RICHMOND COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS- SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS EXHIBITS GENERAL-PURPOSE FINANCIAL STATEMENTS COMBINED STATEMENTS - OVERVIEW A COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP 2 B COMBINED STATEMENT OF REVENUES, EXPENDITURES AND .CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS 4 C COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS 6 D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS 7 ADDmONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 24 F COMBINING STATEMENT OF REVENUES, EXPENDITURES . AND CHANGES IN FUND BALANCES 26 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 28 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 30 DEBT SERVICE FUND I COMBINING BALANCE SHEET 32 J COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 33 RICHMOND COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS- SECTION I FINANCIAL ADDIDONAL FINANCIAL INFORMATION EXHIBITS COMBINING STATEMENTS FIDUCIARY FUND TYPES K COMBINING BALANCE SHEET 34 . L COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES EXPENDABLE TRUST FUNDS 36 M COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABil..mES AGENCY FUNDS 38 SCHEDULES 1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 39 2 SCHEDULE OF STATE REVENUE . 41 3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS . 43 ALLOTMENTS AND EXPENDmJRES GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE) 4 BY PROGRAM 44 5 BY SITE 45 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 ACCORDANCE WITII GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE WITII REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITII 0MB CIRCULAR A-133 RICHMOND COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS- SECTION ill 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 SECTION I FINANCIAL RussELL W. HtNTON STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 February 14, 2002 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Richmond 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 Richmond 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 ofthe Richmond County Board of Education's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit. Except as discussed in the following paragraph, we cop.ducted our audit in accordance with auditing standards generally accepted in the United States of Ainerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We did not observe the taking ofthe consumable supplies inventory at June 30, 2001, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. 2001ARL-13 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: * 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 ge~eral-purpose financial statements. * The Board of Education did not recognize as expenditures, in the year ended June 30, 2001, ~ portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2001. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's ~hare of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were improperly recorded in the year ended June 30, 2001. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed. The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material. In our opinion, except for the effects ofsuch adjustments, ifany, on the General Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the consumable supplies inventory as discussed in the third paragraph, and except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Richmond County Board ofEducation as ofJune 30, 2001, and the results of its 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 February 14, 2002, on our consideration of the Richmond 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 ofan audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. 2001ARL-13 Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Richmond County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through M) 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 effect of adjustments, if any, on the General Fund, as might have been d_etermined to be necessary had we qeen able to satisfy ourselves as to the accuracy of the consumable supplies inventory as discussed in the third paragraph, and except for the effects ofthe matters referred to in the fourth paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole. 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:gp 2001ARL-13 RICHMONDCOUNTYBOARDOFEDUCATION RIQHMOND QQUNTY BOARD OF EQUQ~T)ON CQMBINED BALANCE SHEET ALL FUND TYPES ANQ ACCOUNT GROUP Jl,!NE 30. 2001 ~ Cash and Cash Equivalents Investments Accounts Receivable Due from Other Funds Inventories Consumable Supplies Food Donated Commodities Purchased Food Amount Available in Debt Service Fund Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements "Compensated Absences GENERAL FUND GOVERNMENTAL FUND TYPES SPECIAL CAPITAL REVENUE PROJECTS FUND FUND $ 9,969,072.78 $ 4,361,798.48 13,590,653.44 $ 43,881,920.68 2,062,238.22 4,265,412.35 6,658,748.11 260,092.90 3,249,268.83 51,111.53 135,351.52 138,233.93 Total Assets $ 28,871,233.27 $ 8,951,907.81 $ 501800,761.69 blABILITIE~ ~NQ FUNR !;QUID'. LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Short-Tenn Debt Expired Grant Balances Payable Contracts Payable Retainages Payable Due to Other Funds Funds Held for Others Capital Lease Agreements Compensated Absences General Obligation Bonds Payable Total Liabilities FUND.EQUIIY Fund Balances Reserved For Arbitrage Rebate Tax For Continuation of Federal Programs For Debt Service For Encumbrances For Inventories Consumable Supplies Food Donated Commodities Purchased Food For Purpose of Bond Issue For SPLOST Projects For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity $ 24,182.21 $ 2,518,104.43 $ 669,710.70 35,038.32 2,148,960.00 13,000,000.00 259,348.90 860.00 365,089.27 737,271.10 97,490.49 $ 2,874,943.82 $ 2,819,530.70 $ 14,161,560.90 $ 920,175.00 $ 148,579.23 $ 97,971.69 3,249,268.83 51,111.53 135,351.52 138,233.93 1,257,282.71 34,322,211.00 139,532.08 22,598,441.39 5,709,708.44 0.00 $ 25,996,289.45 $ 6,13213TT.11 $ 36,639,200.79 Total Liabilities and Fund Equity $ 28,8711233.27 $ 819511907.81 $ 501800,761.69 The notes to the general-purpose financial statements are an integral part of this statement. -2- EXHIBIT"A" DEBT SERVICE FUND FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS $ 4,205,871.82 $ 111,728.80 2,613.98 162,318.59 ACCOUNT GROUP GENERAL LONG-TERM DEBT TOTALS (Memorandum Onl~ JUNE 30, 2001 JUNE 30, 2000 $ 18,648,471.88 $ 15,262,143.68 57,475,188.10 58,908,072.50 13,148,717.27 12,608,524.06 260,092.90 $ 4,208,201.98 3,300,380.36 135,351.52 138,233.93 4,208,201.98 3,517,317.35 142,661.14 127,054.25 6,763,878.44 43,366,798.02 17,089,427.27 1.269,110.42 43,366,798.02 17,089,427.27 1,269.110.42 69,006, 121.56 17,471,348.79 1.006.836.56 $ 413701804.39 $ 111-728.80 $ 6519331537.69 $ 15910391973.65 $ 18418131958.33 $ 162,602.41 $ $ 162,602.41 $ 38,215.68 $ $ 17,089,427.27 1,269,110.42 47.575.000.00 24,182.21 3,222,853.45 $ 2,148,960.00 13,000,000.00 260,208.90 365,069.27 737,271.10 260,092.90 38,215.68 17,089,427.27 1,269,110.42 47.575,000.00 4,782,120.73 2,259,970.51 109,156.61 3,226,378.47 1,864,318.79 34,534.43 17,471,348.79 1,006,836.56 75,no,ooo.oo 38,215.68 $ 65.933.537.69 $ 85,990,391.20 $ 106.524.664.89 $ 4,208,201.98 0.00 $ $ 4.208.201.98 $ 73.513.12 73,513.12 $ 920,175.00 $ 920,175.00 149.24 4,208,201.98 6,763,878.44 248,550.92 543,015.59 3,300,380.36 3,517,317.35 135,351.52 138,233.93 1,257,282.71 34,322,211.00 139,532.08 142,681.14 127,054.25 10,561,573.52 27,388,291.64 5,679,511.40 28.381.682.95 22.645,685.87 $ 73.049.582.45 $ 78.289.293.44 $ 413701804.39 $ 111-728.80 $ 6519331537.69 $ 15910391973.65 $ 18418131958.33 -3- RiCHMOND COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30. 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 Administration Maintenance and Operation of Plant Stui:lent Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations Capital Outlay Debt Service Principal Interest Paying Agent Fees Total Expenditures Excess of Revenues over (under) Expenditures OT!:!ER FINANCING SOURC!;S (USES} Capital Leases 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 .Consumable Supplies Inventory - Net Change in Period Food Inventory - Net Change in Period Donated Commodities Purchased Food GENERAL FUND GOVERNMENTAL FUND SPECIAL CAPITAL REVENUE PROJECTS FUND FUND $ 137,023,016.29 $ 1,301,626.41 61,996,305.70 3,622,041.03 8,045,396.92 $ 24,492,381.33 3,310,352.57 5,201,297.51 9,408,022.96 2,727,130.46 $ 203,942,989.43 . $ 35,848,130.82 $ 17,336,450.93 $ 132,589,801.91 $ 15,179,216.33 4,120,090.14 4,419,182.91 5, 165,483.45 1,935,396.70 14,673,350.79 1,454,053.55 21,917,244.85 8,599,012.25 1,901,460.09 27,832.78 70,148.70 107,423.00 632,933.65 2,614,468.49 2,107,796.76 614,537.00 349,279.31 231,515.03 $ 705,964.26 79,927.60 170.47 43,968.51 13,024,041.10 315,962.12 100,000.00 25,174,093.98 1,447,167.42 1,222,425.38 14,068.40 1,986.75 $ 200,283,007.57 $ 35,282,902.13 $ 25,274,093.98 $ 3,659,981.86 $ 565,228.69 $ -7,937,643.05 $ 1,079,314.31 55,610.12 $ -239,400.00 $ 895,524.43 $ 239,400.00 $ 239,400.00 $ -55,610.12 -55,610.12 $ 4,555,506.29 $ 21,505,999.27 -65,216.11 804,628.69 $ -7,993,253.17 5,323,878.36 44,632,453.96 07,309.62 11,179.68 FUND BALANCE JUNE 30 $ 25,996,289.45 $ 6,132,377.11 $ 36,639,200.79 The notes to the general-purpose financial statements are an integral part of this statement. -4- EXHIBIT"B" TYPES DEBT SERVICE FUND TOTAL FIDUCIARY FUND TYPE EXPENDABLE TRUST FUNDS TOTALS (Memorandum Onll:'.l YEAR ENDED JUNE 30, 2001 JUNE 30, 2000 $ 150,269,710.72 25,794,007.74 $ 28,455,305.81 99,859,634.47 407,710.99 10,067,235.05 $ $ 28,863,016.80 $ 285,990,587.98 $ $ 150,269,710.72 $ 140,566,279.88 25,794,007.74 23,764,408.59 99,859,634.47 97,215,587.36 10,804.71 10,078,039.76 10,109,932.64 10,804.71 $ 286,001,392.69 $ 271,656,208.47 $ 147,769,018.24 6,734,558.63 6,526,979.67 5,780,020.45 2,284,676.01 14,904,865.82 1,554,053.55 22,623,209.11 8,678,939.85 1,901,630.56 $ 71,801.29 13,094,189.80 423,385.12 25,807,027.63 $ 28,195,000.00 3,214,680.00 9,013.26 29,656,235.82 4,439,092.13 9,013.26 $ 31,418,693.26 $ 292,258,696.94 $ $ -2,555,676.46 $ -6,268,108.96 $ $ 147,769,018.24 $ 133,668,311.29 375.00 6,734,558.63 6,526,979.67 5,780,020.45 2,284,676.01 14,904,865.82 1,554,053.55 22,623,209.11 8,678,939.85 1,902,005.56 71,801.29 13,094,189.80 423,385.12 25,807,027.63 10,600,842.61 6,367,218.28 6,022,386.97 2,360,612.17 13,995,455.68 1,270,083.75 21,306,947.36 7,615,167.27 2,263,834.93 453,065.28 13,045, 128.50 491,505.24 36,928,772.88 29,656,235.82 4,439,092.13 9,013.26 24,372,965.52 5,061,192.87 8,886.70 375.00 $ 292,259,071.94 $ 285,832,377.30 10,429.71 $ -6,257,679.25 $ -14,176,168.83 $ 1,079,314.31 295,010.12 -295,010.12 $ 1,079,314.31 $ -2,555,676.46 $ -5,188,794.65 $ 6,763,878.44 78,226,210.03 -65,216.11 . -7,309.62 11,179.68 $ 1,079,314.31 $ 295,010.12 -295,010.12 $ 1,079,314.31 $ 11,496.00 480,954.77 -480,954.77 11,496.00 10,429.71 $ -5,178,364.94 $ -14,164,672.83 63,083.41 78,289,293.44 92,110,611.82 -65,216.11 302,971.10 -7,309.62 11,179.68 31,075.98 9,307.37 $ 4,208,201.98 $ 72,976,069.33 $ 73,513.12 $ 731049,582.45 $ 78,289,293.44 -5- RICHMOND COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL INON-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 $ 133,632,423.50 $ 137,023,016.29 1,738,365.00 1,301,626.41 59,348,717.00 61,996,305.70 18,129,785.28 3,622,041.03. Total Revenues $ 212,849,290.78 $ 203,942,989.43 EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations Capital OuUay Debt Service $ 129,757,743.28 $ 132,589,801.91 5,364,468.00 5,084,844.49 5,722,769.95 1,862,038.40 14,781,094.85 1,488,729.08 21,490,221.89 8,453,183.53 1,952,575.67 43,113.00 15,396.00 107,423.00 634,642.82 17,781,186.00 4,120,090.14 4,419,182.91 5,165,483.45 1,935,396.70 . 14,673,350.79 1,454,053.55 21,917,244.85 8,599,012.25 1,901,460.09 27,832.78 70,148.70 107,423.00 632,933.65 2,669,592.80 Total Expenditures $ 214,539,429.96 $ 200,283,007.57 Excess of Revenues over (under) Expenditures $ -1,690, 139.18 $ 3,659,981.86 OTHER FINANCl!'!!G SOURCES (USES} Other Sources Other Uses $ 1,969,539.18 $ -279,400.00 1, 134,924.43 -239,400.00 Total Other Financing Sources (Uses) $ 1,690,139.18 $ 895,524.43 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ FUND BALANCE JULY 1. 2000 o.oo $ 4,555,506.29 0.00 19,344,479.41 EU!'!IP BALA!'!!Cf; ,IU!'!lf; 30 2001 $ 0.00 $ 2318991985.70 SPECIAL REVENUE FUND ACTUAL (BUDGET BUDGET BASIS} $ 8,012,370.00 $ 8,045,396.92 24,648,546.00 24,492,381.33 3,049,965.00 3,310,352:57 $ 35,710,881.00 $ 35,848,130.82 $ 15,956,751.00 $ 15,179,216.33 2,904,432.87 2,302,953.00 614,537.00 367,113.00 234,924.00 2,614,468.49 2,107,796.76 614,537.00 349,279.31 231,515.03 689,352.00 127,435.00 1,500.00 48,149.00 14,013,522.99 593,126.00 705,964.26 79,927.60 170.47 43,968.51 13,024,041.10 315,962.12 16,055.15 $ 37,853,795.86 $ 35,282,902.13 $ -2, 142,914.86 $ 565,228.69 $ 2,160,411.86 $ -17,497.00 $ 2,142,914.86 $ 239,400.00 239,400.00 $ 0.00 $ 804,628.69 0.00 5,054,162.97 $ 0.00 $ 5,858i791.66 The notes to the general-purpose financial statements are an Integral part of this statement. -6- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Richmond County Board ofEducation (School District) was established under the laws ofthe 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 of purchase. 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 reportingthe cost of assets acquired by governmental fund types. Although "s.chool 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 sho.uld 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 activtties. 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. - 7- RICHMOND 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 tjie 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. a FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include: EXPENDABLE TRUST FUNDS Davidson Trust Fund - the fund used to account for the principal and earnings which may be expended to provide financial assistance to needy students ofDavidson Fine Arts Magnet School. Gail Hendricks Scholarship Fund, Nora Coxwell Scholarship Fund and Robetta McKenzie Scholarship Fund. - the funds used to account for the principal. and earnings which may be expended to provide scholarships for selected students. AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for other funds, governments, or individuals. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding, accrued compensated absences and capital lease obligations. . BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets._ Their reported fund balan~e is considered a measure of available spendable resources. - 8- RICHMOND COUNTY BOARD.OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group. Agency funds are purely custodial in nature and do not involve measurement ofresults ofoperations. Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which: Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and. available). "Measurable" means the amount 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 ~ligibility requirements have been satisfied. . Expenditures are generally recognized when the related fund liability is incurred. A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from.the Georgia Department of Education for the State's share of these contracts. During fiscal year 2001, a substantial number ofpersonnel ofthe School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this employment period 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 were disbursed from the Georgia Department of Education to the School District in the same twelve months. As of June 30, 2001, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30, 2001. Also, the State's portion ofthe compensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. Genera}Jy accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed. -9- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Agency funds are accounted for using the modified accrual basis ofaccounting in recognizing assets and liabilities. BUDGET The Richmond 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 fund type 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 Ghanges in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate .comparison with the budget, the following adjustments have been made to fund balance as reflected on Exhibit 11 ~ 11 of this report: General Fund. Special Revenue Fund FUND BALANCE JULY 1;2000 $21,505,999.27 $ 5,323,878.36 Adjustments Inventories.;. July 1, 2000 Food Donated Commodities Purchased Foods Supplies Fund Balance July 1, 2000 (Budget Basis). -2,161,519.86 $19,344,479.41 -142,66i.14 -:127,054.25 $ 5,054,162.97 Excess ofRevenues and Other Financing Sources over (under) Expenditures and Other Financing Uses 4,555,506.29 FUND BALANCE JUNE 30, 2001 (Budget Basis) $23,899.985,70 804.628.69 $ 5,858,791.66 RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 and equity investments are reported at fair value. The Official Code of Georgia 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 of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: (1) Obligations issued by the State of Georgia or by other states, (2) Obligations issued by the United States government, (3) Obligations fully insured or guaranteed by the United States government or a United States government agency, (4) Obligations of any corporation_ofthe 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 f.or expenditures made but not reimbursed and other receivables disclosed from information available. Receivables - 11 - RICHMOND COUNfY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 Augusta - Richmond County Board ofCommission Council fixed the property tax levy for the 2000 tax year (calendar year) on September 19, 2000 (levy date). Taxes were due on December 27, 2000 (lien date). Taxes collected within the current fiscal year or within 60 days after y~ar-end are reported as revenue in fiscal year 2001. The Augusta - Richmond 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 oftaxes collected to the School District. In addition, the Clerk of the Superior Court of Richmond County collects recording taxes for the Board of Education, withholds 6% of taxes collected as a fee for tax. collection and remits the balance to the School District Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $61,742,221.06 and for school bonds amounted to $5,981,796.69. Tax millage rates levieC, for the 2000 tax year (calendar year) for the Richmond County Board of . Education were as follows (a mill equals $1 per thousand dollars of assessed value~: School Operations School Bonds 18.688 mills 1.860 mills 20.548 mills SALES TAXES Special Purpose Local Option Sales Tax is to be used for capitaloutlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $31,856,250.46 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection ofthis tax once an additional $30,673,131.23 has been collected or on June 30, 2002, whichever occurs first. INVENTORIES CONSUMABLE SUPPLIES Inventories of athletic, custodial and instructional supplies are recorded as e~penditures under the consumption method and are valued at cost (weighted ayerage). These inventories are recorded as assets at the time ofpurchase. Inventories ofmaintenance and transportation supplies are recorded as expenditures at the time of purchase and are valued on the Combined Balance Sheet at cost (weighted average). Inventories of textbooks are recorded as expenditures at the time ofpurchase and are valued on the Combined Balance Sheet at cost (first-in, first-out). Inventories reported on - 12 - . RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES the balance sheet are equally offset by a reservation of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component ofnet current assets. 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. COMPENSATED ABSENCES Compensated absences represent obligations ofthe 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. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to th~ general-purpose financial statements. 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-Term Debt Account Group. RESERVED FUND BALANCES For Encumbrances - This reserve constitutes the unperformed portion ofpurchase orders, contracts and other commitments for goods and services at year end. Encumbrances outstanding are reported as a reservation of fund balance and do not constitute expenditures or liabilities in the current year because the commitments will be honored during the subsequent year. : j INTERFUND TRANSACTIONS The School District has the following types of interfund transactions: - 13 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reimbursements ofexpenditures initially made from a fund that are properly appli~able to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed. Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY -TOTAL COLUMNS Totalcolumns 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 G~orgia 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 aftel'. the deduction ofthe amount ofdeposit insurance. If a depository elects the pooled method (OCGA 45.;.8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts. Acceptable security for deposits consists of an~ 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 ofthe State of Georgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose, - 14 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 2: DEPOSITS AND INVESTMENTS (6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, ap.d (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 $27,673,025.34; 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 i11 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 $ 100,222.25 2 27,572,803.09 3 0.00 Total $27.673.025.34 CATEGORIZATION OF INVESTMENTS as Investments are classified to risk by the three categories described below: Category 1 - Insured or registered, or securities held by the School District or the School District's agent in the School District's name. Category 2- Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the School District's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the School District's name. - 15 - RICHMOND COUNTY BOA.RD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 2: DEPOSITS AND INVESTMENTS At June 30, 2001, the carrying value ofthe School District's total investments w~ $57,475,188.10 which is materially the same as fair value. The investments are classified as to risk categories as follows: TYQe of Investment U. S. Government Comn:ion Stock Total Local Goveminent Investment Pools Total Investments Risk Categories 2 $14,548,644.33 $ $ 453,491.44 $ 453 421 44 $14 548 644,33 $ Carrying Fair 3 Amount Value 0.00 $14,548,644.33 $14,548,644.33 453,491.44 453,491.44 QQQ $15,002,135.77 $15,002,135.77 42,473,052.33 42,473,052.33 $5H'.25 188 IQ $5H'.25 188, IQ The carrying amounts shown above includes amounts maintained in an investment pool by the State ofGeorgia, Office ofTreasury and Fiscal Services in which the School District owns no identifiable securities. The investment policy ofthe State ofGeorgia, Office ofTreasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description ofthe Primary Liquidity Portfolio is as follows: .The Primary Liquidity Portfolio consists ofGeorgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAArn. rated money market funds. The pool is not registered with the Securities and Exchange Commission as an investment company but does operate Georgia Fund 1 in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool's primary objectives are safety ofcapital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated-weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. . Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds ofGeorgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund. Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instruinentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 _on June 30, 2001, was 39 days. The average investment duration for Fund 6 on June 30, 2001, was 6 months. - 16 - . RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 200 I 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 Note 4: INTERFUND ASSETS AND LIABILITIES Due to and due from other funds are recorded for interfund receivables and payables which arise from interfund transactions. The following analysis summarizes the status of all _interfund transactions of the School District at June 30, 2001: Due From Other Funds Due To Other Funds General Fund Capital Projects Fund Special Purpose Local Option Sales Tax Debt Service Fund Property Taxes for Bond Debt $ 97,490.49 $ 260,092.90 162,602.41 $ 260,092.90 $ 260,092.90 Note 5: 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, job related illness or injuries to employees and natural disaster. 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 established a limited risk management program for workers' compensation claims. The School District accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $225,000.00 loss per occurrence, up to the statutory limit. - 17 - RICHMOND COUNfY BOARD OF EDUCATION EXHIBIT "D" . NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 5: RISK MANAGEMENT Changes in the workers' compensation claims liability during the last two fiscal years are as follows: Beginning of Year Liability Claims and Changes in Estimates. Claims Paid End of Year Liability 2000 $ 0.00 $ 322,385.23 $ 322,385.23 $ .0.00 2001 $ 0.00 $ 137,494.44 $ 137,494.44 $ 0.00 . . .The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurr~d. and the amount ofthat loss can 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 $ 18,950.00 $ $ 8,049.00 $ 24,742.77 $ 5,677.00 $ 35,643.77 $ 12,186.00 $ 8,049.00 1,540.00 The School District has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent President .Vice-President . Comptroller Assistant Superintendent Associate Superintendent Supervisors Administrative Assistant Each Central Office Bookkeeper Each Principal .. .Each School Bookkeeper Each School Business Manager Athletic Business Manager Each Lunchroom Manager $ 50,000.00 $ 50,000.00 $ 50,000.00 $ 50,000.00 $ . 50,000.00 $ 50,000.00 $ 20,000.00 $ 10,000.00 $ 10,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 3,000.00 - 18 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 6: GENERAL LONG-TERM DEBT CAPITAL LEASES The Richmond County Board of Education has entered into various lease agreements as lessee for school buses,. operating vehicles, office equipment, computer equipment, equipment upgrades at various schools, lighting systems, a career exploration lab and the acquisition and construction of school facilities. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: Purpose Interest Rates Amount General Government - Refunding - Series 1998 General Government - Refunding - Series 1993 General Government - Refunding - Series 1991 3.80% - 4.25% 2.50% - 4.70% 4.50% - 6.30% $32,685,000.00 10,900,000.00 3,990,000.00 $47.575.000.00 The changes in General Long-Term Debt during the fiscal year ended June 30, 2001, were as follows: Balance July 1, 2000 Additions Capital Leases Annual Leave Earned and Utilized (Net) Deductions Debt Retired Balance June 30, 2001 Capital Leases Compensated Absences General Obligation Bonds Total $17,471,348.79 $ 1,006,836.56 $75,770,000.00 $94,248,185.35 1,079,314.31 262,273.86 1,079,314.31 262,273.86 1,461,235.83. 28,195,000.00 29,656,235.83 $12 082 ~22 22 $ 1,26211M2 ~1515 00000 $65 233 532 62 At June 30, 2001, payments due by fiscal year which includes principal and interest for these items are as follows: - 19 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT ;'D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001 Note 6: GENERAL LONG-TERM DEBT Fiscal Year Ended June 30 Capital . Leases General Obligation Bonds Total Debt 2002 2003 2004 2005 2006 2007 - 2011 2012 - 2016 2017-.2021 2022 - 2025 $ 2,530,278.95 $31,420,397.50 2,047,806.54 . 8,571,217.50 1,904,456.85 2,998,460.00 1,907,449.35 3,015,256.25 1,904,599.57 3,026,972.50 5,648,625.82 2,128,880.00 . 4,040,033.75 . 4,040,175.00 3,233;050.00 $33,950,676.45 10,619,024.04 4,902,916.85 4,922,705.60 4,931,572.07 .7,777,505.82 4,040,033.75 4,040,175.00 3~233,050.00 Total Principal and Interest $27,256,475.83 $51.161.183.75 $78.417.659.58 Deduct: Imputed Interest 10,167,048.56 Net Present Value of Future Minimum Lease Payments $17.089.427.27 Note 7: SHORT-TERM DEBT ; The School District issues tax anticipation notes in advance ofproperty tax collections~ depositing the proceeds in its General Fund and Capital Projects Fund. This short-term debt is to provide cash for operations until property tax collections are received by the School District. Article IX, Section V, Paragraph V ofthe Constitution ofthe State ofGeorgia limits the aggregate amount ofshort-term debt to 75 percent ofthe tptal gross income from taxes collected in the preceding year and requires all short-term debt to be repaid no later than December 31 ofthe calendar year in which the debt was incurred. Beginning Balance Additions Payments Ending Balance Tax Anticipation Notes $.==~o~.o~o $28,ooo,ooo,oo $15,000,000.00 $13,000,000.00 Note 8: ON-BEHALF PAYMENTS The School District has recognized revenues and expenditures in the amount of$3,125,607.38 for health insurance and retirement contributions paid on the School District's behalfby the following State Agencies. -20- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 8: ON-BEHALF PAYMENTS Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $2,401,533.40 Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $211,405.98 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 $512,668.00 Note 9: SIGNIFICANT COMMITMENTS The following is an analysis ofsignificant outstanding construction or renovation contracts executed by the School District as of June 30, 2001: Project Unearned Executed Contracts CP-2011 99-721-088 00/99S-721-106 B-98033-409 B-97-013-426 B-97-017-424 B-98-035-411 B-98-029-418 B-99-041-420 B-97-012-415 B-99-036-417 $ 1,403.09 30,787.20 84,781.63 11,608.12 84,095.10 11,778.54 322,824.85 350.59 98,914.00 7,702.00 48,840.18 $ 2Q31Q85.30 The amounts described in this note are not reflected in the general-purpose financial statements. - 21 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 200 I Note 10: CONTINGENT LIABILITIES .ARBITRAGE REBATE TAX The Federal Tax Reform Act of 1986 requires issuers of tax-exempt debt to make payments to the United States Treasury of Investment Income received at yields that exceed the issuer's tax-exempt borrowing rates. The U. S. Treasury requires payment every five years. The estimated contingent liability of$920, 175.00 at June 30, 2001, is based on tax exempt debt subject to the Tax Reform Act. This amount will be updated annually for any tax-exempt issuances or changes in yields through September 1, 2003, at which time payment ofthe final calculated liability for the five-year period is required to be remitted. Amounts received or receivable principally from the Federal government are subject to audit and reviewby 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 11: SUBSEQUENT EVENTS In the subsequent fiscal year, voters authorized the School District to issue general obligation bonds in the amount of$115,000,000.00. The proceeds from these bonds will be used for the purpose of acquiring, constructing and equipping capital outlay projects for educational purposes in Richmond County and paying certain costs and expenses relating to the issuance of the bonds. Note 12: ACCUMULATED EMPLOYEES' LEAVE Administrative and other clerical personnel earn two days ofvacation each month with a maximum accumulation of twenty-four days less required vacation days to be taken during the year. Maintenance and other twelve-month employees earn vacation leave ranging from ten days to twenty-four days per year depending upon the employee's length of service with a maximum accumulation of22 days. Vacation leave vests with the employee and unused accumulated vacation leave up to the maximum accumulation is paid at the current rate of pay, to employees upon retirement or termination of employment. See Note 1 - Compensated Absences Note 13: 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 of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts. - 22 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001 Note 13: 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% $14,559,150.00 $14,016,137.79 $14,315,192.29 - 23 - RICHMOND COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2001 ASSETS Cash and Cash Equivalents Accounts Receivable Inventories Consumable SuJ:!plies Food Donated Commodities Purchased Food SCHOOL FOOD SERVICES FUND LOTTERY PROGRAMS FEDERAL PROGRAMS $ 6,268,607.56 $ 347,853.05 248,109.70 242,460.25 $ 3,774,842.40 135,351.52 138,233.93 Total Assets $ 6,790,302.71 $ 590,313.30 $ 3,774,842.40 LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Continuation of Federal Programs For Encumbrances For Inventories Consumable Supplies Food Donated Commodities Purchased Food Unreserved Undesignated Total Fund Equity $ 256,115.13 $ . 742,254.0f $ 998,369.14 $ $ 135,351.52 . 138,233.93 5,518,348.12 $ $ 5,791,933.57 $ $ 130,986.90 459,326.40 590,313.30 $ 2,543,994.14 282,608.67 947,379.59 860.00 3,774,842.40 0.00 $ 0.00 0.00 $ 0.00 Total Liabilities and Fund Equity $ . 6,790,302.71 $ See notes to the general-purpose financial statements. -24- 590,313.30 $ 3,774,842.40 EXHIBIT"E" OTHER PROGRAMS $ 1,319.89 $ ATHLETIC FUND TOTALS JUNE 30, 2001 JUNE 30, 2000 288,012.12 $ 6,905,792.62 $ 6,093,349.53 4,265,412.35 4,125,608.87 51,111.53 51,111.53 135,351.52 138,233.93 39,071.37 142,661.14 1271054.25 $ 1,319.89 $ 339,123.65 $ 11,495,901.95 $ 10,527,745.16 $ 2,543,994.14 $ 2,292,276.97 669,710.70 613,568.93 2,148,960.00 2,259,970.51 860.00 381050.39 $ 5,3631524.84 $ 512031866.80 $ 149.24 $ 97,971.69 $ 97,971.69 119,059.87 51,111.53 51,111.53 39,071.37 135,351.52 138,233.93 142,661.14 127,054.25 $ 11319.89 190,040.43 5,7091708.44 4,8951882.49 $ 11319.89 $ 3391123.65 $ 6,132,377.11 $ 513231878.36 $ 11319.89 $ 3391123.65 $ 11,4951901.95 $ 10,527,745.16 -25- RICHMOND COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2001 SCHOOL FOOD SERVICES FUND LOTTERY PROGRAMS FEDEfML PROGRAMS REVENUES State Funds Federal Funds Other Funds $ 1,010,054.00 $ . 10,353,378.01 2,878,843.07 4,551,157.23 $ 2,484,185.69 14,139,003.32 Total Revenues EXPENDITURES . $ . 14,242,275.08 $ 4,551,157.23 $ 16,623,189.01 Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations Debt Service Principal Interest Total Expenditures $ $ 6,973.99 71,046.00 13,022,408.81 315,962.12 $ 13,416,390.92 $ 3,253,485.91 $ 11,848,245.14 497,664.02 18,196.62 614,537.00 139,734.25 27,539.43 1,759,637.99 2,089,600.14 342,305.32 231,515.03 237,820.04. 52,388.17 170.47 43,968.51 1,632.29 14,068.40 1,986.75 4,551,157.23 $ 16,623,338.25 Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES