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

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STATE OF GEORGIA

DEPARTMENT OF AUDITS AND ACCOUNTS

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MORGAN COUNTY BOARD OF EDUCATION

MADISON, GEORGIA
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REPORT ON AUDIT

OF THE FINANCIAL STATEMENTS



FOR THE FISCAL YEAR ENDED JUNE 30, 2000




Russell W. Hinton State Auditor




MORGAN COUNTY BOARD OF EDlTCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUNDS

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

E

STATEMENT OF CASH FLOWS

. FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

F NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ADDIDONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPES

K

COMBINING BALANCE SHEET

L

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

EXPENDABLE TRUST FUNDS



Page
2 4 7 8 9 10
20 22 24 25 26 28

J\,10RGAN COlTNTY RO ARD OF EDlTCA TION - TABLE OF CONTENTS -

Page

SECTION I

FINANCIAL

ADDITTONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

30

2 SCHEDULE OF STATE REVENUE

32

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

33

ANALYSIS OF M VJ.YJ. EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

35

5

BY PROGRAM

36

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

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

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

SECTION I FINANCIAL






RussELL W. H1NTON
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
May 23, 2001

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

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

Ladies and Gentlemen:

We have audited the accompanying general purpose financial statements of the Morgan County

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

These general purpose fmancial statements are the r!!sponsibility of the Morgan County Board of

Education's management. Our responsibility is to express an opinion on these general purpose

.


financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perfo11n the audit to obtain reasonable assurance about whether the fmancial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our op1 n1 on.

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:



2000ARL-13A

* 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 confo11n to generally accepted accounting principles, these accounts should be included in the general purpose financial statements.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been detcrn1ined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Morgan County Board of Education as of June 30, 2000, and the results of its operations and the cash flows of its nonexpendable trust fund for the year then ended, in confortnity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated May 23, 2001, on our consideration of the Morgan County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit perfortned in accordance with
Government Auditing Standards and should be read in conjunction with this report in considering the
results of our audit.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Morgan County Board of Education tajcen as a whole. The accompanying combining statements (Exhibits G through L) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of
Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required pmt of the
general purpose financial statements. Such infortnation has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole.
2000ARL-13A

A copy ofthis report has been filed as a pe11nanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 50-
6-24.

Respectfully submitted,



RWH:gp
2000ARL-13A

w.
R ssell W. Hinton State Auditor

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MORGAN COUNTY BOARD OF EDUCATION

MORGAN COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30, 2000

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable

Inventories Food Donated Commodities Purchased Food

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$ 2.610,257.64 $ 466,685.61

2.473,218.13

33.318.25

20,022.11 6 414.49

Total Assets

$ 51083,475.77 $===52=6=14=40.....4...6....

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable

Total Liabilities

FUND FOi IITY

-

Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Endowment Corpus For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For SPLOST Projects Unreserved Undesignated

Total Fund Equity

Total Liabilities and Fund Equity

$

519,764.58 $

1,687,741.94

59,031.38 160,243.69



$ 2,2071506.52 $ _.....,;;;2'-,;..19=1=27'--'5c..;...0.7. _

$

15,099.00

$

14,471.10

507.20

20,022.11 6,414.49

2,860,363.05 $ 218751969.25 $

266,257.69
-
3071165.39



$ 5.083,475.77 $ -====-5=2=6=1==4=4=0=.4=6==

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

EXHIBIT "A"

TYPES CAPITAL
PROJECTS FUND

FIDUCIARY FUND TYPES
TRUST FUNDS

TOTALS

(Memorandum Only)

JUNE 30, 2000

JUNE 30, 1999

$

527,608.90 $

462.41 $ 3,605,014.56 $ 2,923,977.33

8,151.87

8,151.87

8,296.10

394,376.10

2,900,912.48

2,790,949.45



20,022.11

6 414.49

26,864.67 3 437.06

921,985.00 $

8 614.28 $ 6,540,515.51 $ 5,753,524.61

$

207.70

79,149.96 162,637.01
$ _ __;;2~4~1=9.;:;..94.;..;..6;;.;7_

$

579,003.66 $

365,517.27

1,847,985.63

1,779,063.40

1,061.72

79,149.96

403,816.98

162,637.01

143,511.01

$ 2,668,776.26 $ 2,692,970.38

$

$

678,727.05

1,263.28

$

679,990.33 $

$

921,985.00 $

$
2,500.00

15,099.00 14,471.10 $
2,500.00 507.20

30,592.25 2,500.00 507.20

6 114.28
8,614.28 $

20,022.11 6,414.49
678,727.05
3,133,998.30
3,871,739.25 $

26,864.67 3,437.06
363,957.50
2,632,695.55
3,060,554.23

8,614.28 $ 6,540,515.51 $ 5,753,524.61

- 3-

MORGAN COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30, 2000

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 10,844,816.12 $ 414,900.56

35,240.75

1,449,411.78

7,019,170.35

$ 2,322,239.59

375,313.34

268,243.98

13,509.94

Total Revenues

$ 18,274,540.56 $ 2,132,556.32 $ 2,335,749.53

EXPENDITURES

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

$ 11,992,899.09 $ 1,010,693.56

873,772.66 556,996.65 379,808.43 167,941.32 1,276,471.86 284,752.67 1,325,989.09 744,647.34
39,707.23 21,218.88
1,375.02

93,828.38 125,182.59
10,050.75 302.19
11,924.88
7,352.15
980,009.74 1,437.49
- - - - - $ 2,020,979.98

$ 17,665,580.24 $ 2,240,781.73 $ 2,020,979.98

Excess of Revenues over (under) Expenditures

$ 608,960.32 $ -108,225.41 $ 314,769.55

OTHER FINANCING SOURCES (USES)

Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)

$ $ _---"-2=9=,8.7..5.."-".2=8.....

29,875.28

$

-29,875.28 $ _...,2=9=,8"'-75==28;_

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

FUND BALANCE JULY 1

$ 579,085.04 $ 2,296,884.21

-78,350.13 $ 389,380.65

Food Inventory - Net Change in Period Donated Commodities Purchased Food

-6,842.56 2,977.43


314,769.55 365,220.78

FUND BALANCE JUNE 30

$ 2,875,969.25 $ 307,165.39 $ 679,990.33

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



-4-

EXHIBIT "B"

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUNDS

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

$ 11,259,716.68

$ 11,259,716.68 $ 10,515,735.31

1,484,652.53

1,484,652.53

1,582,788.29

9,341,409.94

9,341,409.94

7,587,753.33

657,067.26 $ ----'--15=.0=3~ . 657,082.29

2,105,119.88

$ 22,742,846.41 $ _ _ __;_1.::;,;5=03:;_ $ 22,742,861.44 $ 21,791,396.81

$ 13,003,592.65

$ 13,003,592.65 $ 12,598,206.89

967,601.04 $

385.18

967,986.22

930,428.84

682,179.24 379,808.43

682,179.24 379,808.43

638,. 117.44 366,941.38

177,992.07

177,992.07

186,408.90

1,276,774.05

1,276,774.05

1,168,670.78

296,677.55

296,677.55

356,694.65

1,325,989.09 751,999.49

1,325,989.09

1,301,548.84

751,999.49

788,044.58

,

39,707.23

39,707.23

21,734.12

1,001,228.62

1,001,228.62

998,000.08

2,812.51 2,020,979.98

2,812.51
2,020,979.98

3,582.91 2,040,814.48



$ 21,927,341.95 $

385.18 $ 21,927,727.13 $ 21,399,193.89

$ 815,504.46 $

-370.15 $ -815,134.31 $ 392,202.92

$

29,875.28

-29,875.28

$ _ _ _ _o=.;;;..oo;;....

$ 815,504.46 $ 3,051,485.64

-6,842.56 2,977.43

$ 3,863,124.97 $

$

29,875.28 $

41,714.80

-29,875.28

-41 714.80

$

o.oo $ _ _ _ _o__.o""""o~

-370.15 $ 815,134.31 $ 392,202.92

1,541.69

3,053,027.33

2,660,177.99

-6,842.56 2,977.43

3,559.91 -2,913.49


1 171.54 $ 3,864,296.51 $ 3,053,027.33

-5-

MORGAN COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS} GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30. 2000

EXHIBIT "C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 9,864,651.00 $ 10,844,816.12

105,185.00

35,240.75

6,997,953.00

7,019,170.35

338,931.00

375,313.34

Total Revenues

$ 17,306,720.00 $ 18,274,540.56

EXPENDITURES

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

$ 11,943,445.50 $ 11,992,899.09

605,854.80 380,106.50 388,614.00 173,832.00 1,263,861.00 283,159.00 1,361,994.00 675,337.00 166,390.00 472,101.00
1,000.00 75,000.00

873,TT2.66 556,996.65 379,808.43 167,941.32 1,276,471.86 284,752.67 1,325,989.09 744,647.34
39,707.23 21,218.88
1,375.02

Total Expenditures

$ 17,790,694.80 $ 17,665,580.24

Excess of Revenues over (under) Expenditures

$ -483,974.80 $ ____60_8=,96=0.=32"--

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$ _ __,:-2::;:9=,8'-'-7=5.=28"--

Total Other Financing Sources (Uses)

$ _ __,:29=,8'-'-7=5=28"--

Excess of Revenues and Other Financing Sources

over (under) Expenditures and Other Financing

Uses

$ -483,974.80 $

579,085.04

FUND BALANCE JULY 1. 1999

2,720,906.41

2,296,884.21

Adjustments

-1,066.33

FUND BALANCE JUNE 30. 2000

$ 2,235,865.28 $ 2,875,969.25

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 200,345.00 $ 414,900.56

1,473,709.00

1,449,411.78

268,243.98

$ 1,674,054.00 $ 2,132,556.32

$ 637,064.00 $ 1,010,693.56

53,515.20 7,000.00

93,828.38 125,182.59

10,050.75 302.19
11,924.88

7,352.15

492,500.00

980,009.74 1,437.49

$ 1,190,079.20 $ 2,240,781.73
$ 483,974.80 $ -108,225.41

$ 29,875.28 $ _--=29~18::..:.7_,.5.,..28=-

$ 483,974.80 $ -78,350.13

1,066,TT4.20

359,078.92

96,509.17

$ 1,647,258.17 $ 280,728.79

The notes to the general purpose financial statements are an integral part of this statement.
-7-


MORGAN COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2000

EXHIBIT "D"

OPERATING REVENUES
Donations
OPERATING EXPENSES
Current Support Services Pupil Services Operating Income (Loss)
NONOPERATING REVENUES
Interest Earned Net Income (Loss)
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

ENDOWMENT FUND
JAMESW. HOLLIS
SCHOLARSHIP FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999



$

0.00 $

0.00 $ _ ____;4.,_;;6;.:;;:2..;.;4.=24..;._

$

500.00 $

500.00 $ _ _ _ _1_40__._1_0_

$

-500.00 $

-500.00 $ _____4.__4_8_4_ _.1_4_

$ $
$
-

415.84 $ -84.16 $ 7,526.90

7 442.74 $

415.84 $ _ _ _-=2=5=9;..;..4..;._1

-84.16 $

4,743.55

7,526.90

2,783.35

7 442.74

$

-

--

7,526.90
--- --- ---~-- -

The notes to the general purpose financial statements are an integral part of this statement.
-8-

MORGAN COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2000

EXHIBIT "E"

ENDOWMENT FUND
JAMESW. HOLLIS
SCHOLARSHIP FUND

TOTALS

(Memorandum Only) YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

Cash Flows from Operating Activities: Cash Paid for Scholarships Donations

$


-500.00 $

-500.00 $

-140.10 4 624.24

Net Cash Provided (Used) by Operating

Activities

$

-500.00 $

-500.00 $ _ ____,;.4.i....;.4~84.;.,;.;..;...14;._

Cash Flows from Investing Activities: Interest Received on Investments Purchase of Investments Sale of Investments

$

415.84 $

415.84 $

259.41

-7,442.74

-7,442.74

-4,743.55



7,526.90

7,526.90

Net Cash Provided (Used) by Investing

Activities

$

500.00 $

500.00 $ _ _ _-4~4-=-84.:.;..1.;_4:....

Net Increase (Decrease) in Cash

$

0.00 $

0.00 $

0.00

Cash and Cash Equivalents - July 1

0.00

0.00

0.00





Cash and Cash Equivalents - June 30

$ --

0.00 $

-

---

~~---

-

-

0.00 $

0.00




The notes to the general purpose financial statements are an integral part of this statement. -9-

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

MORGAN COUNTY BOARD OF EDUCATION NOTES TO THE GENER.A.L PURPOSE FIN.A.NCIAL STATEMENTS
JUNE 30, 2000

EXHIBIT "F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Morgan County Board of Education (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. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists ofall the organizations that compose its legal entity.

FUND ACCOUNTING '
The Board uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the Board. To confo11n to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although ''school activity accounts'' are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To confo1111 to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all fmancial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund -used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.

- 10 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PlJRPOSE FINANCIAL STATEt\1ENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in a
trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUND
James W. Hollis Scholarship Fund - the fund used to account for an endowment ofwhich the
corpus is to be invested and preserved intact with the resultant income to be used to provide scholarship aid to a graduating senior of the Morgan County School System.
EXPENDABLE TRUST FUNDS
Fannie Mae Elder Memorial Fund - the fund used to account for proceeds or income used to
provide a scholarship to a deserving student in accordance with provisions ofthe trust agreement.
Sara Cook Library Fund - the fund used to account for the principal and earnings which may be
expended to buy textbooks for the Morgan County School System.
Thomas Prior and Mattie Peacock, Jr., Scholarship Fund - the fund used to account for
awards of scholarship aid to graduating seniors of the Morgan County School System.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust 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 ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds.
All nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation ofthese funds are included on the balance sheet. Operating state~ents present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
- 11 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENER.A.L PURPOSE FINANCIAL STATEi'v1ENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and
available). ''Measurable'' means the amount of the transaction can be deterrnined and ''available'' means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1999 and ending in early June 2000. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share ofthese contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements.
The accrual basis ofaccounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
BUDGET
The Morgan County Board ofEducation's budget is a complete financial plan for the Board's fiscal year and is based upon estimates ofexpenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level ofbudget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board; such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
The Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following_adjustments have been made to fund balance as reflected on Exhibit ''B'' of this report:



- 12 -

MORGAN COUNTY BOARD OF EDUCATJON

NOTES TO THE GENERAL PURPOSE FINANCIAL ST.A..TEi\1ENTS

JUNE 30, 2000



EXHIBIT "F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FUND BALANCE JULY 1, 1999

Special Revenue
Fund
$ 389,380.65

Adjustments

Inventories - July 1, 1999

Food



Donated Commodities

Purchased Foods

Fund Balance July 1, 1999 (Budget Basis)

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JUNE 30, 2000 (Budget Basis)

-26,864.67 -3,437.06
$ 359,078.92
-78,350.13 $ 280.728.79

CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws O<.::GA 45-8-14 authorize the Board to deposit its funds in one or more solvent banks, insl!red Federal savings and loan associations, or insured State chartered building and loan associations.

INVESTMENTS
-
COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at

purchase greater than one year and equity investments are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,

- 13 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENER.A.L PURPOSE FINANCIAL STATE.i\1ENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,

(4) Obligations of any corporation of the United States government, (5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and

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

Receivables consist ofgrant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from info1111ation 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 Morgan County Board of Commissioners fixed the property tax levy for the 1999 tax year (calendar year) on October 12, 1999 (levy date). Taxes were due on December 20, 1999. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Morgan County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance oftaxes collected to the Board.

The tax millage rate levied for the 1999 tax year (calendar year) for the Morgan County Board of
Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations
SALES TAXES

16.0 mills

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $2,322,239.59 and was recorded in the Capital Projects Fund. The State will ti;;1111inate collection of this tax once an additional $1,097,149.28 has been collected or on December 31, 2002, whichever occurs first.

- 14 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PlJRPOSE FIN.A..NCIAL ST.A..TErvrENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute ''available spendable resources" even though they are a component of net current assets.
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements of expenditures/expenses initially made from a fund that are properly applicable
to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses 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 state1nents are captioned ''Memorandum Only'' to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results ofoperations or cash flows in confo11nity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data.
Note 2: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS
Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on
deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than
11 Opercent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion,
waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
- 15 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENER.t\L PlJRPOSE FINANCIAL ST:\TE1\1E1\"TS

JUNE 30, 2000

Note 2: DEPOSITS AND INVESTMENTS
Acceptable security for deposits consists of any one of or any combination of the following:
( 1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that . the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Inte1111ediate 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, 2000, the bank balances were $4,497,319.63. The amounts ofthe total bank balances are classified intQ 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 depart111ent or agent but not in the Board's name.)
The Board's deposits are classified by risk category at June 30, 2000, as follows:


- 16 -

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PlJRPOSE FIN:\NCIAL STATEl\1ENTS

JUNE 30, 2000

Note 2: DEPOSITS AND INVESTMENTS Risk Category

Bank Balance

1

$ 107,442.74

2

4,389,876.89

3

0.00

Total

$ 4,497,319.63

CATEGORIZATION OF INVESTMENTS At June 30, 2000, the fair value ofthe Board's total investments was $709.13 and this entire amount consisted ofpreferred stock which was insured or registered, or securities held by the Board or the Board's agent in the Board's name.

Note 3: NON-MONETARY TRANSACTIONS

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

Note 4: RISK MANAGEMENT

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

The Board has obtained commercial insurance for risk ofloss associated with assets and job related illness or injuries to employees. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any ofthe past three years. _

The Board participates in the Georgia School Boards Association Risk and Insurance Management System, a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The Board pays an annual premium to the system for its general insurance coverage. Additional coverage is provided through agreements by the system with other companies according to their specialty for property, boiler and machinery, general liabil.ity (including coverage for sexual harassment, molestation and abuse) and automobile risks. Payment of excess insurance for the system varies by line of coverage.

- 17 -

MORGAN COUNTY BOARD OF EDUCATION NOTES TO THE GENERAL PURPOSE FINi\NC'I.!'\.L STATEi\1ENTS
JUNE 30, 2000

EXHIBIT "F"

Note 4: RISK MANAGEMENT

The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years.

The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

1999
2000

Beginning
of Year
Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

$

0.00 $

6,382.00 $

6,382.00 $_ _ _...;:;o..:.a.o=o

$

0.00 $

0.00 $

o.oo $_ _ _...;:;o=.o=-o

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

Position Covered

Amount

Superintendent Each Principal

$ 20,000.00



$ 2,500.00



Note 5: ON-BEHALF PAYMENTS

-

-

The Board has recognized revenues and expenditures in the amount of $225,951.94 for health

insurance and retirement contributions paid on the Board's behalfby the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance ofNon-Certified Personnel In the amount of $184,293.94

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $41,658.00

Note 6: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the Board as of June 30, 2000:

- 18 -

MORGAN COUNTY BOARD OF EDUCATION NOTES TO THE GENERAL PURPOSE FJN;\NCIAL ST,A.TEt\1ENTS
JUNE 30, 2000

EXHIBIT "F"

Note 6: SIGNIFICANT COMMITMENTS

Proiect Morgan County Middle School Project

Unearned Executed Contracts
$ 432,999.32

The amount described in this note is 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 te11ns. 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 ofGeorgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

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

Fiscal Year

Percentage Contributed

Required Contribution

2000 1999 1998

100% 100% 100%

$1,257,231.53 $1,231,178.86 $ 1,100,183.30

- 19 -

MORGAN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2000

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

344,446.18 $

33,182.29

752.77

3,210.00

20,022.11 6 414.49

$

371,635.55 $ - - -------3-6--,-39-2- .29

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable



Total Liabilities

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated

Total Fund Equity

Total Liabilities and Fund Equity

$

15,174.61 $

15,696.10

63,766.65

20,696.19

$

78,941.26 $ _ _..;;3.6..,.".'-39=2=.2=9-





$

20,022.11

6,414.49


266,257.69 $ _ _ _......,;o=.o=o'-

$ 292,694.29 $ _ _ _......,;o__.o=o'-

$

371,635.55 $ ===3.6..,.3..9=2=.2=9=

See notes to the general purpose financial statements. -20-

EXHIBIT "G"

FEDERAL
PROGRAMS

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

89,057.14 $

466,685.61 $

422,354.34

29,355.48

33,318.25

212,439.70

20,022.11 6 414.49

26,864.67 3,437.06



$

118,412.62 $

526,440.46 $ ==6=6=5..,,0=95==77==

$

73,996.06

$

28,160.67 $

59,031.38

44,630.21

75,780.85

160,243.69

156,027.13

1,061.72

$

103,941.52 $

219,275.07 $ _----'2=7..a.5..._7,_1_5=._1_2~

$

14,471.10 $

14,471.10 $

30,592.25

20,022.11 6,414.49

26,864.67 3,437.06

0.00

266,257.69

328,486.67

$

14 471.10 $

307z165.39 $ ____3_,.8..a..9=,3.;a...80"'-".6.,.5'-

$

118,412.62 $

526,440.46 $_=6_6_5...,,0.,.95....7_7_

- 21 -





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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration School Administration Business Administration Student Transportation Services Central Support Services Food Services Operation Community Services Operations
Total Expenditures

Excess of Revenues over (under) Expenditures
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
FUND BALANCE JUNE 30
See notes to the general purpose financial statements.
- 22-

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

80,668.00 $

334,232.56

570,910.37

268,243.98

$

919,822.35 $ _ _3_3_4_,2_32_.5_6_

$

316,388.31

21,893.54 360.07

$

980,009.74

53.82

$

980,009.74 $ _ _3_3_8,_6_95_.7_4_

$

-60,187.39 $

-4,463.18


$

.-60,187.39 $

356,746.81

-6,842.56 2,977.43

2,421.59
-2,041.59 2,041.59

$

292,694.29

$
-- ---- - - -

0.00

EXHIBIT "H"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

414,900.56 $

281,584.83

$

878,501.41

1,449,411.78 268,243.98

. 1,548,534.48

240,772.95

$

878,501.41 $ 2,132,556.32 $ 2,070,892.26

$

694,305.25 $ 1,010,693.56 $

964,461.77

71,934.84

93,828.38

103,887.92

. .

124,822.52

125,182.59

82,814.65

10,050.75

10,050.75

19,984.26

302.19

302.19

1,600.61

11,924.88

11,924.88

9,348.21

7,298.33

7,352.15

9,098.41

2,000.00

980,009.74

903,585.01

1 437.49

1 437.49

1,420.32

$

922,076.25 $ 2,240,781.73 $ 2,098,201.16

$

-43,574.84 $

-108,225.41 $ : -27,308.90

27,453.69

29,875.28

39,468.83

$

-16,121.15 $

-78,350.13 $

12,159.93

30,592.25

389,380.65

376,574.30

-6,842.56 2 977.43

3,559.91 -2,913.49



$

14471.10 $

307, 165.39 $-===3=8=9=,3==80=.6=5=

- 23-

MORGAN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND
JUNE 30, 2000

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Accounts Receivable

REGULAR

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS
JUNE 30, 2000 JUNE 30, 1999

$ 1,263.28 $ 526,345.62 $ 527,608.90 $ 630,790.65

394,376.10

394,376.10

284,881.62

Total Assets

$ 1,263.28 $


920,721.72 $ 921,985.oo $ ___91_5_,6_1_2._21_

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable

$

Contracts Payable

Retainages Payable

Total Liabilities

$

FUND EQUITY

Fund Balances Reserved For SPLOST Projects Unreserved Undesignated

$
$ 1,263.28

Total Fund Equity

$ 1,263.28_ $

207.70 $ 79,149.96 162,637.01
241,994.67 $

207.70 $ 79,149.96 162,637.01

3,123.50 403,816.98 143,511.01

241,994.67 $ __.;a.;55;.;0._,4;.;a5.;.;1."'"-49;a..

678,727.05 $ 0.00
678,727.05 $

678,727.05 $ 363,957.50

1,263.28

1,263.28

679,990.33 $ ____36=5=,2=2=0;.;..7.;;;...8

Total Liabilities and Fund Equity

$ 1,263.28 $

920,721.72 $


921,985.oo $ __9_1_5_,s_1_2._2.1..

See notes to the general purpose financial statements.

-24-

MORGAN COUNTY BOARD OF EDUCATION

EXHIBIT "J"

COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

YEAR ENDED JUNE 30. 2000

REGULAR

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED
JUNE 30, 2000 JUNE 30, 1999

REVENUES

Taxes Other Funds

$

0.00 $ 2,322,239.59 $ 2,322,239.59 $ 1,696,622.98

13,509.94

13,509.94

38,201.33

Total Revenues

$

0.00 $ 2,335,749.53 $ 2,335,749.53 $ 1,734,824.31

EXPENDITURES

Capital Outlay Building and Building Improvements Equipment

$

0.00 $ 1,895,410.43 $ 1,895,410.43 $ 1,958,470.27

125,569.55

125,569.55

82,344.21

Total Expenditures

$

0.00 $ 2,020,979.98 $ 2,020,979.98 $ 2,040,814.48

Excess of Revenues over (under) Expenditures

$

0.00 $ 314,769.55 $ 314,769.55 $ -305,990.17

OTHER FINANCING SOURCES

Operating Transfers In

2,245.97

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$

0.00 $ 314,769.55 $ 314,769.55 $ -303,744.20

FUND BALANCE JULY 1

1,263.28

363,957.50

365,220.78

668,964.98

FUND BALANCE JUNE 30

$ 1,263.28 $


618.727.05 $ 6791990.33 $ _,__36.;5_,2_20_._18_





See notes to the general purpose financial statements.

-25-

MORGAN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30, 2000

ASSETS Cash and Cash Equivalents Investments

Total Assets

NON EXPENDABLE TRUST FUND
JAMES W. HOLLIS
SCHOLARSHIP FUND

FANNIE MAE ELDER
MEMORIAL FUND

$

212.41

$ _ _ __;..7"-'4...;.;42=.;..74~

$

7 442.74 $

212.41

FUND EQUITY
Fund Balances Reserved For Endowment Corpus Unreserved Undesignated
Total Fund Equity

$

2,500.00

4 942.74 $ - - -21-2.4-1

$

7 442.74 $

212.41

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

EXHIBIT "K"

EXPENDABLE TRUST FUNDS

THOMAS PRIOR

AND MATTIE

SARA COOK

PEACOCK, JR.

LIBRARY

SCHOLARSHIP

FUND

FUND

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

250.00 $

462.41 $

772.49

$ _ _ _7_0_9_._13_

8 151.87

8,296.10

$

. 709.13 $

250.00 $

8,614.28 $ ====9=,0=68=.59=

$

2,500.00 $

2,500.00

$

709.13 $ _____2;.;;.50==00~

6,114.28

6,568.59

$ 709.13 $ 250.00 $ -~

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

-- -- ---- - --

--- ---

8,614.28 $ -====-=9,-0=6=8=.5=9-









- 27-

MORGAN COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30, 2000

REVENUES Other Funds
EXPENDITURES Current Support Services Pupil Services
Excess of Revenues over (under) Expenditures FUND BALANCE JULY 1
FUND BALANCE JUNE 30

FANNIE MAE
ELDER
MEMORIAL
FUND

SARA COOK LIBRARY FUND

$

0.00 $ _ _ ___..;...15==03~

$

0.00 $ - - - - ~135-.18-

$

0.00 $

-120.15

212.41

829.28

$

212.41 $

709.13


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

EXHIBIT "L"

THOMAS PRIOR AND MATTIE PEACOCK, JR.
SCHOLARSHIP FUND

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

0.00 $

15.03 $ _ _ _,_.;4~92=.;..;72~

$

250.00 $

385.18 $ _ _ _ _o:.:.::.;00"-

$

-250.00 $

-370.15 $

492.72

500.00

1 541.69

1 048.97

$

250.00 $

1 171.54 $ _...,_.....,1,_5_41_.,.69=


- 29-

MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30 2000

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Agriculture, U. S. Department of

Child Nutrition Cluster

Pass-Through From Georgia Department of Education

Food and Nutrition Program

Food Services

School Breakfast Program

National School Lunch Program



* 10.553 * 10.555

Total Child Nutrition Cluster

Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1) Pass-Through From Office of Treasury and Fiscal Services National Forest Reserve Funds

10.550 10.665

Total U. S. Department of Agriculture

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

84.027 84.173 84.173

Total Special Education Cluster

Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development Title Ill Technology Literacy Challenge Fund Grants Title VI Innovative Education Program Strategies Class Size Reduction
Goals 2000
State and Local Education Systemic Improvement Grants
Safe and Drug-Free Schools and Communities Vocational Education - Basic Grants to States
High School Program Basic Grant
Tech-Prep Education

* 84.010 84.281 84.318 84.298 84.340
84.276 84.186
84.048 84.243

Total U. S. Department of Education

Health and Human Services, U. S. Department of Pass-Through From Office of the Governor Abstinence Education

93.235

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

NIA

$ 112,993.75

NIA

408,180.59 $

$ 521,174.34 $

(2)
930,273.71 (3)
930,273.71

N/A

49,736.03

49,736.03

N/A

306.34

(4)

$ 571,216.71 $ _ _.::;98==0~0,:..:0:.:::9:.7.:..:...4

NIA $ 224,370.21 $

NIA

33,068.53

NIA

2,304.24

$ 259,742.98 $

227,444.33 (3) 33,068.53 2,304.24
262,817.10

NIA

353,467.19

356,290.73 (3)

NIA

16,000.00

11,698.92 (3)

NIA

13,786.85 (3)

NIA

17,084.00

17,463.79 (3)

NIA

57,858.00

57,858.00

NIA

62,205.00

76,410.82

NIA

11,695.33

11,695.33

NIA

35,924.00

45,397.69 (3)

NIA

3,552.00

3,552.00

$ 817,528.50 $ _ _.::;85==6~,9:..:.7..:.1::2=-3

N/A

$ 42,603.85 $ ---=-37:...,,,.:.:17.::6:.:.6:.:.7

- 30-

MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2000

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

Justice, U. S. Department of Pass-Through From Office of the Governor Juvenile Justice and Delinquency Prevention - Allocation to States

OTHER FEDERAL ASSISTANCE

Defense, U. S. Department of

Direct Department of the Air Force

--

R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

16.540

N/A

$ 18,369.06 $

27,928.35 (3)

$ 34,934.41 $

46,338.13 (3)

Total Federal Financial Assistance

$ 1,484,652.53 $ _....;.1,_94.;.;8_,,4.;.;;2;.;4,;..;.1,_2

NIA = Not Available

Notes to the Schedule of Expenditures of Federal Awards

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2000 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Funds earned on this program do not require reporting of expenditures.

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

The Board did not provide Federal Assistance to any Subrecipient.

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

See notes to the general purpose financial statements.

- 31

MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2000

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education. Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Counselors Grades 4 and 5 Technology Specialist Local Five Mill Share Deferred Summer Salaries (Prior Year) Deferred Summer Salaries (Current Year) Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Program Apprenticeship Program At-Risk Summer School Program Health Insurance Mentor Teacher Program Next Generation Schools Pay for Performance Preschool Handicapped Program Remedial Summer School Program
Year 2000 Project Funding
Lottery Programs Applied Technology Labs Assistive Technology Computers in the Classroom
Human Resources, Georgia Department of Family Connection
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Georgia's Reading Challenge Program

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 6,662,638.00
1,547,193.00 169,574.00 280,984.00 77,945.00
1,787,482.00
417,870.00 117,054.00 212,730.00 180,925.00
69,703.00 241,548.00
27,941.00 28,842.00 -2, 109,796.00 -1,406,046.00 1,518,953.00 262,929.00
$ -1,000.00
76,671.10 35,000.00
6,858.43 184,293.94
5,184.00 75,000.00 98,000.00 37,014.67
4,969.86 11,771.75
90,925.37
41,658.00

$
80,668.00
99,800.81 14,845.81 65,419.00

6,662,638.00 1,547,193.00
169,574.00 280,984.00
77,945.00 1,787,482.00
417,870.00 117,054.00 212,730.00 180,925.00
69,703.00 241,548.00
27,941.00 28,842.00 -2, 109,796.00 -1,406,046.00 1,518,953.00 262,929.00 80,668.00 -1,000.00
76,671.10 35,000.00
6,858.43 184,293.94
5,184.00 75,000.00 98,000.00 37,014.67
4,969.86 11,771.75

99,800.81 14,845.81 65,419.00

90,925.37

154,166.94

154,166.94

41,658.00

90,000.00

90,000.00

See notes to the general purpose financial statements.

$ 10,844,816.12 $ - 32-

414,900.56 $ 11,259,716.68

MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR Ef-.JDED JUNE 30, 2000

SCHEDULE "3"

PROJECT
Morgan County Primary School facility construction, renovation, modernization, equipping and improvements
Morgan County Elementary School new facility construction, renovation, modernizing, equipping and improvement
Morgan County Middle School renovation, modernizing, expansion, equipping and improvements
Morgan County High School renovation, modernizing, expansion, equipping and improvement, plus purchasing equipment with an extended useful life
New Facility Construction for Morgan County school buses and purchase of school buses with an extended useful life

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS

$ 2,370,000.00 $ 2,573,034.29 $ 1,075,819.93 $ 1,497,214.36


520,000.00

590,347.72


210,040.13

380,307.59

1,220,000.00 1,220,000.00

538,221.75

134,137.37

1,000,000.00 1,000,000.00

196,898.17

64,762.84

710,000.00


710,000.00

$ 5,820,000.00 $ 6,093,382.01 $ 2,020,979.98 $ 2,076,422.16 - -- -- ------- -
(1) The Board's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The Board's current estimate of total cost for the projects. Includes all cost from project inception to completion.
(3) The voters of Morgan County approved the imposition of a 1/o sales tax to fund the above projects. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the general purpose financial statements. - 33-

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

SCHEDULE "4"

Minimum Expenditure Requirements (Total Allotment)
Expenditures on Combined Program Basis Salaries (1) (2) Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expenditures per Audit

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

1OOo/o TEST FOR
OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

8,901 ,937.oo $ _ _--=.;21:...:.1..z..;8,c.::3..:.1;.;;;.o~o

$

10,267,032.49

589,912.00 $ _ ___;...50;....7..,..1_2_2._2_6

$

10,856,944.49

-90,181.77
$ ___1o_,_7_6_6-'-1,_6_2._12_

Amount of Underexpenditure for Total Allotment

$

0.00 $

---



Note: (1)

Salary accruals (July and August 2000 Deferred Salaries) reported
as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.

(2) Salary accruals (July and August 1999 Deferred Salaries) reported
as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines.

0.00

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


MORGAN COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMU~! EXPENDITURE REQUIREMENTS - BY PROGRA~1
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 2000

GENERAL AND CAREER EDUCATION PROGRAMS

Kindergarten ()

Grades 1 3 ()

Sub-Total K-3

Grades 4 5 ()

Grades 6 8 ()



Grades 9 - 12 ()

High School Laboratories ()

Vocational Education Laboratories ()

Total General and Career Education Programs

SPECIAL EDUCATION PROGRAMS
Regular Programs Category I () Category II () Category Ill () Category IV () Category V ()

Sub-Total Regular

Category VI (Gifted) ()

Total Special Education Programs
REMEDIAL EDUCATION PROGRAM 11

Total Fourteen Weighted Programs

MEDIA CENTER PROGRAMS
-
Salaries Operations

Total Media Center Programs

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

758,721.00

$

682,848.90

1,865,258.00

1,678,732.20 $ _ _...;8:.:0.:.::,5:.:1.;;..6.;;..0.:..0

$ 2,623,979.00 90 $ 2,361,581.10 $

80,516.00

833,333.00 90

749,999.70

1,286,200.00 90

1,157,580.00

855,876.00 90

770,288.40

328,621.00 90

295,758.90

161,032.00

734,629.00 90

661,166.10

$ 6,662,638.00

$ 5,996,374.20 $ _.....;2=.4:.:1.:.::,54=8.;;..00=-

$ 1,428,378.00

$ 1,285,540.20 $

0.00

$ 1,428,378.00 90 $ 1,285,540.20 $

0.00

118,815.00 90

106,933.50

$ 1,547,193.00

$ 1,392,473.70 $ _ _ _ _.;;.O;.;;.O.;;.O



$

169,574.00 90 $

1s2,61 s.so $ _ _ _ _.;;.o;..o;;.;;..o

$ 8,379,405.00

$ 7,541,464.50 $ _ _2=-4'-'1"",54;.;.;;.8;,.;;.0.;;..0

$

225,647.00 90 $

55,337.00 100

s _......;;2.;;..so.;;.:.:..98;;..;4.;.;;.o;..:..o

$

203,082.30 $

0.00

55,337.00

s_ _ _ _ 258,419.30

o.:...;;..oo.:..

Total Fourteen Weighted and Media Center Programs

8,660,389.00

$ 7,799,883.80 $ _ _2;;;;4;.,:,1,:;;,54;;;;;;;8.;,00=

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs
c) Identifies Fourteen Weighted Programs.
(1) Salary accruals (July and August 2000 Deferred
Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
See notes to the general purpose financial statements.

$

25,290.00

$

25,290.00 $

0.00

52,655.00

52,655.00

0.00

$

77,945.00 100 $

77,945.oo $-=--====o.o..o=

(2) Salary accruals (July and August 1999 Deferred
Salaries) reported as expenditures in the prior year General Purpose Financial Statements are Included on this analysis as required by program guidelines.

36

SCHEDULE "5"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES SALARIES (1)(2) OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

682,848.90 $

739,664.98

$

739,664.98

1,759,248.20

2,142,747.11 $ - - - '96-,6-19-.4-7

2,239,366.58

$ 2,442,097.10 $ 2,882,412.09 $

96,619.47 $ 2,979,031.56 $

0.00

749,999.70

1,037,772.64

77,007.31

1,114,779.95

0.00

1,157,580.00

1,699,506.74

73,463.2A

1,772,970.02

0.00

770,288.40

1,121,755.75

122,148.95

1,243,904.70

0.00

456,790.90

689,900.24

93.00

689,993.24

0.00

661,166.10

647,307.36

81,207.96

728,515.32

0.00

$ 6,237,922.20 $ 8,078,654.82 $

450,539.97 $ 8,529,194.79

$ 1,285,540.20 $

$ 1,285,540.20 $

106,933.50

$ 1,392,473.70 $

$

152,616.60 $

$ 7,783,012.50 $

4,149.82 470,454.38 894,177.20 $ 111,400.49
17,751.92
1,497,933.81 $
249,506.49
1,747,440.30 $
152,561.34 $
9,978,656.46 $

$
26,886.45 6,497.33
22,907.42

4,149.82 470,454.38 921,063.65 117,897.82
40,659.34

56,291.20 $ 1,554,225.01

231.09

249,737.58

56,522.29 $ 1,803,962.59



s_ 60.00

__,;1.;;.s2"'.;;.;s2;;.;1.;.;_;.34_

507,122.26 $ 10,485,TT8.72

0.00 0.00
0.00



-



$

203,082.30 $

288,376.03

$

______ s_ _ 55,337.00

.;;.82"'._18_9.;.1;._4_

288,376.03 82,789.74

0.00 0.00

$

258,419.30 $

288,376.03 $

82,789.74 $ ___3..;.7.;.:1,_16_5.;.7;._7_

$ 8,041,431.80 $ 10,267,032.49 $

s s_______ 589,912.00

10,856,944.49

o,..o.o...

$

25,290.00

52,655.00

s ==-=7=7=,9=4=s._,o..,o

$

54,847.16 $

54,847.16

23,362.55

23,362.55

----------==== $

78,209.71 $

78,209.71 $

0.00



37

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS



w. RUSSELL

HINTON

STATE AUDITOR

(404) 656-2174

........... 177b
DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
May 23, 2001

Honorable Roy E. Barnes, Governor

Members of the General Assembly

Members of the State Board of Education

and

.

Superintendent and Members of the Morgan County Board of Education

REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
-
Ladies and Gentlemen:

We have audited the financial statements of Morgan County Board of Education as of and for the

year ended June 30, 2000, and have issued our report thereon dated May 23, 2001. This report was

qualified for various departures from generally accepted accounting principles, as identified in the

auditor's report on the general purpose financial statements. We conducted our audit in accordance

with auditing standards generally accepted in the United States of America and the standards

appljcable to financial audits contained in Government Auditing Standards, issued by the

Comptroller General of the United States.

-

Compliance

As part of obtaining reasonable assurance about whether Morgan County Board of Education's financial statements are free of material misstatement, we perfo1111ed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a
direct and material effect on the dete11nination offinancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly,

we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance
that are required to be reported under Government Auditing Standards.

Internal Control Over Financial Reporting

In planning and perfu1n1ing our audit, we considered Morgan County Board ofEducation's internal control over financial reporting in order to dete1mine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal

2000YB-40A

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Morgan County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-7041-00-01.
A material weakness is a condition in which the design or operation of one or more ofthe internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the no11nal course of perfonning their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions, and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the reportable condition described above is considered to be a material weakness.
This report is intended solely for the info11nation and use ofmanagement, members of the Morgan County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:gp
2000YB-40A

LJ . QQ ,I.., p C
R ssell W. Hinton
State Auditor

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
May 23, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education

and Superintendent and Members of the Morgan County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance ofMorgan County Board ofEducation with the types ofcompliance requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2000. Morgan County Board of Education's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility ofMorgan County Board ofEducation's management. Our responsibility is to express an opinion on Morgan County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the .United States ofAmerica; the standards applicable to fmancial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and 0MB Circular A133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and 0MB Circular A-133 require that we plan and perfo1n1 the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requiretnents referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Morgan County Board of Education's compliance with those requirements and perfo1ming such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal dete11nination on Morgan County Board of Education's compliance with those requirements.
2000SA-10A

In our opinion, the Morgan County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 2000.
Internal Control Over Compliance
The management of Morgan County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and perfo1111ing our audit, we considered Morgan County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to dete11nine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report
on internal control over compliance in accordance with 0MB Circular A-133.
Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the no1mal course ofperfo11ning their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the info1111ation and use of management, members of the Morgan County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

w.
ssell W. Hinton State Auditor
RWH:gp
2000SA-10A

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




MORGAN COUNTY BOARD OF EDUCATION i\UDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7041-97-03 FS-7041-98-01 FS-7041-99-01

Unresolved - See Corrective Action/Responses

Further Action Not Warranted



Unresolved - See Corrective Action/Responses



CORRECTIVE ACTION/RESPONSES

EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Amount: $507.20 Finding Control Number: FS-7041-97-03
.
The underexpenditure will be returned to the State through an increase in the Board's Local Five Mill Share.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7041-99-01


We have hired a consultant and are in the process of getting bids from our Regional

Educational Service Agency for beginning and maintaining a fixed asset system.
-



SECTION IV FINDINGS AND QUESTIONED COSTS






MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF FI1\TDINGS AKD QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000

I SUMMARY OF AUDITOR'S RESULTS

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

2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Morgan County Board ofEducation disclosed a financial statement reportable condition related to the following control category.

General Fixed Assets

The reportable condition described above is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit of the Morgan County Board of Education disclosed no instances of noncompliance that were deemed to be material -to the financial statements.
4. Reportable Conditions in Internal Control Over Maior Programs The audit report for the Morgan County Board ofEducation did not disclose any reportable conditions in internal control over major programs.

5. Type of Report Issued on Compliance for Maior Programs

The auditor's opinion on the Morgan County Board ofEducation's report on compliance with

requirements applicable to major programs was unqualified.

--

6. Audit Findings Required to be Reported by Section .510{a) of 0MB Circular A-133

-

The Morgan County Board ofEducation's audit did not disclose audit findings required to be

reported by section .510(a) of 0MB Circular A-133.

7. Maior Programs Federal awards audited as major programs are as follows: _ 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.010 Elementary and Secondary Ed~cation Act-Title I- Grants to Local Educational Agencies

8. Type ''A'' Program Dollar Threshold The dollar threshold for type ''A'' programs was $300,000.00.

9. Low Risk Auditee The Morgan County Board ofEducation was audited as a low risk auditee based on a waiver granted by the U.S. Department of Education.

- 1-

MORGAN COUNTY BOARD OF EDUCATION SCHEDULE OF FI"t\TITNGS ,1\"t\TD QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7041-00-01 The Morgan County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements 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 ofa 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 Asset Account Group. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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