Audit report, Montgomery County Board of Education, Mount Vernon, Georgia, year ended June 30, 1994

~
JU
;!_~ /v/75 1qq3.q+
STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET ATLANTA. GEORGIA 30334

AUDIT REPORT MONTGOMERY COUNTY BOARD OF EDUCATION
MOUNTVERNON,GEORGIA YEAR ENDED JUNE 30, 1994

MONTGOMERY COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

~

SECTION!

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS- OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

GOVERNMENTAL FUND TYPES

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - ACTUAL AND BUDGET

GOVERNMENTAL FUND TYPES

4

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

16

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

18

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

20

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

21

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

22

2 ANALYSIS OF CASH AND CASH EQUIVALENTS

24

3 ACCOUNTS RECEIVABLE

25

SCHEDULE OF REVENUE

4

STATE FUNDS

26

5

LOCAL AND OTHER FUNDS

27

SCHEDULE OF EXPENDITURES BY OBJECT

6

GOVERNMENTAL FUND TYPES

28

7

LOTTERY FUNDS

29

MONTGOMERY COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

8

OVERALL

31

9

BY PROGRAM

32

JO SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS

34

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

SECTION III
INTERNAL CONTROL
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS

MONTGOMERY COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTIONN FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

SECTION! FINANCIAL

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Montgomery County Board ofEducation
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
Ladies and Gentlemen:
We have audited the general purpose financial statements (Exhibits A through D) of the Montgomery County Board of Education, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.

94ARL-13

As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:
* The general purpose financial statements of the Board did not contain a General Fixed Assets
Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 1994, a portion of salaries
and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1994. Also funds received, subsequent to June 30, 1994, from the Georgia Department ofEducation for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1993, were improperly recorded in the year ended June 30, 1994. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects of such adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements present fairly, in all material respects, the financial position of the Montgomery County Board of Education as of June 30, 1994, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the Montgomery County Board of Education taken as a whole. The combining statements (Exhibits E through H) and the financial schedules (Schedules 1 through 10 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Montgomery County Board of Education. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effect of adjustments, if any, on the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects of the matters referred to in the fourth paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.
94ARL-13

A copy ofthis 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,
t:l'~,%fi-
Claude L. Vickers State Auditor
CLV:jg 94ARL-13

MONTGOMERY COUNTY BOARD OF EDUCATION - 1-

MQNTGOMfRY COi. !NlY BQARP QE fQI JCA,TJON cgu91N50 RAL,ANQf SHEET
ALL FUNQ JYPFS AND Ag;pLJNT GROUP JUNf 30 1994

EXHIBIT"A"

Cash and Gash Equivalents
, _ Accounts Receivable
Food Donated Commodities Purchased Food
Amount to be Provided in Future Years Fo, Payment cf: C8pilal Lease Agreemer<s

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS
(Memorandum OnM
JUNE 30 1994 JUNE 30 1993

640,429.48 $ 363,129.76 $ 197,361.47

$ 1,200,920.71 $ 916,648.51

70,830.92

79,062.70

149,893.62

88,533.93

13,358.66 3,419.51

13,358.66 3,419.51

20,059.28 4,069.06

29 320.27

29 320.27

41 793.06

Total Assets

711 260.40 $ 458 970.63 $ 197 361.47 $

29 320.27 $ 1 396 912.77 $ 1 071103.84

LIABU !TIES ANQ Fl IND fqt JITY

Accounts Payable Salaries Payable Expired Grant Balance& Payable Deferred Revenue capital Lease Agreements
Total Liabilities
~
Fund Balances ROBefWd For Bus Replacement Fund6 For Continuation cl Federal Programs Fo, 8cp;red Grant Balanoe&IQuestioned Cools For Inventories Food Donated Commodities Purchased Food Fo, Capital outlay Projects
Unreseiwd Designated for Equipment Purchases U-nated
Total Fund Equity
Total Liabilities and Fund Equity

8,676.74 51,232.52 81,213.00 58,706.00
199 828.26

29 320.27 29 320.27 $

8,676.74 $ 51,232.52 81,213.00 58,706.00 29 320.27
229148.53 $

10,714.95 58,163.53
2,254.25
41 793.06
112 925.79

12,922.70 $
2,625.94

6,424.15

15,548.64 $
695 711.76 711 260.40 $

13,358.66 3,419.51
23,202.32 $ 75,541.23 160 398.82 259142.37 $

197 346.00 197,346.00
15.47 197 361.47

12,922.70 $ 6,424.15
2,625.94

48,966.22

13,358.66 3,419.51
197 346.00
236,096.96 $
75,541.23 856126.05
$ 1167 764.24 $

20,059.28 4,069.06
73,094.56
885 083.49 958178.05

711 260.40 $ 458 970.63 $ 197 361.47 $

29320.27 $ 1 396 912.77 $ 1 071103.84

1he notes to the general purpose financial statements are an integral part of this statement. -2 -

MONTGOMERY COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUE$ EXPENPIIURES ANQ CHANGES IN FUNP BAl,,ANCl;S
GOVERNMENTAL FUND TYPES YEAR ENQf P JUNE 30 1994

EXHIBIT"B"

~
State Funds Federal Funds Local and Other Funds
Total Revenues
EXPENPITI.JRES
Current Instruction SupportSe<vices Pupil SeMces Improvement d 1 - . n . 1 Services Educational Media SeMces General Administration School Administration Business Administration Maintenanee and Operation of Plant Student Tranoportation SeMces Central Support SeMces Olller Support SeMces Food SeMces Operation Olller Operations d Non-1-.n.1 SeMces
Capital Outlay Debi Service
Principal I-
Toaol Expenditures
Excess d Revenues c,,er (under) Expenditures
QTHER ANANCING OURl,ES (l,lSES)
Operating Transfer.I In Operating Transfer.I Out
Total Other Financing Sources (Uses)
Excess d Revenues and Other Financing Sources over (under} Expenditures and Other Financing Uses
FUND BAI ANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

CAPITAL PROJECTS
FUND

TOTALS ~morandum On~}
YEAR ENDED JUNE30 1994 JUNE 30 1993

3,401,653.95 $ 18,279.81
946681.80
4 366 615.56 $

133,650.62 $ n3,356.83 104490.53
961 497.98 $

0.00 $

3,535,304.57 $ 741,636.64
1os11n.33

3,514,194.26 753,844.04
1119586.24

0.00 $ 5328113.54 $ 5387624.54

2,734,093.98 $ 329,491.36 $

66,020.04 105,984.50 110,623.24 126,385.79 253,787.41
TT,283.67 327,173.88 318,368.53
8,399.66 1,483.89
24,679.24 4,700.00

28,601.09 10,530.88
42,542.99
1,108.42 12,595.58
13,798.26 456,574.49
39,n6.oo

12,4n.79 4 701.49

4176158.11 $ 935019.07 $

190457.45 $

26478.91 $

0.00 $ 3,063,585.34 $ 3,069,153.86

94,621.13 116,515.38 110,623.24 168,928.78 253,787.41
n,283.67 328,282.30 330,964.11
8,399.66 15,282.15 456,574.49 24,679.24 44,476.00

29,m.os 124,020.92 109,175.98 162,n1.23 256,223.22 73,280.61 354,1n.61 270,919.14 37,557.80
408,158.83 29,008.89

12,4n.79 4 701.49

0.00 $ 51111TT.18 $ 4924165.15

0.00 $ 216936.36 $ 463459.39

-200896.00 -200 896.00 $

3,550.00 $ 3550.00 $

197,346.00 $

200,896.00 -200896.00

197346.00 $

0.00

-10,438.55 $ n1,698.95

30,028.91 $ 236,463.63

197,346.00 $ 15.47

216,936.36 $ 958,178.05

463,459.39 470,590.32

-6,700.62 -649.55

-6,700.62 -649.55

20,059.28 4069.06

FUND BALANCE JUNE 30

711 260.40 $ 259142.37 $ 197 361.47 $ 1 167 764.24 $ 958,178.05

The notes to the general purpose financial statements are an integral part of this statement. 3.

MONTGOMERY CQLJNTY BQARP QF EPUCATIQN
COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
ACTUAL AND BUDGET- GOVERNMENTAL FUND TYPES
YEAR fNQEP JUNE 30 1994

EXHIBIT"C"

~
State Funds Federal Funds Loeal and Other Funds
Total Revenues
EXPENDITURE
Current Instruction Support Services Pupil Services lmp<OVement of Instructional Services Educational Mecf,a Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Serviees Other Support Serviees Food Services Operation other Operations of Non-Instructional Serviees
Capital Outlay OebtService
Total Expenditures
Excess of Revenues _ , (under) Expenditures
QTHfR FINANQIN~ ~QURQI; (Ul;l
Other Sources
Other u...
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources OY8f' (under) Expenditures and Other Financing Uses
FUND la!1\~NCE ~UbY l 1993
FOOt;! INVENTORY
Food Inventory Net Change in Period Donated Commodities Purc:hased Food

ACTUAL PER
EXHIBIT"B"

ADJUSTMENTS

ACTUAL PER
BUDGET BASIS

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

$ 3,535,304.57 $ 741,636.64
1,051,172.33
5,328,113.54 $

0.00 $

3,535,304.57 $ 741,636.64
1.os11n.33

3,423,535.95 $ 696,484.52
1,031,849.25

0.00 $ 5,328,113.54 $ 5,151,869.72 $

111,768.62 45,152.12 19,323.08
176,243.82

3,063,585.34 $
94,621.13 116,515.38 110,623.24 168,928.78 253,787.41 77,283.oT 328.282.30 330,964.11
8,399.66 15,282.15 456,574.49 24,679.24 44,476.00 17,174.28
5,111,177.18 $
216,936.36 $

0.00 $ 3,063,585.34 $ 3,061,270.37 $

94,621.13 116,515.38 110,623.24 168,928.78 253,787.41 77,283.oT 328,282.30 330,964.11
8,399.66 15,282.15 456,574.49 24,679.24 44,476.00 17,174.28

63,502.29 111,951.79 109,437.84 170,582.08 268,382.84 84,961.74 361,845.84 366,136.35
8,399.66 13,562.00 404,3n.02 26,379.02
0.00 0.00

0.00 $ 5,111,177.18 $ 5,050,783.84 $

0.00 $ 216,936.36 $ 101,085.88 $

-2,314.97
-31,118.84 -4,563.59 -1,185.40 1,653.30 14,595.43 7,o78.07 33,563.54 35,1n.24
0.00 -1,720.15 -52,202.47 1,699.78 -44,476.00 -17,174.28
-60,393.34
115,850.48

200,896.00 $ -200,896.00
0.00 $

0.00 $

200,896.00 $ -200,896.00

0.00 $

0.00 $

0.00 $ 0.00
0.00 $

200,896.00 -200,896.00
0.00

216.936.36 $ 958,178.05

0.00 $ -24,128.34

216,936.36 $ 934,049.71

101,085.88 $ 939,662.97

115,850.48 -5,813.26

-ll,700.62

6,700.62

0.00

0.00

-949.55

649.55

0.00

0.00

FllNP BALANCE JUNE 30 1994

1,1o7,764.24 $ -16,778.17 $ 1,150,966.07 $ 1,040,948.85 $

110,037.22

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

MONTGOMERY COUNTY BOARD OF EDUCATION

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Montgomery County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. With the exception of the departures from generally accepted accounting principles disclosed in the following paragraphs, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards.
The more significant of the Board's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the Montgomery County Board of Education.
Based upon the application of the above criteria, the Montgomery County Board ofEducation is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Montgomery County, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards.
Board members were elected by the public and have decision making authority, the power to designate management, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval.
FUND ACCOUNTING
The Board uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
- 5-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Local and Other Funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of a Board's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. Also included are proceeds received from State, Federal, Local and Other sources for operations of the school food services fund. This fund could be accounted for as an enterprise fund; however, the Board chooses not to provide for depreciation, but to maintain the fund on a modified accrual basis and to report the fund as a special revenue fund under governmental fund types, which is acceptable under generally accepted accounting principles for governmental entities.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for 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 available spendable resources.
- 6-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. Property taxes are considered available ifthey are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end.
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 ofthese contracts. During fiscal year 1994, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1993 and ending in early June 1994. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1993 and ending in August 1994. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As ofJune 30, 1994, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1994, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1994. Also, the State's portion of the compensation paid in July and August 1994 was received and recorded as revenue in the fiscal year subsequent to June 30, 1994. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1993, were recorded in the year ended June 30, 1994. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
BUDGET
The Montgomery County Board of Education has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure of the aggregate budget. The budget process begins when the Board's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education.
- 7-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXI-IlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Board prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements. The budget comparison on Exhibit "C" presents actual and budget data for all governmental funds on a combined basis. To facilitate comparison with the budget, donated and purchased food inventories as reflected on Exhibit "B" have been eliminated from fund balance.

CASH AND CASH EQUIVALENTS

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

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

PROPERTY TAXES

The Montgomery County Board ofCommissioners fixed the property tax levy for the 1993 tax year (calendar year) on October 21, 1993 (levy date). Taxes were due on December 31, 1993. The lien date for property taxes was January 1, 1993. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1994 since their collection meets the criteria of GASB codification section P70.103. The Montgomery County Tax Commissioner bills and collects the property taxes for the Board of Education and remits the taxes collected to the Board.

Tax millage rate levied for the 1993 tax year (calendar year) for the Montgomery County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

12 72 mills

INVENTORlES

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. Donated food commodities are recorded as revenues and expenditures at the time

- 8-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30 1994

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.
INTERFUND TRANSACTIONS
The Board has the following types ofinterfund 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 of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral in an amount of not less than 110 percent of the public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:
(I) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on 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,
- 9-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TiiE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 2: DEPOSITS

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

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

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

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

CATEGORIZATION OF DEPOSITS

At June 30, 1994, the bank balances were $1,630,847.62. The amounts of the total bank balances are classified into three categories of credit risk:

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.)

The Board's deposits are classified by risk category at June 30, 1994, as follows:

Risk Category
1 2 3
Total

Bank Balance
$ 200,000.00 1,230,231.09 200 616.53
$ 1 630 847 62

- 10 -

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: RISK MANAGEMENT

The Board has established a limited risk management program for Unemployment Compensation. Estimated claims are budgeted by management based on known claims and prior experience. During fiscal year 1994, a total of$3,780.00 was paid in claims.

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Montgomery County Board of Education has entered into various lease agreements as lessee for equipment. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

The changes in General Long-Term Debt during the fiscal year ended June 30, 1994, were as follows:

Capital Leases

Balance July 1, 1993

$ 41,793.06

Additions

0.00

Deductions

12 472.79

Balance June 30, 1994

$ 2932027

At June 30, 1994, payments due, by fiscal year which includes principal and interest for these items:

Fiscal Year Ended June 30
1995 1996 1997 1998
Total Principal and Interest
Deduct: Imputed Interest
Net Present Value of Future Minimum Lease Payments

Capital Leases
$ 17,174.28 8,667.60 8,667.60 722.30
$ 35,231.78
5911.51
$ 29 320 27

- 11 -

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE30 1994

Note 6: SIGNIFICANT COMMITMENTS

At June 30, 1994, the Board had encumbrances in the amount of$!03,006.39 for the unperformed portion of purchase orders, contracts and other commitments for goods and services associated with the Lottery Programs. Lottery funds in the amount of $102,565.00 are available to fund these encumbrances. The revenues and expenditures associated with these encumbrances will be recognized in the subsequent fiscal year. Encumbrances outstanding do not constitute expenditures or liabilities in the current year because these commitments will be honored during the subsequent year. These encumbrances are identified by Lottery Program as follows:

Algebra Classrooms Computers in Classrooms Distant Leaming Media Center and Library Equipment Safe Schools Grant

$ 2,321.30 43,920.00 1,999.80 35,375.09 19 390.20

$ ]03 006 39

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

Note 7: CONTINGENT LIABILITIES

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

Note 8: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS).

TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement afler 30 years of creditable service, regardless of age, or afler IO years of service and attainment of age 60. A member is eligible for early retirement afler 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death.

- 12 -

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 8: RETIREMENT PLANS

Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.

Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest.

The Board's payroll for employees covered by TRS for the year ended June 30, 1994, was $2,790,260.79; total payroll was $3,258,523.39.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required to contribute 6% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1994 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.

Total contributions made during fiscal year 1994 amounted to $496,946.95, of which $329,530.27 was made by the Board and $167,416.68 was made by employees. These contributions represented 11.81 % (Board) and 6% (employees) of covered payroll.

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

Total unfunded pension benefit obligation ofTRS as ofJune 30, 1993, was as follows:

Total pension benefit obligation

$13,912,014,000.00

Net assets available for benefits, at cost

12 821 722 000,00

Unfunded pension benefit obligation

$ I 090 292 000 00

- 13 -

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 8: RETIREMENT PLANS
The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers.
Total contributions from all employers to TRS for fiscal year ended June 30, 1994 were $521,550,000.00. The Board's contribution for the year ended June 30, 1994 of$329,530.27 was actuarially determined and represented .0632% of total contributions made by all participating employers.
Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due.
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS)
PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia.
PSERS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for nonnal service retirement after IO years ofservice and attainment of age 65. A member applying for service retirement with IO years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life half ofwhat the employee would have received upon retirement.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, bunhe member's contributions are refunded with interest.
There were 39 employees covered under PSERS for the year ended June 30, 1994.
PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees.
- 14 -

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30 1994

Note 8: RETIREMENT PLANS
Total contributions from employees ofthe Board made during fiscal year 1994 amounted to $1,348.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1994, was $9,150,000.00.
Note 9: SURETY BONDS
The School Superintendent, Dr. Jim Paul Poole, is bonded in the amount of$25,000.00 with the Western Surety Company, Sioux Falls, South Dakota, their Bond No. 58554116, on which premium was paid through January 18, 1995.

- 15 -

MONTGOMERY COUNTY BOARD OF EDUCATION COMBININ!a BALANCE SHEET SPECIAL REVENUE FUND JUNE30 1994

ASSETS Cash and Cash Equivalents Accounts Receivable Inventories
Food Donated Commodoies Purchased Food
Total Assets

ELEMENTARY AND SECONDARY

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

EDUCATION OF CHILDREN IN
STATE SCHOOLS

CHAPTER 1 EDUCATION OF
DEPRIVED CHILDREN

MIGRANT PROGRAM

245,495.74 $ 133,100.70 $

0.00

9,940.13

1,100.00

$

61,988.44 $

2,534.13

13,358.66 3,419.51

$ 272,214.04 $ 134,200.70 $

0.00 $

61,988.44 $

2,534.13

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue

$

1,230.72

18,265.10

$ 75,494.70

58,706.00

Total Liabiloies

$ 19,495.82 $ 134,200.70

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commod~ Purchased Food

$ 13,358.66 3,419.51

Unreserved Designated for Equipment Purchases Undesignated

16,778.17
75,541.23 160,398.82 $

0.00 $

Total Fund Equoy

$ 252,718.22 $

0.00 $

Total Liabiloies and Fund Equoy

272,214.04 $ 134,200.70 $

$

22,394.67 $

2,534.03

6,923.72

30,401.38

2,268.67

0.10

$

61,988.44 $

2,534.13

0.00 $ 0.00 $

0.00 $ 0.00 $

0.00 0.00

0.00 $

61,988.44 $

2,534.13

See notes to the general purpose financial statements.

-16-

EXHIBIT"E"

EDUCATION ACT
CHAPTER2 BLOCK GRANT FLOW THROUGH

TITLEIIEISENHOWER MATHEMATICS AND SCIENCE EDUCATION

INDIVIDUALS WITH

DISABILITIES EDUCATION ACT

TITLE VI, B

FLOW

PRESCHOOL

THROUGH

PROGRAM

ENVIRONMENT

EDUCATION

TOTALS

GRANT

JUNE 30, 1994 JUNE 30, 1993

$

0.00 $

0.00 $

3,037.87 $

0.00 $

6,424.15 $ 388,058.46 $ 244,266.45

3,500.00

79,062.70

39,201.57

13,358.66 3,419.51

20,059.28 4,069.06

$

0.00 $

0.00 $

6,537.87 $

0.00 $

6,424.15 $ 483,899.33 $ 307,596.36

$

522.30

2,566.04

3,449.53

$

6,537.87

24,928.70 8,676.74 $
51,232.52 81,213.00 58,706.00
$ 224,756.96 $

10,714.95 58,163.53
2,254.25
71,132.73

$

6,424.15 $

6,424.15

13,358.66 $ 3,419.51

20,059.28 4,069.06

$

6,424.15 $

23,202.32 $

24,128.34

75,541.23

$

0.00 $

0.00 $

0.00 $

0.00

0.00

160,398.82

212,335.29

$

0.00 $

0.00 $

0.00 $

0.00 $

6,424.15 $ 259,142.37 $ 236,463.63

0.00 $

0.00 $

6,537.87 $

0.00 $

6,424.15 $ 483,899.33 $ 307,596.36

-17-

MONTGOMERY COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES !;;llPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30 1994

ELEMENTARY AND SECONDARY

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

EDUCATION OF CHILDREN IN
STATE SCHOOLS

CHAPTER 1 EDUCATION OF
DEPRIVED CHILDREN

MIGRANT PROGRAM

REVENUES

State Funds Federal Funds Local and Other Funds

27,332.00 $ 347,842.23 104,490.53

106,318.62 $

284.53 $ 306,739.77 $ 2,534.03

Total Revenues

$ 479,664.76 $ 106,318.62 $

284.53 $ 306,739.77 $ 2,534.03

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Capital Outlay

$ 79,226.11 $
12,141.38 1,886.49
886.42 11,123.73

456,060.00

514.49 540.00

284.53 $ 223,327.31 $ 2,534.03
1,659.83 28,718.37
13,798.26 39,236.00

Total Expenditures

$ 456,060.00 $ 106,318.62 $

284.53 $ 306,739.77 $ 2,534.03

Excess of Revenues over (under) Expenditures $ 23,604.76 $

0.00 $

0.00 $

0.00 $

0.00

OTHER FINANCING SOURCES

Operating Transfers In

Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

$ 23,604.76 $ 236,463.63
-6,700.62 -649.55

0.00 $ 0.00

0.00 $ 0.00

0.00 $

0.00

0.00

0.00

FUND BALANCE JUNE 30

252,718.22 $

0.00 $

0.00 $

0.00 $

0.00

See notes to the general purpose financial statements.

-18-

EXHIBIT"P

EDUCATION ACT
CHAPTER2 BLOCK GRANT FLOW THROUGH

TITLE IIEISENHOWER MATHEMATICS AND SCIENCE EDUCATION

INDIVIDUALS WITH

DISABILITIES EDUCATION ACT

TITLE VI, B

FLOW

PRESCHOOL

THROUGH

PROGRAM

ENVIRONMENT EDUCATION GRANT

TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993

$ 133,650.62 $ 35,701.04

$

10,699.00 $

7,000.00 $

41,261.27 $

3,052.00 $

3,944.00

723,356.63

735,620.87

104,490.53

92,477.31

$

10,699.00 $

7,000.00 $

41,261.27 $

3,052.00 $

3,944.00 $ 961,497.98 $ 863,799.22

$

8,300.89

$

13,649.95 $

2,168.54

329,491.36 $ 349,195.53

2,331.19 $
66.92

6,984.56 15.44

12,239.52
13,677.95 222.00
1,471.85

819.15 $ 64.31

1,069.85

28,601.09 10,530.88 42,542.99
1,108.42 12,595.58
0.00 13,798.26 456,574.49 39,776.00

2,609.00 10,686.63 44,388.28
222.80 1,480.08 11,433.52
408,158.63

$

10,699.00 $

7,000.00 $

41,261.27 $

3,052.00 $

1,069.85 $ 935,019.07 $ 828,174.67

$

0.00 $

0.00 $

0.00 $

0.00 $

2,874.15 $

26,478.91 $ 35,624.55

3,550.00

3,550.00

$

0.00 $

0.00 $

0.00 $

0.00 $

6,424.15 $

30,028.91 $

35,624.55

0.00

0.00

0.00

0.00

0.00

236,463.63

176,710.74

-6,700.62 -649.55

20,059.28 4,069.06

$

0.00 $

0.00 $

0.00 $

0.00 $

6,424.15 $ 259,142.37 $ 236,463.63

-19-

MONTGOMERY COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30 1994

EXHIBIT"G"

ASSETS Cash and Cash Equivalents

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION
PROJECT 94/94S-703-037

TOTALS JUNE 30, 1994 JUNE 30 1993

$

15.47 $

197,346.00 $

197,361.47 s _ _ _ _1_s_.4_7

FUND EQUITY
Fund Balances Reserved For Capital Outlay Projects Unreserved Undesignated
Total Fund Equity

$ $ _ _--.a1.=.5-:..:4.c..7

197,346.00 $ 0.00

197,346.00 15.47 $ _ _ __;_1;:;:5-..;.47'-

$

15.47 $

197,346.00 $

197,361.47 s _ _ _ _1_s_4_7_

See notes to the general purpose financial statements.

-20-

MONTGOMERY COUNTY BOARD OF EDUCATION

EXHIBIT "H"

COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

YEAR ENDED JUNE 30 1994

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION
PROJECT 94/948-703-037

TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993

REVENUES

None Recorded

$

0.00 $

0.00 $

0.00 $

0.00

EXPENDITURES

None Recorded

$

0.00 $

0.00 $

0.00 $

0.00

Excess of Revenues over (under) Expenditures

$

0.00 $

0.00 $

0.00 $

0.00

OTHER FINANCING SOURCES

Operating Transfers In

197 346.00

197 346.00

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$

0.00 $

197,346.00 $ 197,346.00 $

0.00

FUND BALANCE JULY 1

15.47

0.00

15.47

15.47

FUND BALANCE JUNE 30

$

15.47 $

197,346.00 $ 197 361.47 $

15.47

See notes to the general purpose financial statements.

-21-

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE Of FEDERAi FINANCIAi ASSISTANCE
VEAR ENDED JUNE 30 1994

SCHEDULE "1"

FUNDING AGENCY
PROGRAM/GRANT

CFDA NUMBER

AWARDS IN PERIOD

FEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS)

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agric>Jlture, U. S. Department of Direct Food and Nutrition Program Summer School Food Service Program 1993 Grant Cany-Over 1994 Grant Regular Through Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1994Grant National School Lunch Program 1993Grant 1994Grant Food Distribution Program (1)

10.559 $ 10.559

9,546.00 $ 10,788.00

10.553
10.555 10.555 10.550

79,722.04
219,563.93 2e=.26

9,546.00 $ 5,394.00

9,546.00$ 10,788.00

11,046.46 (3) 11,143.63 (3)

79,722.04
1,308.53 217,680.20 NIA

79,722.04
219,563.93 28=.26

(2)
405,647.65 (3) 28=.26

Total U. S. Department of Agriculture

347842.23 $

313650.77 $ 347842.23 $

456060.00

Education, U. S. Department of Through First District Regional Educational Service Agancy dlbla Live Oak Migrant Education Agency Elementary and Secondary Education Act Chapter 1 Migrant Education 1993Regular 1994 Regular Throug, Georgia Department of Education E - r y and Secondary Education Act Chapter 1 Education of Children in Slate Schools 1994 Regular Education of Deprived Children 1993Regular 1993 Carry-Over 1994Regular Chapter2 Block Grant Flow Through 1994Regular Titlell Eisenhower Mathematics and Science Education 1994Regular Individuals with Disabilities Education Act TitleVl,B Flow Through 1992 Carry-Over 1993 RegUlar 1993 Carry-Over 1994Regular Preschool Program 1992 Carry-Over 1993 Regular 1993 Carry-Over 1994Regular

84.011 84.011 $
84.009 84.010 84.010 84.010
84.151
84.164
84.027 84.027 84.027 84.027 84.173 84.173 84.173 84.173

$ 5,335.95
354.00 66,473.00 257,576.00 10,899.00
7,000.00
3,350.00 46,618.00
38.00 3.615.00

848.13 $

2,534.03$

2,534.03

284.53
31,524.18 65,020.00 182,000.00

284.53
66,473.00 240,266.77

10,699.00

10,699.00

284.53
66,473.00 240,266.77
10,899.00

7,000.00

7,000.00

7,000.00

1,005.00 834.47
3.350.00 37,860.80
-1.59 265.61
37.75 3,014.25

3,350.00 37,911.27
37.75 3,014.25

3,350.00 37,91127
37.75 3,014.25

- 22 -

MONTGOMERY COUNTY BOARD OF FDIJCAT!ON
SCHfQLJLE Of FEDERAi FINANCIAL ASSISTANCE YEAR ENDED JUNE 30 1994

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

AWARDS IN PERIOD

FEDERAL FUNDS RECEIVED IN PERIOD (NET OF REFUNDS)

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Education, U.S. Department of Through Georgia Department of Education Vocational Education - Basic Grants to States High School Program Basic Grant 1993 Grant 1994 Grant Supplemental State Grants for Facilities 1993 Contract

84.048 84.048
84.253

18,279.81

4,743.98

8,358.07 $

18,279.81

(4)

795.00

Total U. S. Department of Education

419338.76 $

357639.18 $ 389,850.41 $

371 570.60

Environmental Protection Agency, United States Direct Environment Education Grant Grant No. NE994413-93-1

66.951 $

4930.00 $

3 944.00 $

3 944.00 $

1 069.85

Total Federal Financial Assistance

772110.99 $

675 233.95 $ 741636.64 $

828 700.45

The Major Program is identified by an asterisk (") in front of the CFDA number.

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Elcpendltures for the School Breakfast Program - e not maintained separately and are included in the 1994 National School Lunch Program.
(3) Elcpendltures for this program include State, and/or Local and Other Funds. Elcpendltures are not maintained by fund source.
(4) Elcpendltures on this program were not maintained by fund source.

See notes to the general purpose financial statements.

- 23 -

MONTGOMERY COUNTY BOARD OF EDUCATION ANALYSIS OF CASH AND CASH EQUIVALENTS JUNE 30 1994
INTEREST BEARING ACCOUNTS
Altamaha Bank and Trust Company, Uvalda, Georgia
Checking Account (3.50%)
Montgomery County Bank, Ailey, Georgia
Certificate of Deposit No. 7058 (4.2%) Checking Accounts (3.50%)

SCHEDULE "2"
$ 758,063.50 19,485.73
423,371.48 $ 1,200,920.71

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

MONTGOMERY COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30 1994

SCHEDULE "3"

Agriculture, U.S. Department of Summer School Food Service Program
Education, Georgia Department of Food Services National School Lunch Program Vocational Funds State Funds Federal Funds Federal Programs ESEA - Chapter 1 Education of Deprived Children Individuals with Disabilities Education Act TIiie VI, B - Flow Through
First District Regional Educational Service Agency dlb/a Live Oak Migrant Education Agency Migrant Education
Montgomery County Tax Commissioner County Wide School Tax
Montgomery -Wheeler County Mental Retardation Service Center Contracted Meals
Vidalia, City of, Board of Education Vocational Funds State Funds
Other Sources Interest Earned Refund on Overpayment

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$

5,394.00 $

5,394.00

$

1,903.71

9,921.74

1,883.73
61,988.44 3,500.00

1,883.73 1,903.71 9,921.74
61,988.44 3,500.00

49,005.47

2,534.13

2,534.13 49,005.47

1,873.20

1,873.20

10,000.00

789.20 1,100.00

10,000.00
789.20 1,100.00

$

70,830.92 $

79,062.70$ 149,893.62

See notes to the general purpose financial statements. - 25 -

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 1994

SCHEDULE "4"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Special Instructional Assistance In-School Suspension Mid-term Adjustment Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Innovative Programs Preschool Handicapped Program Supervision and Assessment of Student and Begiming Teachers and Performance Based Certification Teachers' Retirement Lottery Programs Computers in Classrooms Pre-Kindergarten Program Safe Schools Grant
City of Vidalia Board of Education Vocational Education Tech Prep Grant

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 1,877,224.00 383,473.00 82,747.00 83,674.00 28,257.00 578,436.00
171,917.00 50,099.00 65,711.00 32,584.00 13,116.00
-332,537.00 304,436.00
$ 40,172.68
4,800.00 6,248.55

$ 1,877,224.00 383,473.00 82,747.00 83,674.00 28,257.00 578,436.00

27,332.00

171,917.00 50,099.00 65,711.00 32,584.00 13,116.00
-332,537.00 304,436.00
27,332.00 40,172.68

4,800.00 6,248.55

400.00 895.72

9,104.55 87,067.32 10,146.75

400.00 895.72
9,104.55 87,067.32 10,146.75

10,000.00

10,000.00

$ 3,401,653.95 $ 133,650.62 $ 3,535,304.57

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

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF LOCAL AND OTHER REVENUE YEAR ENDED JUNE 30 1994

SCHEDULE "5"

Taxes County Wide School Tax Railroad Car Tax Real Estate Transfer Tax
Other Compensation for Loss of Assets Indirect Cost Special Revenue Fund Interest Earned Sales Breakfast Lunches Contracted Meals Supplemental Sales Other

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 903,663.46 95.99
2,303.77

$ 903,663.46 95.99
2,303.77

3,697.56 $ 6,578.61 28,011.56
2,330.85

125.00
8,054.30
988.41 49,133.11 35,100.91
9,683.03 1,405.77

3,822.56
6,578.61 36,065.86
988.41 49,133.11 35,100.91
9,683.03 3,736.62

$ 946,681.80 $ 104,490.53 $ 1,051,172.33

See notes to the general purpose financial statements. - 27 -

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30 1994

SCHEDULE "6"

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

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 2,867,904.78 $ 630,404.11 18,574.09 10,062.76 9,954.22 12,355.09 22,010.34 1,558.33 16,937.19 15,244.32 25,080.47
8,399.66
156,643.03 153,077.11
71,364.41 4,199.50
19,268.94

390,618.61 $ 88,140.08 6,027.93 6,829.25
385.00 5,67928
5,166.95
2,174.88
2,849.86 96,787.71
232,446.69 11,335.86 1,145.00 6,578.61 2,884.34

3,258,523.39 718,544.19 24,602.02 16,892.01 9,954.22 12,740.09 27,689.62 1,558.33 16,937.19 20,41127 25,080.47 2,174.88 8,399.66 2,849.86 253,430.74 153,077.11 232,446.69 82,700.27 5,344.50 6,578.61 22,153.28

17,174.28 115,945.48

540.00 39,236.00 36,193.02

17,174.28 540.00
39,236.00 152,138.50

Total Expenditures

$ 4,176,158.11 $ 935,019.07 $ 5,111,177.18

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

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT bQTTERY PROGRAMS YEAR ENDED JUNE 30 1994

SCHEDULE '7''

EXPENDITURES
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Other Purchased Services Supplies Food Usage Books, Textbooks and Periodicals Other Expenditures
Nonoperating Costs Land and Land Improvements Equipment

COMPUTERS IN
CLASSROOMS

PRE-KINDERGARTEN PROGRAM

SAFE SCHOOLS
GRANT

TOTAL

$

$

954.55

8,150.00

27,566.08 4,809.96 1,388.62 52.21 $
29,346.58 514.49
1,244.44 704.94
540.00 20 900.00

$
1,544.00 8,382.75
220.00

27,566.08 4,809.96 1,388.62 52.21 1,544.00
38,683.88 514.49
1,244.44 924.94
540.00 29 050.00

Total Expenditures

$

9,104.55 $

87,067.32 $

10,146.75 $

106,318.62

See notes to the general purpose financial statements.

- 29 -

MONTGOMERY COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND -QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30 1994

SCHEDULE "8"

Minimum Expenditure Requirements (Total Allotment)
Expenditures on Combined Program Basis Salaries Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures for Staff Development Programs in Excess of Total Staff Development Allotment for: Cost of Instruction Professional Development
Expenditures per Audit
Amount of Underexpenditure for Total Allotment

THIRTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

STAFF DEVELOPMENT
PROGRAM

$ 2,432,377.00 $

28,265.00

$ 2,477,593.34 179,985.65 $
$ 2,657,578.99 $

28,391.10 28,391.10

-25,895.24

$ 2,631,683.75 $

-114.95 -11.15
28,265.00

$

0.00 $

0.00

See notes to the general purpose financial statements. - 31 -

MONTGQMfRY COUNTY RQARQ OF F.plJCATIQN
ANAi YSIS Pf MINIMUM fXPfNQlTI JR!; RfQl 118EME;NTS BY PROGRAM GFNfRAI FUNQ. QI.JAi lTY BASIC fpt IC'.ATIQN PROGRAMS
YfAR ENPEP JLJNE 30 1994

GfNfRA( AtJQ CAREER fplJCATION PROGRAMS Kindergarten C, Grades1-3(") Sub-Total K..3 Grades 4. 5 (") Grades 6-8 (") Grades 9-12 (") High School Laboratories (") Vocational Education Laboratories Ci Total General and career Education Programs
SPECIAi EQI ,CATION PROGRAMS Regular Programs Cat~I(") ~II(") Cat~III(") Cat~IV(") Itinerant Supplemental Speech Sub-Total - Regular ~V(Gifted)(") Total Special Education Programs
RfMfQlAI EPUCATIQN PRQGRAM (1
MfIA CfNifR PBQGRAMS
Total Thirteen Weighted and Media Center
STAFF DEVF! OPMfNT PROGRAMS {1) Cost rl Instruction - . , De,elopment
Total Staff Development
(") Identifies Thirteen Weighted Programs. Note (1) $:l,286.00 of the allotment for Professional
Development has been transferred to Cost of Instruction as authorized by OCGA 20-2-182
See notes to the general purpose financial statements.

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

TOTAL

ORIGINAL .....!,_

ORIGINAL

MID-TERM

REQUIRED

160,491.00 535 492.00 695,983.00 259,305.00 427,848.00 302,485.00
72,412.00 119,191.00 1,877 224.00

90 $ 90 90 90 90 90

144,441.90 $ 481,942.80 626,384.70 $ 233,374.50 385,063.20 272,236.50
65,170.80 107,271.90 1 689,501.60 $

0.00 $

144,441.90

481 942.80

0.00 $

626,384.70

233,374.50

385,063.20

272,236.50

65,170.80

4205.00

111 476.90

4 205.00 $ 1,693 706.60

377,891.00

340,101.90 $

0.00 $

340,101.90

377,891.00 90 $ 5,582.00 90
383,473.00 82,747.00 90 $
83 674.00 90 $

340,101.90 $ 5 023.80
345,125.70 $ 74 472.30 $ 75 306.60 $

0.00 $
0.00 $ 0.00 $ 1 054.00 $

340,101.90 5 023.80
345,125.70 74,472.30 76 360.60

$ 2,427,118.00

2184,406.20 $

5,259.00 $ 2,189,665.20

9,631.00 100 $ 18,626.00 100

9,631.00 $ 18,626.00

8.00 $

9,639.00 18,626.00

28,257.00

28,257.00 $

8.00 $

28,265.00

$ 2,455,375.00

2,212,663.20 $

5,267.00 $ 2,217,930.20

32

SCHEDULE "9''

REQUIRED ALLOTMENT

SALARIES ACTUAL

DISTRIBUTION BY RESPECTIVE PORTIONS

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

REQUIRED ALLOTMENT

OPERATIONS ACTUAL

AMOUNT OF UNDEREXPENDllURE
FOR REQUIRED ALLOTMENT

140,750.10 $

182,340.41

3,691.80 $

1,673.04

466 992.90

529 781.14

14 949.90

16 976.36

607,743.00 $

712,121.55 $

0.00

18,641.70 $

18,649.40 $

0.00

226,331.10

249,681.72

0.00

7,043.40

11,075.35

0.00

373,810.50

401,700.95

0.00

11,252.70

16,202.89

0.00

260,424.90

340,646.26

0.00

11,811.60

41,753.01

0.00

62,354.70

93,591.80

0.00

2,816.10

2,923.23

0.00

97 736.60

129 505.27

0.00

13 740.30

61 475.72

0.00

1628400.80 $ 1927247.55 $

0.00

65,305.80 $

152,079.60 $

0.00

10,996.20 94,743.90 $ 193,548.60 29,325.60
996.30 1 775.70

109,583.63 218,761.95
12,265.16

554.40 $ 1,993.50 5,181.30
986.40

236.47 784.16 7,644.68 196.35

331,386.30 $

340,610.74 $

0.00

8,715.60 $

8,861.66 $

0.00

4 887.00

38 420.56 $

0.00

136.80

403.65 $

0.00

336 273.30 $

379 031.30

8,852.40 $

9 265.31

73189.80 $

77 822.21 $

0.00

1 282.50 $

1 509.78 $

0.00

59 466.70 $

93 492.28 $

0.00

16 893.90 $

17130.96 $

0.00

2 097 330.60 $ 2 477,593.34 $

0.00

92,334.60 $

179,985.65 $

0.00

9,639.00 $

9,753.95 $

0.00

18 626.00

18 637.15

0.00

28,265.00 $

28,391.10 $

0.00

2 097 330.60 $ 2,477,593.34 $

0.00

120,599.60 $

208,376.75 $

0.00

- 33

MONTGOMERY COUNTY BOARD OF EDUCATION
SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS
YEAR ENDED JUNE 30 1994

SCHEDULE "1 O''

BOARD MEMBER ADDRESS
Mr. Calvin Hart, Chariman () P.O. Box 158 Alston, Georgia 30412
Mr. William Braddy () Route 1 Vidalia, Georgia 30474
Mr. Festus Fountain (*) Route 1, Box 110A Mount Vernon, Georgia 30445
Mr. Milburn McRae () Route 1, Box 193 Ailey, Georgia 3041 O
Mr. Randall Morris () Route 1, Box 3428 Uvalda, Georgia 30473

COMPENSATION

TRAVEL

$

1,650.00 $

1,695.79

1,050.00

280.30

1,250.00

1,118.59

1,050.00

410.22

1,000.00

449.32

$

6,000.00 $

3,954.22

() Denotes Board Members Serving as of June 30, 1994

See notes to the general purpose financial statements. - 34 -

SECTION II COMPLIANCE

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Montgomery County Board ofEducation
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Montgomery County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
Compliance with laws, regulations, contracts, and grants applicable to Montgomery County Board of Education is the responsibility of the Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.

94CRL-10

The results of our tests indicate that, with respect to the items tested, the Montgomery County Board of Education complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects, with those provisions.

This report is intended for the information of management, the Federal cognizant audit agency and other

Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a

matter of public record.

Rz:~

CLV:jg 94CRL-10

Claude L. Vickers State Auditor

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

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

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

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Montgomery County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.

We have applied procedures to test the Montgomery County Board of Education's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994:

(1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-Up/Resolution

(4) Federal Financial Reports

(8) Administrative Requirements

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

94CRL-40

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that Montgomery County Board of Education had not complied, in all material respects, with those requirements.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
J~
Claude L. Vickers State Auditor
CLV:jg 94CRL-40

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

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

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

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Montgomery County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.

We have also audited the Montgomery County Board of Education's compliance with the requirements governing:

(1) Types of Services Allowed or Unallowed

(5) Applicable Special Tests and Provisions

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

(6) Other Requirement Claims for Advances and Reimbursements

(4) Reporting

These requirements are applicable to the major Federal financial assistance program, which is identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994. The management of the Montgomery County Board of Education is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit.

94CRL-80

Except as discussed in the following paragraph, we conducted our audit of compliance in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office ofManagement and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Montgomery County Board of Education's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion.
We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. However, this matter has no affect on the Board's compliance with the requirements listed in the second paragraph ofthis report.
In our opinion, the Montgomery County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance program for the year ended June 30, 1994.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:jg 94CRL-80

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

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

SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Montgomery County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.

In connection with our audit of the fiscal year 1994 general purpose financial statements of the Montgomery County Board of Education and with our consideration of the Board's internal control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing:

(1) Types of Services Allowed or Unallowed

(2) Eligibility

Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Montgomery County Board ofEducation's compliance with these requirements. Accordingly, we do not express such an opinion.

94CRL-120

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

CLV:jg 94CRL-120

Claude L. Vickers State Auditor

SECTION III INTERNAL CONTROL

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Montgomery County Board ofEducation
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Montgomery County Board ofEducation as ofand for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
In planning and performing our audit of the general purpose financial statements of the Montgomery County Board of Education for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure.
The management of the Montgomery County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies

94ICL-3

and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness ofthe design and operation of policies and procedures may deteriorate.

For the purposes of this report, we have classified the significant internal control structure policies and procedures in the following categories:

(1) Cash and Cash Equivalents

(6) Employee Compensation

(2) Inventories

(7) General Ledger

(3) Revenue/Receivables/Receipts

(8) General Fixed Assets

(4) Procurement

(5) Expenditures/Liabilities/ Disbursements

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

We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements.

As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories:

(1) Accounting Controls (Overall)

(2) General Fixed Assets

A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control stnicture elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their
assigned functions,

94ICL-3

Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses.
These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit of the Montgomery County Board of Education's financial statements and this report does not affect our report thereon dated July 12, 1995.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,

CLV:jg 94ICL-3

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
July 12, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Montgomery County Board ofEducation
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINlSTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Montgomery County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 12, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Board's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated July 12, 1995.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Montgomery County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program.
We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
In planning and performing our audit for the year ended June 30, 1994, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB
94ICL-11

Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We bave addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated July 12, 1995.

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

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

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

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

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

(5) Allowable Costs/Cost Principles

(4) Reporting

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

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

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

94ICL-l l

During the year ended June 30, 1994, the Montgomery County Board ofEducation expended 71% of its total Federal financial assistance under a major Federal financial assistance program and the following nonmajor Federal financial assistance program:
Food and Nutrition Program Food Services National School Lunch Program
We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements, and specific requirements, as described above that are applicable to the Board's major Federal financial assistance program, which is identified in the Schedule of Federal Financial Assistance, and the aforementioned nonmajor program. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion.
We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the Board's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations.
As described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category:
Administrative Requirements
A material weakness is a reportable condition in which the design or operation ofone or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.
Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions, and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition described above is also considered to be material weakness.
This condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Montgomery County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance program for the year ended June 30, 1994, and this report does not affect our report thereon dated July 12, 1995.
94ICL-11

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record.
7~
Claude L. Vickers State Auditor
CLV:jg 94ICL-11

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30 1994
PRIOR YEAR/CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation of Duties Reportable Condition - Material Weakness Audit Control Number 7031-93-01
The audit report for the year ended June 30, 1993, noted that the Board had not provided for adequate separation ofemployees duties in the performance of accounting functions and related procedures. In the year under review, no improvement in adequate separation of employees duties was made. This deficiency was a result of management's decision to limit the number ofadministrative 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.
Note: Federal financial assistance programs affected by this finding are as follows: Chapter 1 Program (CFDA 84.010) School Food Services Fund (CFDA 10.550, 10.553, 10.555 and 10.559)
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7031-93-02
The audit report for the year ended June 30, 1993, stated that the management of the Montgomery County Board of Education had chosen not to maintain a system wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.

SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

MONTGOMERY COUNTY BOARD OF EDUCATION SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30 1994
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7031-93-01
We concur with this finding, however due to current budgetary constraints, the Board is unable to hire the additional staff required to clear this finding. The Board feels it has provided for the most appropriate assignment ofduties with the number of personnel available to perform the accounting functions. With staff limitations, this finding can not be totally resolved.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7031-93-02
We concur with this recommendation. Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff the Board has decided not to pursue the recording of general fixed assets on the financial statements.