.:,,' !,. ~-~ t. . .;. ; ,... I,., EXHIBIT "A" DEBT SERVICE FUND $ 121,127.67 130,657.00 28,014 45 ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Only) JUNE 301 2001 JUNE 30, 2000 $ 708,114.29 $ 671,856.91 780,762.00 408,986.16 287,018.30 334,408.00 $ 279,799.12 741.96 532.07 279,799.12 768.07 515.34 33,090.54 1,985,200.88 1,985,200 88 26,800.05 2,266,909.46 $ 279,799 12 $ 2,265,000.00 $ 4,042,168.62 $ 3,743,334.53 $ 47,967.42 $ 52,294.23 209,966.32 190,636.20 3,662.39 1,066.25 12,040.30 26,800.05 $ 2,265,000.00 2,265,000.00 2,300,000.00 $ 2,265,000.00 $ 2,538,636.43 $ 2,570,796.73 $ 279,799.12 0.00 $ 279,799.12 $ 36,774.35 $ 279,799.12 19,370.70 40,305.08 33,090.54 27,266.06 741.96 532.07 300,901.85 768.07 515.34 330,439.73 136,979.04 24,265.92 841,146.22 24,197.92 578,976.02 $ 1,503,532.19 $ 1,172,537.80 $ 279.799.12 $ 2.26s1000.oo $ 41042.168.62 $ 3.743.334.53 -3- QUITMAN COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2001 REVENUES State Funds Federal Funds Taxes Other Funds Total Revenues EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Adm1mstrat1on Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Capital Outlay Debt Service Principal Interest Paying Agent Fees Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES} Operating Transfers In Operating Transfers Out Total Other Financing Sources (Uses) Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses FUND BALANCE JULY 1 Food Inventory - Net Change in Period Donated Commod1t1es Purchased Food GENERAL FUND SPECIAL REVENUE FUND $ 1,747,345.33 $ 667,867 73 3921617 $ 2,454,429.23 $ 199,967.08 404,262.50 14,292.57 618,522.15 $ 1,429,745.17 $ 28,501.65 9,551.61 63,535.72 170,214.53 110,851.49 53,524.00 133,711.06 130,577.84 300.00 12,256.50 300.03 370,874.93 38,896.51 2,347.50 356.03 49,917.40 4,160.01 9,515.02 174,634.54 26,800.05 1,567.68 $ 2,171,437.33 $ $ 282,991.90 $ 650,701.94 -32,179.79 $ $ -15,090.02 $ -15,090.02 $ $ 267,901.88 $ 627,348.58 15,090.02 15,090.02 -17,089.77 44,058.85 -26.11 16.73 FUND BALANCE JUNE 30 $ 895,250.46 $==.::,2~6i;;,9,;;;;59~.7~0;,,. The notes to the general-purpose financial statements are an integral part of this statement -4- EXHIBIT"B" CAPITAL PROJECTS FUND DEBT SERVICE FUND TOTALS (Memorandum Only) YEAR ENDED JUNE 301 2001 JUNE 301 2000 $ 1,947,312.41 $ 1,654,268.10 404,262.50 345,219.23 $ 247,647.98 915,515.71 1,029,960.52 $ 6.10 132,389.27 185,904 11 178,634.72 $ 6.10 $ 380,037.25 $ 3,452,994.73 $ 3,208,082.57 $ 1,800,620.10 $ 1,547,631.61 $ 29,543.98 67,398.16 11,899.11 63,535.72 170,570.56 110,851.49 53,524.00 183,628.46 134,737.85 300.00 21,771.52 174,934.57 29,543.98 91,883.97 44,369.84 54,089.60 148,032.78 108,698.32 37,210.63 173,177.90 140,666.35 604.86 21,759.77 143,917.64 24,565.05 $ 35,000.00 234,635.00 672.71 61,800.05 236,202.68 672.71 55,316.10 239,093.63 65.60 $ 29,543.98 $ 270,307.71 $ 3,121,990.96 $ 2,831,083.65 $ -29,537.88 $ 109,729.54 $ 331,003.77 $ 376,998.92 $ $ -136,979.04 $ -136,979.04 $ 136,979.04 $ 136,979.04 $ 152,069.06 $ -152,069.06 0.00 $ 3,340.42 -3,340.42 0.00 $ -166,516.92 $ 468,039.83 246,708.58 $ 33,090.54 331,003.77 $ 1,172,537.80 376,998.92 794,971.12 -26.11 16.73 238.56 329.20 $ 301,522.91 $ 279,799.12 $ 1,503,532.19 $ 1.172,537.80 -5- QUITMAN COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL - {NON-GAAP BASIS} GENERAL AND SPECIAL REVENUE FUNDS YEAR ENDED JUNE 30. 2001 EXHIBIT "C" GENERAL FUND ACTUAL (BUDGET BUDGET BASIS} REVENUES State Funds Federal Funds Taxes Other Funds $ 1,596,514 00 $ 1,747,345 33 632,976 00 667,867.73 39,216.17 Total Revenues $ 2,229,490 00 $ 2,454,429.23 EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administrabon School Administration Business Administrabon Maintenance and Operabon of Plant Student Transportabon Services Central Support Services Other Support Services Food Services Operation Capital Outlay Debt Service $ 1,384,496 98 $ 1,429,745.17 40,277.37 6,920.00 60,851.24 148,938.79 / 109,98843 36,591.43 142,210.42 156,454.09 300.00 12,000.00 5,905.00 20,873.99 28,501.65 9,551.61 63,535.72 170,214.53 110,851 49 53,524.00 133,711.06 130,577.84 300.00 12,256 50 30003 28,367.73 Total Expenditures $ 2,125,807 74 $ 2,171,437.33 Excess of Revenues over (under) Expenditures $ 103,682.26 $ 282,991.90 OTHER FINANCING SOURCES {USES} Other Sources Other Uses $ -15,090.02 Total Other Financing Sources (Uses) $ -15,090 02 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ FUND BALANCE JULY 1. 2000 103,682.26 $ 608,043.04 267,901.88 627,348.58 Adjustments -829 44 FUND BALANCE JUNE 30, 2001 $ 7101895 86 $ 8951250 46 SPECIAL REVENUE FUND ACTUAL (BUDGET BUDGET BASIS) $ 174,860 81 $ 199,967.08 397,626 00 404,262 50 14,786 00 14,292 57 $ 587,272 81 $ 618,522 15 $ 379,456 41 $ 370,874.93 35,222 45 2,343.00 38,896.51 2,347.50 353 00 356.03 20,434.00 2,085 00 11,984.95 135,358.00 49,917 40 4,160 01 9,515.02 174,634.54 $ 587,236.81 $ 650,701.94 $ 3600 $ -32,179 79 $ 15,090 02 $ 15,090.02 $ 36.00 $ -17,089.77 41,006.57 42,775 44 -947.96 $ 40,094.61 $ 25,685.67 The notes to the general-purpose financial statements are an integral part of this statement -7- QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY I The Quitman County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. FUND ACCOUNTING The School District uses funds and an account group to report on its financial position and the results ofits operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources. General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the School District. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types. Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements. The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School District, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows: GOVERNMENTAL FUND TYPES - are used to account for all or most of a School District's educational activities. Governmental Fund Types include: GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education. - 8- QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives. CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding. BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources. Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group. Governmental funds are accounted for using the modified accrual basis ofaccounting under which: Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. -9- OUTIMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures are generally recognized when the related fund liability is incurred. A substantial number of personnel of the School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 2000 and ending in August 2001. State grants to fund the State's share of these contracts are disbursed to the School District in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements. BUDGET The Quitman County Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. The budget process begins when the School District's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. The Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to fund balance as reflected on Exhibit "B" ofthis report: - 10- QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Special Revenue Fund FUND BALANCE JULY 1, 2000 $ 44,058.85 Adjustments Inventories - July 1, 2000 Food Donated Commodities Purchased Foods -768.07 -515.34 Fund Balance July 1, 2000 (Budget Basis) $ 42,775.44 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses -17.089.77 FUND BALANCE JUNE 30, 2001 (Budget Basis) $ 25,685.67 CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations. INVESTMENTS COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: - 11 - QUITMAN COUNfY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (1) Obligations issued by the State of Georgia or by other states, (2) Obligations issued by the United States government, (3) Obligations fully insured or guaranteed by the United States government or a United States government agency, (4) Obligations of any corporation of the United States government, (5) Prime banker's acceptances, (6) The Local Government Investment Pool administered by the State ofGeorgia, Office of Treasury and Fiscal Services, (7) Repurchase agreements, and (8) Obligations of other political subdivisions of the State of Georgia. RECEIVABLES Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general-purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. PROPERTY TAXES The Quitman County Board of Commissioners fixed the property tax levy for the 2000 tax year (calendar year) on October 5, 2000 (levy date). Taxes were due on December 29, 2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Quitman County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% oftaxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $649,171.94 and for school bonds amounted to $69,382.81. Tax millage rates levied for the 2000 tax year (calendar year) for the Quitman County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value): - 12 - QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES School Operations School Bonds 13.46 mills 1.50 mills 14.96 mills SALES TAXES Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $178,076.96 and was recorded in the Debt Service Fund. The State will terminate collection ofthis tax once an additional $1,239,511.11 has been collected or on December 31, 2002, whichever occurs first. INVENTORIES FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the . Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets. GENERAL OBLIGATION BONDS The School District issues general obligation bonds to provide funds for the acquisition and construction ofmajor capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount of these bonds is recorded in the General Long-Tenn Debt Account Group. INTERFUND TRANSACTIONS The School District has the following types of interfund transactions: Reimbursements ofexpenditures initially made from a fund that are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed. Operating transfers are recorded for all interfund transactions other than reimbursements. - 13 - QUITMAN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITTJRES OF FEDERAL AWARDS EXHIBITS GENERAL-PURPOSE FINANCIAL STATEMENTS COMBINED STATEMENTS - OVERVIEW A COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP B COMBINED STATEMENT OF REVENUES, EXPENDITTJRES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES C COMBINED STATEMENT OF REVENUES, EXPENDITTJRES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS ADDIDONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET F COMBINING STATEMENT OF REVENUES, EXPENDITTJRES AND CHANGES IN FUND BALANCES CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET H COMBINING STATEMENT OF REVENUES, EXPENDITTJRES AND CHANGES IN FUND BALANCES DEBT SERVICE FUND I COMBINING BALANCE SHEET J COMBINING STATEMENT OF REVENUES, EXPENDITTJRES AND CHANGES IN FUND BALANCES Page 2 4 7 8 20 22 24 26 28 29 QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the general-purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results ofoperations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Note 2: DEPOSITS AND INVESTMENTS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts. Acceptable security for deposits consists of any one of or any combination of the following: (1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, (2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, (3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, (4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, (5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, (6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws of the State of Georgia, and - 14 - QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 2: DEPOSITS AND INVESTMENTS (7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 2001, the bank balances were $1,764,881.77. The amounts ofthe total bank balances are classified into three categories of credit risk: Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the School District or by the School District's agent in the School District's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name. Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the School District's name.) The School District's deposits are classified by risk category at June 30, 2001, as follows: Risk Category Bank Balance 1 $ 382,323.42 2 1,131,974.48 3 250,583.87 Total $ 1,764,881.77 CATEGORIZATION OF INVESTMENTS At June 30, 2001, the fair value of the School District's total investments was $30,762.00 and this entire amount consisted of U. S. Government Securities which was insured or registered, or securities held by the School District or the School District's agent in the School District's name. Note 3: NON-MONETARY TRANSACTIONS The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories - 15 - QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 4: RISK MANAGEMENT The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction ofassets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation. The School District has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and job related illness or injuries to employees. The School District has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years. The School District has elected to self-insure for all losses related to natural disaster. The School District has not experienced any losses related to this risk in the past three years. The School District is self-insured with regard to unemployment compensation claims. A premium is charged when needed by the General Fund to each user fund on the basis ofthe percentage ofthat fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The School District accounts for claims with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss ~an be reasonably estimated. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: 2000 2001 Beginning of Year Liability Claims and Changes in Estimates Claims Paid EndofYear Liability $ 0.00 $ 1,464.00 $ 1.464.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 The School District has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent Principal Bookkeeper $ 25,000.00 $ 25,000.00 $ 25,000.00 Note 5: GENERAL LONG-TERM DEBT GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: - 16- QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 5: GENERAL LONG-TERM DEBT Purpose Interest Rates Amount General Government - Series 1994 6.00% - 6.900% General Government- Refunding- Series 1998 4.05%-4.875% $ 135,000.00 2.130.000.00 $ 2,265,000.00 The changes in General Long-Term Debt during the fiscal year ended June 30, 2001, were as follows: Capital Leases General Obligation Bonds Total Balance July 1, 2000 $ 26,800.05 $ 2,300,000.00 $ 2,326,800.05 Deductions Debt Retired 26,800.05 35,000.00 61,800.05 Balance June 30, 2001 $ 0,00 $ 2,265,000.00 $2,265,000.00 At June 30, 2001, payments due by fiscal year which includes principal and interest for these items are as follows: Fiscal Year Ended June 30 General Obligation Bonds 2002 2003 2004 2005 2006 2007 -2011 2012 - 2016 2017 - 2021 $ 282,925.00 275,412.50 278,005.00 285,297.50 172,200.00 948,980.00 1,103,601.26 708,862.52 Total Principal and Interest $ 4,055,283.78 - 17 - QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 6: PRIOR YEAR DEFEASEMENT OF DEBT In fiscal year 1998, the School District defeased certain general obligation bonds by placing the proceeds ofnew bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the School District's general-purpose financial statements. At June 30, 2001, $1,835,000.00 of bonds are outstanding and are considered defeased. Note 7: ON-BEHALF PAYMENTS The School District has recognized revenues and expenditures in the amount of $45,771.93 for health insurance and retirement contributions paid on the School District's behalfby the following State Agencies. Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $39,336.93 Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $6,435.00 Note 8: CONTINGENT LIABILITIES Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position. Note 9: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school districts are covered by the Teachers Retirement System ofGeorgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts. - 18 - QUITMAN COUNfY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 200 I Note 9: RETIREMENT PLANS TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows: Fiscal Year Percentage Contributed Required Contribution 2001 2000 1999 100% 100% 100% $ 153,458.85 $ 136,939.22 $ 142,109.95 - 19 - QUITMAN COUNTY BOARD OF EDUCATION COMBINING BAliANCE SHEET SPECIAL REVENUE' FUND JUNE 30, 2001 ASSETS Cash and Cash Equivalents Accounts Receivable Inventories Food Donated C9mmodities Purchased Food SCHOOL FOOD SERVICES FUND LOTTERY PROGRAMS $ 31,818.65 $ 26,096.94 741.96 532.07 Total Assets $ 33,092.68 $ ===2=6=,0=96==94= LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue Total Liabilities FUND EQUITY Fund Balances Reserved For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated Total Fund Equity $ 1,131.94 $ 4,835.49 5,001.04 20,885.62 375.83 $ 6,132.98 $ 26,096.94 $ 741.96 532.07 25,685.67 $ $ 26,959.70 $ 0.00 0.00 Total Liabilities and Fund Equity $ 33,092.68 $===2=6=,0=9=6=94== See notes to the general-purpose financial statements. - 20- EXHIBIT"E" FEDERAL PROGRAMS TOTALS JUNE 30, 2001 JUNE 30, 2000 $ 28,172.84 $ 86,088.43 $ 61,790.39 13,592.18 13,592.18 63,643.82 741.96 532.07 768.07 515.34 $ 41,765.02 $ 100,954.64 $ ==1=2=6=7,=17=.6=2= $ 29,999.99 $ 5,675.94 $ 11,643.37 10,754.50 23,872.82 49,759.48 41,597.28 175.96 551.79 307.00 12,040.30 12,040.30 $ 41,765.02 $ 73,994.94 $ 82,658.77 $ $ _ _ _ _o...;._.o_o"-- $ 0.00 $ 741.96 $ 532.07 768.07 515.34 25,685.67 42 775.44 26,959.70 $ ___44_..__,0_58_.8_5"-- $ 41,765.02 $ 100,954.64 $ = = = 126~,71=7.6=2 - 21 - QUITMAN COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30. 2001 REVENUES State Funds Federal Funds Other Funds Total Revenues EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES Operating Transfers In Excess of Revenues and Other Financing Sources over (under) Expenditures FUND BALANCE JULY 1 Food Inventory - Net Change in Period Donated Commodities Purchased Food FUND BALANCE JUNE 30 SCHOOL FOOD SERVICES FUND LOTTERY PROGRAMS $ 9,812.00 $ 175,280.08 129,360.02 14,292.57 $ 153,464.59 $ 175,280.08 $ 126,670.62 38,896.51 19,902.64 783.50 $ 170,554.36 3,620.68 $ 170,554.36 $ 189,873.95 $ -17,089.77 $ -14,593.87 $ -17,089.77 $ 44,058.85 -26.11 16.73 14,593.87 0.00 0.00 $ 26,959.70 $=====0.=00= See notes to the general-purpose financial statements. -22- EXHIBIT "F" FEDERAL PROGRAMS TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000 $ 14,875.00 $ 199,967.08 $ 250,425.72 274,902.48 404,262.50 345,219.23 14,292.57 15 709.41 $ 289,777.48 $ 618,522.15 $ _ _6_1_1.._,3_54_._36_ $ 244,204.31 $ 370,874.93 $ 371,212.27 2,347.50 356.03 30,014.76 3,376.51 9,515.02 459.50 38,896.51 2,347.50 356.03 49,917.40 4,160.01 9,515.02 174 634.54 44,297.78 8,359.28 2,480.78 541.28 16,028.94 13,971.51 573.18 9,476.13 143,917.64 $ 290,273.63 $ 650,701.94 $ 610,858.79 $ -496.15 $ -32,179.79 $ 495.57 / 496.15 15,090.02 3,340.42 $ 0.00 $ -17,089.77 $ 3,835.99 0.00 44,058.85 39,655.10 -26.11 16.73 238.56 329.20 $ 0.00 $ 26,959.70 $ ===44====,0=58..,.=85= - 23- QUITMAN COUNTY BOARD OF EDUCATION -TABLEOFCONfENTS- SECTION I FINANCIAL ADDmONAL FINANCIAL INFORMATION SCHEDULES 1 SCHEDULE OF EXPENDITIJRES OF FEDERAL AWARDS 30 2 SCHEDULE OF STATE REVENUE 31 3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS 33 ALLOTMENTS AND EXPENDITIJRES GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE) 4 BY PROGRAM 34 5 BY SITE 35 SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCEWITHGOVERNMENTAUDITINGSTANDARDS REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133 SECTION ID AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS QUITMAN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 2001 ASSETS Cash and Cash Equivalents Investments Accounts Receivable Total Assets FUND EQUITY Fund Balances Reserved For Purposes of Bond Issue For SPLOST Projects Unreserved Undesignated Total Fund Equity REGULAR BOND PROCEEDS $ 621.06 $ 300,796.85 105.00 $ 621.06 $ 300,901.85 $ 300,901.85 $ 621.06 0.00 $ 621.06 $ 300,901.85 See notes to the general-purpose financial statements. -24- EXHIBIT"G" SPECIAL PURPOSE LOCAL OPTION SALES TAX TOTALS JUNE 30, 2001 JUNE 30, 2000 $ 0.00 $ 301,417.91 $ 337,918.49 105.00 100,099.55 30,021.79 $ 0.00 $ 301,522.91 $ 468,039.83 $ $ ____o=.o=o'- 300,901.85 $ 621.06 330,439.73 136,979.04 621.06 $ 0.00 $ 301,522.91 $ 468,039.83 -25- QUITMAN COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 2001 REVENUES Taxes Other Funds Total Revenues EXPENDITURES Capital Outlay Building and Building Improvements Equipment Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING USES Operating Transfers Out Excess of Revenues over (under) Expenditures and Other Financing Uses FUND BALANCE JULY 1 FUND BALANCE JUNE 30 REGULAR BOND PROCEEDS $ 0.00 $ 6.10 $ 0.00 $ 6.10 $ 24,691.58 $ 0.00 4,852.40 $ 0.00 $ 29,543.98 $ 0.00 $ -29,537.88 $ 0.00 $ -29,537.88 621.06 330,439.73 $ 621.06 $ =====3=0=0=,9=01=.8=5= See notes to the general-purpose financial statements. - 26- EXHIBIT"H" SPECIAL PURPOSE LOCAL OPTION SALES TAX TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000 $ $ _ _ _ _0__.~00~$ _ _ _ _6~.1_0_ 27,996.22 4 816.99 $ 0.00 $ 6.10 $ _ _ _3_2._,8_13_.2_1_ $ $ _ _ _-'o""'".oa,,.o_ $ 0.00 $ $ 0.00 $ 24,691.58 4,852.40 $ _ _ _2_4._,5_6_5_.0_5_ 29,543.98 $ _ _ _2_4._,5_65_._0_5_ -29,537.88 $ 8,248.16 -136 979.04 -136,979.04 $ -136,979.04 $ -166,516.92 $ 136,979.04 468,039.83 8,248.16 459,791.67 $ 0.00 $ 301,522.91 $ ==4=6=8=,0=39....8=3= -27- QUITMAN COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30. 2001 EXHIBIT"!" ASSETS Cash and Cash Equivalents Investments Accounts Receivable PROPERTY TAXES FOR BOND DEBT SPECIAL PURPOSE LOCAL OPTION SALES TAX TOTALS JUNE 30, 2001 JUNE 30, 2000 $ 32,037.81 $ 89,089.86 $ 121,127.67 $ 15,169.05 30,657.00 100,000.00 130,657.00 8,886.61 1,598.28 26,416.17 28,014.45 9,034.88 Total Assets $ 64,293.09 $ 215,506.03 $ 279,799.12 $ ===3=3'=09=0=.54==== FUND EQUITY Fund Balances Reserved For Debt Service Unreserved Undesignated $ 64,293.09 $ 0.00 215,506.03 $ 0.00 279,799.12 $ 0.00 33,090.54 0.00 Total Fund Equity $ 64,293.09 $ 215,506.03 $ 279,799.12 $ ===33='=09=0=.54==== See notes to the general-purpose financial statements. -28- QUITMAN COUNTY BOARD OF EDUCATION EXHIBIT "J" COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES DEBT SERVICE FUND YEAR ENDED JUNE 30, 2001 PROPERTY TAXES FOR BOND DEBT SPECIAL PURPOSE LOCAL OPTION SALES TAX TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000 REVENUES Taxes Other Funds $ 69,571.02 $ 68,258.88 178,076.96 $ 64,130.39 247,647.98 $ 132,389.27 163,813.92 125,453.52 Total Revenues $ 137,829.90 $ 242,207 35 $ 380,037.25 $ 289,267.44 EXPENDITURES Debt Service Pnncipal Interest Paying Agent Fees $ 15,000.00 $ 72,647.97 672 71 20,000.00 $ 161,987.03 35,000.00 $ 234,635.00 672 71 30,000.00 236,045.00 65.60 Total Expenditures $ 88,320.68 $ 181,987.03 $ 270,307 71 $ 266,110.60 Excess of Revenues over (under) Expenditures $ 49,509.22 $ 60,220.32 $ 109,729.54 $ 23,156.84 OTHER FINANCING SOURCES Operating Transfers In 136,979.04 136,979.04 Excess of Revenues and Other Financing Sources over (under) Expenditures $ 49,509.22 $ 197,199.36 $ 246,708.58 $ 23,156.84 FUND BALANCE JULY 1 14,783.87 18,306.67 33,090.54 9,933.70 FUND BALANCE JUNE 30 215,506 03 $ 219,19912 s_=o:,;3.3..1=,0=90.54~ See notes to the general-purpose financial statements. -29- QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30 2001 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT Agnculture, U S Department of Child Nutntion Cluster Pass-Through From Georgia Department of Education Food and Nutntion Program Food Services School Breakfast Program National School Lunch Program Total Child Nutnt1on Cluster Other Programs Pass-Through From Georgia Department of Education Food and Nutnbon Program Food D1stnbut1on Program (1) Total U S Department of Agnculture Education. U S Department of Speaal Education Cluster Pass-Through From Georgia Department of Education lnd1v1duals with Disabilities Education Act Part B - Speaal Education Flow Through Preschool Capaaty Budding Improvement Grant Total Speaal Education Cluster Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act T1tlel Grants to Local Educational Agenaes Goals2000 State and Local Education Systemic Improvement Grants Total U S. Department of Education CFDA NUMBER PASSTHROUGH ENTITY ID NUMBER FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 10 553 10 555 N/A $ 34,251 00 NIA 90,709 56 $ $ 124,960 56 $ (2) 166,15490 (3) 166,154 90 10 550 NIA 4 399 46 $ 129,360 02 $ 4,399 46 170,554 36 84027 84173 84173 NIA $ 28.292 35 $ NIA 14,279 00 NIA 1,500 00 $ 44,071 35 $ 28,788.50 (3) 14,279.00 1 500 00 44,567.50 . 84 010 84.276 N/A 151,304.63 NIA 79,526 50 $ 2741902.48 $ 151,304 63 79,526 50 275,398 63 Total Federal F1nanaal Assistance $ 404,262 50 $ _ _ _44_5.,.,9..,52....,99._ N/A = Not Available Notes to the Schedule of Expenditures of Federal Awards (1) The amounts shown for the Food D1stnbution Program represents the Federally assigned value of nonmonetary assistance for donated commod1t1es received and/or consumed by the system dunng the current fiscal year (2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2001 National School Lunch Program (3) Expenditures for this program include State, and/or Other Funds Expenditures are not maintained by fund source The Maior Program 1s identified by an astensk (") in front of the CFDA number. The School D1stnd did not proVlde Federal Assistance to any Subreapient The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Quitman County Board of Educabon and 1s presented on the modified accrual basis of accounting which 1s the basis of accounting used in the presentation of the general-purpose finanaal statements See notes to the general-purpose financial statements - 30- QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 2001 SCHEDULE "2" AGENCY/FUNDING GRANTS Community Affairs, Georgia Department of Governor's Emergency Funds (1) Education, Georgia Department of Quahty Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Pnmary Grades (1-3) Program Pnmary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle Grades (6-8) Program Students with D1sab1ht1es Category II Category Ill Category IV Remedial Education Program Alternative Education Program Media Center Program Staff and Professional Development Indirect Cost Categoncal Grants Pupil Transportation Regular Bus Replacement Sparsity Nursing SeMces Pnnapal Supplements M1d-tenn AdJustment Hold-Harmless Education Equalization Funding Grant Deferred Summer Salanes (Pnor Year) Deferred Summer Salanes (Current Year) FoodSeMces Other State Programs Health Insurance Preschool Handicapped Program Statewide Local Education Improvement Lottery Program Computers 1n the Classroom Office of School Readiness Pre-Kindergarten Program Office of Treasury and Fiscal Services Pubhc School Employees Retirement CONTRACTS Education, Georg1S Department of GeorglS'S Reading Challenge Reading First Program GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 16,250 00 $ 16,250 00 107,392.00 4,638 00 242,349.00 19,157.00 136,130 00 105,264 00 15,195.00 89,107 00 16,548.00 20,051 00 3,801 00 26,422 00 5,701.00 310,514.00 93,620.00 24,837.00 126,096.00 24,219.00 975 00 30,269.00 71,844 00 -145,309.00 202,076.00 $ 39,336.93 11,228 00 25,14140 9,812.00 5,150.21 170,129.87 6,435 00 107,392 00 4,638 00 242,349 00 19,15700 136,130 00 105,264.00 15,195 00 89,107 00 16,548 00 20,051 00 3,801.00 26,422 00 5,701.00 310,514 00 93,620 00 24,837.00 126,096 00 24,21900 975.00 30,26900 71,844 00 -145,309 00 202,076.00 9,812.00 39,336 93 11,228 00 25,141 40 5,150.21 170,129.87 6,43500 118,058.00 14,875 00 118,058.00 14 875.00 $ 1,747,345 33 $ 199.967 08 $ 1,947,312 41 (1) The purpose of the funds are to renovate Pre-Kindergarten and Headstart buildings and to restore the Kaigler Training School building See notes to the general-purpose finanaal statements - 31 - QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS YEAR ENDED JUNE 30, 2001 SCHEDULE "3" PROJECT ORIGINAL ESTIMATED COST(1) CURRENT ESTIMATED COSTS (2) AMOUNT EXPENDED IN CURRENT YEAR (3) (4) AMOUNT EXPENDED IN PRIOR YEARS (3) PROJECT STATUS Removal and excavation of matenals from an uncharted drain field located within the building and parking perimeter of the new Quitman County Elementary School construction site $ 20,000.00 $ 17,468.75 $ 17,468.75 Completed Asphalt paving on the new Quitman County Elementary construction site 130,000.00 89,715.00 89,715.00 Completed Repayment of principal and interest on School Distnct's Series 1994 bonds matunng February 1, 2004 and thereafter 1,650,000.00 1,650,000.00 $ 181,987.03 367.226.66 Ongoing $ 1,800,000.00 $ 1,757,183.75 $ 181,987.03 $ 474,410.41 (1) The School District's onginal 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. lndudes all cost from project inception to completion. (3) The voters of Quitman County approved the imposition of a 1% sales tax to fund the above proJects and retire associated debt Amounts expended for these projects may indude sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. (4) A portion of the Series 1994 Bonds were retired through the sale of Series 1998 Refunding Bond Issue. The School District will utilize the SPLOST proceeds budgeted for this project, plus any excess SPLOST proceeds to retire the Series 1998 Refunding Bond Issue. See notes to the general-purpose financial statements. -33- QUITMAN COUNTY BOARD OF EDUCATION GENERAL FUND- QUALITY BASIC EDUCATION PROGRAM {QBE) ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2001 SCHEDULE 4 DESCRIPTION Direct Instructional Programs Kindergarten Program Kindergarten Program-Early Intervention Program Pnmary Grades (1-3) Program Pnmary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle Grades (6-8) Program Students with Disabilities Category Ill Remedial Education Program Alternative Education Program TOTAL DIRECT INSTRUCTIONAL PROGRAMS Media Center Program Staff and Professional Development ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1) ELIGIBLE QBE PROGRAM COSTS SALARIES OPERATIONS TOTAL $ 124,097 00 $ 106,109.07 $ 1,60640 $ 107,715.47 5,360.00 14,986.93 14,986.93 280,048.00 271,873.05 5,326.48 277,199.53 22,113.00 21,830 01 21,830.01 157,306.00 173,428 59 2,302.39 175,730.98 121,638 00 135,100.40 300.00 135,400.40 139,649.00 168,820.89 3,664.24 172,485.13 23,170.00 35,808.60 35,808.60 4,392.00 7,993 10 5500 8,04810 $ 877,773 00 $ 935,950.64 $ 13,254.51 $ 949,20515 30,533.00 6,588.00 56,334.14 1,980.78 1,987.90 5,006.04 58,322.04 6,986.82 TOTAL QBE FORMULA FUNDS $ 914,894.00 $ 994,265.56 $ 20,248 45 $ 1,014,514.01 (1) Comprised of State Funds plus Local Five Mill Share. See notes to the general-purpose financial statements - 34- SECTION I FINANCIAL QUITMAN COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE) ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30, 2001 SCHEDULE "5" SITE New Quitman County Elementary School Central Office (Alternative Education Program) TOTAL (1) Comprised of State Funds plus Local Five Mill Share. ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1) ELIGIBLE QBE PROGRAM COSTS $ 873,381.00 $ 949,205.15 4,392.00 $ 877,773.00 $ ====9=49=,2=05=.1=5 See notes to the general-purpose financial statements. -35- SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS RussELL W. H1NTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Wa\hrngton Street. S W.. Su11c 214 Atlanta. Georgia 30334-8400 March 28, 2002 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Quitman County Board of Education REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the financial statements of Quitman County Board of Education as of and for the year ended June 30, 2001, and have issued our report thereon dated March 28, 2002. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether Quitman County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered Quitman County Board ofEducation's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal 2001YB-40 control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Quitman County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-7181-01-01, FS-7181-01-02 and FS-7181-01-03. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, ofthe reportable conditions described above, we considered item FS-718101-03 to be a material weakness. This report is intended solely for the information and use of the management, members of the Quitman County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. Respectfully submitted, RWH:as 2001YB-40 State Auditor RussELL W. H1NTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Wa~hmgton Street. S.W. Sunc 214 AtlJnta. Georg.ta 30334-8400 March 28, 2002 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Quitman County Board of Education REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133 Ladies and Gentlemen: Compliance We have audited the compliance of Quitman County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2001. Quitman County Board ofEducation's major Federal program is identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major Federal program is the responsibility ofQuitn;tan County Board ofEducation's management. Our responsibility is to express an opinion on Quitman County Board ofEducation's compliance based on our audit. We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States ofAmerica; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and 0MB Circular A133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and 0MB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance 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 Quitman County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Quitman County Board ofEducation's compliance with those requirements. 2001SA-10 In our opinion, the Quitman County Board ofEducation complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 2001. Internal Control Over Compliance The management of Quitman County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Quitman County Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with 0MB Circular A-133. Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course ofperforming their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. This report is intended solely for the information and use of the management, members of the Quitman County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. Respectfully submitted, ~.4k RWH:as 2001SA-10 State Auditor SECTION ID AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS QUITMAN COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS FS-7181-99-01 FS-7181-99-02 FS-7181-00-01 FS-7181-00-02 Unresolved - See Corrective Action/Responses Further Action Not Warranted Previously Reported Corrective Action Implemented Unresolved - See Corrective Action/Responses CORRECTIVE ACTION/RESPONSES EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Amount: $19,370.70 Finding Control Number: FS-7181-99-01 Underexpenditure in the amount of$ l 9,370.70 will be returned to the Georgia Department of Education through an increase in the School District's Local Five Mill Share for the QBE programs. The Quitman County Board ofEducation will spend the required amount for all allocated funds. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7181-00-02 Quitman County Board ofEducation will fully implement a General Fixed Assets Account Group as required by Governmental Accounting Standards Board Statement Number 34. SECTIONN FINDINGS AND QUESTIONED COSTS QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001 I SUMMARY OF AUDITOR'S RESULTS 1. Type of Report Issued on the Financial Statements The auditor's opinion on the Quitman County Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles. 2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Quitman County Board of Education disclosed financial statement reportable conditions related to the following control categories. Cash and Cash Equivalents Employee Compensation Expenditures/Liabilities/Disbursements General Fixed Assets Of the reportable conditions described above, General Fixed Assets is considered to be a material weakness. 3. Noncompliance Material to the Financial Statements The audit of the Quitman County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements. 4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Quitman County Board ofEducation did not disclose any reportable conditions in internal control over major programs. 5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Quitman County Board of Education's report on compliance with requirements applicable to major programs was unqualified. 6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Quitman County Board ofEducation's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133: 7. Major Programs Federal award audited as a major program is as follows: 84.010 Elementary and Secondary Education Act-Title I- Grants to Local Educational Agencies 8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00. 9. Low Risk Auditee The Quitman County Board of Education qualified as a low risk auditee based on a waiver granted by the U.S. Department of Education. - 1- w. RUSSELL HINTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Wu~hington Street. S W.. Suite 214 Atl,mtJ. Georgia 30334-8400 March 28, 2002 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Quitman County Board of Education INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Ladies and Gentlemen: We have audited the accompanying general-purpose financial statements of the Quitman County Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the Quitman County Board of \ Education's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a-test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: 2001ARL-13 QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 2001 II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS CASH AND CASH EQUIVALENTS EXPENDITURES/LIABilJTIES/DISBURSEMENTS EMPLOYEE COMPENSATION Inadequate Separation of Duties Reportable Condition Finding Control Nwnber: FS-7181-01-01 An examination ofthe internal accounting control procedures revealed that the School District did not maintain adequate separate ofduties in the performance ofthe following categories and related procedures: Cash and Cash Equivalents - All Funds There was no administrative review to determine that bank reconciliations were correct and that all required adjustments had been made. Expenditures/Liabilities/Disbursements The duty of approving vouchers for payment for all funds was not adequately separated from the duty of writing checks. In addition, there was no independent review to determine that expenditures were appropriate, accurate and properly docwnented prior to payment. Employee Compensation The duty ofapproving payroll disbursements for the General and Special Revenu~Funds was not adequately separated from the duty ofwriting checks. In addition, there was no independent review ofthe payroll registers to determine that the payroll disbursements were authorized, properly docwnented and in accordance with approved contracts and salaries. Separation ofduties involving key accounting functions is the basis for achieving an adequate system of internal control. Inadequate separation of duties creates an environment that does not provide reasonable assurance that accounting data and financial statements are accurate and complete. This deficiency was a result of management's decision to limit the number of administrative staffmade responsible for accounting functions. Management should periodically review this decision to determine ifemployee duties can be reassigned to achieve a higher degree ofinternal control with the existing staff. -2- QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 2001 II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS EMPLOYEE COMPENSATION Salary Overpayments Reportable Condition Amount: $11,814.00 Finding Control Number: FS-7181-01-02 A sample of fourteen employees was selected for the purpose of testing the accuracy of employee compensation paid. The following discrepancies were noted: (I) One employee was overpaid $814.00 due to salary payments being calculated using the wrong salary step on the State salary schedule. (2) One employee was overpaid $11,000.00 due to local supplement amount referenced in the employee's contract being applied as a monthly supplement instead of an annual supplement as intended. (3) The School District did not maintain adequate documentation to support amounts paid to non-certified employees. The discrepancies above occurred because management failed to ensure that payments to employees were correctly calculated and documented. The School District should implement procedures to ensure that all payroll disbursements are properly calculated and documented in accordance with approved salaries and contracts. The School District should review the overpayments of$11,8 l 4.00 to determine whether reimbursements should be secured. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7181-01-03 The Quitman County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general-purpose financial statements ofthe School District being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the School District and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. -3- QUITMAN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001 ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. -4- * The general-purpose financial statements of the Board of Education did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles. * School activity accounts maintained at the individual schools are not included in the general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements. The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material. In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Quitman County Board of Education as ofJune 30, 2001, and the results ofits operations for the year then ended, in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated March 28, 2002, on our consideration of the Quitman County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Quitman County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through J) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general-purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general-purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole. 2001ARL-13 A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24. Respectfully submitted, RWH:as 2001ARL-13 State Auditor QUITMAN COUNTY BOARD OF EDUCATION QUITMAN COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP JUNE 30, 2001 ASSETS Cash and Cash Equivalents Investments Accounts Receivable lnventones Food Donated Commodities Purchased Food Amount Available in Debt Service Fund Amount to be Provided in Future Years For Payment of. Capital Lease Agreements Bond Debt GENERAL FUND GOVERNMENTAL FUND TYPES SPECIAL CAPITAL REVENUE PROJECTS FUND FUND $ 199,480.28 $ 86,088.43 $ 301,417.91 650,000.00 105.00 245,411.67 13,592.18 741.96 532.07 Total Assets $ 1,094,891.95 $ 100,954.64 $ 301,522.91 LIABILITIES AND FUND EQUITY LIABILITIES Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue Capital Lease Agreements General Obligation Bonds Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Bus Replacement Funds For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST ProJects Unreserved Designated for Self-Insurance Undesignated Total Fund Equity $ 36,324.05 $ 11,643.37 160.206.84 49,759.48 3,110.60 551.79 12,040.30 $ 199,641.49 $ 73,994.94 . $ 36,774.35 19,370.70 $ 741.96 532.07 $ 300,901.85 24,265.92 814,839.49 25,685.67 621.06 $ 895,250.46 $ 26,959.70 $ 301,522.91 Total Liabilities and Fund Equity $ 11094,891.95 $ The notes to the general-purpose financial statements are an integral part of this statement. -2- 100,954 64 $ 301,522.91