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

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LAURENS COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS-OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND ,



v

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

6

D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

7

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

I

AND CHANGES IN FUND BALANCES

22

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CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

DEBT SERVICE FUND

I

COMBINING BALANCE SHEET

28

.I

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

29

K

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

30

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LAURENS COUNTY BOARD OF EDUCATION
- TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

31

2 SCHEDULE OF STATE REVENUE

33

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

35

EARNINGS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

36

5

BY SITE

37

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

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H.l.'SSEI.J. \\'. H1,T01'

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STATE AUDITOR

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:aQCJ 656-217J

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DEPARTMENT OF AUDITS AND ACCOUNTS
25-1 Washington S1rec1. S.W.. Suite214 Atla111a. Georgia 3033-1-8400
January 24, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Laurens County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the Laurens County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Laurens County Board of Education's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our op1mon.
As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

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* The general-purpose financial statements of the Board of Education did not contain a General Fixed Assets Account Group to account for property and equipment owned by -the Board of Education which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the general-purpose financial statements. To conforn1 to generally accepted accounting principles, these accounts should be included in the general-purpose financial . statements.
* The Board of Education did not recognize as expenditures, in the year ended
June 30, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were improperly recorded in the year ended June 30, 2001. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Laurens County Board of Education as of June 30, 2001, and the results of its operations for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated January 24, 2002, on our consideration of the Laurens County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Laurens County Board of Education taken as a whole. The accompanying combining and individual fund statements (Exhibits E through K) and the financial schedules (Schedules 1 through 5), which includes the Schedule ofExpenditures ofFederal Awards as required by U.S. Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general-purpose financial statements. Such information has been subjected to the. auditing procedures applied in the audit of the general-purpose financial statements and in our
2001ARL-13

opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office of the State Auditor and made available to the press ofthe State, as provided for by Official Code of Georgia Annotated Section 506-24.
Respectfully submitted,
~-
II W. Hinton

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L'AURENS COUNTY BOARD OF EDUCATION
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LAURENS COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 2001

ASSETS Cash and Cash Equivalents Investments Investments Held by Trustee Accounts Receivable Due from Other Funds Inventories
Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund Amount to be Provided in Future Years
\
For Payment of: Bond Debt Capital Lease Agreements
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

355,933.56 $ 2,354,584.42

$

2.96

431,231.92

246,281.82

655,706.57 458,609.89

13,006.87 4,979.45

$

431 234.88 $

620,201.70 $ 3,468,900.88

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Temporary Loan Expired Grant Balances Payable Contracts Payable Retainages Payable Due to Other Funds Funds Held for Others Capital Lease Agreements General Obligation Bonds Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Continuation of State Programs For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Deficit Undesignated
Total Fund Equity

$

628,653.22

15,129.69 $

116,111.30

3,912.58

385,191.69

800,000.00

$ 458,609.89

44,295.80

$ 1,906,305.38 $

501,302.99 $

\

$

244,908.00

$

113.58

44,295.80

-1,719,978.50 0.00
$ -1 475,070.50 $

13,006.87 4,979.45
$

2,955,405.08 469,200.00

100 798.81 118 898.71 $

0.00 3,424,605.08

Total Liabilities and Fund Equity

$

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

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431,234.88 $

6201201.70 $ 3,468,900.88

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EXHIBIT "A"

DEBT SERVICE
FUND

s

955,782.61

FIDUCIARY FUND TYPE AGENCY FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Onl~)

JUNE 30, 2001

JUNE 30, 2000

$ 3,666,300.59 $

7.229, 709. 79

s

339,668.04

2.96 339,668.04

1,953 93 327,798.66

163.96

1,333,384.27 .

1,505.286 53

458,609.89

13,006.87 4,979.45

17,441.56 5,966.20

$

955,946.57

955,946.57

4,267,642.68

9,664,053.43 3,679,227.96

9,664,053.43 3,679,227.96

9,587,357.32 3,474,984.48

$

955,946.57 $

339,668.04 $

14,299,227.96 $ 20,115,180.03 $ 26.418,141.15

$

628,653.22 $

900,417.51

131,240.99

809,281.03

389,104.27

334,959.94

800,000.00

7,353.80

1,370,879.77

44,295.80

742,640.96

458,609.89

$

339,668.04

s

3,679,227.96

339,668.04 3,679,227.96

327,798.66 3,474,984.48

10,620,000.00

10,620,000.00

13,855,000.00

$

339 668.04 $

14,299,227.96 $ 17,090,800.17 $ 21,823,316.15

$

955,946.57

0.00

$

955 946.57

$

244,908.00

s 113.58

3,106.95

14,962.20

955,946.57

4,267,642.68

8,713.44

13,006.87 4,979.45
2,955,405.08 469,200.00
-1,719,978.50 100,798.81
$ 3,024,379.86 $

17,441.56 5,966.20
359,855.08 959,166.41
79,839.50
-1, 139,405.39 17,536.37
4,594,825.00

$

955,946.57 $

339,668.04 $

14,299,227.96 $ 20,115,180.03 $ 26 418 141.15

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LAURENS COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Federal Funds Taxes Other Funds
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 Food Services Operation Community Services Operations
Capital Outlay Debt Service
Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Capital Leases Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

s s 23,986,602.64
7,132,197.59 419,807.12
s $ 31,538,607.35

1,404,694.46 3,460,886.20
541,110.04
5,406,690.70

$ 23,253,565.73 $
992,054.82 423,839.10 757,261.88 457,727.54 2,096,157.03 174,164.11 1,791,288.94 2,065,006.15

54,978.00

134,864.05 179,993.34

$ 32,380,900.69 $

$

s -842,293.34

2,620,702.44 168,104.27 108,773.35 56,731.49 920.00 41,105.33 13,457.87 4,175.05
2,326,182.98 1,231.05
5,341,383.83 65,306.87

$

339,107.53

158,807.26

$

497 914.79

$

-344,378.55 $

-1, 130,691.95

65,306.87 59,013.28
-4,434.69 -986.75

FUND BALANCE JUNE 30

$ -1,475,070.50 S===1=18='=89=8=.7=1=

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

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EXHIBIT"B"
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TOTALS

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CAPITAL

DEBT

PROJECTS

SERVICE

(Memorandum Only) YEAR ENDED

FUND

FUND

JUNE 30, 2001

JUNE 30, 2000

s 3,461,469.43 $
70,317.74
$ 3,531,787.17 $

$
321,775.38 199,280.02

25,391,297.10 $ 3,460,886.20
10,915,442.40 1,230,514.92

521,055.40 $ 40,998,140.62 $

24,199,454.43 3,414,045.42
10,540,134.18 1.408, 265. 06
39,561,899.09

s $ 25,874,268.17

23,395,407.63

$ 1,348,719.83

1,160,159.09 532,612.45 757,261.88 514,459.03
2,096,157.03 175,084.11
1,832,394.27 2,078,464.02
4,175.05 2,326,182.98
1,231.05 1,403,697.83

1,832,277.58 687,215.30 676,909.95 676,927.00
2,176,822.63 180,415.17
1,889,256.51 2,071,554.53
64,258.50 14,801.93 2,453,402.28
446.97 14,474,911.36

$ 3,235,000.00 596,267.50

3,369,864.05 776,260.84

1,752,509.00 687,085.89

s

1,348,719.83 $

3,831,267.50 $ 42,902,271.85 $

53,034,202.23

s 2,183,067.34 $ -3,310,212.10 $ -1,904,131.23 $ -13,472,303.14

$

-157,323.25 $

$

-157 ,323.25 $

$ -1 484.01 -1,484.01 $

339,107.53 $ 158,807.26 -158,807 .26
339,107.53 $

3,200,000.00 9,349.06 -9,349.06
3,200,000.00

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s 2,025,744.09 $ -3,311,696.11 $ -1,565,023.70 $ -10,272,303.14

1,398,860.99

4,267,642.68

4,594,825.00

14,867,555.43

-4,434.69 -986.75

-59.64 -367.65

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$ 3,424,605.08 $

955,946.57 $ 3,024,379.86 $

4,594,825.00

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

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES
State Funds Federal Funds Taxes Other Funds

s 23,321,373.00 $ 23,986,602.64

6,848,655.00 339,623.00

7,132,197.59 419 807.12

Total Revenues

$ 30,509,651.00 $ 31,538,607.35

EXPENDITURES

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

$ 22,329,067.38 $ 23,253,565.73

872,505.00 365,610.00 719,939.00 352,220.8~ 1,966,195.00 193,532.00 1,796,658.00 1,687,934.00
31,909.00

992,054.82 423,839.10 757,261.88 457,727.54 2,096,157.03 174,164.11 1,791,288.94 2,065,006.15

1,487.76

200,000.00

54,978.00 314 857.39

Total Expenditures

$ 30,517,058.00 $ 32,380,900.69

Excess of Revenues over (under) Expenditures

$

-7 407.00 $ -842,293.34

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$ 497,914.79

Total Other Financing Sources (Uses)

$ 497 914.79

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

-7,407.00 $ -344,378.55

FUND BALANCE :JULY 1. 2000

149,853.48 -1,130,691.95

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

-50,070.50

FUND BALANCE JUNE 30. 2001

$ 92 375.98 $ -1,475,070.50

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

s s 1,269,826.80 1,404,694.46
3,467,637.26 3,460,886.20

522,199.00

541 110.04

s $ 5,259,663.06 5,406,690.70

s $ 2,537,667.17 2,620,702.44

115,265.00 157,217.32
10,809.87 40,521.31

168,104.27 108,773.35
56,731.49

11,200.00 22,141.00

920.00 41,105.33 13,457,87

10,140.76 2,334,686.00
500.00

4,175.05 2,326,182.98
1,231.05

$ 5,240,148.43 $ 5,341,383.83 $ 19,514.63 $ 65,306.87
\

$ 90,000.00 -90,000.00

$

0.00

$ 19,514.63 $ 65,306.87

41,722.88

59,013.28

59,512.17

-4,434.69 -986.75

$ 120,749.68 $ 118 898.71

The notes to the general-purpose financial statements are an integral part of this statement. -6-

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LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 200 I

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REPORTING ENTITY

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The Laurens County Board of Education (School District) was established under the laws of the

State of Georgia and operates under the guidance of a school board elected by the voters and a

Superintendent appointed by the Board; The 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
of entity. Accordingly, the School District is a primary government and consists all the

organizations that compose its legal entity.

FUND ACCOUNTING

The School District uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.

General Fixed Assets are recorded as expenditures in the various f~mds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the School District. To. conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.

Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the rev~nues, expenditures and Ghanges in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.

The general-purpose financial statements account for all State, Federal, Taxes and Other funds under

control of the School District, in compliance with generally accepted accounting principles

applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account

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group presented in this report are as follows:

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GOVERNMENTAL FUND TYPES - are used to account for all or most of a School District's

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educational activities. Governmental Fund Types include:

GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.

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LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001 _

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes.. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.

CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.

DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-tern1 principal, interest and paying agent fees.

FIDUCIARY FUND TYPE - the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:

AGENCY FUND - the fund used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.

ACCOUNT GROUP

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

BASIS OF ACCOUNTING

The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. _With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of ayailable spendable resources.

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Liabilities 'which are expected to be financed from available spendable resources are reported as

liabilities in the governmental funds. Other liabilities, which are not expected to be financed 'from

available spendable resources, are reported in the General Long-Term Debt Account Group.

Agency funds are purely custodial in nature and do not involve measurement ofresults ofoperations.

Governmental

funds

are

accounted .

for .

using

the.

modified .

accrual

basis

of .

accounting
.

under

which:

Revenues are recognized when susceptible to a~crual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be detennined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of

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LAURENS COUNTY.BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual_. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.

Expenditures are generally recognized when the related fund liability is incurred.

A departure from the above definitions is the accounting treatment afforded the final two payments

on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia

Department of Education for the State's share of these contracts. During fiscal year 2001, a

substantial number ofpersonnel ofthe School District were employed for a one hundred and ninety

day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this

employment period specify that compensation be paid in twelve equal monthly payments beginning

in September 2000 and ending in August 2001. State grants to fund the State's share of these

contracts were disbursed from the Georgia Department of Education to the School District in the

same twelve months. As of June 30, 2001, compensation under these employment contracts had

been earned, but two of the twelve monthly payments, due for July and August 2001, had not been

made. Payments for these two months were made and recorded as expenditures by the School

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District subsequent to June 30, 2001. Also, the State's portion ofthe compensation paid in July and

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August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to

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June 30, 2000, were recorded in the year ended June 30, 2001. Generally accepted accounting

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principles require that revenues be recorded when available and measurable and that expenditures be

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recorded when incurred, rather than when funds are received or disbursed.

Agency funds are accounted for using the modified accrual basis ofaccounting in recognizing assets and liabilities.

BUDGET

The Laurens County Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.

The budget process begins when the School District's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised
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LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FTNANCIAL STATEMENTS

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACOUNTING POLICIES
at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section .20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during.the year: All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of cash on hand, demand deposits and short-term investments with original maturities o'f three months or less from the date of acquisition in authorized financial 'institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or n:iore solvent banks or insured Federal savings and loan associations..
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning
contracts and money market investments with amaturity at purchase of one year or less are reported
at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4. authorizes the School District to invest its funds.. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
" 10 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 200 I

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

RECEIVABLES

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

PROPERTY TAXES

The Laurens County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on August 23, 2000 (levy date). Taxes were due on December 1, 2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Laurens County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% oftaxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $7,100,327.05 and for school bonds amounted to $1,503.30.

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

I

I.

School Operations

I

13.13 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $3,781,741.51 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection of this tax once an additional $9,281,076.90 has been collected or on December 31, 2002, whichever occurs first.

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet

- 11 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT ;'D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

"

JUNE 30, 2001

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

GENERAL OBLIGATION BONDS

'The School District issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.

INTERFUND TRANSACTIONS

The School District has the following types of interfund transactions:

Reimbursements ofexpenditures initially made from a fund that are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.

Operating transfers are recorded for all interfund transactions other than reimbursements.

MEMORANDUM ONLY -TOTAL COLUMNS

Total columns on the general-purpose financial statements are captioned "Memorandum Only" to

indicate that they are presented only to facilitate financial analysis. Data in these columns do not

present financial position or results ofoperations in conformity with generally accepted accounting

principles. Neither are such data comparable to a consolidation. Interfund eliminations have not

been made in the aggregation of .this data. Certain reclassifications have been made to the

comparative data to conform to the current year classifications.



DEFICIT FUND BALANCES

Funds reporting a deficit fund balance position at June 30, 2001, are as follows:

Fund Type/Fund Name

Deficit Balances

Governmental Fund Type General Fund

$1,719,978.50

In order to liquidate the deficit, theLaurens County Board of Education set up a Deficit Financing Elimination Plan and increased their millage rate 1.87 mills in fiscal year 2001. This increased millage rate should provide funds for deficit reduction in subsequent years.

-,12 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE.FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS AND INVESTMENTS

COLLATERALIZATION OF DEPOSITS

Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on

deposit at any time in any depository for a time longer than ten days a sum of money which has not

been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face

value of such surety bond and the market value of securities pledged shall be equal to not less than

110 percent of the public funds being secured after the deduction ofthe amount ofdeposit insurance.

If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate of the market value ofthe

securities pledged to secure a pool of public funds shall be not less than 110 percent ofthe daily pool

i
I

balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion,

I

waive the requirement for security in the case of operating funds placed in demand deposit, checking

accounts.

Acceptable security for deposits consists of any one of or any combination of the following:

(1) Surety bond sign~d 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 the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 2001, the bank balances were $7,687,813.58. The amounts ofthe total bank balances are classified into three categories of credit risk:

- 13 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 2: DEPOSITS AND INVESTMENTS

Category 1 - Cash that is insur~d (e.g., Federal depository insurance) or collateralized with

securities held by the School District or by the School District's agent in th,e

School District's nam. e.

.

Category 2 - Cash collateralized with securities held by the pledging financial _institution's

trust department or agent in the School District's name.

Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized

with securities held by the pledging financial institution, or by its trust

department or agent but not in the School District's name.)

The School District's deposits are classified by risk category at June 30,-2001, as follows:

)

Risk Category

1 2 3

Bank Balance
$ 1,355,782.61 4,497,623.75 1,834,407.22

Total

$ 7.687.813.58

CATEGORIZATION OF INVESTMENTS At June 30, 2001, the carrying value of the School District's total investmen,ts was $2.96 which is materially the same as fair value. This investment consisted entirely of funds invested in the Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services which are not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office ofTreasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund l is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. The pool is not registered with the SEC as an investment company but does operate Georgia Fund l in a manner consistent with Rule 2a-7 of the.Investment Company Act of 1940 and is considered to be a Rule 2a7 like pool. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principaL (S 1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.

- 14 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30, 200 i

Note 2: DEPOSITS AND INVESTMENTS

Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U.S.

I! .

Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S.

Government or any of its agencies or instrumentalities, banker's acceptances and repurchase

agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The

weighted average maturity for Georgia Fund 1 on June 30, 2001, was 39 days. The average

investment duration for Fund 6 on June 30, 2001, was 6 months.

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: RISK MANAGEMENT

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

The School District participates in the Georgia School Boards Association Risk and Insurance Management 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 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, general liability (including coverage for sexual harassment, molestation and abuse) and automobile risks. Payment of excess insurance for the system varies by line of coverage.

The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

2000 2001

$

0.00 $ 15,611.00 $ 15,611.00 $

0.00

$

0.00 $

2 472.74 $

2,472.74 $

0.00

- 15 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 4: RISK MANAGEMENT

The School District participates in the Georgia School Boards Association Workers' Compensation 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 general insurance coverage. Additional insurance coverage is provided through an agreement by the Fund with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Fund in excess of $350,000.00 loss per occurrence, up to the statutory limit.

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

Position Covered

Amount

Superintendent Employees' Blanket Bond

$ 50,000.00 $ 100,000.00

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES

The Laurens County Board of Education has entered into various lease agreements as lessee for land,

building, equipment and buses. These lease agreements qualify as capital leases for accounting

purposes and, therefore, have been recorded at the present value of the future minimum lease

payments as of the date of their inception.

"

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

Purpose

Interest Rates

Amount

General Government' - Series 1995 General Government - Series 1997 General Government - Series 1998

3.90% - 5.20% 4.00% - 4.35% 3.75% - 4.05%

$ 3,520,000.00 3,065,000.00 4,035,000.00

$10.620.000.00

The changes in General Long-Tem1 Debt during the fiscal year ended June 30, 2001, were as

follows:



. - 16 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 5: GENERAL LONG-TERM DEBT

Capital Leases

GSBA

Other

General Obligation
Bonds

Total

Balance July I, 2000

S 3,310, I03.85 $ 164,513.90 S13,855,000.00 $17,329,617.75

Retroactive Restatement of Prior Year Balances

I

Balance July I, 2000

I

Restated

Additions Capital Leases

366.73

366.73

S 3,310,103.85 s 164,880.63 S13,855,000.00 S17,329,984.48

339,107.53

339,107.53

Deductions Debt Retired

57,889.27

76 974.78 3,235,000.00 3,369,864.05

Balance June 30, 2001

S 3 252 214 58 $ . 421 QI 3.38 $1 Q62Q QQQ,QQ $14,222 221 26

'i I

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

are as follows:

Fiscal Year Ended June 30

Capital Leases

GSBA

Other

General Obligation
Bonds

Total Debt

2002

$ 265,904.88 $ 187,341.86 $ 4,149,525.00 $ 4,602,771.74

2003

262,705.00

93,047.28 4,302,492.50 4,658,244.78

2004

326,413.75

93,047.28

479,907.50

899,368.53

2005

323,247.50

93,047.28

499,665.00

915,959.78

2006

324,550.00

507,275.00

831,825.00

2007 2011

1,610,603.75

2,087,795.00 3,698,398.75

2012-2016

1,609,827.50

1,609,827.50

'i .

Total Principal and Interest

$ 4,723,252.38 $ 466,483.70 $12 Q26 660 QQ $11216 326 Q8

Deduct: Imputed Interest

1,471,037.80

39 470.32

Net Present Value of Future Minimum Lease Payments

S 3 252 214.58 $ 421 Q13J8

Note 6: SHORT-TERM DEBT

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

- 17 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 6: SHORT-TERM DEBT

Beginning Balance

Additions

Payments

Ending Balance

Temporary Loans s;====0==.0==0 $3.65.0.000.00 $2,850,000.00 $ 800,000.00

Note 7: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of $439,312.56 for health insurance and retirement contributions paid: on the School District's behalf by the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $342,844.08

Paid to the Teache_rs Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the'amount of $21,391.48

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $75,077.00

Note 8: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2001, together with funding available:

Project .

Unearned Executed Contracts

Funding Available From State

02G/01S-687-029

$ 2,580,357.00 $ 1,488,840.00

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

Note 9: CONTINGENT LIABILITIES
Amounts received or receivable principally from the Federal government are subject to audit and review by granter agencies. This could result in requests for reimbursement to the granter agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.

- 18 -

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

Note 10: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION

i

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

I

are coyered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple

1.

employer defined benefit pension plan. TRS provides service retirement, disability retirement and

survivors benefits for its members in accordance with State statute. The Teachers Retirement

System of Georgia issues a separate stand alone financial audit report and a copy can be obtained

from the Georgia Department of Audits and Accounts.

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

i

Fiscal Year

i

I

2001

II :
I

2000 1999

I

Percentage Contributed
100% 100% 100%

Required Contribution
$2,404,539.18 $ 2,325,491.99 $2,286,768.49

- 19 -

LAURENS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 2001

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$ 214,880.81 $ 161,169.28

5,467.97

8,304.26

13,006.87 4,979.45

Total Assets

$ 238,335.10 $ 169,473.54

LIABiLITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Continuation of State Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity
See notes to the general-purpose financial statements .
.- 20 -

$ 21,210.96 $ 38,137.00

98,339.01

131,336.54

$ 119 549.97 $ 169 473.54

$ 13,006.87 4,979.45
100,798.81 $ ____o_.o_o_ $ 118,785.13 $ _ _ _-'o'-'-.o"-'o'-
$ 238,335.10 $ 169,473.54

!,.,
i' EXHIBIT "E"
I'

; I

,\

I
I

FEDERAL

TOTALS

I

PROGRAMS

JUNE 30, 2001

JUNE 30, 2000

$

376,050.09 $

243,513.76

$ 232,509.59

246,281.82

247,695.86

, I

13,006.87 4,979.45

17,441.56 5 966.20

$ 232,509.59 $

640,318.23 $

514,617.38

I

: I

I

I

$

20,116.53 $

20,116.53 $

20,834.03

i

56,763.34

116,111.30

92,456.33

155,516.14

385,191.69

334,959.94

7,353.80

$ 232,396.01 $

521.419.52 $

455 604.10

I; I

; I $
I.
I
I

113.58 $

113.58 $

3,106.95 14,962.20

13,006.87 4,979.45

17,441.56 5,966.20

0.00

100,798.81

17,536.37

$

113.58 $

118,898.71 $

59,013.28

i

I

$ 232,509.59 $

640,318.23 $

514,617.38

- 21 -

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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current .Instruction Support Services Pupil Services Improvement of Instructional Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND.

LOTTERY PROGRAMS

$

158,676.00 $ 1,246,018.46

1,704,543.09

541,110.04

$ 2,404,329.13 $ 1,246,018.46

$ 1,109,423.71
95,000.00 4,371.36

$ 2,321,066.69

920.00 41,105.33
4,226.23
. 817.74 5,116.29

$ 2,321,066.69 $ 1,260,980.66

$

83,262.44 $

-14,962.20

40,944.13

14,962.20

-4,434.69 -986.75

118,785.13 -$====0.=00=

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

EXHIBIT "F"

I

I

,.

I

FEDERAL

TOTALS YEAR ENDED

PROGRAMS

JUNE 30, 2001 JUNE 30, 2000

$ 1,404,694.46 $ 2,232,731.82

$ 1,756,343.11

3,460,886.20

3,414,045.42

541,110.04

497,195.43

$ 1 756,343.11 $ 5,406,690.70 $ 6,143,972.67

I
, I

I

I

, I

$ ' 1,511,278.73 $ 2,620,702.44 $ 2,738,410.77

73,104.27

168,104.27

418,715.74

104,401.99

108,773.35

239,690.27

56,731.49

56,731.49

228,825.56

3,814.55

920.00

35,840.97

41,105.33

148,386.68

9,231.64

13,457.87

27,109.35

440.50

I I
I'

3,357.31

4,175.05

7,606.28

2,326, 182.98

2,450,769.15

1,231.05

1,231.05

446.97

3,213.00

$ 1,759,336.48 $ 5,341,383.83 $ 6,303,269.79

$

-2,993.37 $

65,306.87 $ -159,297.12

I:

3,106.95

59,013.28

218,737.69

-4,434.69 -986.75

-59.64 -367.65

$

113.58 $

118,898.71 $ =====5=9=,0=13==28=

- 23 -

LAURENS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET . CAPITAL PROJECTS FUND JUNE 30. 2001

ASSETS Cash and Cash Equivalents Investments Accounts Receivable Due from Other Funds

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$

0.00 $ 1,885,384.42

655,706.57 458,609.89

Tota I Assets

$===0==00= $ 2,999,700.88

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Contracts Payable Retainages Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

$_ _..:.4..:.4c:2.::.:95:.:..::.:80:.. $_ _..:.44.:.,.=,29::.:5:.:..8::.:0c..

. $ 2,955,405.08

$_ _ _0:.:,.0::.:0c..

0.00

$_ _ _0;:;.;.o.::..;o'- $ 2,955.405.0B

$===o=.o=o= $ 2,999,100.ss

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

EXHIBIT"G"

LOTTERY PROJECT

TOTALS JUNE 30, 2001 JUNE 30, 2000

$ 469,200.00 $ 2,354,584.42 $ 3,076,275.68

I:

1,951.16

655,706.57

605,561.16

458,609.89

i

I

$ 469,200.00 $ 3,468,900.88 $ 3,683,788.00

I $ 171,406.28

I
I

$ 44,295.80

1,370,879.77 742,640.96

$ . 44,295.80 $ 2,284,927.01

$

$ 2,955,405.08

$ 469,200.00

469,200.00

359,855.08 959,166.41
79,839.50

0.00

0.00

0.00

$ 469,200.00 $ 3,424,605.08 $ 1,398,860.99

$ 469,200.00 $ 3,468,900.88 $ 3,683,788.00

I
I
i
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- 25 -

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

REVENUES
State Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Capital Outlay Land and Land Improvements Building and Building Improvements Equipment
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Capital Leases Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$ 3,461,469.43

$

12 494.56

57 823.18

$

12 494.56 $ 3,519,292.61

$

372,349.64 $

574,339.49

322,191.20

$

372 349.64 $

896,530.69

$ -359,855.08 $ 2,622,761.92

$ -626,523.25 $ -626,523.25

$ -359,855.08 $ 1,996,238.67

359,855.08

959,166.41

FUND BALANCE JUNE 30

$ ====0.=00= $ 2,955,405.08

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

EXHIBIT "H"

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$ . I
I
$

0.00 $

$ 3,461,469.43
70 317.74

292,965.10 957,610.14 451 279.81

0.00 $ 3,531,787.17 $ 1,701,855.05

$

258,933.22

$ 79,839.50 $ 1,026,528.63

14,160,473.42

322,191.20

41,852.58

I 1

$ 79,839.50 $ 1,348,719.83 $ 14,461,259.22

i I

::. I

$ -79,839.50 $ 2,183,067.34 $ -12,759,404.17

I

$ 469,200.00 $ $ 469,200.00 $

$ 469,200.00 -626,523.25

3,200,000.00

-157,323.25 $ 3,200,000.00

$ 389,360.50 $ 2,025,744.09 $ -9,559,404.17

79,839.50

1,398,860.99

10,958,265.16

$ 469,200.00 $ 3,424,605.08 . $ 1,398,860.99

.. 'I
- 27 -

LAURENS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30. 2001

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets

PROPERTY TAXES
FOR.BOND DEBT

SPECIAL PURPOSE. LOCAL OPTION SALES TAX

TOTALS JUNE 30. 2001 JUNE 30, 2000

$

955,782.61 $ 955,782.61 $ 3,930,754.38

$

163.96

163.96

336,888.30

s

163.96 $

955,782.61 $. 955,946.57 $ 4,267,642.68

FUND EQUITY
Fund Balances Reserved For Debt S~rvice Unreserved Undesignated
Total Fund Equity

$

163.96 $

955,782.61 $ 955,946.57 $ 4,267,642.68

0.00

0.00 .

0.00

0.00

$

163.96 $

955,782.61 $ 955,946.57 $ 4,267,642.68

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

LAURENS COUNTY BOARD OF EDUCATION

EXHIBIT "J"

I

COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES

"i

DEBT SERVICE FLJND

YEAR ENDED :JUNE 30 2001

.l

I

REVENUES

I

Taxes

Other Funds

Total Revenues

EXPENDITURES

Debt Service Principal Interest

Total Expenditures

Excess of Revenues over (under) Expenditures

OTHER FINANCING USES

. Operating Transfers Out

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

I

FUND BALANCE JULY 1

I
I I
FUND BALANCE JUNE 30

I

PROPERTY TAXES
FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000

s $ 1,503.30
42.86
s s 1,546.16

s 320,272.08
199,237.16

s 321,775.38

2,618,322.05

199,280.02

206,379.92

519,509.24 $ 521,055.40 $ 2,824,701.97

$

0.00 $ 3,235,000.00 $ 3,235,000.00 $ 1,620,000.00

596,267.50

596,267.50

661 307.50

$

s s 0.00

3,831,267.50

3,831,267.50 $ 2,281,307.50

/

s s s $ 1,546.16

-3,311,758.26 -3,310,212.10

543,394.47

-1,484.01

-1,484.01

-9,349.06

s

s s 62.15 $ -3,311,758.26 -3,311,696.11

534,045.41

101.81

4,267,540.87

4,267,642.68

3,733,597.27

s

s 163.96

955,782.61 $ 955,946.57 $ 4,267,642.68

iI '
I. See notes to the general-purpose financial statements.
- 29 -

LAURENS COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30, 2001

EXHIBIT "K"

GSBA CONSTRUCTION PROJECT
ASSETS Investments Held by Tru'stee

BALANCE JUNE 30, 2000

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 2001

$

327,798.66 $ 25,058.55 $

13,189.17 $ ====33=9=,6=6=8.=04=

LIABILITIES Funds Held for Others
._--.:...,

$

327,798.66 $ 25,058.55 $

13,189.17 $==33=9=,6=6=8=.0=4

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

LAURENS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2001

SCHEDULE "1"

PASS-

THROUGH

ENTITY

FEDERAL

I' .
i

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

ID NUMBER

REVENUE IN PERIOD

EXPENDITURES IN PERIOD

I
Agriculture, U.S. Department of

Child Nutrition Cluster

Pass-Through From Georgia Department of Education

Food and Nutrition Program

Food Services School Breakfast Program
National School Lunch Program

10.553 10.555

N/A

$ 420,300.40

(2)

N/A

1,093,300.45 $ 2,197,244.83 (3)

Pass-Through From Office of School Readiness

Food and Nutrition Program

I' !:'

Summer Food Service Program

Total Child Nutrition Cluster

. 10.559

N/A

67,120.38

(2)

$ 1,580,721.23 $ 2,197,244.83

! i Other Programs

Pass-Through From Georgia Department of Education

I

Food and Nutrition Program

I
I

Food Distribution Program (1)

10.550

N/A

108,821.86

108,821.86

Pass-Through From U.S. Department of Defense

Food and Nutrition Program Food Distribution Program (1)

10.550

N/A

15,000.00

15,000.00

I

Total U. S. Department of Agriculture

$ 1,704,543.09 $ 2,321,066.69

Education, U.S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part 8 - Special Education Flow Through Preschool Capacity Building Improvement Grant Pass-Through From Heart of Georgia Regional Educational Service Agency Individuals with Disabilities Education Act Part 8 - Special Education Severely Emotionally Disturbed

. 84.027
. 84.173
. 84.173 . 84.027

N/A

$ 332,706.64 $

N/A

26,949.34

N/A

8,933.73

332,706.64 26,949.34
8,933.73

N/A

2,649.56

2,649.56

Total Special Education Cluster

$ 371,239.27 $

371,239.27

Other Programs

Pass-Through From First District Regional Educational-

Service Agency

d/b/a Live Oak Migrant Education Agency

Elementary and Secondary Education Act

Title I Migrant Education

84.011

N/A

16,330.96

16,330.96

Pass-Through From Georgia Department of Education

Elementary and Secondary Education Act

Title I Grants to Local Educational Agencies

84.010

N/A

823,973.09

825,792.98

Title II Eisenhower Professional Development

84.281

N/A

18,277.77

18,277.77

Title Ill Technology Literacy Challenge Fund Grants

84.318

N/A

112,083.01

113,370.07

Title VI

Innovative Education Program Strategies

84.298

N/A

36,075.00

36,075.00

Class Size Reduction
I'

84.340

N/A

141,877.00

141,877.00

I

- 31

LAURENS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2001

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Education, U. S. Department of Other Programs Pass-Through From Georgia Department of Education Goals 2000 State and Local Education Systemic Improvement Grants Safe and Drug-Free Schools and Communities Vocational Education - Basic Grants to States High School Program Basic Grant
Total U. S. Department of Education

CFDA NUMBER

PASS THROL,JGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.276 84.186
84.048

NIA

$ 141,307.42 $

NIA

22,574.40

141,203.12 22,565.12

NIA

72,605.19

72,605.19

$, 1,756,343.11 $

1,759,336.48

Total Federal Financial Assistance

$ 3,460,886.20 $ ==4=,0=80=,4=0=3=.1=7

NIA= Not Available

Notes to the Schedule of Expenditures of Federal Awards

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary

assistance for donated commodities received and/or consumed by the system during the current fiscal year.

(2) Expenditures for the Summer Food Service Program and the School Breakfast Program were not maintained

separately and are included in the 2001 National School Lunch Program.

'

(3) Expenditures for this program include State, and/or Other Funds.

Expenditures are not maintained by fund source.

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

The School District did not provide Federal Assistance to any Subrecipient.

The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Laurens County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the general purpose financial statements.

See notes to the general-purpose financial statements.

32

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

SCHEDULE "2"

i
I I
I '
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I:
I I
, I
i .1 ! !
I

AGENCY/FUNDING
GRANTS Community Affairs, Georgia Department of . Governor's Emergency Funds (1) Governor's Emergency Funds (2)
Education. Georgia Department of Qua lily 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 Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category Ill Category IV CategoryV Gifted Student - Category VI Remedial Education Program Alternative Education Program Media Center Program Staff and Professional Development Indirect Cost Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Principal Supplements Vocational Supervisors Education Equalization Funding Grant Food Services Vocational Education Other State Programs At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Mentoring Program Mentor Teachers Preschool Handicapped Program Remedial Summer School Teachers' Retirement Lottery Programs Assistive Technology Computers in the Classroom Distant Learning
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACTS Education, Georgia Department of Georgia's Reading Challenge Reading First Program

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

s

10,000 00

5,000.00

$

10,000 00

5,000 00

980,952.00 485,692.00 3,184,338.00 810,206.00 1,826,151.00 3,192,506.00 2,476,599.00 788,757.00
94,445.00 656,144 00 1,050,332.00 111,137.00
18,378.00 317,884.00 469,074.00 233,618.00 533,950.00 140,886.39 3,115,885.00

922,252.00 249,528.00 125,124.00
23,516.00 29,329 00 1,307,921.00
$ 129,452.11

158,676.00

7,798.00 2,250.00 342,844 08 4,778.88 -894.70 14,605.40 60,331.00 10,036.00 21,391.48

-281.07 116,558.00
-6.420.00

1,136,161.53

75,077.00

980,952.00 485,692.00 3,184,338.00 810,206.00 1,826,151.00 3,192,506.00 2.476,599.00 788,757.00
94,445.00 656,144.00 1,050,332.00 111,137.00
18,378.00 317,884.00, 469,074.00 233,618.00 533,950.00 140,886.39 3,115,885.00
922,252.00 249,528.00 125,124.00
23,516.00 29,329.00 1,307,921.00 158,676.00 129,452.11
7,798.00 2,250.00 342,844 08 4,778.88 -894.70 14,605.40 60,331.00 10,036.00 21,391.48
-281.07 116,558 00
-6.420.00
1,136,161.53
75,077.00

53,992.00 105,337.00

53,992.00 105,337.00

$ 23,986,602.64 $ 1,404,694.46 $ 25,391,297.10

(1) The purpose of these funds is to upgrade computers and software for the computer lab at West Laurens High School.

(2) The purpose of these funds is to purchase computers and special software for the Oconee Regional Library Dublin Talking Book Center.

See notes to the general-purpose financial statements.

-33-

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

SCHEDULE "3"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS

PROJECT STATUS

Acquiring land, constructing and equipping

I

two new elementary schools (Northwest and Southwest Laurens Elementary

, I

Schools); renovating, improving and

adding to East Laurens High School;

acquiring, constructing and equipping

renovations to East Laurens Elementary

School; making improvements to the

physical education and athletic facilities at

East Laurens and West Laurens High

Schools; and retiring previously incurred general obligation debt.

S 21,343,650,00 $ 21,343,650,00 $ 2, 189,987,33 $ 14,958, 131,27 Ongoing

(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 project. Includes all cost from project inception to completion.
(3) The voters of Laurens County approved the imposition of a 1% sales tax to fund the above project and retire associated debt. Amounts expended for this project may include sales tax proceeds, state, local property taxes and/or other funds over the life of the project.

: I I

See notes to the general-purpose financial statements.

- 35-

LAURENS COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
EARNINGS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2001

SCHEDULE "4"

DESCRIPTION
Direct Instructional Programs 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 Middle Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category II Category 111 Gifted Student - Category VI Remedial Education Program_ Alternative Education Program
TOTAL DIRECT INSTRUCTIONAL PROGRAMS

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

s

s 1,102,177.00

1,268,086.01 $

42,113.72 $ 1,310,199.73

545,714.00

380,805.70

17,178.64

397,984.34

3,577,854.00

3,472,258.41

113,591.15

3,585,849.56

910,330.00

630,418.38

25,359.49

. 655,777.87

2,051,824.00

2,061,018.40

84,707.81

2,145,726.21

.. 92.98

92.98

3,587,031.00

3,885,448.29

123,969.93

4,009,418.22

2,782,654.00

3,747,535.04

278,653.23

4,026,188.27

886,231.00

961,201.67

110,276.74

1,071,478.41

2,168,996.00

158.47

158.47

2,101,874.57

56,136.56

2,158,011.13

357,168.00

328,032.52

7,019.21

335,051.73

527,042.00

542,658.18

4,436.25

547,094.43

262,488.00

420,333.66

6,886.60

427,220.26

s

s 18,759,509.00 19,799,670.83 $ 870,580.78 $ 20,670,251.61

Media Center Program Staff and Professional Development

599,935.00 157,179.00

632,279.75 16,749.33

115,135.80 155,196.86

747,415.55 171,946.19

TOTAL QBE FORMULA FUNDS

$

19,516,623.00 $ 20,448,699.91 $ 1,140,913.44 $ 21,589,613.35

(1) Comprised of State Funds plus Local Five Mill Share.

See notes to the general-purpose financial statements.

- 36 -

LAURENS COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
EARNINGS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2001

SCHEDULE "5"

I

SITE

Southwest Laurens Elementary

East Laurens High School

Northwest Laurens Elementary

East Laurens Middle School

East Laurens Elementary School

West Laurens Middle School

West Laurens High School

Heart of Georgia Psychoeducational Program

CrossRoads Alternative

I.

Central Office (Alternative Education Program) Maintenance Facility

TOTAL

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

2,671,949.00 $

2,696,018.05

1,988,627.00

4,377,870.50

3,072,805.00

3,340,092.44

1,714,944.00

3,629,544.00

3,684,713.09

2,677,897.00

2,830,761.89

2,741,255.00

3,261,880.04

15,171.20

427,220.26

262,488.00

36,524.14

$ 18,759,509.00 $ 20,670,251.61

(1) Comprised of State Funds plus Local Five Mill Share.
I
I
i' I

See notes to the general-purpose financial statements. - 37 -

I
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I
I
SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS
I
I

I I I
R1 1ssi-:1.1. \\'. lfo,To~
STATE AUDITOR /-l04) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
2:'i-l Washington S1rcct. S.W.. Suite 214 Atl:rnta. Gcurgia 30334-8400
January 24, 2002

I .Honorable Roy E. Barnes, Governor Members of the General Assembly

Members of the State Boar~ of Education

and

. I

Superintendent and Members of the

Laurens County Board of Education

REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL

I REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

I ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

I

I

Ladies and Gentlemen:

We have audited the financial statements of Laurens County Board of Education as of and for the year ended June 30, 2001, and have issued our report thereon dated January 24, 2002.' This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.

Compliance

As part of obtaining reasonable assurance about whether Laurens County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and ri1aterial 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,
. I we do not express such an opinion. The results of our tests disclosed no instances ofnoncompliance
that are required to be reported under Government Auditing Standards.
I I
I Internal Control Over Financial Reporting I
In planning and performing our audit, we considered Laurens County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
I I 2001YB-40
' j

i
I I

I control over financial reporting. However, we noted certain matters involving the internal control
I over financial reporting and its operation that we consider to be reportable conditions. Reportable
conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Laurens County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-6871-01-02 and FS-6871-01-03.

A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts . that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in. the normal course of perforn1ing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, all of the reportable conditions described above are also considered to be material weaknesses.

This report is intended solely for the infornrntion and use of the management, members of the
Laurens County Board of Education, Federal awarding agencies and pass-through entities and is not
.I intended to be and should not be used by anyone other than these specified parties.

Respectfully submitted,

I

4 ... O.Q. u.) .::k::

11 W. Hinton

RWH:gp 200IYB-40

R1.1ss1-:1.1. \\'. Ht~Tor-.

I

STATE AUQITO!l

/40>i 650-217 <

0EPART1\1ENT OF AUDITS AND ACCOUNTS
25--1 Washington S1rcc1. S.W.. Suite 214 A1lan1a. Georgia 30334-8400
January 24, 2002

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

REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133

Ladies and Gentlemen:

Compliance

We have audited the compliance of Laurens County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 2001. Laurens County Board ofEducation's major Federal programs are identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Laurens County Board of Education's management. Our responsibility is to express an opinion on Laurens County Board of Education's compliance based on our audit.

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 0MB Circular A-

133, Audits of States. Local Governments, and Non-Profit Organizations. Those standards and

0MB Circular A-133 require that we plan and perforn1 the audit to obtain reasonable assurance

about whether noncompliance with the types ofcompliance requirements refen-ed to above that could

have a direct and material effect on a major Federal program occun-ed. An audit includes examining,

on a test basis, evidence about the Laurens County Board of Education's compliance with those

requirements and performing such other procedures as we considered necessary in the circumstances.

I

We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a

legal detem1ination on Laurens County Board of Education's compliance with those requirements.

2001SA-10

I

In our opinion, the Laurens County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 2001.

Internal Control Over Compliance

The management of Laurens County Board of Education is responsible for establishing and

maintaining effective internal control over compliance with requirements of laws, regulations,

contracts and grants applicable to Federal programs. In planning and perfonning our audit, we

considered Laurens County Board ofEducation's internal control over compliance with requirements

that could have a direct and material effect on a major Federal program in order to determine our

auditing procedures for the purpose of expressing our opinion on compliance and to test and report

on internal control over compliance in accordance with 0MB Circular A-133.

'.. I

II .

I .

Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in

I

which the design or operation of one or more of the internal control components does not reduce to a

relatively low level of risk that noncompliance with applicable requirements of laws, regulations,

: I contracts and grants that would be material in relation to a major Federal program being audited may

. I

occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its

I operation that we consider to be material weaknesses.

I

This report is intended solely for the infomrntion and use of the management, members of the

Laurens County Board of Education, Federal awarding agencies and pass-through entities and is not

intended to be and should not be used by anyone other than these specified parties.

Respectfully submitted,
---:;),.., .OJ ~ .4:.:is..
~llW.~n State Auditor

RWH:gp 2001SA-10

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

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

I: PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-6871-99-01 FS-6871-99-02 FS-6871-00-01 FS-6871-00-02 FS-6871-00-03 FS-68 71-00-04 FS-6871-00-05

Further Action Not Warranted Further Action Not Warranted Unresolved - See Corrective Action/Responses Unresolved - See Corrective Action/Responses Unresolved - See Corrective Action/Responses Previously Reported Corrective Action Implemented Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

BUDGET PREPARATION/EXECUTION Deficit Fund Balance Finding Control Number: FS-6871-00-01

The School District has established a deficit elimination plan. The plan calls for the elimination of the debt by June 30, 2005. The School District will work towards eliminating the deficit earlier if at all possible.

CASH AND CASH EQUNALENTS

GENERAL LEDGER

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Inadequate Separation of Duties

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Finding Control Number: FS-6871.:00-02.

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The School District has hired a financial director, effective November 1, 2001. The

School District feels that the addition of the financial director has provided for adequate

separation of duties in the performance of accounting functions and related procedures.

REVENUES/RECEN ABLES/RECEIPTS Commingling of Funds Finding Control Number: FS-6871-00-03

The School District has set up a payable to the Capital Projects Fund from the General Fund to recognize the amount of funds that have been commingled. As funds come a~ailable in the General Fund, they will be transferred to the Capital Projects Fund.

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LAURENS COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS CORRECTIVE ACTION/RESPONSES GENERAL FIXED ASSETS Failure to Maintain Gerieral Fixed Assets Account Group Finding Control Number: FS:6871-00-05Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff, the School District has decided i1ot to pursue therecording of general fixed assets on the financial statements.
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SECTION IV FINDINGS AND QUESTIONED COSTS
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LAURENS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001

I SUMMARY OF AUDITOR'S RESULTS

1. Type of Report Issued on the Financial Statements The auditor's opinion on the Laurens County Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.

2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Laurens County Board of Education disclosed financial statement reportable conditions related to the following control categories.

Cash and Cash Equivalents General Fixed Assets

General Ledger

All of the reportable conditions described above are considered to be material weaknesses.

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I 3. Noncompliance Material to the Financial Statements

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The audit of the Laurens County Board of Education disclosed no instances of

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noncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over MajorPro.grams The audit report for the Laurens County Board of Education did not disclose any reportable conditions in internal control over major programs.

5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Laurens County Board ofEducation's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Reported by Section .510(a) of 0MB Circular A-133 The Laurens County Board ofEducation's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.

7. Major Programs

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Federal awards audited as major programs are as follows:

10.553 Food and Nutrition Program - Food Services - School Breakfast Program

10.555 Food and Nutrition Program - Food Services - National School Lunch Program

10.559 Food and Nutrition Program - Summer Food Service Program

84.027 Individuals with Disabilities Education Act - Part B - Special Education -

Flow Through

84.1 73 Individuals with Disabilities Education Act - Part B - Special Education -

Preschool

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LAURENS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2001
I SUMMARY OF AUDITOR'S RESULTS
7. Major Programs 84.027 Individuals with Disabilities Education Act - Part B - Special Education Severely Emotionally Disturbed 84.1 73 Individuals with Disabilities Education Act - Part B - Special Education Capacity Building Improvement Grant
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Laurens County Board of Education did not qualify as a low risk auditee as defined by Section .530 ofOMB Circular A-133.
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
BUDGET PREPARATION/EXECUTION Deficit Fund Balance Nonmaterial Noncompliance Repeated from Prior Year Finding Control Number: FS 6871-01-01
At June 30, 2001, the liabilities and reserved fund balances exceeded assets available for the General Fund by $1,719,978.50. O.C.G.A. 20-2-67 (b) requires that the Superintendent submit to the Georgia Department of Education both a response to this condition and a corrective action plan designed to correct the budget deficit. The School District should establish budgetary procedures to ensure that funding is available prior to committing to expenditures.
CASH AND CASH EQUIVALENTS GENERAL LEDGER Inadequate Control Procedures Reportable Condition - Material Weakness Repeated from Prior Year -Finding Control Number: FS 6871-01-02
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The .School District did not provide for adequate separation of duties in the performance of accounting functions and related procedures. The following deficiencies were noted:
(1) The bank reconciliation function was not separated from the general ledger posting and check preparation function. In addition, the bank reconciliations were not reviewed by an individual independent of cash operations and the cash receipts function was not separated from the general ledger posting function for all funds.
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LAURENS COUNTY BOARD OF EDUCATION

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SCHEDULE OF FINDINGS AND QUESTIONED COSTS

YEAR ENDED JUNE 30, 2001

: I II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
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CASH AND CASH EQUIVALENTS

GENERAL LEDGER

j Inadequate Control Procedures

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Reportable Condition - Material Weakness

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Repeated from Prior Year Finding Control Number: FS 6871-01-02

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(2) Journal entries were not reviewed and approved by someone independent of the general

ledger posting and maintenance functions.

These conditions were a result ofmanagement's decision to iimit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-6871-01-03

The Laurens County Board of Education failed to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements ofthe School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the School District and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.

III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

No matters were reported.

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