POLK SCHOOL DISTRICT CEDARTOWN, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED
JUNE 30, 2021 (Including Independent Auditor's Reports)

Polk County School District

Table of Contents

Section I

Financial

Independent Auditor's Report

Required Supplementary Information

Management's Discussion and Analysis

i

Exhibits

Basic Financial Statements

Government-Wide Financial Statements

A

Statement of Net Position

1

B

Statement of Activities

2

Fund Financial Statements

C

Balance Sheet

Governmental Funds

3

D

Reconciliation of the Governmental Funds Balance Sheet

to the Statement of Net Position

4

E

Statement of Revenues, Expenditures and Changes in Fund

Balances

Governmental Funds

5

F

Reconciliation of the Governmental Funds Statement of

Revenues, Expenditures and Changes in Fund Balances

to the Statement of Activities

6

G

Statement of Fiduciary Net Position

Fiduciary Funds

7

H

Statement of Changes in Fiduciary Net Position

Fiduciary Funds

8

I Notes to the Basic Financial Statements

9

Schedules

Required Supplementary Information

1 Schedule of Proportionate Share of the Net Pension Liability

Teachers Retirement System of Georgia

45

2 Schedule of Contributions Teachers Retirement System of Georgia

46

3 Schedule of Proportionate Share of the Net Pension Liability

Employees' Retirement System of Georgia

47

Polk County School District Table of Contents Section I

Schedules

Required Supplementary Information

4 Schedule of Contributions Employees' Retirement System of Georgia

48

5 Schedule of Proportionate Share of the Net Pension Liability Public

School Employees Retirement System of Georgia

49

6 Schedule of Proportionate Share of the Net OPEB Liability

School OPEB Fund

50

7 Schedule of Contributions School OPEB Fund

51

8 Schedule of Changes in the Net Pension Liability and Related Ratios

Social Security Replacement Plan

52

9 Schedule of Contributions Social Security Replacement Plan

54

10 Schedule of Investment Returns Social Security Replacement Plan

55

11 Notes to the Required Supplementary Information

56

12 Schedule of Revenues, Expenditures and Changes in Fund

Balances - Budget and Actual General Fund

58

Supplementary Information

13 Schedule of Expenditures of Federal Awards

59

14 Schedule of State Revenue

61

15 Schedule of Approved Local Option Sales Tax Projects

62

Section II

Compliance and Internal Control Reports
Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards
Independent Auditor's Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance

Section III

Auditee's Response to Prior Year Findings and Questioned Costs Summary Schedule of Prior Year Findings

Polk County School District Table of Contents Section IV Findings and Questioned Costs Schedule of Findings and Questioned Costs

Section I Financial

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Dr. Katherine Thomas, Superintendent and Members of the Polk County School District
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and fiduciary activities of the Polk County School District (School District), as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the School District's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and fiduciary activities of the School District as of June 30, 2021, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated August 23, 2022 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance.
A copy of this report has been filed as a permanent record and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.
Respectfully submitted,
Greg S. Griffin State Auditor
August 23, 2022

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POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR
ENDED JUNE 30, 2021
INTRODUCTION
The intent of this discussion and analysis is to look at the Polk County School District's (School District) financial performance as a whole. The reader should review the notes to the basic financial statements and the financial statements to enhance their understanding of the School District's financial performance. The School District's financial statements for the fiscal year ended June 30, 2021 includes a series of basic financial statements that report financial information for the School District as a whole, its funds, and its fiduciary responsibilities. The Statement of Net Position and the Statement of Activities provide financial information about all of the School District's activities and present both a short-term and long-term view of the School District's finances. The fund financial statements provide information about all of the School District's funds.
FINANCIAL HIGHLIGHTS
Key financial highlights for fiscal year 2021 are as follows:
On the government-wide financial statements:
Government-wide net position at June 30, 2021 was approximately ($2.4) million. Net position reflects the difference between all non-fiduciary assets of the School District including capital assets, net of depreciation, deferred outflows and all liabilities, both short-term and long-term, and deferred inflows. The net position at June 30, 2021 of ($2.4) million represented an increase of approximately $2.1 million when compared to the prior year. This increase is due to overall decrease in liabilities and an increase in capital assets. The School District has completed constructing a fine arts building.
The School District had $95.6 million in expenses relating to governmental activities; only $64.3 million of these expenses were offset by program specific charges for services, operating and capital grants and contributions. However, the general revenues (primarily property and sales taxes) of approximately $33.5 million provided additional funding of these expenses.
As stated above, general revenues accounted for $33.5 million or about 34% of all revenues totaling approximately $97.8 million. Program specific revenues in the form of charges for services, operating and capital grants and contributions accounted for the balance of these revenues.

Source of Revenues

General Revenue- Equalization 8%
General Revenue- Sales Taxes 7%

General Revenue- All
Other 1%

General Revenue- Property Taxes 18%

Program Revenues 66%

i

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR
ENDED JUNE 30, 2021
On the fund financial statements:
Among major funds, the general fund had approximately $90.9 million in revenues and $87.8 million in expenditures. The general fund balance of approximately $27.1 million at June 30, 2021 increased by approximately $3.2 million from the prior year.
OVERVIEW OF THE FINANCIAL STATEMENTS
These financial statements consist of three parts: management's discussion and analysis (this section), the basic financial statements, including notes to the financial statements, and supplementary information. The basic financial statements include two levels of statements that present different views of the School District. These include the government-wide and fund financial statements.
The government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the School District's overall financial status.
The fund financial statements focus on individual parts of the School District, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the short-term as well as what remains for future spending. The fiduciary funds statements provide information about the financial relationships in which the School District acts solely as a trustee or agent for the benefit of others. In the case of the School District, the general fund, capital projects fund, and debt service fund are all considered to be major funds. The School District has no non-major funds as defined by GASB Statement No. 34 for purposes of this report.
The financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements.
Government-Wide Statements
Since the School District has no operations that have been classified as "Business Activities", the government-wide financial statements are basically a consolidation of the entire School District's operating funds into one column called governmental activities. In reviewing the government-wide financial statements, a reader might ask the question, are we in a better financial position now than last year? The Statement of Net Position and the Statement of Activities provides the basis for answering this question. These financial statements include all School District's non-fiduciary assets, deferred outflows, liabilities, and deferred inflows which uses the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into accounts all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the School District's net position and any changes in net position. The change in net position is important because it tells the reader that, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the results of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs, student-teacher ratios, and other factors.
ii

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021
When analyzing government-wide financial statements, it is important to remember these statements are prepared using an economic resources measurement focus (accrual accounting) and involve the following steps to format the Statement of Net Position:
Capitalize current outlays for capital assets Depreciate capital assets Report long-term debt as a liability Calculate revenue and expense using the economic resources measurement focus and the
accrual basis of accounting Allocate net position as follows:
o Net Investment in Capital Assets o Restricted net position is that with constraints placed on the use by external sources
such as creditors, grantors, contributors or laws and regulations. o Unrestricted net position is net position that does not meet any of the above
restrictions.
Fund Financial Statements
The School District uses many funds or sub-funds to account for a multitude of financial transactions during the fiscal year. The fund financial statements presented in this report provide detail information about the School District's significant or major funds. As discussed previously, the School District has no non-major funds as defined by generally accepted accounting principles.
The School District has two kinds of funds as discussed below:
Governmental Funds Most of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the modified accrual method of accounting which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The differences between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements.
Fiduciary Funds The School District is the trustee, or fiduciary, for assets that belong to clubs, organizations and others within the principals' accounts as well as an employer sponsored pension plan. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations.
FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE
Net position, which is the difference between total assets, deferred outflows of resources, total liabilities and deferred inflows of resources, is one indicator of the financial condition of the School District. When revenues exceed expenses, the result is an increase in net position. When expenses exceed revenues, the result is a decrease in net position. The relationship between revenues and expenses can be thought of as the School District's operating results. The School District's net position, as measured in the Statement of Net Position, can be one way to measure the School District's financial health, or financial position. Over time, increases or decreases in the School District's net position as measured in the Statement of Activities
iii

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021 are one indicator of whether its financial health is improving or deteriorating. However, the School District's goal and mission is to provide success for each child's education, not to generate profits as private corporations do. For this reason, many other non-financial factors should be considered in assessing the overall health of the School District. The School District had approximately $87.9 million (net of related debt) invested in capital assets (e.g., land, buildings, and equipment). The School District uses these capital assets to provide educational services to students within geographic boundaries served by the School District. Because of the very nature and on-going use of the assets being reported in this component of net position, it must be recognized that this portion of the net position is not available for future spending. The deficit balance of unrestricted net position of approximately $103.0 million reflects the net pension liability adjustments as required by GASB Statement No. 68 and GASB Statement No. 71 and the OPEB liability adjustments as required by GASB Statement No. 75.
iv

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021

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

Table 1 Net Position

Governmental Activities

Fiscal Year

Fiscal Year

2021

2020

Assets Current and Other Assets Capital Assets, Net

$ 48,014,370 $ 45,291,514

104,333,621

103,458,205

Total Assets

152,347,991

148,749,719

Deferred Outflows of Resources Related Defined Benefits Pension Plans Related OPEB Plan

23,954,465 11,673,846

20,525,982 3,110,566

Total Deferred Outflows

35,628,311

23,636,548

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

11,120,899 22,083,856 83,796,704 58,031,576

11,158,005 25,385,817 73,471,420 48,079,689

Total Liabilities

175,033,035

158,094,931

Deferred Inflows of Resources Related Defined Benefits Pension Plans Related OPEB Plan

2,248,386 13,079,497

4,758,965 14,063,641

Total Deferred Inflows

15,327,883

18,822,606

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

87,925,017 12,676,924 (102,986,557)

84,470,128 10,045,718 (99,047,116)

Total Net Position

$

(2,384,616) $

(4,531,270)

v

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021

Total net position increased by approximately $2.1 million in fiscal year 2021 from the prior year. This change in net position is detailed in Table 2 below. Table 2 also shows the change in net position as compared to the prior fiscal year.

Table 2 Change in Net Position
Revenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions
Total Program Revenues
General Revenues: Taxes Property Taxes For Maintenance and Operations Other Taxes Sales Taxes Special Purpose Local Option Sales Tax - Other Taxes For Debt Services Other Sales Tax Grant and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Special Item Donation - Land Donation - Paving Labor and Equipment Cost

Governmental Activities

Fiscal Year

Fiscal Year

2021

2020

$ 1,776,872 $ 61,405,531 1,095,530

2,150,761 58,772,928
1,249,268

64,277,933

62,172,957

17,338,022 60,718

17,044,897 64,504

6,375,615 339,373
7,851,861 78,609
1,432,807
38,070

6,220,591 258,512
7,954,400 330,691
1,044,866
50,000 -

Total General Revenues and Special Item
Total Revenues and Special Item
Program Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Food Services Interest on Long-Term Debt
Total Expenses
Increase in Net Position

33,515,075 97,793,008

32,968,461 95,141,418

65,694,333

58,544,312

3,931,760 1,480,517 1,319,190 1,200,815 5,020,228 1,090,677 7,101,774 3,009,554
205,646 103,096

3,729,124 1,313,844 1,246,683 1,031,230 4,679,716
902,985 7,312,839 3,337,804
206,623 65,796

94,606 4,981,987
412,171

40,935 4,657,480
541,976

95,646,354

87,611,347

$ 2,146,654 $ 7,530,071

vi

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021

Cost of Providing Services

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

Table 3 Governmental Activities

Total Cost of Services

Fiscal Year

Fiscal Year

2021

2020

Net Cost of Services

Fiscal Year

Fiscal Year

2021

2020

Instruction Support Services
Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services: Enterprise Operations Food Services Interest on Long-Term Debt

$ 65,694,333 $ 58,544,312 $ 21,010,077 $ 14,351,323

3,931,760 1,480,517 1,319,190 1,200,815 5,020,228 1,090,677 7,101,774 3,009,554
205,646 103,096

3,729,124 1,313,844 1,246,683 1,031,230 4,679,716
902,985 7,312,839 3,337,804
206,623 65,796

982,611 726,044 231,246 (147,139) 2,551,718 1,073,546 4,509,759 1,311,161 202,755
47,228

1,174,923 758,471 79,482 (812,358)
2,251,170 892,711
4,363,598 2,070,384
204,447 61,181

94,606 4,981,987
412,171

40,935 4,657,480
541,976

94,516 (1,637,272)
412,171

40,935 (539,853) 541,976

Total Expenses

$ 95,646,354 $ 87,611,347 $ 31,368,421 $ 25,438,390

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS
Information about the School District's governmental funds is presented starting on Exhibit "C" of this report. Governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues and other financing sources of $102.2 million and total expenditures and other financing uses of $98.8 million in fiscal year 2021. Total governmental fund balances of approximately $36.2 million at June 30, 2021, increased approximately $3.5 million from the prior year.
General Fund Budget Highlights
The School District's budget is prepared according to Georgia Law. The most significant budgeted fund is the general fund. During the course of fiscal year 2021, the School District amended its general fund budget as needed.
The School District budget is adopted at the aggregate level and maintained at the program, function, object, and site levels to facilitate budgetary control. The budgeting systems are designed to control the total budget but provide flexibility to meet the ongoing programmatic needs. The budgeting systems are also designed to control total site budgets but provide flexibility for site management as well.
vii

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021

For the general fund, the final actual revenues of $90.9 million were less than the final budgeted amount of $96.0 million by $5.1 million. This can be attributed to receiving less federal funds than originally expected.

The general fund's final actual expenditures of $87.7 million were less than the final budget amount of $112.7 million by approximately $25.0 million. The School District believes it effectively managed its budget during the fiscal year.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

At fiscal year ended June 30, 2021, the School District had $104.3 million invested in capital assets, net of accumulated depreciation, all in governmental activities. These assets are made up of a broad range of items including buildings and improvement, land, land improvements, food service, transportation and maintenance equipment. Table 4 reflects a summary of these balances, net of accumulated depreciation, as compared to the prior fiscal year.

Table 4 Capital Assets (Net of Depreciation)

Governmental Activities

Fiscal Year

Fiscal Year

2021

2020

Land Construction in Progress Building and Improvements Equipment Land Improvements

$ 2,384,621 $ 2,384,621

1,505,066

9,937,408

96,988,939

88,278,133

1,776,631

1,496,818

1,678,364

1,361,225

Total

$ 104,333,621 $ 103,458,205

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

Debt Administration

At June 30, 2021, the School District had $20.1 million in bonds outstanding with $3.4 million due within one year and $337 thousand in capital leases with $165 thousand due within one year.

Table 5 Debt at June 30

Governmental Activities

Fiscal Year

Fiscal Year

2021

2020

Bond Debt Capital Leases

$ 20,050,000 $ 22,655,000

336,607

495,868

Total

$ 20,386,607 $ 23,150,868

viii

POLK COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2021 Net Pension and OPEB Liabilities
At June 30, 2021, the School District reported liabilities for its proportionate share of the net pension and OPEB liabilities. Reporting these liabilities were required by GASB Statement No. 68, GASB Statement No. 71 and GASB Statement No. 75.
FACTORS BEARING ON THE SCHOOL DISTRICT'S FUTURE Currently known circumstances that are expected to have a significant effect on financial position or results of operations in future years are as follows:
The School District is financially stable. The School District's operating millage for 2020 was 15.664. It was rolled back in 2021 to 14.139.
The general fund had a fund balance as of June 30, 2021, of $27.1 million which is up $3.2 million from prior year.
The School District is scheduled to receive a $3,532,516 increase of state revenue for fiscal year 2022. The general fund is healthy enough to offset the payroll step increases.
During the COVID-19 pandemic, the School District received CARES and ESSER monies to help with extra expenditures, staff retention, and new positions needed.
The School District will continue to renovate the existing facilities to accommodate student growth as needed. The School District plans to fund additional capital outlays with the one percent local sales tax revenue, general obligation bonds, and state capital outlay grants. A fine arts building has been constructed at Cedartown High School. roofing, paving, and HVAC improvements have been made. Technology upgrades will continue to be made. Also, additions and modifications will be done as needed.
CONTACTING THE SCHOOL DISTRICT'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Mrs. Tammy McDonald, Executive Finance Director, Polk County School District, 612 South College Street, Cedartown, Georgia 30125. You may also email your questions to Mrs. McDonald at tammy@polk.k12.ga.us.
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Polk County School District

POLK COUNTY SCHOOL DISTRICT STATEMENT OF NET POSITION JUNE 30, 2021
ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories Restricted Assets Investments with Fiscal Agent or Trustee Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES Related to Defined Benefit Pension Plans Related to OPEB Plan
Total Deferred Outflows of Resources
LIABILITIES Accounts Payable Salaries and Benefits Payable Interest Payable Contracts Payable Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities
Due Within One Year Due in More Than One Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES Related to Defined Benefit Pension Plans Related to OPEB Plan
Total Deferred Inflows of Resources
NET POSITION Net Investment in Capital Assets Restricted for
Continuation of Federal Programs Debt Service Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

34,909,118.24

10,000.00

2,455,287.26 6,745,682.19 1,675,267.69
170,048.40 134,761.59

1,914,205.21 3,889,686.73 100,443,934.05 152,347,991.36

23,954,464.99 11,673,846.00 35,628,310.99

861,887.32 9,579,706.03
277,750.00 370,501.84
31,053.97 83,796,704.00 58,031,576.00
3,898,510.92 18,185,345.44 175,033,035.52

2,248,386.00 13,079,497.00 15,327,883.00

87,925,017.04

4,478,881.80 5,061,498.94 3,136,542.71 (102,986,556.66)

$

(2,384,616.17)

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

- 1 -

POLK COUNTY SCHOOL DISTRICT STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2021

EXHIBIT "B"

EXPENSES

CHARGES FOR SERVICES

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

GOVERNMENTAL ACTIVITIES

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

Educational Media Services

General Administration

School Administration

Business Administration

Maintenance and Operation of Plant

Student Transportation Services

Central Support Services

Other Support Services

Operations of Non-Instructional Services

Enterprise Operations

Food Services

Interest on Long-Term Debt

65,694,333.22 $
3,931,760.02 1,480,516.73 1,319,190.07 1,200,815.04 5,020,228.47 1,090,676.42 7,101,773.95 3,009,553.89 205,645.86
103,096.35
94,605.78 4,981,987.02
412,171.20

107,197.64 $ 44,029,495.87 $

1,496,961.21 -
7,474.57 -
140,068.17 -
8,737.95 834.58 -
2,877.35

1,452,188.10 754,472.53 1,080,469.47 1,347,953.77 2,328,442.79
17,130.81 2,583,277.13 1,157,018.27
2,890.61 52,991.35

89.22 12,631.85
-

6,599,199.96
-

547,562.90 $ (21,010,076.81)

540,540.00 -

(982,610.71) (726,044.20) (231,246.03)
147,138.73 (2,551,717.51) (1,073,545.61) (4,509,758.87) (1,311,161.04) (202,755.25)
(47,227.65)

7,427.17
-

(94,516.56) 1,637,271.96
(412,171.20)

Total Governmental Activities

$ 95,646,354.02 $ 1,776,872.54 $ 61,405,530.66 $ 1,095,530.07

(31,368,420.75)

General Revenues Taxes Property Taxes For Maintenance and Operations Other Taxes Sales Taxes Special Purpose Local Option Sales Tax For Debt Services Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Special Item Donation - Paving Labor and Equipment Cost Total General Revenues and Special Item

17,338,022.21 60,717.80
6,375,615.03 339,372.83
7,851,861.00 78,608.94
1,432,806.88
38,070.00 33,515,074.69

Change in Net Position

2,146,653.94

Net Position - Beginning of Year

(4,531,270.11)

Net Position - End of Year

$

(2,384,616.17)

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

- 2 -

ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories Restricted Investments with a Fiscal Agent or Trustee
Total Assets
LIABILITIES Accounts Payable Salaries and Benefits Payable Contracts Payable Retainages Payable
Total Liabilities
DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Property Taxes
FUND BALANCES Nonspendable Restricted Assigned Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of Resources, and Fund Balances

POLK COUNTY SCHOOL DISTRICT BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2021

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

EXHIBIT "C" TOTAL

$

28,481,407.24 $

10,000.00

1,853,783.02 6,190,692.12 1,675,267.69
170,048.40 134,761.59

-

$

38,515,960.06 $

3,604,171.51 $ -
554,990.07
-
-
4,159,161.58 $

2,823,539.49 $ -

34,909,118.24 10,000.00

601,504.24 -

2,455,287.26 6,745,682.19 1,675,267.69
170,048.40 134,761.59

1,914,205.21

1,914,205.21

5,339,248.94 $ 48,014,370.58

$

861,887.32 $

9,579,706.03

-

-

10,441,593.35

- $ 370,501.84 31,053.97 401,555.81

- $ -

861,887.32 9,579,706.03
370,501.84 31,053.97
10,843,149.16

974,298.05

-

-

974,298.05

134,761.59 4,344,120.21 1,000,593.45 21,620,593.41 27,100,068.66

3,757,605.77
3,757,605.77

5,339,248.94
5,339,248.94

134,761.59 13,440,974.92 1,000,593.45 21,620,593.41 36,196,923.37

$

38,515,960.06 $

4,159,161.58 $

5,339,248.94 $ 48,014,370.58

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

-3-

POLK COUNTY SCHOOL DISTRICT RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2021

EXHIBIT "D"

Total fund balances - governmental funds (Exhibit "C")
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. Land Construction in progress Buildings and improvements Equipment Land improvements Accumulated depreciation
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds. Net pension liability Net OPEB liability
Deferred outflows and inflows of resources related to pensions/OPEB are applicable to future periods and, therefore, are not reported in the funds. Related to pensions Related to OPEB
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Long-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds. Bonds payable Accrued interest payable Capital lease payable Compensated absences payable Unamortized bond premiums
Net position of governmental activities (Exhibit "A")

$

36,196,923.37

$

2,384,621.10

1,505,065.63

130,749,478.75

6,566,238.42

3,192,036.65

(40,063,819.77)

104,333,620.78

$

(83,796,704.00)

(58,031,576.00)

(141,828,280.00)

$

21,706,078.99

(1,405,651.00)

20,300,427.99 974,298.05

$

(20,050,000.00)

(277,750.00)

(336,607.33)

(258,535.68)

(1,438,713.35)

$

(22,361,606.36) (2,384,616.17)

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

- 4 -

POLK COUNTY SCHOOL DISTRICT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2021

EXHIBIT "E"

REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues
EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Food Services Operation Capital Outlay Debt Services Principal Dues and Fees Interest Total Expenditures
Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES) Transfers In Transfers Out Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

17,564,256.45 $

339,372.83

54,644,802.51

15,235,151.17

1,776,872.54

4,194.33

1,329,929.00

90,894,578.83

- $ 554,990.07 1,921.14 102,877.88 659,789.09

- $ 6,939,114.77
72,493.47 7,011,608.24

17,564,256.45 7,278,487.60 55,199,792.58 15,235,151.17 1,776,872.54
78,608.94 1,432,806.88 98,565,976.16

58,328,875.72
3,885,922.58 1,400,131.26 1,232,392.87 1,180,624.02 4,671,353.83 1,051,991.00 7,157,577.89 3,517,252.99 178,691.07 102,343.19 94,605.78 4,918,325.88 -
87,720,088.08 3,174,490.75

41,760.00
3,521.00 -
435,365.36 -
3,157,950.47
159,260.89 1,075.00 18,539.11
3,817,471.83 (3,157,682.74)

-
3,500.00 -
2,605,000.00 -
963,500.00 3,572,000.00 3,439,608.24

58,370,635.72
3,889,443.58 1,400,131.26 1,232,392.87 1,184,124.02 4,671,353.83 1,051,991.00 7,592,943.25 3,517,252.99 178,691.07 102,343.19 94,605.78 4,918,325.88 3,157,950.47
2,764,260.89 1,075.00
982,039.11 95,109,559.91 3,456,416.25

-

3,174,490.75

23,925,577.91

$

27,100,068.66 $

3,670,156.33 -
3,670,156.33
512,473.59
3,245,132.18
3,757,605.77 $

(3,670,156.33) (3,670,156.33)
(230,548.09)
5,569,797.03
5,339,248.94 $

3,670,156.33 (3,670,156.33)
-
3,456,416.25
32,740,507.12
36,196,923.37

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

- 5 -

POLK COUNTY SCHOOL DISTRICT RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2021

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. Capital outlay Depreciation expense
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. Property taxes SPLOST taxes
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. Bond principal retirements Capital lease payments Amortization of bond premium
District pension/OPEB contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEB, is reported in the Statement of Activities. Pension expense OPEB expense
Some items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Accrued interest on issuance of bonds Compensated absences
Change in net position of governmental activities (Exhibit "B")

$

3,456,416.25

$

3,779,662.32

(2,904,246.64)

875,415.68

$

(165,516.44)

(563,499.74)

(729,016.18)

$

2,605,000.00

159,260.89

538,380.41

3,302,641.30

$

(4,386,222.10)

(404,463.00)

(4,790,685.10)

$

32,562.50

(680.51)

31,881.99

$

2,146,653.94

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

- 6 -

ASSETS Cash and Cash Equivalents Investments
Total Assets
LIABILITIES Due To Broker
NET POSITION Employee's Pension Benefits Held in Trust for Private Purposes

POLK COUNTY SCHOOL DISTRICT STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS JUNE 30, 2021

EXHIBIT "G"

PRIVATE PURPOSE TRUSTS

PENSION TRUST FUND December 31, 2020

$

9,699.72 $

4,877.83

-

4,944,361.11

$

9,699.72 $

4,949,238.94

$

3,373.94

4,945,865.00

$

9,699.72

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

-7-

POLK COUNTY SCHOOL DISTRICT STATEMENT OF CHANGES IN FIDCUCIARY NET POSITION
FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2021

EXHIBIT "H"

ADDITIONS Contributions Employer Contributions Investment Earnings Net Increase in Fair Value of Investments Total Additions
DEDUCTIONS Administrative Expenses Benefits Paid to Participants Other Deductions Total Deductions
Change in Net Position
Net Position - Beginning
Net Position - Ending

PRIVATE PURPOSE TRUSTS

PENSION TRUST FUND December 31, 2020

$

- $

354,642.94

-

485,410.06

-

840,053.00

97.00 97.00

9,949.00 375,690.00
385,639.00

(97.00)

454,414.00

9,796.72

4,491,451.00

$

9,699.72 $

4,945,865.00

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

-8-

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
Reporting Entity
The Polk County School District (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
Basis of Presentation
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
Government-Wide Statements:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Net Position presents the School District's non-fiduciary assets, deferred outflows of resources, deferred inflows of resources and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
- 9 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), bond proceeds and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general longterm principal and interest.
The School District reports the following fiduciary fund types:
Private purpose trust funds are used to report all trust arrangements, other than those properly reported elsewhere, in which principal and income benefit individuals, private organizations or other governments.
Pension trust fund accounts for the activities of Polk County School District Social Security Replacement Plan, a single employer defined benefit pension plan for the group of employees covered by the Public School Employees Retirement Systems (PSERS).
Basis of Accounting
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are

- 10 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers certain revenues reported in the governmental funds to be available if they are collected within 60 days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources.
The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted resources available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
New Accounting Pronouncements
In fiscal year 2021, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 90, Majority Equity Interests. It defines a majority equity interest and specifies that majority equity interest in a legal separate organization should be reported as an investment. A majority equity interest that meets the definition of an investment should be measured using the equity method, unless it is held by a special-purpose government engaged only in fiduciary activities, a fiduciary fund, or an endowment (including permanent and term endowments) or permanent fund. Those governments and funds should measure the majority equity interest at fair value. The adoption of this statement did not have an impact on the School District's financial statements.
Fiscal Year End
All funds are reported using fiscal years which end on June 30, except defined benefit pension plan (fiduciary fund), which has a fiscal year ending December 31.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
- 11 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Investments
The School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity.
Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value.
For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.
Receivables
Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
Inventories
Food Inventories
On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the first-in, first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.
Restricted Assets
Certain resources set aside for repayment of debt are classified as restricted assets on the Statement of Net Position because their use is limited by applicable debt statutes, e.g. Qualified Zone Academy Bond sinking funds.
Capital Assets
On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art.
Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements.
- 12 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.
Capitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land Land Improvements Buildings and Improvements Equipment Intangible Assets

All $ 50,000.00 $ 50,000.00 $ 50,000.00 $ 50,000.00

N/A 20 to 60 years 25 to 60 years
5 to 50 years 10 to 20 years

Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time.
Compensated Absences
Compensated absences payable consists of vacation leave employees earned based on services already rendered.
Vacation leave of 10 days is awarded annually to all full-time personnel employed on a twelve-month basis with less than 15 years of experience and 15 days annually to all full-time personnel employed on a twelve-month basis with between 15 and 40 years of experience. Twelve-month employees with 40 or more years of services to the School District are eligible for 5 additional vacation days annually. No other employees are eligible to earn vacation leave.
For twelve-month employees with 15 or more years of experience, all unused vacation days may be carried forward into the next employment year up to and including June 30. This is a maximum of 15 days earned from previous year. Upon expiration of this limit, a maximum of 5 unused vacation days may be carried forward. Therefore, this employee could have a maximum of 20 days of acquired vacation at the start of a new fiscal year.
For twelve-month employees with less than 15 years of experience, all unused vacation days may be carried forward into the next employment year up to and including June 30. This is a maximum of 10 days earned from previous year. Upon expiration of this limit, a maximum of 5 unused vacation days may be carried forward. Therefore, this employee could have a maximum of 15 days of acquired vacation at the start of a new fiscal year.

- 13 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Upon terminating employment, the School District pays all unused and unforfeited vacation benefits to employees. Accordingly, vacation benefits are accrued as a liability in the government-wide financial statements. A liability for these amounts is reported in the governmental fund financial statements only if they have matured, for example, as a result of employee resignations and retirements by fiscal-year end.
Members of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement. The liability for early retirement will be borne by TRS rather than by the individual School Districts. Otherwise, sick leave does not vest with the employee, and no liability is reported in the School District's financial statements.
Long-Term Liabilities and Bond Discounts/Premiums
In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straightline method. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.
In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures.
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Post-Employment Benefits Other Than Pensions (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Post-Employment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Fund Balances
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.

- 14 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

The School District's fund balances are classified as follows:

Nonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.

Restricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

Assigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

Property Taxes

The Polk County Board of Commissioners adopted the property tax levy for the 2020 tax digest year (calendar year) on August 28, 2020 (levy date) based on property values as of January 1, 2020. Taxes were due on December 1, 2020 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2020 tax digest are reported as revenue in the governmental funds for fiscal year 2021. The Polk County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2021, for maintenance and operations amounted to $15,883,508.47.
The tax millage rate levied for the 2020 tax digest year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

14.139 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $1,620,030.18 during fiscal year ended June 30, 2021.

- 15 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Sales Taxes
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $6,939,114.77 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.
NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds, except the various school activity (principal) accounts, is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate function level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America.
The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS, CASH EQUIVALENTS AND INVESTMENTS
Collateralization of Deposits
O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

- 16 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
Categorization of Deposits
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2021, School District had deposits with a carrying amount of $30,401,036.83, and a bank balance of $34,393,085.81. The bank balances insured by Federal depository insurance were $1,102,037.10.
At June 30, 2021, $33,291,048.71 of the School District's bank balances was in the State's Secure Deposit Program (SDP).
The School District participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased in the amount of up to 125% if economic or financial conditions warrants. The program lists the types of eligible criteria. The OST approves authorized custodians.
In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.

- 17 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Reconciliation of cash and cash equivalents balances to carrying value of deposits:

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

$ 34,909,118.24 14,577.55

Total cash and cash equivalents

34,923,695.79

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

10,000.00

Less: Investment pools reported as cash and cash equivalents Georgia Fund 1

4,532,658.96

Total carrying value of deposits - June 30, 2021

$ 30,401,036.83

Categorization of Cash Equivalents
The School District reported cash equivalents of $4,532,658.96 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2021 was 36 days.
Georgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Annual Comprehensive Financial Report, which is publicly available at https://sao.georgia.gov/statewide-reporting/acfr.

- 18 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Categorization of Investments

At June 30, 2021, the School District had the following investments:

Investment Type

Fair Value

Investment Maturity Less Than 1 Year

Debt Securities U. S. Treasuries U. S. Agencies Implicitly Guaranteed

$

1,453.90 $

1,912,751.31

1,453.90 1,912,751.31

Other Investments

Mutual Bond Funds

1,893,090.32

-

Mutual Equity Funds

2,927,495.59

-

Mutual Money Market Funds

123,775.20

-

Total Investments

$ 6,858,566.32 $

1,914,205.21

Fair Value of Investments
The School District measures and records its investments using fair value measurement guidelines established by generally accepted accounting principles. These guidelines recognize a three-tiered fair value hierarchy, as follows:
Level 1: Quoted prices for identical investments in active markets; Level 2: Observable inputs other than quoted market prices; and, Level 3: Unobservable inputs. At June 30, the School District had the following investments by fair value level:

Investments by fair value level:

Fair Value

Level 1

Level 2

Debt Securities U. S. Treasuries U. S. Agencies Implicitly Guaranteed Mutual Bond Funds Mutual Equity Funds - Domestic Mutual Equity Funds - International Mutual Money Market Funds
Total investments by fair value level

$

1,453.90 $

- $

1,453.90

1,912,751.31 1,893,090.32 2,655,065.72
272,429.87 123,775.20

2,655,065.72 272,429.87 123,775.20

1,912,751.31 1,893,090.32
-

$ 6,858,566.32 $ 3,051,270.79 $ 3,807,295.53

- 19 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Interest Rate Risk

Interest rate risk is the risk that changes in interest rates of debt investment will adversely affect the fair value of an investment. The School District does not have a formal policy for managing interest rate risk.

Custodial Credit Risk

Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, the School District will not be able to recover the value of the investment or collateral securities that are in the possession of an outside party. The School District does not have a formal policy for managing custodial credit risk.
At June 30, 2021, $4,820,585.91 of the School District's applicable investments were held by the investment's counterparty, not in the School District's name.

Credit Quality Risk

Credit quality risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. State law limits investments to those prescribed O.C.G.A. 36-83-4. The School District does not have a formal policy that would further limit its investment choices or one that addresses credit risk.
The investments subject to credit quality risk are reflected below:

Rated Debt Investments

Fair Value

Quality Ratings

AAA

Unrated

Debt Securities U. S. Treasuries U. S. Agencies Implicitly Guaranteed Mutual Bond Funds Mutual Money Market Funds

$

1,453.90 $

1,453.90 $

-

1,912,751.31 1,893,090.32
123,775.20

1,912,751.31 -

1,893,090.32
123,775.20

Totals by Quality Ratings

$ 3,931,070.73 $ 1,914,205.21 $ 2,016,865.52

Concentration of Credit Risk
Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in a single issuer. The School District does not have a formal policy for managing concentration of credit risk. More than 5% of the School District's investments are in Mutual Equity Funds, Mutual Bond Funds, and U.S. Agencies Implicitly Guaranteed. These investments are 43%, 28%, and 28% respectively of the School District's total investments.
NOTE 5: RESTRICTED ASSETS
The restricted assets represent the cash and investment balance of $1,914,205.21, for the QZAB Bond Sinking Fund.

- 20 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

NOTE 6: CAPITAL ASSETS

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

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

Balances July 1, 2020

Increases Decreases Transfers

Balances June 30, 2021

$ 2,384,621.10 $

- $

9,937,407.94 2,694,295.24

- $

- $

-

(11,126,637.55)

2,384,621.10 1,505,065.63

Total Capital Assets Not Being Depreciated

12,322,029.04 2,694,295.24

-

(11,126,637.55)

3,889,686.73

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements

119,499,397.72 5,991,468.42 2,804,883.05

348,443.48 574,770.00 162,153.60

Less Accumulated Depreciation: Buildings and Improvements Equipment Land Improvements

31,221,264.23 4,494,650.80 1,443,658.10

2,539,275.53 294,956.66 70,014.45

Total Capital Assets, Being Depreciated, Net

91,136,176.06 (1,818,879.56)

Governmental Activities Capital Assets - Net

$ 103,458,205.10 $ 875,415.68 $

-

10,901,637.55 130,749,478.75

-

-

6,566,238.42

-

225,000.00

3,192,036.65

-

-

33,760,539.76

-

-

4,789,607.46

-

-

1,513,672.55

-

11,126,637.55 100,443,934.05

- $

- $ 104,333,620.78

Current year depreciation expense by function is as follows:
Instruction Support Services
Student Transportation Services Food Services

$ 2,591,599.39
273,781.10 38,866.15

$ 2,904,246.64

- 21 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

NOTE 7: INTERFUND TRANSFERS

Interfund transfers for the year ended June 30, 2021, consisted of the following:

Transfers to

Transfers From Debt Service
Fund

Capital Projects Fund

$ 3,670,156.33

Transfers are used to move Special Purpose Local Option Sales Tax (SPLOST) revenues collected by the debt service fund to the capital projects fund for the payment of cost associated with construction projects approved by the Special Purpose Local Option Sales Tax (SPLOST) referendum.

NOTE 8: LONG-TERM LIABILITIES

The changes in long-term liabilities during the fiscal year for governmental activities were as follows:

Balance July 1, 2020

Governmental Activities

Balance

Additions

Deductions

June 30, 2021

Due Within One Year

General Obligation (G.O.) Bonds $ 20,655,000.00 $ Qualified Zone Academy Bonds 2,000,000.00

- $ 2,605,000.00 $ 18,050,000.00 $ 3,425,000.00

-

-

2,000,000.00

-

UnamTotratilzeBdonBdonDdebDtiscount

22,655,000-.00

-

2,605,000-.00 20,050,000-.00 3,425,000-.00

Capital Leases Compensated Absences (1) Unamortized Bond Premiums

495,868.22 257,855.17 1,977,093.76

56,433.98
-

159,260.89 55,753.47 538,380.41

336,607.33 258,535.68 1,438,713.35

165,215.20 -
308,295.72

$ 25,385,817.15 $ 56,433.98 $ 3,358,394.77 $ 22,083,856.36 $ 3,898,510.92

(1) The portion of compensated absences due within one year has been determined to be immaterial to the basic financial statements.
General Obligation Debt Outstanding
The School District's bonded debt consists of general obligation bonds that are generally noncallable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.
The School District's outstanding general obligation bonds related to governmental activities of $18,050,000.00 contain a provision that in the event of a nonpayment, the State Board is authorized to and must withhold from any state appropriations to which the School District may be entitled and apply so much thereof as shall be necessary to the payment of the principal of and interest on such indebtedness then due.

- 22 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

General obligation bonds currently outstanding are as follows:

Description

Interest Rates

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

General Government - Series 2018 4.00% - 5.00% 3/1/2018 3/1/2026 $ 18,050,000.00 $ 18,050,000.00

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

Fiscal Year Ended June 30:

General Obligation Debt

Principal

Interest

Unamortized Bond Premium

2022 2023 2024 2025 20237 - 202340126

$ 3,425,000.00 $ 833,250.00

3,500,000.00

696,250.00

3,600,000.00

556,250.00

3,700,000.00

376,250.00

3,825,000-.00

191,250-.00

Total Principal and Interest $ 18,050,000.00 $ 2,653,250.00

$ 308,295.72 308,295.72 308,295.72 308,295.72 205,530-.47
$ 1,438,713.35

Qualified Zone Academy Bonds (QZAB)

Section 226 of the Taxpayer Relief Act of 1997 (Public Law 105-34) provides for a source of capital at no or at nominal interest rates for costs incurred by School Districts in connection with the establishment of special academic programs, in partnership with the business community. The School District, in agreement with Regions Bank, has entered into such an arrangement.
This agreement establishes a method of repayment for the qualified interest-free debt instrument. The agreement requires the School District to deposit funds annually into a sinking fund account on or before June 30, 2021. The amount on deposit at June 30, 2021 was $1,914,205.21.
In the event the amount of funds lawfully available is not sufficient to pay the QZAB payments when due in any year, the School District shall levy an ad valorem tax on all taxable property located within the boundaries of the School District subject to taxation for such purposes, at such rate or rates (subject to the 20 Mills Limitation) as may be necessary to produce in each calendar year revenues which shall be sufficient to fulfill the School District's obligations.
Debt currently outstanding under Qualified Zone Academy Bonds is as follows:

Description General Government - QZAB - Series 2006

Interest Rate
0.00%

Issue Date 12/5/2006

Maturity Date

Amount Issued

Amount Outstanding

12/15/2022 $ 2,000,000.00 $ 2,000,000.00

The following schedule reports the annual Qualified Zone Academy Bond payments:

Fiscal Year Ended June 30:

Principal

2023

$ 2,000,000.00

- 23 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Capital Leases

The School District has acquired school buses under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term.
Capital leases currently outstanding are as follows:

Purpose

Interest Rate

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

SDcehsocroipl btounses

3.74%

10/26/2018 10/5/2022 $

827,733-.00 $ 336,607-.33

The following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end:

Governmental Activities

Equipment

$

Less: Accumulated Depreciation

827,733.00 206,933.25

$

620,799.75

The following is a schedule of total capital lease payments:
Fiscal Year Ended June 30:

Principal

2022 2023
Total Principal and Interest

$ 165,215.20 $ 171,392.13
$ 336,607.33 $

Compensated Absences
Compensated absences represent obligations of the School District 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. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences.
NOTE 9: RISK MANAGEMENT
Insurance
Commercial Insurance
The School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; and natural disasters. The School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceed commercial insurance coverage in any of the past three fiscal years.
- 24 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Unemployment Compensation

The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District had no unemployment claims liability during the past two years.

Surety Bond

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

Position Covered

Amount

Superintendent

$

100,000.00

NOTE 10: FUND BALANCE CLASSIFICATION DETAILS

The School District's financial statements include the following amounts presented in the aggregate at June 30, 2021:

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

$
4,344,120.21 3,757,605.77 5,339,248.94

134,761.59
13,440,974.92 1,000,593.45 21,620,593.41

Fund Balance, June 30, 2021

$ 36,196,923.37

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

- 25 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

NOTE 11: SIGNIFICANT COMMITMENTS

Commitments Under Construction Contracts

The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2021.

Project

Unearned Executed Contracts (1)

Payments through June 30, 2021 (2)

Cedartown High School Parking Lot

$

Eastside Elementary School Roof

Eastside Elementary School HVAC

Northside Elementary School Modular

324,283.45 $ 380,734.40 362,309.75
68,456.25

465,716.55 14,715.60
156,190.25 426,958.80

$

1,135,783.85 $ 1,063,581.20

(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts and retainages payable at year end.
NOTE 12: SIGNIFICANT CONTINGENT LIABILITIES
Federal Grants
Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
Litigation
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District.
NOTE 13: OTHER POST-EMPLOYMENT BENEFITS (OPEB)
Georgia School Personnel Post-Employment Health Benefit Fund
Plan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit post-employment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.

- 26 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Benefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.
Contributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $1,509,114.00 for the year ended June 30, 2021. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2021, the School District reported a liability of $58,031,576.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2020. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2019. An expected total OPEB liability as of June 30, 2020 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2020. At June 30, 2020, the School District's proportion was 0.395104%, which was an increase of 0.003325% from its proportion measured as of June 30, 2019.

- 27 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

For the year ended June 30, 2021, the School District recognized OPEB expense of $1,913,577.00. At June 30, 2021, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

OPEB

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

Differences between expected and actual experience
Changes of assumptions
Net difference between projected and actual earnings on OPEB plan investments
Changes in proportion and differences between School District contributions and proportionate share of contributions

$

- $ 6,335,246.00

9,597,134.00

5,163,562.00

151,252.00

-

416,346.00

1,580,689.00

School District contributions subsequent to the

measurement date

1,509,114.00

-

Total

$ 11,673,846.00 $ 13,079,497.00

School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2022 2023 2024 2025 2026 Thereafter

$ (1,544,979.00) $ (1,549,039.00) $ (1,133,461.00) $ (10,339.00) $ 950,708.00 $ 372,345.00

- 28 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Actuarial Assumptions: The total OPEB liability as of June 30, 2020 was determined by an actuarial valuation as of June 30, 2019 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2020:

OPEB:

Inflation

2.50%

Salary increases

3.00% 8.75%, including inflation

Long-term expected rate of return

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

Healthcare cost trend rate

Pre-Medicare Eligible

7.00%

Medicare Eligible

5.25%

Ultimate trend rate

Pre-Medicare Eligible

4.50%

Medicare Eligible

4.50%

Year of Ultimate trend rate

Pre-Medicare Eligible

2029

Medicare Eligible

2023

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:

For TRS members: The Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree Mortality Table projected generationally with MP-2019 projection scale (set forward one year and adjusted 106%) is used for death prior to retirement and for service retirements and beneficiaries. The Pub-2010 Teachers Mortality Table for Disabled Retirees projected generationally with MP-2019 Projection scale (set forward one year and adjusted 106%) is used for disability retirements. For both, rates of improvement were reduced by 20% for all years prior to the ultimate rate.
For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement. Rates of mortality in active service was based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. There is a margin for future morality improvement in the tables used by the plan.

The actuarial assumptions used in the June 30, 2019 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2018, with the exception of the assumed annual rate of inflation which was changed from 2.75% to 2.50%, effective with the June 30, 2018 valuation.
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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

The remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2019 valuation were based on a review of recent plan experience done concurrently with the June 30, 2019 valuation.
Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.
The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

Target Allocation

Long-Term Expected Real Rate of Return*

Fixed Income Equity

30.00% 70.00%

0.50% 9.20%

Total

100.00%

*Net of Inflation

Discount Rate: In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 2.22% was used as the discount rate, as compared with last year's rate of 3.58%. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation bonds with an average rating of AA or higher (2.21% per the Municipal Bond Index Rate). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2118.
Sensitivity of the School District's Proportionate Share of the Net OPEB Liability to Changes in the Discount Rate: The following presents the collective net OPEB liability of the participating employers calculated using the discount rate of 2.22%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (1.22%) or 1-percentage-point higher (3.22%) than the current discount rate:

1% Decrease (1.22%)

Current Discount Rate (2.22%)

1% Increase (3.22%)

School District's proportionate share of the Net OPEB liability

$ 68,177,528.00 $

58,031,576.00 $ 49,917,648.00

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Sensitivity of the School District's Proportionate Share of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rates: The following presents the collective net OPEB liability of the participating employers, as well as what the collective net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentagepoint higher than the current healthcare cost trend rates:

1% Decrease

Current Healthcare Cost Trend Rate

1% Increase

School District's proportionate share of the Net OPEB liability

$ 48,317,120.00 $

58,031,576.00 $ 70,608,974.00

OPEB Plan Fiduciary Net Position: Detailed information about the OPEB plan's fiduciary net position is available in the Annual Comprehensive Financial Report, which is publicly available at https://sao.georgia.gov/statewide-reporting/acfr.

NOTE 14: RETIREMENT PLANS

The School District participates in various retirement plans administered by the State of Georgia, as further explained below.

Teachers Retirement System of Georgia (TRS)

Plan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications.
Benefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2021. The School District's contractually required contribution rate for the year ended June 30, 2021 was 19.06% of annual School District payroll, of which 18.98% of

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

payroll was required from the School District and 0.08% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $8,421,137.11 and $33,519.02 from the School District and the State, respectively.
Employees' Retirement System
Plan Description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials.
Benefits Provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS.
Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60.
Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
Contributions: Member contributions under the old plan are 4.00% of annual compensation, up to $4,200.00, plus 6.00% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's total required contribution rate for the year ended June 30, 2021 was 24.66% of annual covered payroll for old plan members of which 19.91% was required from the School District and 4.75% was contributed on behalf of the School District by the state. Additionally, the School District's total required contribution rate was 24.66% for new plan members and 21.57% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $43,418.88 for the current fiscal year.

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Public School Employees Retirement System (PSERS)

Plan Description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials.

Benefits Provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.

Upon retirement, the member will receive a monthly benefit of $15.50, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $108,231.00.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
At June 30, 2021, the School District reported a liability of $79,692,563.00 for its proportionate share of the net pension liability for TRS ($79,367,716.00) and ERS ($324,847.00).
The TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows:

School District's proportionate share of the net pension liability

$ 79,367,716.00

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

287,053.00 $ 79,654,769.00
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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

The net pension liability for TRS and ERS was measured as of June 30, 2020. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2019. An expected total pension liability as of June 30, 2020 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2020.
At June 30, 2020, the School District's TRS proportion was 0.327642%, which was an increase of 0.004779% from its proportion measured as of June 30, 2019. At June 30, 2020, the School District's ERS proportion was 0.007707%, which was an increase of 0.000557% from its proportion measured as of June 30, 2019.
At June 30, 2021, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $563,934.00.
The PSERS net pension liability was measured as of June 30, 2020. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2019. An expected total pension liability as of June 30, 2020 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2020.
For the year ended June 30, 2021, the School District recognized pension expense of $12,699,437.49 for TRS, $93,814.36 for ERS and $113,483.00 for PSERS and revenue of ($53,755.00) for TRS and $113,483.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

At June 30, 2021, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

ERS Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual

experience

$ 3,456,489.00 $

- $

3,957.00 $

-

Changes of assumptions

8,174,966.00

-

-

-

Net difference between projected

and actual earnings on pension plan

investments

1,911,585.00

-

4,589.00

-

Changes in proportion and

differences between School District

contributions and proportionate share of

contributions

705,247.00

1,249,334.00

31,608.00

-

School District contributions

subsequent to the measurement date

8,421,137.11

-

43,418.88

-

Total

$ 22,669,424.11 $ 1,249,334.00 $

83,572.88 $

-

The School District contributions subsequent to the measurement date of are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

ERS

2022 2023 2024 2025

$ 2,310,946.00 $ $ 4,223,780.00 $ $ 4,506,333.00 $ $ 1,957,894.00 $

23,849.00 6,966.00 5,325.00 4,014.00

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Actuarial Assumptions: The total pension liability as of June 30, 2020 was determined by an actuarial valuation as of June 30, 2019, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:

Inflation

2.50%

Salary increases

3.00% 8.75%, average, including inflation

Investment rate of return

7.25%, net of pension plan investment expense, including inflation

Post-retirement benefit increases 1.50% semi-annually
Post-retirement mortality rates for service retirements and beneficiaries were based on the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree mortality table (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. Post-retirement mortality rates for disability retirements were based on the Pub-2010 Teachers Mortality Table for Disabled Retirees (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. The Pub-2010 Teachers Headcount Weighted Below Median Employee mortality table with ages set forward one year and adjusted 106% as used for death prior to retirement. Future improvement in mortality rates was assumed using the MP-2019 projection scale generationally. These rates of improvement were reduced by 20% for all years prior to the ultimate rate.
The actuarial assumptions used in the June 30, 2019 valuation were based on the results of an actuarial experience study for the period July 1, 2013 June 30, 2018.
Employees' Retirement System:

Inflation

2.75%

Salary increases

3.25% - 7.00%, including inflation

Investment rate of return

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

Post-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP-2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

The actuarial assumptions used in the June 30, 2019 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014, with the exception of the assumed investment rate of return.

Public School Employees Retirement System:

Inflation

2.75%

Salary increases

N/A

Investment rate of return

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

Post-retirement benefit increases 1.50% semi-annually
Post-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2019 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014, with the exception of the assumed investment rate of return.
The long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

TRS Target allocation

ERS/PSERS Target
allocation

Long-term expected real rate of return*

Fixed income Domestic large stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative

30.00% 51.00%
1.50% 12.40%
5.10% --

30.00% 46.20%
1.30% 12.40%
5.10% 5.00%

(0.10)% 8.90% 13.20% 8.90% 10.90% 12.00%

Total

100.00%

100.00%

* Rates shown are net of the 2.75% assumed rate of inflation with the exception of TRS, which assumed a rate of 2.50% rate of inflation.

Discount Rate: The discount rate used to measure the total TRS pension liability was 7.25%. The discount rate used to measure the total ERS and PSERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plans' fiduciary net position were projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the School District's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.25% and 7.30%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.25% and 6.30%) or 1-percentage-point higher (8.25% and 8.30%) than the current rate:

Teachers Retirement System:

1% Decrease (6.25%)

Current Discount Rate (7.25%)

1% Increase (8.25%)

School District's proportionate share of the net pension liability

$ 125,858,252.00 $

79,367,716.00 $ 41,258,807.00

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

1% Decrease (6.30%)

Current Discount Rate (7.30%)

1% Increase (8.30%)

$

457,002.00 $

324,847.00 $

212,067.00

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Pension Plan Fiduciary Net Position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publicly available at www.trsga.com/publications and http://www.ers.ga.gov/financials.
Polk County School District Social Security Replacement Plan
Plan Description: As of January 2004, the School District established a single employer defined benefit pension plan for the group of employees covered under the Public Service Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined benefit plan that does not meet the requirements of a qualified social security replacement plan, the new plan was established for these employees to meet the requirements of a social security replacement plan.
The School District Social Security Replacement Plan (Plan) provides a pension benefit for each participant at retirement, equal to 1.5% of the participant's Average Monthly Compensation multiplied by his Years of Credited Service up to 40 Years of Credited Service. Years of service subsequent to July 1, 1991, are counted for purposes of determining a participant's benefit. The funding method and determination of benefits payable are provided in or authorized by various sections of Title 47 of the Official Code of Georgia Annotated ("OCGA"). The Plan does not issue a separate financial report.
The employee is always 100% vested in his accrued benefit in the Plan.
The Plan is funded by employer contributions held in trust by Reliance Trust Company. The Actuary for the Plan is Future Plan by Ascensus. The Actuary determines the Plan liabilities and required contributions on an annual basis.
As of January 1, 2021, there were 421 Plan participants, consisting of the following:
January 1, 2021

Active plan members

108

Vested terminated participants

201

Retirees, beneficiaries, and disabled participants

112

421

Funding Policy: Employees are neither required nor permitted to make contributions to the Plan. The Polk County School District (Employer) makes contributions required to fund the cost of the benefits provided to its eligible employees by this Plan. The Employer makes such contributions as necessary to fund the Plan in accordance with all applicable minimum funding standards under Georgia Law.
The Employer's Annual Required Minimum contribution is the actuarially determined amount necessary to fund the plan benefits. The current year required minimum contribution was $336,514.00. The current contribution rate was 15.94% of annual covered payroll.
Investments: The Plan maintains an investment policy which fosters prudent and sound judgment in the management of plan assets to ensure safety of capital consistent with its fiduciary responsibility to the citizens of Georgia and which conforms to the Plan's investment policy. All investments are consistent with Polk School District's policy and applicable Federal and state laws.

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

Investments are reported at fair value. Securities are traded on a national or international exchange and are valued at the last reported sales price. The Plan's investment policy requires diversification of assets in an effort to avoid the risk of large losses and maximize the investment return to the Plan consistent with market and economic risk.
As of December 31, 2020, the Plan's assets are:
Asset Class

Cash and Equivalent Short-Term Investments Domestic Equities International Equities Fixed Income

$

4,877.83

123,775.20

2,655,065.72

272,429.87

1,893,090.32

$ 4,949,238.94

For the plan year ended December 31, 2020, the annual money-weighted rate of return on pension plan investments, net of plan investment expense, was 11.52%.
The following table summarizes the adopted asset allocation policy at December 31, 2020:

Asset Class

Adopted Asset Allocation

Domestic Equities International Equities Fixed Income Cash and Equivalent
Total

40% to 50% 1% to 5%
35% to 45% 1% to 10%
100%

Pension Liability, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to the Plan:
The components of the net pension liability at December 31, 2020 were as follows:

Total pension liability

$

Plan fiduciary net position

9,050,006.00 (4,945,865.00)

Net pension liability

$

4,104,141.00

The Plan's fiduciary net position as a percentage of its total pension liability is 54.65%.
The net pension liability for the Plan was measured as of December 31, 2020. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of January 1, 2020. An expected total pension liability as of December 31, 2020 was determined using standard roll-forward techniques.

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

For the year ended June 30, 2021, the School District recognized pension expense of $339,519.00 for the Plan.

At June 30, 2021, the School District reported deferred outflows and resources and deferred inflows of resources related to the Plan from the following sources:

Deferred Outflows of Resources

Deferred Inflows of Resources

Difference between projected and actual

earnings on pension plan investments

$

219,256.00 $

449,119.00

Differences between expected and actual experiences

141,654.00

323,743.00

Changes in actuarial assumptions

840,558.00

226,190.00

Total

$ 1,201,468.00 $ 999,052.00

Amounts reported as deferred outflows of resources and deferred inflows of resources related to the Plan will be recognized in pension expense as follows:
Year Ended June 30:

2020 2021

$ (5,955.00) $ 22,465.00

2022 2023 2024

$ (87,159.00) $ (1,354.00) $ 38,304.00

2025

$ 236,115.00

Actuarial Methods and Assumptions: The total pension liability was determined as of January 1, 2021 using the following actuarial assumptions and methods (see the January 1, 2021 actuarial valuation report for other assumptions):

Inflation

2.50%

Salary Increases

3.00%

Investment rate of return

7%, net of pension plan investment expense

Single equivalent discount rate

4.83%, net of pension plan investment expense

Morality rates were based on the RP-2014 Blue Collar with MP-2018.
The long-term expected rate of return on the Plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return, net of investment expenses and inflation, are developed for each major asset class. These ranges are combined to produce

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POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

the long-term expected rate of return by weighing the expected future real rates of return by the target asset allocation percentage and by the expected inflation. Best estimates of arithmetic real rates of return for each major asset class, included in the Plan's target asset allocation as of December 31, 2020:

Asset Class

Target Allocation

Long-Term Expected Real Rate of Return*

Domestic Equities International Equities Fixed Income Cash

49% 5% 41% 5%

6.40% 7.00% 2.75% 1.00%

* Rates shown are net of the 2.50% assumed rate of inflation.
Discount Rate: The discount rate used to measure the total pension liability was the single equivalent discount rate shown above. The projection of cash flows used to determine the discount rate assumed that employer contributions will be made at rates equal to actuarially determined contribution rates. Based on this assumption, the Plan's fiduciary net position was projected to be available to make all projected future benefit payments of current Plan members through 2055 and the long-term expected rate of return of 7.00% was applied to this period. The December 31, 2020 20-year tax-free municipal bond yield of 2.12% was applied after 2055.
Sensitivity of the Polk County School District's Net Pension Liability to Changes in the Discount Rate: The following represents the net pension liability calculated using the stated discount rate, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (3.83%) or 1-percentage-point higher (5.83%) than the current rate:

School District's proportionate share of the net pension liability

1% Decrease (3.83%)
$ 5,258,448.00 $

Current Rate (4.83%)

1% Increase (5.83%)

4,104,141.00 $

3,140,345.00

NOTE 15: TAX ABATEMENTS
The Development Authority of Polk County, the Cedartown Development Authority and the Rockmart Development Authority can enter into agreements with private individuals or entities for economic or industrial projects to encourage the creation of jobs and capital investment through an "Economic Incentive Program". This program is used to incentivize these businesses to build, relocate, expand, or renovate within incorporated and unincorporated Polk County. Each agreement provides a property tax benefit to the company through a schedule of discounted valuation that reduces, for ad valorem tax purposes, the fair market value of real and/or personal property that is held by the Authorities and leased to the company. Georgia case law and the Authorities' enabling legislation provides the Authorities with the power to enter into such agreements with private companies.
The Authorities may accept title to real and personal property assets from a company in return for job creation and capital investment and provide a tax benefit to the company through a lease agreement with the Authority. In considering eligibility for providing this benefit to a company, the Authorities review the following criteria:
1. Eligible businesses can include new and existing industrial businesses.

- 42 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2021

EXHIBIT "I"

2. But for an incentive agreement, the company would not create the jobs and investment in the community.
3. Eligible projects must involve significant investment in real and personal property. 4. The average wage of the business' employees should be above the average wage of goods
producing employees in Polk County. 5. The business should offer medical benefits to all employees. 6. The impact to job retention will be considered for each expansion project. 7. As a condition of assistance, a business will be required to work with the Authority to convey
title to the Authority.
In return for a property tax benefit, a company is required to commit to creating jobs and capital investment within a defined period as part of a performance and accountability agreement with the Authority that includes provisions for the company to pay back a prorated portion of the benefit if they fail to meet the performance criteria by a specified date. The Authorities monitor compliance with performance and accountability agreements to ensure the companies meet their commitments.
For the Polk County School District's year ending June 30, 2021 the cumulative property tax not collected due to incentive agreements was $62,452.51; however, $581,825.86 was paid to the Polk County School District through the Economic Incentive Program for the same period. These agreements will result in an estimated $67.0 million in new capital investment for Polk County and more than 186 new/retained jobs. According to the National Association of Manufacturers, the new capital investment will generate an additional $167.4 million in our economy, and the 186 jobs will generate another 632 jobs in other sectors.
Included in the $62,452.51 abated, the following are tax abatement agreements amounts with individual companies that each exceed 10.00 percent of the total amount abated:
A property tax abatement was granted to Kimoto Tech in the amount of $24,483.00.
A property tax abatement was granted to Westbound Solar in the amount of $17,735.10.
Property tax abatements were granted to Inman Solar totaling $14,665.55.
NOTE 16: SPECIAL ITEM
During fiscal year 2021, the School District received a donation for paving labor and equipment cost on the Westside Elementary School and Cherokee High School projects. The fair value of this donated cost is $38,070.00. This is reflected as a special item on Exhibit B of this report.
NOTE 17: SUBSEQUENT EVENTS
On November 2, 2021, voters authorized the School District to reimpose a special one percent sales and use tax for educational purposes and funding of capital projects.
On April 12, 2022, the School District sold General Obligation Bonds, Series 2022, in the amount of $25,000,000.00, generating a premium of $3,669,380.00, to provide the necessary funds for the acquisition, construction, and equipping of capital facilities.

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POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "1"

For the Year Ended
June 30

School District's proportion
of the Net Pension Liability (NPL)

School District's proportionate share of the NPL

State of Georgia's proportionate
share of the NPL associated with
the School District

Total

School District's covered payroll

School District's proportionate share of the NPL as a percentage of its covered
payroll

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

2021 2020 2019 2018 2017 2016 2015

0.327642% $ 79,367,716.00 $ 287,053.00 $ 79,654,769.00 $ 42,459,243.32 0.322863% $ 69,424,275.00 $ 327,916.00 $ 69,752,191.00 $ 39,589,606.96 0.327378% $ 60,768,369.00 $ 289,755.00 $ 61,058,124.00 $ 39,127,366.15 0.332680% $ 61,829,603.00 $ 748,059.00 $ 62,577,662.00 $ 38,673,234.64 0.342487% $ 70,658,887.00 $ 944,080.00 $ 71,602,967.00 $ 38,069,372.98 0.345774% $ 52,640,658.00 $ 600,892.00 $ 53,241,550.00 $ 36,915,144.69 0.346443% $ 43,768,503.00 $ 560,177.00 $ 44,328,680.00 $ 35,545,926.47

186.93% 175.36% 155.31% 159.88% 185.61% 142.60% 123.13%

77.01% 78.56% 80.27% 79.33% 76.06% 81.44% 84.03%

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

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POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "2"

For the Year Ended June 30

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

School District's covered payroll

2021 2020 2019 2018 2017 2016 2015

$

8,421,137.11 $

$

8,941,170.49 $

$

8,235,903.09 $

$

6,546,048.34 $

$

5,456,446.48 $

$

5,360,865.43 $

$

4,797,913.58 $

8,421,137.11 $ 8,941,170.49 $ 8,235,903.09 $ 6,546,048.34 $ 5,456,446.48 $ 5,360,865.43 $ 4,797,913.58 $

-

$ 44,357,338.07

-

$ 42,459,243.32

-

$ 39,589,606.96

-

$

39,127,366.15

-

$ 38,673,234.64

-

$ 38,069,372.98

-

$

36,915,144.69

Contribution as a percentage of covered payroll
18.98% 21.06% 20.80% 16.73%
14.11% 14.08% 13.00%

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

- 46 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "3"

For the Year Ended June 30
2021 2020 2019 2018 2017 2016 2015

School District's proportion of the Net Pension Liability (NPL)

School District's proportionate share
of the NPL

School District's covered payroll

School District's proportionate share
of the NPL as a percentage of covered payroll

Plan fiduciary net position as a
percentage of total pension liability

0.007707% $ 0.007150% $ 0.005132% $ 0.005232% $ 0.004803% $ 0.003427% $ 0.003393% $

324,847.00 $ 295,047.00 $ 210,978.00 $ 212,489.00 $ 227,202.00 $ 138,841.00 $ 127,258.00 $

206,943.46 180,218.56 130,926.01 128,331.00 111,677.30 78,360.00 76,400.48

156.97% 163.72% 161.14% 165.58% 203.45% 177.18% 166.57%

76.21% 76.74% 76.68% 76.33% 72.34% 76.20% 77.99%

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

- 47 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "4"

For the Year Ended June 30

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

School District's covered payroll

Contribution as a percentage of covered payroll

2021

$

2020

$

2019

$

2018

$

2017

$

2016

$

2015

$

2014

$

2013

$

2012

$

43,418.88 $ 51,023.36 $ 44,658.15 $ 32,475.72 $ 31,838.88 $ 27,606.43 $ 17,207.88 $ 14,104.00 $ 11,306.36 $
2,581.12 $

43,418.88 $ 51,023.36 $ 44,658.15 $ 32,475.72 $ 31,838.88 $ 27,606.43 $ 17,207.88 $ 14,104.00 $ 11,306.36 $
2,581.12 $

-

$

-

$

-

$

-

$

-

$

-

$

-

$

-

$

-

$

-

$

176,070.11 206,943.46 180,218.56 130,926.01 128,331.00
111,677.30 78,360.00 76,400.48 75,872.88 22,193.64

24.66% 24.66% 24.78% 24.81% 24.81% 24.72% 21.96% 18.46% 14.90% 11.63%

- 48 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "5"

For the Year Ended
June 30

School District's proportion of the Net Pension Liability (NPL)

School District's proportionate share of the NPL

State of Georgia's proportionate
share of the NPL associated with the School District

Total

School District's covered payroll

School District's proportionate share of the NPL as a percentage of its covered
payroll

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

2021 2020 2019 2018 2017 2016 2015

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

-

$

563,934.00 $ 563,934.00 $ 1,569,655.68

-

$

553,552.00 $ 553,552.00 $ 1,712,200.77

-

$

565,141.00 $

565,141.00 $ 1,883,260.87

-

$

551,379.00 $ 551,379.00 $ 1,810,170.59

-

$

762,372.00 $ 762,372.00 $ 1,791,780.27

-

$

485,473.00 $ 485,473.00 $ 1,790,955.74

-

$ 443,309.00 $ 443,309.00 $ 1,692,625.17

N/A

84.45%

N/A

85.02%

N/A

85.26%

N/A

85.69%

N/A

81.00%

N/A

87.00%

N/A

88.29%

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

- 49 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND

SCHEDULE "6"

For the Year Ended
June 30

School District's proportion of the Net OPEB Liability (NOL)

School District's proportionate share of the NOL

State of Georgia's proportionate share of the NOL associated with the School
District

Total

School District's covered-
employee payroll

School District's proportionate share of the
NOL as a percentage of
its coveredemployee payroll

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

2021 2020 2019 2018

0.395104% $ 58,031,576.00 $ 0.391779% $ 48,079,689.00 $ 0.396941% $ 50,449,983.00 $ 0.402911% $ 56,608,834.00 $

-

$ 58,031,576.00 $ 36,339,858.85

-

$ 48,079,689.00 $ 32,761,391.83

-

$ 50,449,983.00 $ 32,469,171.98

-

$ 56,608,834.00 $ 31,880,339.52

159.69% 146.76% 155.38% 177.57%

3.99% 4.63% 2.93% 1.61%

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

- 50 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND

SCHEDULE "7"

For the Year Ended June 30

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

School District's covered-employee
payroll

Contribution as a percentage of
covered-employee payroll

2021

$

1,509,114.00 $

2020

$

1,336,150.00 $

2019

$

2,110,001.00 $

2018

$

2,057,312.00 $

2017

$

2,100,811.00 $

1,509,114.00 $ 1,336,150.00 $ 2,110,001.00 $ 2,057,312.00 $ 2,100,811.00 $

-

$ 37,827,087.46

-

$ 36,339,858.85

-

$ 32,761,391.83

-

$ 32,469,171.98

-

$ 31,880,339.52

3.99% 3.68% 6.44% 6.34% 6.59%

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

- 51 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE NET POSITION LIABILITY AND RELATED RATIOS
SOCIAL SECURITY REPLACEMENT PLAN YEAR ENDING DECEMBER 31

Total Pension Liability Service Cost Interest Differences Between Expected and Actual Experience Change of Assumptions Benefit Payments
Net Change in Total Pension Liability
Total Pension Liability - beginning
Total Pension Liability - ending (a)

2021

2020

2019

$

196,414.00 $

200,141.00 $

205,015.00 $

436,782.00

429,921.00

424,569.00

74,724.00

(21,491.00)

(128,097.00)

474,227.00

177,923.00

(149,027.00)

(375,690.00)

(358,105.00)

(333,310.00)

806,457.00

428,389.00

19,150.00

8,243,549.00

7,815,160.00

7,796,010.00

$ 9,050,006.00 $ 8,243,549.00 $

7,815,160.00 $

Plan Fiduciary Net Position Contributions - Employer Net Investment Income Benefit Payments Administrative Expenses Due to Broker

$

336,514.00 $

335,053.00 $

332,646.00 $

503,539.00

684,749.00

(271,717.00)

(375,690.00)

(358,105.00)

(333,310.00)

(9,949.00)

(22,682.00)

(21,147.00)

-

-

-

Net change in Plan Fiduciary Net Position

454,414.00

639,015.00

(293,528.00)

Plan Fiduciary Net Position - beginning Plan Fiduciary Net Position - ending (b)

4,491,451.00

3,852,436.00

4,145,964.00

$ 4,945,865.00 $ 4,491,451.00 $ 3,852,436.00 $

Net Pension Liability - ending (a - b)

$

4,104,141.00 $ 3,752,098.00 $ 3,962,724.00 $

Plan Fiduciary Net Position as a percentage of the Total Pension Liability

54.65%

54.48%

49.29%

Covered-Employee Payroll

$

Net Pension Liability as percentage of Covered-Employee

2,110,591.00 $ 2,290,640.00 $ 2,347,678.00 $

194.45%

163.80%

168.79%

SCHEDULE "8"
2018 202,546.00 416,164.00 (63,999.00)
128,319.00 (332,304.00) 350,726.00 7,445,284.00 7,796,010.00
335,798.00 392,875.00 (332,304.00) (24,030.00)
372,339.00 3,773,625.00 4,145,964.00 3,650,046.00
53.18% 2,416,621.00
151.04%

- 52 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE NET POSITION LIABILITY AND RELATED RATIOS
SOCIAL SECURITY REPLACEMENT PLAN YEAR ENDING DECEMBER 31

SCHEDULE "8"

Total Pension Liability

Service Cost

$

Interest

Differences Between Expected and Actual Experience

Change of Assumptions

Benefit Payments

Net Change in Total Pension Liability

Total Pension Liability - beginning

Total Pension Liability - ending (a)

$

Plan Fiduciary Net Position

Contributions - Employer

$

Net Investment Income

Benefit Payments

Administrative Expenses

Due to Broker

Net change in Plan Fiduciary Net Position

Plan Fiduciary Net Position - beginning

Plan Fiduciary Net Position - ending (b)

$

Net Pension Liability - ending (a - b)

$

Plan Fiduciary Net Position as a percentage of the Total Pension Liability

Covered-Employee Payroll

$

Net Pension Liability as percentage of Covered-Employee

2017
211,474.00 $ 393,557.00 70,820.00 (153,139.00) (321,825.00)
200,887.00
7,244,397.00
7,445,284.00 $

2016
252,078.00 $ 357,947.00
62,585.00 (61,902.00) (294,805.00)
315,903.00
6,928,494.00
7,244,397.00 $

349,969.00 $ 238,741.00 (321,825.00) (21,220.00)
(1,113.00)
244,552.00
3,529,073.00
3,773,625.00 $
3,671,659.00 $

315,891.00 $ (20,197.00) (294,805.00) (29,660.00)
(1,229.00)
(30,000.00)
3,559,073.00
3,529,073.00 $
3,715,324.00 $

50.68% 2,377,259.00 $
154.45%

48.71% 2,600,407.00 $
142.87%

2015

2014

203,802.00 $ 378,679.00 (446,217.00) 471,960.00 (244,169.00)

164,756.00 363,955.00
251,101.00 832,322.00 (221,185.00)

364,055.00

1,390,949.00

6,564,439.00

5,173,490.00

6,928,494.00 $ 6,564,439.00

310,889.00 $ 147,675.00 (244,169.00) (25,205.00)
(4,493.00)

304,253.00 473,233.00 (221,185.00) (23,094.00)
(242.00)

184,697.00

532,965.00

3,374,376.00

2,841,411.00

3,559,073.00 $ 3,374,376.00

3,369,421.00 $ 3,190,063.00

51.37%

51.40%

2,562,945.00 $ 2,726,676.00

131.47%

117.00%

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

- 53 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SOCIAL SECURITY REPLACEMENT PLAN
FOR THE YEAR END DECEMBER 31

SCHEDULE "9"

For the Year

Actual determined contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

School District's covered payroll

Contribution as a percentage of covered payroll

2021

$

2020

$

2019

$

2018

$

2017

$

2016

$

2015

$

2014

$

336,514.00 $ 335,053.00 $ 332,646.00 $ 335,798.00 $ 328,611.00 $ 315,891.00 $ 310,889.00 $ 304,253.00 $

336,514.00 $ 335,053.00 $ 332,646.00 $ 335,798.00 $ 349,969.00 $ 315,891.00 $ 310,889.00 $ 304,253.00 $

-

$

2,110,591.00

-

$ 2,290,640.00

-

$ 2,347,678.00

-

$

2,416,621.00

(21,358.00) $ 2,377,259.00

-

$ 2,600,407.00

-

$ 2,562,945.00

-

$ 2,726,676.00

15.94% 14.63% 14.17% 13.90% 14.72% 12.15% 12.13% 11.16%

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

- 54 -

POLK COUNTY SCHOOL DISTRICT REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF INVESTMENT RETURNS SOCIAL SECURITY REPLACEMENT PLAN
FOR THE YEAR END DECEMBER 31

Year Ended
2021 2020 2019 2018 2017 2016 2015 2014

Annual Money - Weighted Rate of Return, Net of Investment Expense
11.52% 18.47% (6.73)% 10.88% 7.04% (0.59)% 4.55% 17.25%

SCHEDULE "10"

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

- 55 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2021

SCHEDULE "11"

Teachers Retirement System Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).

On May 15, 2019, the Board adopted recommended changes from the smoothed valuation interest rate methodology that has been in effect since June 30, 2009, to a constant interest rate method. In conjunction with the methodology, the long-term assumed rate of return in assets (discount rate) has been changed from 7.50% to 7.25%, and the assumed annual rate of inflation has been reduced from 2.75% to 2.50%.

In 2019 and later, the expectation of retired life mortality was changed to the Pub-2010 Teacher Headcount Weighted Below Median Healthy Retiree mortality table from the RP-2000 Mortality Tables. In 2019, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.
Employees' Retirement System Changes of benefit terms: A new benefit tier was added for members joining the System on and after July 1, 2009. A one-time 3% payment was granted to certain retirees and beneficiaries effective July 2016, and a one-time 3% payment was granted to certain retirees and beneficiaries effective July 2017. Two one-time 2% payments were granted to certain retirees and beneficiaries effective July 2018 and January 2019. Two onetime 3% payments were granted to certain retirees and beneficiaries effective July 2019 and January 2020.
Changes of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, withdrawal and salary increases.

On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. The assumed investment rate of return remained at 7.30% for the June 30, 2019 actuarial valuation.
Public School Employees Retirement System Changes of benefit terms: The member contribution rate was increased from $4.00 to $10.00 per month for members joining the System on or after July 1, 2012. The monthly benefit accrual rate was increased from $14.75 to $15.00 per year of credible service effective July 1, 2017. The monthly benefit accrual was increased from $15.00 to $15.25 per year of credible service effective July 1, 2018. The monthly benefit accrual was increased from $15.25 to $15.50 per year of credible service effective July 1, 2019. A 2% cost-of-living adjustment (COLA) was granted to certain retirees and beneficiaries effective July 2016, another July 2017, and another July 2018. Two 1.5% COLAs were granted to certain retirees and beneficiaries effective July 2019 and January 2020.
Changes of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.

On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP-2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females).

On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. The assumed investment rate of return remained at 7.30% for the June 30, 2019 valuation.

- 56 -

POLK COUNTY SCHOOL DISTRICT NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2021

SCHEDULE "11"

School OPEB Fund Changes of benefit terms: There have been no changes in benefit terms.
Changes in assumptions : The June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to State OPEB fund based on their last employer payroll location; irrespective of retirement affiliation.
The June 30, 2019 decremental valuation were changed to reflect the Teachers Retirement Systems experience study.
The discount rate was updated from 3.07% as of June 30, 2016 to 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018, to 3.58% as of June 30, 2019, and to 2.22% as of June 30, 2020.

Social Security Replacement Plan Changes of assumptions: There were no changes in benefits that affected the measurement of the total pension liability since the prior measurement date. However, in 2020 the amounts reported as changes in assumptions resulted from an decrease in the discount rate
from 5.30% to 4.83% since the prior measurement date.

Method and assumptions used in calculations of actuarially determined contributions: The actuarially determined contribution rates in the schedule of contributions are calculated as of January 1, 2021. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2021 reported in that schedule:

Valuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation Method
Inflation rate Salary increases Investment rate of return

January 1, 2020 Entry Age Level percentage of payroll 18 years Method recognized a portion of the difference between the market value of assets and expected actuarial value of assets, based on the assumed interest rate of return. The amount recognized each year is 20% of the difference between market value and expected actuarial value. 2.50% 3.00% per annum 7.00%, net of pension plan investment

- 57 -

POLK COUNTY SCHOOL DISTRICT GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2021

SCHEDULE "12"

REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues
EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Food Services Operation Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES) Other Sources Other Uses Total Other Financing Sources (Uses) Net Change in Fund Balances
Fund Balances - Beginning
Adjustments
Fund Balances - Ending

NONAPPROPRIATED BUDGETS

ORIGINAL (1)

FINAL (1)

$

13,035,000.00 $

13,035,000.00 $

-

-

50,656,755.71

51,489,322.49

6,984,589.12

31,240,987.23

-

-

-

-

250,000.00

250,000.00

70,926,344.83

96,015,309.72

57,549,843.77
2,250,532.51 1,468,368.28 1,130,560.89
968,055.96 4,627,411.95 1,145,488.56 7,331,483.50 2,981,674.07 205,755.66
43,494.00 -
5,647,579.90 85,350,249.05 (14,423,904.22)

76,424,946.50
5,463,171.46 2,898,996.24 1,232,397.67
982,223.96 5,328,763.95
1,151,576.56 7,836,531.50 4,312,231.07 206,770.66
49,038.42 -
6,849,280.05 112,735,928.04 (16,720,618.32)

(350,000.00) (350,000.00) (14,773,904.22)

267,857.00 (628,283.67) (360,426.67) (17,081,044.99)

23,883,749.59

23,883,749.59

64,649.58

-

$

9,174,494.95 $

6,802,704.60 $

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

17,564,256.45 $ 339,372.83
54,644,802.51 15,235,151.17 1,776,872.54 4,194.33 1,329,929.00
90,894,578.83

4,529,256.45 339,372.83
3,155,480.02 (16,005,836.06)
1,776,872.54 4,194.33
1,079,929.00 (5,120,730.89)

58,328,875.72
3,885,922.58 1,400,131.26 1,232,392.87 1,180,624.02 4,671,353.83 1,051,991.00 7,157,577.89 3,517,252.99 178,691.07 102,343.19 94,605.78 4,918,325.88
87,720,088.08 3,174,490.75

18,096,070.78
1,577,248.88 1,498,864.98
4.80 (198,400.06)
657,410.12 99,585.56 678,953.61 794,978.08 28,079.59 (53,304.77) (94,605.78) 1,930,954.17 25,015,839.96 19,895,109.07

3,174,490.75
23,925,577.91
-
27,100,068.66 $

(267,857.00) 628,283.67 360,426.67 20,255,535.74
41,828.32
-
20,297,364.06

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
(1) Original and Final Budget amounts do not include the budgeted revenues or expenditures of the various principal accounts. The actual revenues and expenditures of the various principal accounts are $1,764,240.69 and $1,621,352.96, respectively.
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

- 58 -

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2021

SCHEDULE "13"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program Total U.S. Department of Agriculture
Education, U. S. Department of Education Stabilization Fund Pass-Through From Georgia Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund COVID-19 - Elementary and Secondary School Emergency Relief Fund COVID-19 - American Rescue Plan Elementary and Secondary School Emergency Relief Fund Total Education Stabilization Fund
Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Grants to States Preschool Grants Preschool Grants Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States English Language Acquisition State Grants English Language Acquisition State Grants Rural Education Rural Education Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Supporting Effective Instruction State Grants Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies Total Other Programs Total U. S. Department of Education
Health and Human Services, U. S. Department of Pass-Through From Bright From the Start Georgia Department of Early Care and Learning COVID-19 - Child Care and Development Block Grant
Total Expenditures of Federal Awards

ASSISTANCE LISTING NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

215GA324N1199 $ 215GA324N1199

1,991,212.36 2,716,065.36 4,707,277.72

84.425D 84.425D
84.425U

S425D200012 S425D210012
S425U210012

1,708,282.57 1,570,686.91
4,407.48 3,283,376.96

84.027A 84.027A 84.173A 84.173A

H027A190073 H027A200073 H173A190081 H173A200081

222,557.00 1,360,487.67
41,872.00 17,228.42 1,642,145.09

84.048A 84.365A 84.365A 84.358B 84.358B 84.424A 84.424A 84.367A 84.010A 84.010A

V048A200010 S365A190010 S365A200010 S365B190010 S365B200010 S424A190011 S424A200011 S367A200001 S010A190010 S010A200010-20A

112,670.00 7,401.00
72,374.92 39,687.00 135,331.44 63,278.24 151,935.75 152,246.26 624,675.00 2,524,371.48 3,883,971.09 8,809,493.14

93.575

2100GACCCS $

30,435.00 13,547,205.86

- 59 -

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2021

SCHEDULE "13"

Notes to the Schedule of Expenditures of Federal Awards
Note 1. Basis of Presentation
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Polk County School District (the "Board") under programs of the federal government for the year ended June 30, 2021. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board.
Note 2. Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Note 3. Indirect Cost Rate
The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

See notes to the basic financial statements.

- 60 -

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2021

SCHEDULE "14"

AGENCY/FUNDING

GRANTS

Bright From the Start:

Georgia Department of Early Care and Learning

Pre-Kindergarten Program

$

Education, Georgia Department of

Quality Basic Education

Direct Instructional Cost

Kindergarten Program

Kindergarten Program - Early Intervention Program

Primary Grades (1-3) Program

Primary Grades - Early Intervention (1-3) Program

Upper Elementary Grades (4-5) Program

Upper Elementary Grades - Early Intervention (4-5) Program

Middle School (6-8) Program

High School General Education (9-12) Program

Vocational Laboratory (9-12) Program

Students with Disabilities

Gifted Student - Category VI

Remedial Education Program

Alternative Education Program

English Speakers of Other Languages (ESOL)

Media Center Program

20 Days Additional Instruction

Staff and Professional Development

Principal Staff and Professional Development

Indirect Cost

Central Administration

School Administration

Facility Maintenance and Operations

Mid-term Adjustment Hold-Harmless

Amended Formula Adjustment

Categorical Grants

Pupil Transportation

Regular

Bus Replacement

Nursing Services

Education Equalization Funding Grant

Other State Programs

Food Services

Hygiene Products

Math and Science Supplements

Preschool Disability Services

Pupil Transportation - State Bonds

Residential Treatment Centers Grant

School Safety Grant

Teachers Retirement

Vocational Education

Vocational Supervisors

Georgia Emergency Management Agency

Donations to LEA for COVID

Georgia State Financing and Investment Commission

Reimbursement on Construction Projects

Office of the State Treasurer

Public School Employees Retirement

CONTRACT

Human Resources, Georgia Department of

Family Connections

$

GOVERNMENTAL FUND TYPES

GENERAL FUND

CAPITAL PROJECTS FUND

1,411,463.24 $

- $

2,543,588.00 269,654.00 6,101,231.00 804,058.00
3,154,032.00 350,903.00 5,841,198.00
4,643,543.00 1,913,286.00 7,195,682.00 1,400,822.00
551,195.00 409,252.00 1,029,234.00 952,360.00 295,340.00 166,852.00
3,291.00
1,110,684.00 1,973,433.00 2,017,998.00 1,122,863.00 (1,425,113.00)
811,064.00 308,880.00 165,392.00 7,851,861.00
135,204.00 5,420.00
38,605.00 215,139.00 231,660.00 487,680.96 24,905.99 33,519.02 163,158.00 27,298.00
147,471.49
-
108,231.00
52,463.81
54,644,802.51 $

-
-
-
-
-
554,990.07
-
-
554,990.07 $

TOTAL
1,411,463.24
2,543,588.00 269,654.00 6,101,231.00 804,058.00
3,154,032.00 350,903.00 5,841,198.00
4,643,543.00 1,913,286.00 7,195,682.00 1,400,822.00
551,195.00 409,252.00 1,029,234.00 952,360.00 295,340.00 166,852.00
3,291.00
1,110,684.00 1,973,433.00 2,017,998.00 1,122,863.00 (1,425,113.00)
811,064.00 308,880.00 165,392.00 7,851,861.00
135,204.00 5,420.00
38,605.00 215,139.00 231,660.00 487,680.96 24,905.99 33,519.02 163,158.00 27,298.00
147,471.49
554,990.07
108,231.00
52,463.81
55,199,792.58

See notes to the basic financial statements.

- 61 -

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2021

SCHEDULE "15"

PROJECT
SPLOST V
Construction, remodeling, improving, and equipping of existing facilities including Cedartown High School, Rockmart High School, Westside Elementary School and Eastside Elementary School.
SPLOST VI For the purposes acquiring, constructing, and equipping the following capital projects: Elementary school classroom additions and related facilities, roofing and air conditioning HVAC improvements, track resurfacing at Rockmart and Cedartown High Schools, gym renovations at Rockmart High School, parking lots and access roads, equipment and furnishings, technology devices, and physical education and athletic equipment; System-wide instructional and administrative technology/infrastructure; Cedartown High School Fine Arts building with the expansion of and improvements to band and drama facilities, college and career facilities, and expansions to administrative offices; Rockmart High agriculture barn/learning center and college and career facilities; System-wide safety and security systems and equipment; Press box at Rockmart High School; Concession Stand-Rockmart High School/Rockmart Middle; Purchasing school buses; Rockmart Middle School field house; Purchasing vocational, fine arts and cafeteria equipment; Purchasing textbooks; Acquiring real and personal property necessary or to be used for the foregoing purposes; All other general purposes related to these capital outlay projects; and 2017 bond issuance costs.
Total SPLOST VI
Total

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

ESTIMATED COMPLETION
DATE

$

300,000.00 $

3,908,385.61

Complete

11,644,647.02 1,750,000.00

7,817,792.97 1,000,000.00

6/30/2026 6/30/2026

6,850,682.01

8,987,577.43

1,276,159.00 284,750.00 480,000.00 274,002.00 889,000.00
-

1,297,842.65 350,000.00 444,547.00
33,741.36 889,000.00
198,749.99 -

301,142.00
925,008.00 324,609.97 25,000,000.00

368,746.78
800,000.00 327,834.97
22,515,833.15

$ 25,300,000.00 $ 26,424,218.76

Complete
Complete 6/30/2022 Complete Complete 6/30/2024 Complete
Complete
6/30/2022 6/30/2026

- 62 -

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2021

SCHEDULE "15"

PROJECT

AMOUNT EXPENDED IN CURRENT YEAR (3) (4)

AMOUNT EXPENDED IN PRIOR YEARS (3) (4)

TOTAL COMPLETION
COST

EXCESS PROCEEDS NOT
EXPENDED

SPLOST V

Construction, remodeling, improving, and equipping of existing

facilities including Cedartown High School, Rockmart High School,

Westside Elementary School and Eastside Elementary School.

$ 2,609,956.56 $

1,298,429.05 $ 3,908,385.61 $

-

SPLOST VI

For the purposes acquiring, constructing, and equipping the

following capital projects:

Elementary school classroom additions and related facilities, roofing

and air conditioning HVAC improvements, track resurfacing at

Rockmart and Cedartown High Schools, gym renovations at

Rockmart High School, parking lots and access roads, equipment

and furnishings, technology devices, and physical education and

athletic equipment;

832,294.46

3,343,439.87

-

-

System-wide instructional and administrative

technology/infrastructure;

41,760.00

943,938.38

-

-

Cedartown High School Fine Arts building with the expansion of

and improvements to band and drama facilities, college and career

facilities, and expansions to administrative offices;

85,530.07

8,902,047.36

8,987,577.43

-

Rockmart High agriculture barn/learning center and college and

career facilities;

-

1,297,842.65

1,297,842.65

-

System-wide safety and security systems and equipment;

-

320,789.48

-

-

Press box at Rockmart High School;

-

444,547.00

444,547.00

-

Concession Stand-Rockmart High School/Rockmart Middle;

-

33,741.36

33,741.36

-

Purchasing school buses;

177,800.00

355,600.00

-

-

Rockmart Middle School field house;

-

198,749.99

198,749.99

-

Purchasing vocational, fine arts and cafeteria equipment;

-

-

-

-

Purchasing textbooks;

-

-

-

-

Acquiring real and personal property necessary or to be used for

the foregoing purposes;

-

368,746.78

368,746.78

-

All other general purposes related to these capital outlay projects;

and

69,055.74

703,372.68

-

-

2017 bond issuance costs.

1,075.00

326,759.97

-

-

Total SPLOST VI

1,207,515.27

17,239,575.52

11,331,205.21

-

Total

$ 3,817,471.83 $ 18,538,004.57 $ 15,239,590.82 $

-

(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. (2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. (3) The voters of Polk County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt.
Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. (4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding as follows:

Prior Years Current Year Total

$ 4,069,945.00 963,500.00
$ 5,033,445.00

See notes to the basic financial statements.

- 63 -

Section II Compliance and Internal Control Reports

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Dr. Katherine Thomas, Superintendent and Members of the Polk County School District
We have audited the financial statements of the governmental activities, each major fund, and fiduciary activities of the Polk County School District (School District), as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated August 23, 2022. We conducted our audit in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the basic financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the School District's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor
August 23, 2022

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Dr. Katherine Thomas, Superintendent and Members of the Polk County School District
Report on Compliance for Each Major Federal Program
We have audited the Polk County School District's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs.
Management's Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

Opinion on Each Major Federal Program
In our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021.
Report on Internal Control over Compliance
Management of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor
August 23, 2022

Section III Auditee's Response to Prior Year Findings and Questioned Costs

POLK COUNTY SCHOOL DISTRICT AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2021
PRIOR YEAR FINANCIAL STATEMENT FINDINGS No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.

Section IV Findings and Questioned Costs

POLK COUNTY SCHOOL DISTRICT SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2021

I SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of auditor's report issued: Governmental Activities, Each Major Fund, and Fiduciary Activities
Internal control over financial reporting: Material weakness(es) identified? Significant deficiency(ies) identified?
Noncompliance material to financial statements noted:
Federal Awards
Internal Control over major programs: Material weakness(es) identified? Significant deficiency(ies) identified?
Type of auditor's report issued on compliance for major programs:
All major programs

Unmodified No
None Reported No
No None Reported
Unmodified

Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)?

Identification of major programs:

Assistance Listing Numbers Assistance Listing Program or Cluster Title

10.553, 10.555 84.425

Child Nutrition Cluster Education Stabilization Fund

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

Auditee qualified as low-risk auditee?

No
$750,000.00 No

II FINANCIAL STATEMENT FINDINGS No matters were reported. Ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.