Audit report, Paulding County Board of Education, Dallas, Georgia, year ended June 30, 1998

AUDIT REPORT PAULDING COUNTY BOARD OF EDUCATION
DALLAS, GEORGIA YEAR ENDED JUNE 30, 1998

PAULDING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS-

SECTION I

FINANCIAL

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

EXlllBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUND

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

6

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

7

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

21

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

24

DEBT SERVICE FUND

I

COMBINING BALANCE SHEET

26

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

27

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

28

2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

29

3 SCHEDULE OF STATE REVENUE

31

4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

32

PAULDING COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDffiONAL FINANCIAL INFORMATION

SCHEDULES

5 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

33

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

6

OVERALL

35

7

BY PROGRAM

36

SECTIONll
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCEWITH OMB CIRCULAR A-B3

SECTION ill AUDITEE'S RESPONSE TO PRJOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRJOR YEAR FINDINGS AND QUESTIONED COSTS

SECTIONN FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
April 20, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Paulding County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMAnON SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general purpose financial statements of the Paulding County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Paulding County Board ofEducation'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 generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose fmancial statements, the Board's fmancial 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 fmancial 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.

98ARL-13B

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, 1998, a portion ofsalaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were improperly recorded in the year ended June 30, 1998. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements ofthe 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 Paulding County Board of Education as of June 30, 1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated April 20, 1999, on our consideration of the Paulding County Board of Education's intemal control over financial reporting and our tests of its compliance with certain provisions ofIaws, regulations, contracts and grants.
The year 2000 supplementary information on Schedule "I" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries ofmanagement regarding the methods ofmeasurement and presentation of the supplementary information. However we did not audit the information and do not express an opinion on it. In addition, we do not provide assurance that Paulding County Board of Education is orwill become year 2000 compliant, that the Board's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Paulding County Board of Education does business are or will become year 2000 compliant.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Paulding County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through J) and the financial schedules (Schedules 2 through 7, which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits o/States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose fmancial statements and in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose fmancial statements taken as a whole.
98ARL-13B

A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
Respectfully submitted,
~.~.eL~.~ Russell W. Hinton State Auditor
RWH:jb 98ARL-13B

PAULDING COUNTY BOARD OF EDUCATION

PAULDING COUNTY BOARD OF EDUCATION COMBINED BALANCE SIiEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30 1998

Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

3,655,825.18 $

551,303.05 $

75,590.81

1,659,536.22

17,526,206.44

736,759.56

445,206.77

1,252,057.00

55,067.70 27,574.37

Total Assets

6.052.120.96 $ 1.079.153.89

18.853.854.25

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payabie Capital Lease Agreements General Obligation Bonds Payable
Total LiabilRies
FUNDEQUrIY
Fund Balances Reserved For Continuation of Federal Programs For Debt Service For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Designated for Equipment Purchases Undesignated
Total Fund EqUity

1,160,934.97 $ 755.40

123,768.92 $ 272,676.33
11,804.36

132,5n.73
1,117,322.64 552,201.85

1,161,690.37 $

408.249.61 $

1,802,102.22

$
4.890.430.59 4,890,430.59

55,067.70 27,574.37
$
14,799.51 573,462.70
670,904,28

15,959,683.52 575,077.18 45,000.00
471,791.33
17,051,752.03

Total Liabilities and Fund EquRy

6.052,120,96

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

-2-

1:079153.89 $ 18.853.854.25

EXHIBIT "A"

DEBT SERVICE
FUND
2,850,495,93
2,316,731.06
1,092,726.43

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 30, 1998

JUNE 30, 1997

600.00

$ 7,133,814,97 $ 8,191,421.33

21,502,473.72

27,258,994.19

3,526,751.76

524,983.96

6,259,953.42

55,067,70 27,574,37
6,259,953,42

20,634,49 24,470,71
2,685,532,96

52,630,046.58 312,798,25

52,630,046.58 312,798,25

57,919,467,04 1,224,901 ,65

6,259,953.42 $

600.00 $

59,202,798,25

91,448,460,77

97,850,406,33

$ 1,417,281,62 $

668,255,67

273,431,73

242,436,38

11,804,36

344,81

1,117,322.64

361,880,57

552,201.85

453,208,65

$

312,798,25

312,798.25

1,224,901.65

58,890,000,00

58,890,000.00

60,605,000,00

59,202,798.25

62,574,840.45 $ 63,576027,73

6,259,953.42
0.00 6,259,953.42 6 259 953.42 $

600.00 600.00

$

6,747.50

$ 6,259,953,42

2,665,532,96

55,067.70 27,574.37 15,959,883,52 575,077,18 45,000.00
14,799.51 5,936,284.62
$ 28,873,640,32

20,634,49 24,470.71 26,417,076,84
14,361.65 5,105,554.45 34 274,378.60

600.00 $

59,202798.25

n 91.448.480. $ 97,850 406.33

-3

PAULDING COUNTY BOARD OF E!:!UCATION
COMBINEP STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUNp TYPES AND EXPENllABLE TRUST FUNp
YEAR ENDED JUNE 30 1998

~
State Funds Federal Funds Texes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
capital Outlay Debt Service
Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES>
Accrued Interest on Bonds Sold Proceedslrom General Obligation Bonds
Par Value Premium on Bonds Sold Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) ExpendRures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

GOVERNMENTAL FUND

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 43,180,727.60 $
15,432,783.24 1.253,825.42
$ 59,867,336.26 $

993,418.05 $ 3,014,144.15
1,954,638.66
5,962,200.86 $

1,605,545.00
564,527.39 1,280,828.02
3450,900.41

$ 38,433,036.34 $
2,649,743.85 1,826,879.43 1,535,430,80
356,961.67 3,711,632,68
288,138.05 4,542,784.41 3,336,683,51
239,914,07 30,175.00
119,702,64 823,370,70
48,350.22
912,103.40 49,574.78

1,586,245.69
328,181.96 94,598.05 50,640.64
142,680.94 2,415.00
1,523.20 133,394.56
8,851.84 3,715,476.74
1,077.56 $

13,323,565.21

$ 58,904.481.55 $

$

962,854,71 $

6 065,086,36 $ -102885.52 $

13,323,565,21 -9,872,864.80

$

$

42,972.36

$

42,972.36 $

$

919,882.35 $

3,970,548,24

42,972.36 $ -7,000.00
35,972,36 $

7,000.00 7,000.00

-66,913.16 $ 700,280.57

-9,885,864.80 26,917,416,83

34.433.21 3,103,66

FUN!:! BALANCE JUNE 30

$ 4,890,430.59 $

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

670,904.28 $ 17,051,752.03

EXHIBIT"B"

TYPES
DEBT SERVICE
FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

$ 45,779,690.65

3,014,144.15

$ 8,290,542.58

24,287,853.21

130,271.77

4,619,563.87 $

$ 8,420.814.35 $ 77,701,251.88 $

$
0.00 0.00 $

45,779,890.65 $ 3,014,144.15
24,287,853.21 4,619.563.87
77,701.251.88 $

43,214,298.18 2,409,787.41 18,461,830.05 3.797,007.22
67.882,922.86

$ 40,019,282.23 $

2,977,925.81 1,921,477.48 1,586,071.44
499,642.61 3,714,047.68
288,138.05 4,544,307.61 3,470,078.07
239,914.07 39,026.64
3,835,179.38 824,448.26
13,371,915.43

$ 1,715,000.00 3,119,042.81 12.351.08

2,627,103.40 3,168,617.59
12.351.08

$ 4,646.393.89 $ 83.139,527.03 $

$ 3,574,420.46 $ -5,438,275.15 $

$

49,972.36

-49,972.36

$

0.00

$ 3,574,420.46 $ -5,438,275.15 $

2,685,532.96

34,273,778.60

34,433.21 3103.86

$ 6,259,953.42 $ 28,873,040.32 $

0.00 $
0.00 $ 0.00 $

40,019,282.23 $
2,977,925.81 1,921,477.48 1,586,071.44
499,642.61 3,714,047.68
288,138.05 4,544,307.61 3,470,078.07
239,914.07 39,026.64
3,835,179.38 824,446.26
13,371,915.43
2,627,103.40 3,168,617.59
12,351.08
83.139.527.03 $
-5,438.275.15 $

35,708,900.71
2,278,950.41 1,454,775.42 1,388,433.04
632,728.67 3,334,229.26
577,088.66 3,988,813.55 2,888,979.23
54,857.83 35,185.80 3,451,740.20 655,744.19 12,905,017.57
2,276,812.24 2,602,275.03
8,415.02
74.240.746.83
-6,357,823.97

$

88,280.41

20,105,000.00

16,685.05

$

49,972.36

36,539.74

-49.972.36

-36.539.74

$

0.00 $ 20,209.965.46

0.00 $ 600.00

-5,438,275.15 34,274,378.60

13,852,141.49 20,455,837.00

34,433.21 3,103.66

-33,074.16 -525.73

600.00 $ 28.873,640.32 $ 34,274,378.60 -5-

PAULDING COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET ANp ACTUAL - INON-GAAP BASIS> GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30 1998

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

~
State Funds Federal Funds Taxes Other Funds

$ 42,159,193.50 $ 43,180,727.60

14,480,514.00 932,368.20

15,432,783.24 1,253,825.42

Total Revenues

$ 57,572.075.70 $ 59,887.338.26

EXPENDITURES

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

38,777,342.66
2,648,514.26 1,718,614.08 1,566,055.00
392,453.00 3,699,284.06
282,928.00 4,652,571.20 3,561,516.00
231,293.00 30,100.00 79,730.00 99,500.00 81,000.00

38,433,036.34
2,649,743.85 1,826,879.43 1,535,430.80
356,961.67 3,711,632.66
288,138.05 4,542,764.41 3,338,683.51
239,914.07 30,175.00 119,702.64
823,370.70 48,350.22
961,678.18

Total Expenditures

57,820,901.26 $ 58,904,481.55

Excess of Revenues over (under) Expenditures

$ -248,825.56 $

962,854.71

OTHER FINANCING SOURCES (USES>

Other Sources OlherUses

$

-16,010.00 $

-42,972.38

Total Other Financing Sources (Uses)

$

-16,010.00 $

-42,972,36

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

-264,835.56 $

919,882.35

FUNp BALANCE JULY 1 1997

3,970,557.n

3,970,548,24

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

-1,366.02

FUND BALANCE JUNE 30 1998

3.704.354.19 $ 4,890,430.59

SPECIAl REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

1,009,937.00 $ 3,305,272.13

993,418.05 3,014,144.15

1,845,881.00

1,954,838.88

$ 6,160,870.13 $ 5.962.200.86

1,708,835.65 $
361,320.24 160,657.06
54,500.00 199,412.44
2,600.00
171,303.00
10,432.00 3,498,982.n
7,730.58

1,586,245.89
328,161.96 94,598.05 50,640.64 142,680.94 2,415.00
1,523.20 133,394.56
8,851.64 3,715,476.74
1,0n-56

6,195,773.74 $ 6.065,086.38

$

-34,903.61 $ -102,885.52

$

16,010.00 $

42,972,36

-7,000,00

$

16,010,00 $

35,972,36

-18,893,61 $ 700,280,57 30,780.76

-66,913.16 700,280.57
34,433.21 3,103.66

$' 712,167.72 $

670,904.28

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

PAULDlNG COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FlNANCIAL STATEMENTS
JUNE 30,1998

Note I: SUMMARY OF SIGNIFICANT ACCOUNTlNG POLICIES
REPORTING ENTITY
The Paulding 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 of all the organizations that compose its legal entity.
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 ofpurchase. 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.
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 fmancial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of a Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial 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 ofspecific 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.
-7-

PAULDING COUNTY BOARD OF EDUCATION

EXlllBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

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.
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPE - the fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:
EXPENDABLE TRUST FUND McGarity Fund- the fund used to account for the principal and earnings from the estate of Mrs. Maybell Hitchcock McGarity which may be expended to provide the purchase of a hardwood tree at McGarity Elementary School and also to purchase awards, recognition plaques, etc. for outstanding students of the Paulding County School System.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and material capital lease obligations.
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 (Le., revenues and other financing sources) and decreases (Le., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure ofavailable spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (Le., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be detennined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
- 8-

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIlE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

A departure from the above definitions is the accounting treatment afforded the fina1 two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in early June 1998. Personnel contracts for this employment period specifY that compensation be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. 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 of June 30, 1998, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30,1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were recorded in the year ended June 30, 1998. 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 Paulding County Board of Education's budget is a complete financial plan for the Board's fiscal year and

is based upon estimates of expenditures together with probable funding sources. There is no statutory

prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is

prepared by fund, function and object. The legal level of budget control was established by the Board at the

aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted

accounting principles.

.

The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a fina1 school budget. This fmal budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.

CASH AND CASH EQUIVALENTS

COMPOSmON OF DEPOSITS Cash and cash equivalents consist of deposits 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.

-9-

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofretum shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
RECEIVABLES
Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
PROPERTY TAXES
The Paulding County Board of Commissioners fixed the property tax levy for the 1997 tax year (calendar year) on August 12, 1997 (levy date). Taxes were due on November 15, 1997. The lien date for property
- 10-

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIlE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 1: SUMMARY OF SlGNlFlCANT ACCOUNTING POLICIES

taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are
reported as revenue in fiscal year 1998. The Paulding County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

Tax millage rates levied for the 1997 tax year (calendar year) for the Paulding County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

17.70 mills 4.20 mills

2l..2Q mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax collected by the State and remitted to the Board during the
fiscal year amounted to $5,106,319.53 and was recorded in the Capital Projects and Debt Service Funds. The
State will terminate collection ofthis tax once an additional $19,893,680.47 has been collected or on June 30, 2002 whichever occurs first.

INVENTORIES

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

COMPENSATED ABSENCES

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

- 11 -

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1998

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Additionally, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources has not been recorded in the General Long-Term Debt Account Group as this liability is also deemed to be immaterial to the fair presentation ofthese financial statements.
GENERAL OBLIGATION BONDS
The Board issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit of the goverurnent. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than reimbursements.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general pwpose 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. Certain reclassifications have been made to the comparative data to conform to the current year classifications.
Note 2: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value ofsecurities pledged shall be equal to 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.
- 12-

PAULDING COUNTY BOARD OF EDUCAnON

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 2: DEPOSITS AND INVESTMENTS
Acceptable security for deposits consists of anyone ofor any combination of the following:
(l) 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 ofthe counties or municipalities ofthe State of Georgia,
(5) Bonds ofany public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use ofthe 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 govermnent 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, 1998, the bank balances were $9,289,150.53. 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, 1998, as follows:

-13 -

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1998

Note 2: DEPOSITS AND INVESTMENTS

Risk Category

Bank Balance

1

$ 3,157,651.99

2

6,131,498.54

3

0.00

Total

$ 9 28915053

CATEGORIZATION OF INVESTMENTS
Investments are classified as to risk by the three categories described below:

Category 1 - Insured or registered, or securities held by the Board or the Board's agent in the Board's name.
Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name.
Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name.

Funds invested in an investment pool managed by another government are not required to be categorized
unless the investing entity owns specific, identifiable investment securities in the pool.

At June 30, 1998, the carrying value ofthe Board's total investments was $21,502,473.72. The investments are classified as to risk categories as follows:

Type ofinvestment U. S. Government

Risk Categories 2

Carrying Amount

Fair Value

$

000 $ 19 371 146 17 $

000 $ 19,371,146.17 $ 19,422,577.18

Local Government Investment Pools

213132755 2131327.55

Total Investments

$ 21502 473 72 $ 21 553 904 73

The carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy of the State of Georgia, Office ofTreasury and Fiscal Services for the Local Govermnent Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state govermnent investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to

- 14-

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 2: DEPOSITS AND INVESTMENTS
be a 2a-7 like pool. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is vohmtary and deposits consist offunds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.
Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund I may not exceed 60 days. Fund 6 maintains a duration of approximately one year. The weighted average maturity for Georgia Fund I on June 30, 1998 was 29 days. The average investment duration for Fund 6 on June 30, 1998 was .96 years.
Note 3: NON-MONETARY TRANSACTIONS
The Board receives food cornmodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their F~derally 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 cornmercial insurance for risk ofloss associated with torts, assets, errors or omissions and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years.
The Board 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 amol;U1t of that loss can be reasonably estimated.
Changes in the unemployment compensation claims liability during the last two fiscal years are as follows:

- 15 -

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30,1998

Note 4: RISK MANAGEMENT

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1997

$

0.00 $

2,925.00 $

2.925.00 $

0.00

1998

$

0.00 $

0.00 $

0.00 $

0.00

The Board participates in the Georgia School Boards Association Workers' Compensation Fund, a public entity risk pool organized on July 1, 1992 to develop, implement, and administer a program of workers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Fund for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Fund with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Fund in excess of $350,000.00 loss per occurrence, up to the statutory limit. Also, should losses within the retained limit of $350,000.00 aggregate to more than seventy-five percent (75%)of the standard experience rated premium during the policy term, the policy with the United States Fidelity and Guaranty Company will pay the next $1,000,000.00 ofloss.

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

Position Covered Superintendent Note 5: GENERAL LONG-TERM DEBT

$ 100,000.00

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

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

Purpose

Interest Rates

Amount

General Government - Series 1997 General Government - Series 1995 General Government - Series 1992-A General Government - Refunding - Series 1992-B General Government - Series 1991

4.00% - 5.00% $ 19,405,000.00

4.60% - 5.50% 21,000,000.00

5.25% - 6.625% 10,720,000.00

5,25% - 6.40%

3,350,000.00

5.00%-6.10%

4.415,000,00

$ 5889000000

- 16-

PAULDING COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 5: GENERAL LONG-TERM DEBT

The changes in General Long-Tenn Debt during the fiscal year ended June 30,1998, were as follows:

Capital Leases

General Obligation
Bonds

Total

Balance July 1, 1997
Deductions Payments
Balance June 30, 1998

$ 1,224,901.65 $ 60,605,000.00 $ 61,829,901.65
912,103.40 1,715,000.00 2.627.103.40 $ 31279825 $ 58 890 000 00 $ 5920279825

At June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

Capital Leases

General Obligation
Bonds

Total Debt

1999 2000 2001 2002 2003 2004 - 2008 2009 - 2013 2014 - 2015

$ 176,688.98 $ 8,103,296.25 $ 8,279,985.23 163,903.47 8,564,503.75 8,728,407.22 8,970,620.00 8,970,620.00 9,377,230.00 9,377,230.00 8,089,010.00 8,089,010.00 26,748,135.00 26,748,135.00 23,532,225.00 23,532,225.00 11,983,725.00 11,983,725.00

Total Principal and Interest

$ 340,592.45 $ 105 368 745 00 $ 105 70933745

Deduct: Imputed Interest

27,794.20

Net Present Value of Future Minimum Lease Payments

$ 31279825

Note 6: PRIOR YEAR DEFEASEMENT OF DEBT

In fiscal year 1986, the Board defeased certain general obligation bonds by placing the proceeds ofnew bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 1998, $385,000.00 of bonds are outstanding and are considered defeased.

Note 7: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of$973,747.36 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

- 17 -

PAULDING COUNTY BOARD OF EDUCATION

EXlllBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 7: ON-BEHALF PAYMENTS

Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of$802,665.36

Office ofTreasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$171,082.00

Note 8: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as ofJune 30,1998:

Facility No. 100 Facility No. 199 Facility No. 299 Facility No. 2352

Unearned Executed Contracts
$ 9,366,542.08 3,639.54
906,344.32 258,644.46

$10 535 17040

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

Note 9: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by 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 10: DEFERRED COMPENSATION PLAN

In prior years, the Board's deferred compensation plan, created in accordance with Internal Revenue Code Section 457, was reported as an agency fund. This agency fund had a fund balance of$340,808.05 at June 30, 1997. For fiscal year 1998, the Board converted this plan to a trust in accordance with Federal law enacted on August 20, 1996. Since the Board does not have fiduciary accountability for the Section 457 plan, the assets of this plan will no longer be reported within the Board's financial statements.

- 18 -

PAULDING COUNTY BOARD OF EDUCATION NOTES TO mE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30.1998
:t

EXlllBIT "D"

Note 11: ACCUMULATED EMPLOYEES' LEAVE

The Board's administrative staff and certain other full-time employees earn a maximum of one and onequarter days per month of annual leave. Annual leave may be accumulated to a maximum of20 days, and an amount based on unused leave, up to the maximum accumulation, is paid at the current rate of pay to employees upon retirement or termination of employment. See Note 1 - Compensated Absences

Note 12: 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 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 of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. The required employer contributionrate is 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1998

100%

$ 4,319,035.81

1997

100010

$ 3,734,916.77

1996

100%

$ 3,230,884.90

- 19-

PAULplNG COUNJY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30 1998

EXHIBIT"E"

~ Cash and Cash Equivalents Accounts Receivable Inventories
Food Donated Commodities Purchased Food
Total Assels

SCHOOL FOOD
SERVICES FUND

LOTIERY PROGRAMS

FEDERAL PROGRAMS

TOTALS JUNE 30, 1998 JUNE 30,1997

S 626.300.10 S

31,983.25

S

656.283,35 $

922.184.61

162.641.09

25.326.25 $

237.241.43

445.2OB.n

143.151,02

55.067,70 27,574.37

55.067.70 27.574,37

20,634.49 24,470.71

891,583.26 $

57.309.50 $

237.241.43 $ 1.186,134,19 $ 1,110.440.83

LIABILITIES ANp FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable salaries Payable Expired Grant Balances Payable

S

67,029.55 $

153,649.43

Total Liabilities

220,678.98 $

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donaled Commodities Purchased Food Unreserved Desi9nated for Equipmenl Purchases Undesi9nated

55,067.70 27.574,37
14,799.51 573.462.70 S

Tolal Fund Equity

670.904.28 $

S 14,976.06 42,333.44
57,309.50 $

106.980.30 $ 41.763,31 76.693,46 11.804.36
237.241.43 $

106.980.30 $ 123.768.92 272.676.33
11.804.36
515,229,91 $

30,612.67 137.111.21 242,436.38
410,160.26

0,00 $ 0.00 S

$

6.747.50

0.00 0.00 $

55.067.70 27.574,37
14.799,51 573.462,70
670.904.28 S

20.634.49 24,470.71
14.361.65 634,066.22
700,280.57

Total L1abillties and Fund Equity

S

891.583.26 $

57.309.50 $

237.241,43 $ 1.186.134.19 S 1.110,440.63

See notes to the general purpose financial statements.

-20-

PAULDING COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND )'EAR ENDED JUNE 30 1998

EXHIBIT"P

~
State Funds Federal Funds Other FUnds

SCHOOl FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30, 1998 JUNE 30, 1997

287,654.00 $ 1,438,576.26 1,954,638.66

725,764.05 $

$ 1,575,567.89

993,418.05 $ 3,014,144.15 1,954 638.66

926,483.18 2,323,617.17 1,818,439.78

Total Revenues

3,660,868.92 $

725,764.05 $ 1,575,567.89 $ 5,962 200.86 $ 5,068,540.13

EXPEND'TURES

Current
Instruction Support services
Pupil 8ervices Improvement of Instructional Services Educational Media Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation Community Services Operations
Total Expenditures

3,714,034.58 3,714,034.56 $

680,658.69 $ 31,623.83 1,485.60 15,320.14 1,523.20 748.75 1,372.74
732,732.95 $

905,587.20 $
296,558.13 93,112.45 50,640.64
127,360.80 2,415.00
132,645.81 8,851.84 69.42 1,On.56
1,618,318.65 $

1,586,245.89 $
328,181.96 94,598.05 50,640.64
142,680.94 2,415.00 1,523.20
133,394,56 8,851.84
3,715,476.74 1,On.56
6,065,086.38 $

1,382,130.67
85,901.20 95,623.57
9,536.67 73,358.27
167.92 102,518.99
14,363.80 3,323,921.11
5,087,522.20

Excess of Revenues over (under) Expenditures

-53,165.66 $

-6,968.90 $

-42,750.96 $ -102,885.52 $

-18,982.07

OTHER FINANCING SOURCES (USES)

Operating TransfeBln Operating TransfeB Out

$

$

-7,000.00

6,968.90 $

36,003.46 $

42,972.36 $ -7,000.00

36,539.74

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

-7,000.00 $ -60,165.66 $

6,968.90 $ 0.00 $

36,003.46 $

35,972.36 $

-6,747.50 $

-66,913.16 $

36,539.74 17,557.67

FUND BALANCE JULY 1

693,533.07

0.00

6,747.50

700,280.57

716,322.79

Food Inventory - Net Change in Period Donated Commodities Purchased Food

34,433.21 3,103.66

34,433.21 3,103,66

-33,074.16 -525.73

FUND BALANCE JUNE 30

670,904.28 $

0.00 $

0.00 $

670,904.28 $

700,280.57

See notes to the general purpose financial statements.

-21-

PAULDING COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30 1998

~ Cash and Cash Equivalents Investments Accounts Receivable
Total Assets
LIABILITIES AND FUND EQUITY L1ABI L1TI ES
Cash Overdraft Accounts Payable Contracts Payable Retainages Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For SPLOST Projects For Slale CapRal Outlay Projects Unreserved Undesignated Tolal Fund Equity
Tolal Liabilities and Fund Equity

REGULAR

BOND PROCEEDS

$

45,000.00 $ 1,282,647.81

471,791.33

16,479,337.93

$

516,791.33 $ 17,761:985.74

$

132,577.73

1,117,322.64

552,201.85

$ 1,802,102.22

$ 15,959,883.52

$

45,000.00

471,791.33

0.00

$

516,791.33 $ 15,959,883.52

$

516,791.33 $ 17,761,985.74

See notes to the generalpurpose financial statements. - 22-

EXHIBIT"G"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

$

575,077.18

$

LOTTERY PROJECT

TOTALS

JUNE 30, 1998

JUNE 30, 1997

$ 1,327,647.81 $ 2,645,816.44

17,526,206.44

25,094,437.00

1,252,057.00

1,252,057.00

5,815.69

$

575,077.18 $ 1,252,057.00 $ 20,105,911.25 $ 27,746,069.13

$ 1,252,057.00 $ 1,252,057.00 $ 132,577.73
1,117,322.64 552,201.85
$ 1,252,057.00 $ 3,054,159.22 $

643.08 12,920.00 361,880.57 453,208.65
828,652.30

$

575,077.18

0.00 $

$

575,077.18 $

$
0.00 0.00 $

15,959,883.52 $ 575,077.18 45,000.00
471,791.33
17,051l52.03 $

26,417,076.84
500,339.99 26,917,416.83

$

575,077.18 $ 1,252,057.00 $ 20,105,911.25 $ 27.746,069.13

- 23-

PAULDING COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL pROJECTS FUND YEAR ENDED JUNE 30 1998

REVENUES
Slate Funds Taxes Other Funds
Tolal Revenues
EXPENDITURES
Current Support Services Business Administration
Capital OuUay Land and Land Improvements Building and Building Improvements Equiprnent
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES rUSES)
Proceeds from General Obligation Bonds Par Value Premium on Bonds Sold
Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

REGULAR

BOND PROCEEDS

$

45,000.00

23,031.34 $

1,247,246.89

$

68,031.34 $

1,247,246.89

$

7,969.50

$

51,580.00

11,n4,332.31

98,509.40

$

51,580.00 $

11,880,811.21

$

16.451.34 $

-10,633,564.32

$

315.488.00

-139.117.00

$

176,371.00

$

16,451.34 $

-10,457,193.32

500,339.99

26.417,076.84

$

516,791.33 $

15,959,883.52

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

EXHIBIT"H"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 1998

JUNE 30, 1997

$ 1,560,545.00 $ 1,605,545.00 $ 4,811,949.00

$

564,527.39

564,527.39

10,549.79

1,280,828.02

847,932.16

$

575,077.18 $ 1,560,545.00 $ 3,450,900.41 $ 5,659,881.16

$

303,981.93

$

0.00

$

7,969.50

282,023.00

$ 1,391,174.00

13,217,086.31

12,563,629.94

98,509.40

$

0.00 $ 1,391,174.00 $ 13,323,565.21 $ 13,149,634.87

$

575,077.18 $

169,371.00 $ -9,872,664.80 $ -7,489,753.71

$ 20,105,000.00

16,685.05

$

139,117.00 $

454,605.00

2,765,671.00

-308,488.00

-447,605.00

-2,765,671.00

$

-169,371.00 $

7,000.00 $ 20,121 ,685.05

$

575,077.18 $

0.00

0.00 $ 0.00

-9,865,664.80 $ 26,917,416.83

12,631,931.34 14,285,485.49

$.

575,077.18 $

0.00 $ 17,051:752.03 $ 26,917,416.83

-25 -

PAULDING COUNTY BOARP OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUNP JUNE 30 1998

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAl OPTION SALES TAX

TOTALS

JUNE 30, 1998

JUNE 30, 1997

$

2,853,995,93

$ 2,853,995.93 $ 2,539,298.89

$ 2,316.731.06

2,316,731.06

88.280.41

148,952.42

943774.01

1.092.726.43

57953.66

Tolal Assets

$

3,002,948.35 $ 3,260.505.07 $ 6,263,453.42 $ 2,685,532.96

LIABILITIES AND FUNP EQUITY

LIABILITIES

Cash Overdraft

FUND EQUITY

Fund Balances

Reserved

For Debt Service

$

UnreseNed

Undesignaled

Tolal Fund Equity

$

$

3,500.00 $

3,500.00

3,002.948.35 $ O.OP
3,002.948.35 $

3.257,005.07 $ 0.00
3.257,005.07 $

6,259,953.42 $ 0.00
6,259,953.42 $

2,685,532.96 0.00
2,685,532.96

Tolalliabililies and Fund Equity

$

3,002,948.35 $ 3,260,605.07 $ 6,263,453.42 $ 2,685,532.96

See notes to the general purpose financial statements.

-26-

PAULDING COUNTY BOARD OF EPUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND YEAR ENDED JUNE 30 1998

EXHIBIT"J"

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

YEAR ENDED

JUNE 30, 1998

JUNE 30. 1997

REVENUES

Taxes Other Funds

3,748,750.44 $ 98.788.94

4,541,792.14 31.482.83

8,290,542.58 $ 130,271.n

3,614,396.96 115.858.58

Total Revenues

3.847.539.38

4.573,274.97 $

8.420.814.35

3,730.255.54

EXPENDITURES

Debt Service Principal Interest Payin9 Agent Fees

$

1,015,000.00 $

700,000.00

2,417,992.50

701,050.31

8,851.08

3.500.00

1,715,000.00 $ 3,119,042.81
12,351.08

885,000.00 2,484,430.00
8.415.02

Total Expenditures

$

3,441 843.58

1 404,550.31 $ .4,846.393.89

3,337,845.02

Excess of Revenues over (under) Expenditures

405,695.80

3,168,724.66 $

3,574,420.46

392,410.52

OTHER FINANCING SOURCES

Accrued Interest on Bonds Sold

88.280.41

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

405,695.80 $ 3,168,724.66

3,574,420.46 $

480,690.93

FUND BALANCE JULY 1

2.597,252.55

88.280.41

2,685,532.96

2,204,842.03

FUND BALANCE JUNE 30

$

3.002 948.35

3 257.005.07 $

6.259,953.42 $

2.685.532.96

see notes to the general purpose financial statements.

-27-

PAULDING COUNTY BOARD OF EDUCATION

SCHEDULE "1"

SCHEDULE OF REOUIRED SUPPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENDED ruNE 30, 1998

At June 30, 1998, the Paulding County Board of Education had no outstanding contractual commitments for the purpose ofmaking computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result ofshortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is ofprimary concern for the Board's financial accounting system. The following stages have been identified as necessary to implement a year 2000 compliant systems.
Awareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 issue.
Assessment Stage - The actual process of identifying all of its systems and individual components of the systems to check for compliance.
Remediation Stage - When changes are made to systems and equipment.
ValidationfTesting Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system.
It will be necessary for the Board to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As of June 30, 1998, the financial accounting system was determined to be at the Awareness Stage.
The Board's financial accounting software (GENESIS) and hardware (Wang VS) is owned by the State (Georgia Department ofEducation). These systems have been determined to be critical to the Board's ability to successfully conduct operations. As of June 30, 1998, the State had not contracted for the remediation of either the Wang VS operating system or the GENESIS accounting software. In the subsequent period, the Georgia Department of Education remediated the Wang VS operating system and the updated operating
system was installed at all GENESIS sites as of December 9, 1998. The Georgia Department of Education has remediated the GENESIS software and conducted tests at nine pilot sites. The remediated GENESIS software has been provided to all boards of education currently utilizing the GENESIS accounting software.

See notes to the general purpose financial statements. 28 -

PAULDING COUNTY BOARD OF EDUCATION
SCHEDULE OF EXPENPITURES OF FEPERAL AWARDS
YEAR ENDED JUNE 30 1998

SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Dep.rtment of Ps-Through from Georgi. Dep.rtment of Education Food .nd Nutrition Program Food Service. School Bre.kft Pro9ram 1998 Grant N.tion.1 School Lunch progrem 1998 Grant Food Distribution Program (1)
Tot.1 U. S. Department of Agriculture
Educalion, U. S. Dep.rtment of
Ps-Through from Georgi. Dep.rtment of Education Elementary .nd Second.ry Education Act
nlel Grants to Local Education.1 Agencie. 1998 Gr.nt
nlell Eisenhower Professional Development 1997 Grant 199B Gr.nt
TrileVI Innovative Education Program Strategies 199B Grant
Go.I.20oo St.te .nd Local Educalion Systemic Improvement Grants 1998 Grant
Individu.l. with Dibilitie. Education Act P.rt B - Speci.1 Education Flow Through 199BGrant Pre.chool 1998 Grant
S.fe .nd Drug-Free School. 1998 Grant
Vocation.1 Education - Bic Grants to Slates High School Program sa.icGrant 1998 Grant Tech-Prep Education 1998 Grant
P.ss-Through from Georgia Dep.rtment of Hum.n Resource. Sefe and Drug-Free Schools 1998 Grant
Tot.1 U. S. Departmant of Education
Labor, U. S. Department of PThrough Coosa V.11ey Region.1 Development Center Job Training P.rtne"'hip Act 17-97-20-009

CFDA NUMBER

PASSTHROUGH
ENTITY 10
~

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10.553

NlA

10.555

N/A

10.550

N/A

203,566.21
978,949.18 $ 256,060.87
1,438,576.26

(2)
3,457,973.71 (3) 256,060.87
3,714,034.58

84.010 84.281 84.281 84.298
84.276
84.027 84.173 84.186
84.048 84.243 84.186

NlA $
N/A N/A
N/A

683,951.22 $ 22,192.00 43.703.00

683,951.22
6,747.50 22,192.00
51,68B.00 (3)

NlA

111,486.13

111,466.13

N/A

404,678.60

404,678.60

N/A

60,565.15

60,565.15

NlA

48.706.30

48,706.30

N/A

44,163.43

84,213.94 (3)

N/A

4,800.00

4,600.00

N/A

106.169.51

106.634.56 (3)

1.530,415.34 $

1,565,863.40

17.250

NlA $

9,527.91 $

9,527.91

-29-

PAULDING COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30 1998

SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT
OTHER FEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program 1998 Grant

CFDA ~

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

$ _ _-"3",5""62",4",.64,,,,,

43.127.54 (3)

Total Federal Financial Assistance
N/A = Not Available

$ 3.014,144.15 $

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 tha .1998 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures were not maintained by fund source.

Major Programs are identified by an asterisk (1 in front of the CFDA number.
The Board did not provide Federal Assistance to any Subrecipienl.
The accompanying schedule of expend~uresof Federal awards includes the Federal grant activ~ of the Paulding Counly Board of Education and is presented on the modified accrual basis of accounting which is the same basis of accounting used in the presentation of the general purpose financial statements.

5,332.353.43

See notes to the general purpose financial statements.

-30-

PAULDING COUNTY BOARD OF EDUCATION
SCHEDULE OF STATE REI/ENUE
YEAR ENQEP JUNE 30 1998

SCHEOULE "3"

AGENCYIFUNDING
GRANTS Community Affairs, Georgia Department of Govemofs Emergency Funds (1) Local Assistance Grant Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Speciallnstruetional Assistance In.school Suspension Mid-tenn Adjustment Counselors Grades 4 and 5 Technology Training Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other Slate Programs Ad Valorem Tax Adjustment Advanced Placement Exams Alternative Program Apprenticeship Program At-Risk Summer School Program Environmental SCience Program Health Insurance Mentor Teacher Program Pay for Per10nnance Program Preschool Handicapped Program Remedial Summer School Program Lottery Programs Alternative School Program Exceptiooal Growth-eapital Outlay Instructlonal Technology Assistive Technology Classroom Technology
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal 8erVicea Public SChool Employees Retirement
CONTRACT Education, Georgia Dapartmenlof Continuation of Deparlmanfs Elemantary SChool Foreign Languages Model Program in McGarity ElamentaJy SChool

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

15,000.00
23.835,135.00 3,315,027.00 968,012.00 1,012,502.00 321,712.00 6,435,423.00
1,201.437.00 363,725.00 647,509.00
1,445,097.00 230.261.00
2,463,112.00 100.264.00 115,369.00
-3,973,767.00 2,583,810.00
6,502.74
324,624.00 280.00
117,025.00 50,000.00 37,016.67
1,500.00 802,665.36
29,326.00 86,000.00 144,S35.OO
9,025.83
171,082.00

267,854.00
4.132.00 16,026.25 330,700.00 374,905.80

45,000.00 ',560,545.00

15,000.00 45,000.00
23.835,135.00 3,315,027.00 968,012.00 1,012,502.00 321,712.00 8,435,423.00
1,201,437.00 363,725,00 847,509.00
1,445,097.00 230,281.00
2,463,112.00 100,264.00 115,389.00
-3,973,767.00 2.583,810.00
267,654.00 6,502.74
324,624.00 260.00
117,025.00 50,000.00 37,016.67 1,500.00 802,665.36 29,328.00 86,000.00
144,935.00 9,025.83
4,132.00 1,580,545.00
16,028.25 330,700.00
374.905.80
171,082.00

121075.00

121.075.00

43180727.80 $ _ _9~9~3.:,4.!.l'8~.05!:!.

1.605.545.00

45[779,690.65

(1) These funds are designated for the following projects: Purchase and install a sound system at Herschel Middle School. Help build a pavilion at Hiram Elementary School and purchase playground equipment for Panter Elementary SChool. Aasist the East Paulding High SChool with the purchase and/or repair of their weight lifting equipment

5,000.00 5,000.00 5,000.00

See notes to the general purpose financial statements.

15000.00

PAULDING COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX pROJECTS
YEAR ENDED JUNE 30 1998

SCHEDULE "4"

$ 25,000,000.00 $ 25,000,000.00 $ 8,781,801.86 $ 310,026.05 (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 project. Includes all costs from project inception to completion. (3) The voters of Paulding County approved the imposition of a 1% 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 project.
See notes to the general purpose financial statements. -32-

PAULDING COUNTY BOARD OF EDUCATION SCHEPULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDEp JUNE 30 19!18

SCHEDULE "5"

EXPENDITURES
Current Instruction Support Services PupilSeMces Improvement of Instructlonal 5ervIces General Administration Maintenance and Operation of Plant Student Transportation Services Food Services Operation

ALTERNATIVE SCHOOL PROGRAM

INSTRUCTIONAL TECHNOLOGY

ASSISTIVE

CLASSROOM

TECHNOLOGY TECHNOLOGY

PRE-KINDERGARTEN PROGRAM

4,132.00

18,028.25

330,700.00

328,800.44
31,823.83 1,485.80
15,320.14 1,523.20 748.75 1,372.74

TOTAL
680,658.69
31,823.83 1,485.80
15,320.14 1,523.20 748.75 1372.74

TOlaI Expenditures

4,132.00

16028.25 $

330:700.00

381874.70 $

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Alternative Sc:hooI Program InslnJclianal Technology Assistive Technology Classroom Technology Pre-Kindergarten Program

364,441.79
4,132.00
16,026.25 330,700.00
17432.91

732,732.95

See notes to the general purpose tinanasl statements.

33

PAULDING COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30 1998

SCHEDULE "6"

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

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$ 31,593,788.00 $

1,203,034.00

$ 35,395,373.92 2,106,853.10 $
$ 37,502,227.02

1,874,941.96

493,240.51 $ 37,008,986.51

$

0.00 $

0.00

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

PAULDING COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS _BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30 1998

GENERAL AND CAREER EDUCATION PROGRAMS
Kindergarten rl Grades 1 - 3 r)
SuI>-Tolal- K-3 Grades 4 - 5 (0) Grades 6 - 8 (1 Grades 9 -12 (0) High School Laboratories (0) Vocational Education Laboratories (0)
Total General and career Education Programs SPECIAL EDUCATION PROGRAMS
Regular Programs
Category I rJ Category II rJ Category III rJ Category IV rJ
Sul>-To1at - Regular Category VI (Gifted) (1
Total Special Education Programs REMEDIAL EDUCATION PROGRAM "
Total Fourteen Weighted Programs MEDIA CENTER PROGRAMS
Salaries Qpera1Ions
Total Media Center Programs
Total Fourteen Weighted and Media center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL ~

ORIGINAL

MID-TERM

2,976,625.00 7,443,233.00 10,419,858,00 2,995,553,00 5.020.586,00 2.739,387.00 1,713,453,00
946,298.00 23,835,135.00

$ 2,678,962.50

6,698,909.70

90

9,377,87220

90

2,695,997.70

90

4,518,527,40

90

2,465,448.30

90

1,542,107.70

90

851,688,20

21,451,821.50

97.573.00 765,539.00 663,112.00 900,000.00 700,000.00
2,463,112.00

3,187,329.00

$ 2,868,598.10 $

0,00

3,187,329.00 90 127,898.00 90
3,315.027.00 968.012.00 90
28.118.174.00

2,868,598.10 114,928.20
2,983,524.30 $ 871.210.80
25.306.356.60 $

0.00
0.00 0.00 2,483,112.00

818,621.00 90 $

734,958.90

0.00

195,881.00 90

176,292.90

1,012,502,00

$

911,251.80

0.00

29,130,676,00

$ 26,217,808.40 $ 2,463,112.00

STAFF DEVELOPMENT PROGRAMS Cost oIlnstrudian Professional Development
Total Staff Development Programs
rJ Identlft.. Fourteen weighted Programs,
see notes to the general purpose financial statements.

93,386,00 228,326.00

93,386.00 228,326.00

321,712.00 100 $

321,712.00 $

0.00 0,00
...::0:;::.00:::,

- 36 -

SCHEDULE...,.

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 2.n6,535.50 $ 3.177.590.n

189.609.60

3.367,200.37

7.464,448.70

7,809,687,05

618.620,67

8,426,307.72

10,240,984,20

10.987.277.82

806,230.27

11,793.506.09

0.00

3,595,997,70

4.050.936.53

344,968,53

4,395.905,06

0,00

5.218.527.40

8,711.316.65

264,231.61

8.975,548,26

0.00

2,465,448.30

3,352,357,56

189,894.74

3.542,052.30

0.00

1.542.107.70

1,578,292,59

96,356.47

1,674,649.06

0.00

851.888.20

1,469,251.75

136,n4.73

1,806,026.48

0.00

23.914.733.50 $ 28.149,432.90

1.838.258.35

29,957,689.25

2,888,596,10

95,247.23 1.486,695,53 2.755,496.41
199,500.09

23,370.98

95,247,23 1.466,695.53 2.n8,867.39
199,500,09

2,888.596.10

4,516.939.26 $

23,370.98

4.540.310.24

0,00

114.928,20

380,155.93

13,192.66

393,348.59

0.00

$ 2.983.524.30 $ 4.897.095.19

36.563.64

4,933,658.83

871,210.80

1.075,014.46

121,97 $ 1,075.138.43

0.00

27,789,468.60

34,121.542.55

1.874.941.98

35.998,484.51

734,958.90

1.273,831,37

1,273,831,37

0.00

178,292.90

231,911.14

231,911.14

0.00

911,251.80

1,273,831.37 $

231.911.14

1.505,742.51

28.880,720.40 $ 35,395,373.92 $ 2,106,853.10 $ 37.502,227.02 $

0.00

93,386.00 228,326.00
$ _ ....3::;2.,:;1.,;.71::;2:;;:.00::;,

290.379.92 73,149.88

290.379.92 73,149.88

$

363.529.80 $

363,529,80 $

0,.0.0.

37

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
April 20, 1999

Honorable Roy E. Bames, Governor Members of the General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Paulding County Board ofEducation
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 Paulding County Board ofEducation as of and forthe year ended June 30, 1998, and have issued our report thereon dated April 20, 1999. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on.the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Paulding County Board of Education's financial statements are free of material misstatement, we perfonned tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the'determination offlnancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Paulding County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing' our opinion on the frnancial statements and not to provide assurance on the internal control over frnancial reporting. However, we noted a certain matter involving the internal control over financial reporting and its
98YB-40

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 of the internal control over financial reporting that, in our judgement, could adversely affect Paulding County Board of Education's ability to record, process, summarize and report financial data consistent with assertions ofmanagement in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-710l-98-0J.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing 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 noted above is considered to be a material weakness.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,

RWH:jb 98YB-40

Russell W. Hinton State Auditor

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.w.. Suite 214 Atlanta, Georgia 30334-8400
April 20, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Paulding County Board ofEducation
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-B3
Ladies and Gentlemen:
Compliance
We have audited the compliance of Paulding County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1998. Paulding 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 of Paulding County Board of Education's management. Our responsibility is to express an opinion on Paulding County Board of Education's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits ofStates. Local Governments. and Non-Profit Organizations. Those standards and OMB Circular A-B3 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Paulding County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal detennination on Paulding County Board of Education's compliance with those requirements.

98SA-IO

In our opinion, the Paulding 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 30,1998.
Internal Control Over Compliance
The management of Paulding 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 performing our audit, we considered Paulding County Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-l33.
Our consideration ofthe intemal 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 normal course of performing 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 for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,
~~ .. ct2 t.O.~
Russell W. Hinton State Auditor
RWH:jb 98SA-IO

SECTION ill AUDlTEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

PAULDING COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

7101-93-01 7101-93-03 FS-71 01-97-01

No Further Action Warranted No Further Action Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7101-97-01

The Board ofEducation ofPaulding County has determined that it is not economically feasible at this time to maintain a separate General Fixed Assets Account Group from the primary accounting
system provided by the Department ofEducation. Although the Board realizes the significant role the General Fixed Assets Account Group has on financial statements, it has decided not to take any action at this time. The Board hopes that this issue will be addressed in the future accounting system updates.

SECTIONN FINDINGS AND QUESTIONED COSTS

PAULDING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS
YEAR ENDED JUNE 30, 1998
SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the Paulding County Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Paulding County Board of Education disclosed a fmancial 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 ofthe Paulding 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 Major Programs The audit report for the Paulding County Board of Education did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Paulding County Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section .51OCa) of OMS Circular A-133 The Paulding County Board of Education's audit did not disclose audit findings required to be reported by section .510(a) of OMS Circular A-B3.
7. Major 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
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The Paulding County Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.
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PAULDING COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIQNED CQSTS
YEAR ENDED JUNE 30, 1998
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED CQSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-7IOl-98-0l The Paulding 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 of land, 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. Management's Response: We concur with this recommendation. Due to current staffing limitations and budgetary considerations prohibiting the hiring ofadditional administrative staff, the Board has decided not to pursue the recording of general fixed assets on the financial statements at this time. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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