2019

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for Governmental Activities are different because:
Governmental fund report capital outlays as expenditures. However in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense.
Capital outlay Depreciation expense-buildings Depreciation expense-equipment Depreciation expense-land improvements
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position.
Proceeds received from general obligation bonds are reported as liabilities in the Statement of Activities Whereas in the governmental funds these proceeds are reported as other financing sources.
Par value of general obligation bonds issued Premium on bonds issued
Expenses recorded in the Statement of Activities related to the deferred benefit plans do require the use of the current financial resources.
Pension expense OPEB expense
Certain revenues reported in the Statement of Activities that do not provide current financial resources are not reported as revenue in the funds.
Unavailable property taxes June 30, 2018 June 30, 2019
Unavailable state revenue (GSFIC) June 30, 2018 June 30, 2019
Some expenses reported on the Statement of Activities do not require the use of current financial resources and, therefore are not reported as expenditures in the governmental funds.
Accrued interest expense June 30, 2018 June 30, 2019
Repayment of long-term debt is reported as an expenditure in governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position. In the current year, these amounts consist of:
Bond principal payments Amortization of bond premium
Change in net position of governmental activities (Exhibit "B")

$ 6,254,744.09

$ 7,724,505.00 (663,177.00) (228,536.00) (32,053.00)

6,800,739.00 (14,966.00)

$ (9,900,000.00) (1,148,263.15)

(11,048,263.15)

$

313,444.00

(166,365.00)

147,079.00

$ (344,682.07) 384,678.68
$ (860,323.69) 99,134.31

39,996.61 (761,189.38)

$

17,292.92

(46,649.17)

(29,356.25)

$

875,000.00

67,201.15

942,201.15

$ 2,330,985.07

The notes to the basic financial statements are an integral part of this statement.

- 7 -

ASSETS Cash and Cash Equivalents
LIABILITIES Funds Held for Others
NET POSITION Held in Trust for Private Purposes

JASPER COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS JUNE 30, 2019

EXHIBIT "G"

PRIVATE PURPOSE TRUSTS

AGENCY FUNDS

$

1,198.70 $ 75,768.25

$ 75,768.25

$

1,198.70

The notes to the basic financial statements are an integral part of this statement.

- 8 -

JASPER COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2019
ADDITIONS None Reported
DEDUCTIONS None Reported
Change in Net Position Net Position - Beginning
Net Position - Ending

EXHIBIT "H"

PRIVATE PURPOSE TRUSTS

$

-

1,198.70

$

1,198.70

The notes to the basic financial statements are an integral part of this statement.

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The Jasper County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
Additionally, the School District has been granted Charter School Status by the State of Georgia as provided in Georgia Annotated Code section 20-2-84. This status gives the School District freedom from many State rules and regulations in exchange for the School District's agreement to increase academic achievements by its students.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
GOVERNMENT-WIDE STATEMENTS:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
- 11 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
FUND FINANCIAL STATEMENTS:
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), Bond Proceeds and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general long-term principal and interest.
The School District reports the following fiduciary fund types:
Private purpose trust funds are used to report all trust arrangements, other than those properly reported elsewhere, in which principal and income benefit individuals, private organizations or other governments.
Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations.
BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds 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.

- 12 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities are reported as other financing sources.
The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
NEW ACCOUNTING PRONOUNCEMENTS
In fiscal year 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 83, Certain Asset Retirement Obligations. This statement addresses accounting and financial reporting for certain asset retirement obligations (AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital asset. A government that has legal obligations to perform future asset retirement activities related to its tangible capital assets should recognize a liability based on the guidance in this statement. The adoption of this statement did not have an impact on the School District's financial statement.
In fiscal year 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements. The primary objective of this statement is to improve the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements. It also clarifies which liabilities governments should include when disclosing information related to debt. The School District included additional information in the Long-Term Liabilities note disclosures.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
INVESTMENTS
The School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity.
Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value.
For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.
- 13 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

RECEIVABLES

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

Due to other funds and due from other funds consist of activities between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year.

INVENTORIES

Food Inventories

On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the first-in, first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.

CAPITAL ASSETS

On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art.

Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities' column in the government-wide financial statements.

Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.

Capitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land Land Improvements Buildings and Improvements Equipment Intangible Assets

Any amount $ 10,000.00 $ 10,000.00 $ 10,000.00 $ 250,000.00

N/A 10 to 60 years 20 to 60 years
4 to 20 years Individually determined

DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then.

- 14 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

In addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time.
LONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS
In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straight-line method. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.
In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures.
PENSIONS
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
FUND BALANCES
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Nonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.
Restricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Assigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.
Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.
USE OF ESTIMATES
The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.
PROPERTY TAXES
The Jasper County Board of Commissioners adopted the property tax levy for the 2018 tax digest year (calendar year) on July 12, 2018 (levy date) based on property values as of January 1, 2018. Taxes were due on December 20, 2018 (lien date) and could be paid in two installments on September 20, 2018 and December 20, 2018 (due dates). Taxes collected within the current fiscal year or within 60 days after year-end on the 2018 tax digest are reported as revenue in the governmental funds for fiscal year 2019. The Jasper County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2019, for maintenance and operations amounted to $8,347,195.83 and for school bonds amounted to $30,076.57.
The tax millage rate levied for the 2018 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

17.99 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, which are included in property taxes as shown above, amounted to $619,981.79 during fiscal year ended June 30, 2019.
SALES TAXES
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $1,046,415.91 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years. The most recent authorization expires September 30, 2020.
NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general fund. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds, except the various school activity (principal) accounts, is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America.
The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. 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, as well as the School
- 16 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS
COLLATERALIZATION OF DEPOSITS
O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
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,
(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 of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds 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 or debt obligations issued by or securities guaranteed 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.
The School District participates in the State's Secure Deposit program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure deposits: 25%, 50%, 75% and 110%. The SDP also provides for collateral levels to be increased in the amount of up to 125% if economic conditions warrants. The program lists the types of eligible collateral. The OST approves authorized custodians.

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under letters of credit or sale of the covered depository's collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.
CATEGORIZATION OF DEPOSITS
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2019, School District had deposits with a carrying amount of $14,775,154.14 and a bank balance of $16,076,189.96. The bank balances insured by Federal depository insurance were $750,000.00 and the bank balances collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name were $4,686,009.20. The bank balances included in the State's Secure Deposit Program (SDP) were $10,640,180.76.
Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Cash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position

$ 14,649,187.19 76,966.95

Total cash and cash equivalents

14,726,154.14

Add: Deposits with original maturity of three months or more reported as investments

49,000.00

Total carrying value of deposits - June 30, 2019

$ 14,775,154.14

NOTE 5: CAPITAL ASSETS

The following is a summary of changes in the capital assets for governmental activities during the fiscal year:

Balances July 1, 2018

Increases

Decreases

Transfers

Balances June 30, 2019

Governmental Activities Capital Assets, Not Being Depreciated:
Land Construction in Progress

$ 1,000,886.00 $

- $

4,261,157.00 7,375,796.00

- $

- $ 1,000,886.00

-

(4,684,751.00) 6,952,202.00

Total Capital Assets Not Being Depreciated

5,262,043.00 7,375,796.00

-

(4,684,751.00) 7,953,088.00

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements
Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements

35,331,777.00 4,137,911.00 819,087.00

348,709.00
-

37,235.00 94,224.00
-

4,555,182.00 129,569.00 -

39,849,724.00 4,521,965.00 819,087.00

8,272,586.00 2,895,036.00
501,205.00

663,177.00 228,536.00
32,053.00

22,269.00 94,224.00
-

-

8,913,494.00

-

3,029,348.00

-

533,258.00

Total Capital Assets, Being Depreciated, Net 28,619,948.00 (575,057.00) 14,966.00 4,684,751.00 32,714,676.00

Governmental Activities Capital Assets - Net $ 33,881,991.00 $ 6,800,739.00 $ 14,966.00 $

- $ 40,667,764.00

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Current year depreciation expense by function is as follows:

Instruction

Support Services

General Administration

$

School Administration

Maintenance and Operation of Plant

Student Transportation Services

Food Services

$
13,514.00 32,285.00 18,193.00 152,926.00

659,905.00
216,918.00 46,943.00

$ 923,766.00

NOTE 6: INTERFUND TRANSFERS INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2019, consisted of the following:

Transfers to

Transfers From

Capital Projects

General Fund

Fund

Debt Service Fund $ 639,880.91 $ 312,905.28

Transfers from the general fund were to move property taxes to the debt service fund to provide supplemental funding for the payment of debt.

Transfers from the capital projects fund were to move sales taxes to the debt service fund to provide supplemental funding for the payment of debt.
NOTE 7: LONG-TERM LIABILITIES
The changes in long-term liabilities during the fiscal year for governmental activities were as follows:

Balance July 1, 2018

Additions

Governmental Activities

Balance

Deductions

June 30, 2019

Due Within One Year

General Obligation (G.O.) Bonds Unamortized Bond Premiums

$ 3,025,000.00 $ -

9,900,000.00 $ 875,000.00 $ 12,050,000.00 $

1,148,263.15

67,201.15

1,081,062.00

950,000.00 70,122.94

$ 3,025,000.00 $ 11,048,263.15 $ 942,201.15 $ 13,131,062.00 $ 1,020,122.94

The School District had no unused line of credit or outstanding notes from direct borrowings and direct placements related to governmental activities as of June 30, 2019. In the event the entity is unable to make the principal and interest payments using proceeds of the Education Special Purpose Local Option Sales Tax (ESPLOST), the debt will be satisfied from the general fund or from a direct annual ad valorem tax levied upon all taxable property within the School District. Additional security is provided by the State of Georgia Intercept Program which allows for state appropriations entitled to the School District to be transferred to the Debt Service Account Custodian for the payment of debt.

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

GENERAL OBLIGATION DEBT OUTSTANDING

The School District's bonded debt consists of various issues of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved property taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.

During the current year, the School District issued general obligation bonds totaling $9.900,000.00 to provide funding for certain on-going capital outlay projects.

General obligation bonds currently outstanding are as follows:

Description

Interest Rates

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

General Government - Series 2005

3.43%

General Government - Series 2018 3.0% - 5.0%

5/10/2005 8/9/2018

5/1/2021 $ 12/1/2035

9,500,000.00 $ 9,900,000.00

2,150,000.00 9,900,000.00

$ 19,400,000.00 $ 12,050,000.00

The following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable:

Fiscal Year Ended June 30:

General Obligation Debt

Principal

Interest

Unamortized Bond Premium

2020 2021 2022 2023 2024 2025 - 2029 2030 - 2034 2035 - 2036

$

950,000.00 $

486,045.00

$

1,200,000.00

453,460.00

475,000.00

405,175.00

490,000.00

388,250.00

505,000.00

370,875.00

2,825,000.00

1,526,025.00

3,505,000.00

880,525.00

2,100,000.00

107,500.00

70,122.94 70,122.94 70,122.94 70,122.94 70,122.94 350,614.70 350,614.70 29,217.90

Total Principal and Interest

$ 12,050,000.00 $ 4,617,855.00

$

1,081,062.00

NOTE 8: RISK MANAGEMENT
INSURANCE
Commercial Insurance
The School District 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; and natural disasters. Except as described below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceeded commercial insurance coverage in any of the past three fiscal years.
Georgia School Boards Association Risk and Insurance Management System
The School District participates in the Georgia School Boards Association Risk and Insurance Management System (the System), a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims
- 20 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

brought against members of the system. The School District pays an annual premium to the System for its general insurance coverage. Additional coverage is provided through agreements by the System with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the System varies by line of coverage.

WORKERS' COMPENSATION

Georgia School Boards Association Workers' Compensation Fund

The School District participates in the Georgia School Boards Association Workers' Compensation Fund (the Fund), a public entity risk pool organized on July 1, 1992, to develop, implement, and administer a program of workers' compensation self-insurance for its member organizations. The School District pays an annual premium to the Fund for its Workers' Compensation insurance coverage. Excess insurance coverage is provided through an agreement by the Fund with the Safety National Casualty Corporation to provide coverage for potential losses sustained by the Fund in excess of $550 thousand loss per occurrence, up to the statutory limit. Employers' Liability insurance coverage is also provided by Safety National Casualty Corporation to provide coverage for potential losses sustained by the Fund in excess of $550 thousand loss per occurrence, up to $2.0 million. In addition to the $550,000.00 per occurrence retention, the Fund also retains an additional $200,000.00 per year corridor retention.

UNEMPLOYMENT COMPENSATION

The School District is self-insured with regard to unemployment compensation claims. A premium is charged when needed by the general fund to each user program 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 School District accounts for claims with expenses/expenditures and the related 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:

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

2018 $

-

$

-

$

-

$

-

2019 $

-

$

8,190.00

$

8,190.00

$

-

SURETY BOND The School District purchased a surety bond to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent

$

100,000.00

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS

The School District's financial statements include the following amounts presented in the aggregate at June 30, 2019:

Nonspendable Inventories
Restricted Continuation of Federal Programs Capital Projects Debt Service
Assigned School Activity Accounts Unemployment Compensation
Unassigned

$

55,004.75

$ 121,735.56 4,763,614.49 3,261,481.55

8,146,831.60

$ 203,324.25 49,000.00

252,324.25 6,690,013.60

Fund Balance, June 30, 2019

$ 15,144,174.20

When multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds.

NOTE 10: SIGNIFICANT COMMITMENTS

COMMITMENTS UNDER CONSTRUCTION CONTRACTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2019:

Project

Unearned Executed Contracts (1)

Expenditures through
June 30, 2019 (2)

JCHS Athletic Complex

$ 2,596,004.20 $ 6,952,202.20

(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts and retainages payable at year-end.

OPERATING LEASES

The School District leases copiers under the provisions of long-term lease agreements classified as operating leases for accounting purposes. Rental expenditures under the terms of the operating leases totaled $17,495.26 for governmental activities for the year ended June 30, 2019. The following future minimum lease payments were required under operating leases at June 30, 2019:

Year Ending

Principal

2020 2021 2022 2023 2024

$

25,928.52

25,928.52

25,928.52

25,928.52

6,482.13

Total

$

110,196.21

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

NOTE 11: SIGNIFICANT CONTINGENT LIABILITIES
FEDERAL GRANTS
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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
LITIGATION
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District.
NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB)
GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND Plan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.
Benefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.
Contributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $773.304.00 for the year ended June 30, 2019. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2019, the School District reported a liability of $18,604,830.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2018. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2017. An expected total OPEB liability as of June 30, 2018 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2018. At June 30, 2018, the School District's proportion was 0.146383%, which was an increase of 0.002046% from its proportion measured as of June 30, 2017.
For the year ended June 30, 2019, the School District recognized OPEB expense of $939,669.00.
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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

At June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

OPEB

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

Differences between expected and actual

experience

$

- $ 423,187.00

Changes of assumptions

-

3,151,748.00

Net difference between projected and actual

earnings on OPEB plan investments

25,172.00

-

Changes in proportion and differences

between School District contributions and

proportionate share of contributions

744,655.00

-

School District contributions subsequent to

the measurement date

773,304.00

-

Total

$ 1,543,131.00 $ 3,574,935.00

School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2020 2021 2022 2023 2024 Thereafter

$ (535,975.00) $ (535,975.00) $ (535,975.00) $ (537,478.00) $ (465,284.00) $ (194,421.00)

Actuarial assumptions: The total OPEB liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2018:

OPEB:

Inflation

2.75%

Salary increases

3.25% 9.00%, including inflation

Long-term expected rate of return Healthcare cost trend rate
Pre-Medicare Eligible

7.30%, compounded annually, net of investment expense, and including inflation
7.50%

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JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Medicare Eligible Ultimate trend rate
Pre-Medicare Eligible Medicare Eligible Year of Ultimate trend rate Pre-Medicare Eligible Medicare Eligible

5.50%
4.75% 4.75%
2028 2022

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:
For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection
scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement.
For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with
projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014.

The remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2017 valuation were based on a review of recent plan experience done concurrently with the June 30, 2017 valuation.

Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.
The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by

- 25 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

adding expected inflation. During fiscal year 2018, the School OPEB fund updated their investment strategy to a more long-term approach. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

Target allocation

Long-Term Expected Real Rate of Return*

Fixed income Domestic Stocks -- Large Cap Domestic Stocks -- Mid Cap Domestic Stocks -- Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatives

30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%

(0.50)% 9.00%
12.00% 13.50%
8.00% 12.00% 10.50%

Total

100.00%

*Net of Inflation

Discount rate: The discount rate has changed since the prior measurement date from 3.58% to 3.87%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.87% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.87% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2118. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2018. Therefore, the calculated discount rate of 3.87% was applied to all periods of projected benefit payments to determine the total OPEB liability.
Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.87%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.87%) or 1 percentage-point higher (4.87%) than the current discount rate:

1% Decrease (2.87%)

Current Discount Rate (3.87%)

1% Increase (4.87%)

School District's proportionate share of the Net OPEB Liability

$ 21,724,608.00 $ 18,604,830.00 $ 16,089,056.00

Sensitivity of the School District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1percentage-point higher than the current healthcare cost trend rates:

1% Decrease

Current Healthcare Cost
Trend Rate

1% Increase

School District's proportionate share of the Net OPEB Liability

$ 15,641,230.00 $ 18,604,830.00 $ 22,392,201.00

- 26 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

OPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports.
NOTE 13: RETIREMENT PLANS
The School District participates in various retirement plans administered by the State of Georgia, as further explained below.
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
Plan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications.
Benefits P rovided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2019. The School District's contractually required contribution rate for the year ended June 30, 2019 was 20.90% of annual School District payroll, of which 20.68% of payroll was required from the School District and 0.22% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $2,586,784.00 and $42,294.95 from the School District and the State, respectively.
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS)
P lan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs.
Benefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $15.00, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon
- 27 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.

Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $ 49,730.00.

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2019, the School District reported a liability of $18,876,399.00 for its proportionate share of the net pension liability for TRS.

The TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows:

School District's proportionate share of the net pension liability

$ 18,876,399.00

State of Georgia's proportionate share of the net pension liability associated with the School District

318,712.00

Total

$ 19,195,111.00

The net pension liability for TRS was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2018.
At June 30, 2018, the School District's TRS proportion was 0.101693%, which was an increase of 0.002055% from its proportion measured as of June 30, 2017.
At June 30, 2019, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $311,958.00.
The PSERS net pension liability was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2018.

- 28 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

For the year ended June 30, 2019, the School District recognized pension expense of $2,328,298.00 for TRS and $72,230.00 for PSERS and revenue of $60,703.00 for TRS and $72,230.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

At June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS

Deferred Outflows of

Deferred Inflows of

Resources

Resources

Differences between expected and actual experience

$

1,249,644.00 $

38,905.00

Changes of assumptions

284,838.00

-

Net difference between projected and actual earnings on pension plan investments

-

516,117.00

Changes in proportion and differences between School

District contributions and proportionate share of

contributions

753,018.00

-

School District contributions subsequent to the measurement date

2,586,784.00

-

Total

$

4,874,284.00 $

555,022.00

The School District contributions subsequent to the measurement date for TRS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2020 2021 2022 2023 2024

$

1,279,574.00

$

755,882.00

$

(391,341.00)

$

63,402.00

$

24,961.00

Actuarial assum ptions: The total pension liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:

Inflation

2.75%

Salary increases

3.25% 9.00%, average, including inflation

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

- 29 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Post-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

Public School Employees Retirement System:

Inflation

2.75%

Salary increases

N/A

Investment rate of return

7.30%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
The long-term expected rate of return on TRS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative
Total
* Rates shown are net of the 2.75% assumed rate of inflation

TRS Target allocation
30.00% 39.80%
3.70% 1.50% 19.40% 5.60%
-
100.00%

PSERS Target allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-term expected real rate of return*
(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

- 30 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2019

EXHIBIT "I"

Discount rate: The discount rate used to measure the total TRS pension liability was 7.50%. The discount rate used to measure the PSERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50% and 7.30%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50% and 6.30%) or 1-percentage-point higher (8.50% and 8.30%) than the current rate:

Teachers Retirement System:
School District's proportionate share of the net pension liability

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

$ 31,510,115.00 $ 18,876,399.00 $ 8,465,574.00

Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publicly available at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs.html.

NOTE 14: TAX ABATEMENTS
The School District's property tax revenues were reduced in fiscal year 2019 by approximately $31,268.00 under an agreement entered into by Jasper County Development Authority and Norton Packaging Inc. Under the terms of this agreement, the amount billed and paid on their personal property bill by Norton Packaging Inc. will be credited toward their real property bill for a 10year abatement period.
The percent of real property abated will be decreased by 10% per year during the abatement period, which began January 1, 2015 and will end December 31, 2024.
Additionally, the School District's property tax revenues were reduced in fiscal year 2019 by approximately $10,483.00 under an agreement entered into by Jasper County Development Authority and Thompson & Faircloth. The agreement was originally made with Thompson & Thwaite, however, during fiscal year 2019, Thompson & Thwaite ceased operations. The operations and the agreement of Thompson & Thwaite were assumed by Thompson & Faircloth. Under the terms of this agreement, the amount billed and paid on their personal property bill by Thompson & Faircloth will be credited toward their real property bill for a 10-year abatement period.
The percent of real property abated will be decreased by 10% per year during the abatement period, which began January 1, 2017 and will end December 31, 2026.

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JASPER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "1"

Year Ended
2019 2018 2017 2016 2015

School District's proportionate share of the net pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the net pension liability
associated with the School District

0.101693% $ 0.099638% $ 0.099533% $ 0.093846% $ 0.092841% $

18,876,399.00 $ 18,518,029.00 $ 20,534,768.00 $ 14,287,122.00 $ 11,729,236.00 $

318,712.00 $ 271,717.00 $ 284,090.00 $ 208,721.00 $ 149,077.00 $

Total

School District's covered payroll

19,195,111.00 $ 18,789,746.00 $ 20,818,858.00 $ 14,495,843.00 $ 11,878,313.00 $

12,350,978.19 11,619,969.00 11,080,645.00 10,050,676.00
9,587,918.00

School District's proportionate share of the net pension liability as a percentage of its
covered payroll
152.83% 159.36% 185.32% 142.15% 122.33%

Plan fiduciary net position as a
percentage of the total pension liability
80.27% 79.33% 76.06% 81.44% 84.03%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 33 -

JASPER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "2"

Year Ended

School District's proportion of the net pension liability

School District's proportionate share of the net pension liability

State of Georgia's proportionate share of the net pension liability associated with the School District

2019 2018 2017 2016 2015

0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $

- $ - $ - $ - $ - $

311,958.00 $ 306,322.00 $ 346,042.00 $ 246,205.00 $ 179,720.00 $

Total

School District's covered payroll

311,958.00 $ 306,322.00 $ 346,042.00 $ 246,205.00 $ 179,720.00 $

962,822.08 954,257.77 848,885.15 868,930.89 751,978.95

School District's proportionate share the net pension liability as
a percentage of its covered payroll
N/A N/A N/A N/A N/A

Plan fiduciary net position as a percentage
of the total pension liability
85.26% 85.69% 81.00% 87.00% 88.29%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 34 -

JASPER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30

SCHEDULE "3"

Year Ended
2019 2018

School District's proportionate share
of the net OPEB liability expressed
as a percentage

School District's proportionate share of the net OPEB liability

State of Georgia's proportionate share of the net OPEB liability
associated with the School District

0.146383% $ 0.144337% $

18,604,830.00 $ 20,279,290.00 $

- $ - $

Total

School District's covered-employee
payroll

18,604,830.00 $ 20,279,290.00 $

11,085,724.82 10,502,724.54

School District's proportionate share of the
net OPEB liability as a percentage of its covered-employee
payroll

Plan fiduciary net position as a percentage of the total OPEB liability

167.83% 193.09%

2.93% 1.61%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 35 -

JASPER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "4"

Year Ended

Contractually required contribution

Contributions in relation to the contractually
required contribution (1)

Contribution defidiency (excess)

School District's covered payroll

2019 $ 2018 $ 2017 $ 2016 $ 2015 $ 2014 $ 2013 $ 2012 $ 2011 $ 2010 $

2,586,784.00 $ 2,041,815.00 $ 1,634,213.74 $ 1,559,652.00 $ 1,321,325.00 $ 1,176,071.00 $ 1,073,012.00 $ 1,052,574.00 $ 1,115,812.00 $ 1,022,895.00 $

2,586,784.00 $ 2,041,815.00 $ 1,634,213.74 $ 1,559,652.00 $ 1,321,325.00 $ 1,176,071.00 $ 1,073,012.00 $ 1,052,574.00 $ 1,115,812.00 $ 1,022,895.00 $

- $ - $ - $ - $ - $ - $ - $ - $ - $ - $

12,506,398.07 12,350,978.19 11,619,969.00 11,080,645.00 10,050,676.00
9,587,918.00 9,348,575.00 10,075,971.00 10,661,827.00 10,341,208.00

Contribution as a percentage of covered payroll
20.68% 16.53% 14.06% 14.08% 13.15% 12.27% 11.48% 10.45% 10.47%
9.89%

(1) The School District has included On Behalf payments within the contributions for years 2015 and prior.

- 36 -

JASPER COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND
FOR THE YEAR ENDED JUNE 30

SCHEDULE "5"

Year Ended

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

School District's covered-employee
payroll

2019 $ 2018 $ 2017 $

773,304.00 $ 758,692.00 $ 752,584.00 $

773,304.00 $ 758,692.00 $ 752,584.00 $

0.00 $ 0.00 $ 0.00 $

11,086,870.78 11,085,724.82 10,502,724.54

Contribution as a percentage of covered
covered-employee payroll
6.97% 6.84% 7.17%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 37 -

JASPER COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2019

SCHEDULE "6"

Teachers Retirement System

Changes of assumptions: On November 18, 2015, the- Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The

expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the

Society of Actuaries' projection scale BB (set forward one year for males).



In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.

Public School Employees Retirement System
Changes of assumptions: On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date.
On-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (se-t forward 3 years for males and 2 years for females).
In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.

School OPEB Fund
Changes of benefit terms: There have been no changes in benefit terms.
Changes in assumptions: June 30, 2017 valuation: the June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to the State OPEB fund based on their last employer payroll location: irrespective of retirement affiliation.
The discount rate was updated from 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018.

The notes to the basic financial statements are an integral part of this statement.

- 38 -

JASPER COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 2019

SCHEDULE "7"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
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 Enterprise Operations Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL (1)

FINAL (1)

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$ 7,614,964.89 $ 7,534,109.89 $ 8,377,272.40 $

100,000.00

100,000.00

162,414.55

15,257,104.11

15,325,252.02

15,630,044.82

3,597,225.00

4,163,222.28

3,753,610.11

226,542.00

226,542.00

327,656.81

15,410.00

15,410.00

25,422.72

77,500.00

85,694.00

383,732.30

26,888,746.00

27,450,230.19

28,660,153.71

843,162.51 62,414.55
304,792.80 (409,612.17) 101,114.81
10,012.72 298,038.30
1,209,923.52

15,995,786.00
1,340,522.00 1,030,000.00
415,450.00 443,000.00 1,549,200.00 265,000.00 2,050,000.00 1,951,000.00 623,000.00
41,000.00 -
1,688,079.00
27,392,037.00
(503,291.00)

15,499,218.44
1,266,119.12 1,120,240.00
437,265.00 559,588.00 1,525,261.00 280,880.00 1,942,543.00 2,312,977.00 425,704.00
35,050.00 -
1,709,480.00
27,114,325.56
335,904.63

15,207,458.28
1,238,000.08 1,071,144.34
437,036.39 467,419.63 1,562,016.72 276,253.14 1,777,381.41 2,217,457.29 412,353.50 138,927.88 120,379.50 1,560,369.30
26,486,197.46
2,173,956.25

291,760.16
28,119.04 49,095.66
228.61 92,168.37 (36,755.72)
4,626.86 165,161.59
95,519.71 13,350.50 (103,877.88) (120,379.50) 149,110.70
628,128.10
1,838,051.62

(119,000.00) (119,000.00) (622,291.00) 6,542,746.08
(50,124.47)

243,610.00 (958,194.00) (714,584.00) (378,679.37) 6,542,746.08
4,880.28

(639,880.91) (639,880.91) 1,534,075.34 5,585,002.82
-

(243,610.00) 318,313.09
74,703.09 1,912,754.71
(957,743.26) (4,880.28)

Fund Balances - Ending

$ 5,870,330.61 $ 6,168,946.99 $ 7,119,078.16 $

950,131.17

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
(1) Original and Final Budget amounts do not include the budgeted expenditures of the following programs The actual revenues and expenditures of these programs were as follows

Principal Accounts Fund for Improvement of Education Project Headstart Pre Kindergarten Program

Revenues

Expenditures

$

403,325.56 $

401,606.13

413,199.30

412,749.30

649,959.00

649,959.00

477,005.91

477,005.91

$

1,943,489.77 $

1,941,320.34

The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

The notes to the basic financial statements are an integral part of this statement.

- 39 -

JASPER COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2019

SCHEDULE "8"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program
Total Child Nutrition Cluster
Forest Service Schools and Roads Cluster Pass-Through From Office of the State Treasurer Schools and Roads - Grants to States
Total U. S. Department of Agriculture
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Grants to States Preschool Grants
Total Special Education Cluster
Other Programs Direct Fund for the Improvement of Education Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States English Language Acquisition State Grants Rural Education Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Supporting Effective Instruction State Grants Supporting Effective Instruction State Grants Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies
Total Other Programs
Total U. S. Department of Education
Health and Human Services, U. S. Department of Direct Head Start

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

195GA324N1099 $ 195GA324N1099

378,841.14 1,114,242.81
1,493,083.95

10.665

486Forest

36,715.71 1,529,799.66

84.027 84.027 84.173

H027A170073 H027A180073 H173A180081

84.215
84.048 84.365 84.358 84.424A 84.424A 84.367 84.367 84.010 84.010

S215G180076
V048A180010 S365A180010 S365B180010 S424A170011 S424A180011 S367A170001 S367A180001 S010A170010 S010A180010

93.600

04CH101260100

77,536.00 399,753.36
16,461.04
493,750.40
412,749.30
36,144.00 5,538.34
44,798.00 3,026.00
39,760.45 7,928.00
83,478.73 38,628.00 611,369.28
1,283,420.10
1,777,170.50
649,959.00

Total Expenditures of Federal Awards

$

3,956,929.16

Notes to the Schedule of Expenditures of Federal Awards

Note 1. Basis of Presentation

The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Jasper County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2019. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board.
Note 2. Summary of Significant Accounting Policies

Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.

Note 3: Indirect Cost Rate The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

The notes to the basic financial statements are an integral part of this statement.

- 40 -

JASPER COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2019

SCHEDULE "9"

AGENCY/FUNDING
GRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program
Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) One time QBE Adjustment Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Charter System Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Middle School Computer Programming Grant Preschool Disability Services Pupil Transportation - State Bonds School Security Grant Teachers Retirement Vocational Education
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Governor's Office of Student Achievement Early Language and Literacy Mini-Grant Program
Office of the State Treasurer Public School Employees Retirement

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$ 477,005.91 $

- $

477,005.91

408,069.00 366,231.00 1,314,034.00 820,787.00 677,526.00 460,051.00 1,355,971.00 1,278,009.00 509,431.00 2,169,050.00 482,159.00 417,428.00 107,259.00 126,658.00 (122,850.00) 260,726.00
80,294.00 47,917.00
1,070.00
439,490.00 588,921.00 593,338.00 221,964.00
342,884.00 48,424.00 7,150.00
1,687,838.00
37,954.00 22,653.11 25,000.00 43,724.00 154,440.00 40,376.00 42,294.95 42,494.00

-

408,069.00

-

366,231.00

-

1,314,034.00

-

820,787.00

-

677,526.00

-

460,051.00

-

1,355,971.00

-

1,278,009.00

-

509,431.00

-

2,169,050.00

-

482,159.00

-

417,428.00

-

107,259.00

-

126,658.00

(122,850.00)

-

260,726.00

-

80,294.00

-

47,917.00

-

1,070.00

-

439,490.00

-

588,921.00

-

593,338.00

-

221,964.00

-

342,884.00

-

48,424.00

-

7,150.00

-

1,687,838.00

-

37,954.00

-

22,653.11

25,000.00

-

43,724.00

-

154,440.00

-

40,376.00

-

42,294.95

-

42,494.00

4,543.85 49,730.00

892,843.76 -

892,843.76 4,543.85
49,730.00

The notes to the basic financial statements are an integral part of this statement.

$ 15,630,044.82 $

892,843.76 $ 16,522,888.58

- 41 -

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JASPER COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2019

SCHEDULE "10"

PROJECT (SPLOST 2015)
Costs associated with: (i) adding to, renovating, repairing, improving, and equipping
existing school buildings and School District Facilities, by acquiring, constructing and equipping new school buildings and facilities, including:
(a) new physical education/athletic facilities and classrooms, (b) acquiring miscellaneous new equipment, fixtures and
furnishings for the School District, including: (1) technology equipment and safety and security equipment, (2) acquiring school buses and transportation and maintenance equipment, (3) acquiring text books for the School District; and also
(ii) paying a portion of the Jasper County School District General Obligation Bonds, Series 2005 (the maximum amount of such payments not to exceed $4,900,000.00).
Total SPLOST 2015
PROJECT (SPLOST 2020) Costs associated with:
i (a) the addition. Renovation, repair, remediation and improvement of existing school buildings and other facilities, (b) the acquisition, construction, including, but not limited to, a new athletic complex at Jasper County High School, (c) the acquisition, purchase and installation of HVAC equipment, (d) the acquisition, purchase and installation of technology and safety equipment, including, but not limited to, computer hardware and software, classroom displays and projectors, and security equipment, (e) the acquisition, purchase and stallation of lunchroom equipment and appliances, (f) the acquisition and purchase of school buses and other transportation or maintenance vehicles, (g) the acquisition of textbooks and band instruments, (h) the acquisition of land, and (i) the acquisition and purchase of any property necessary and desirable therefor, both real and personal,
ii capitalized interest on the Bonds through and including December 1, 2020, and
iii the costs of issusing the Bonds;
Total SPLOST 2020

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

TOTAL COMPLETION
COST

EXCESS PROCEEDS
NOT EXPENDED

ESTIMATED COMPLETION
DATE

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

2,100,000.00

2,100,000.00

-

-

-

4,900,000.00

4,900,000.00

978,757.50

100,594.88

-

7,000,000.00

7,000,000.00

978,757.50

100,594.88

-

-

-

-

-

9/30/2020

-

9/30/2020

-

8,000,000.00

8,791,636.66

-

-

-

6,618,556.58

-

-

-

-
-
-
-
-
8,000,000.00

-
-
-
-
952,871.11 155,492.23
9,900,000.00

-
-
-
-
334,421.11 155,492.23
7,108,469.92

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

155,492.23

-

155,492.23

-

6/30/2030

-

6/30/2020

-

6/30/2030

-

6/30/2030

-

6/30/2030

-

6/30/2030

-

6/30/2030

-

6/30/2030

-

6/30/2030

-

12/1/2020

-

Completed

-

Total SPLOST

$ 15,000,000.00 $ 16,900,000.00 $ 8,087,227.42 $ 100,594.88 $

155,492.23 $

-

(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion.
(3) The voters of Jasper County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

The notes to the basic financial statements are an integral part of this statement.

- 43 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400

INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Jasper County Board of Education
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information] of the Jasper County Board of Education(School District), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 6, 2020.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,

March 6, 2020

Greg S. Griffin State Auditor

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400

INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Jasper County Board of Education
Report on Compliance for Each Major Federal Program
We have audited the Jasper County Board of Education (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2019. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs.
Management's Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance.

Opinion on Each Major Federal Program
In our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2019.
Report on Internal Control over Compliance
Management of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Respectfully submitted,

March 6, 2020

Greg S. Griffin State Auditor

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

JASPER COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2019
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported

SECTION IV FINDINGS AND QUESTIONED COSTS

JASPER COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2019

I SUMMARY OF AUDITOR'S RESULTS

Financial Statements
Type of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information

Unmodified

Internal control over financial reporting: Material weakness identified? Significant deficiency identified?

No None Reported

Noncompliance material to financial statements noted:

No

Federal Awards

Internal Control over major programs: Material weakness identified? Significant deficiency identified?

No None Reported

Type of auditor's report issued on compliance for major programs: All major programs

Unmodified

Any audit findings disclosed that are required to be reported in

accordance with 2 CFR 200.516(a)?

No

Identification of major programs: CFDA Numbers

Name of Federal Program or Cluster

10.553, 10.555

Child Nutrition Cluster

Dollar threshold used to distinguish between Type A and Type B programs:

$750,000.00

Auditee qualified as low-risk auditee?

Yes

II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

No matters were reported.

III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.