GA A800 ,R! E:2& ,s4 1c,q3-lN- STATE OF GEORGIA DEPARTMENT OF AUDITS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334 AUDIT REPORT SCREVEN COUNTY BOARD OF EDUCATION SYLVANIA, GEORGIA YEAR ENDED JUNE 30, 1994 SCREVEN 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 FEDERAL FINANCIAL ASSISTANCE 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 GOVERNMENTAL FUND TYPES 3 C COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ACTUAL AND BUDGET GOVERNMENTAL FUND TYPES 5 D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 6 ADDITIONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 18 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 20 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 22 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 23 SCHEDULES I SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 24 2 ANALYSIS OF CASH AND CASH EQUIVALENTS 26 3 INVESTMENTS 27 4 ACCOUNTS RECEIVABLE 28 SCHEDULE OF REVENUE 5 STATE FUNDS 29 6 LOCAL AND OTHER FUNDS 30 SCREVEN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL ADDITIONAL FINANCIAL INFORMATION SCHEDULES SCHEDULE OF EXPENDITURES BY OBJECT 7 GOVERNMENTAL FUND TYPES 31 8 LOTTERY PROGRAMS 32 ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 9 OVERALL 33 10 BY PROGRAM 34 11 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS 36 SECTION IT COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS SECTION Ill INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS SCREVEN COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (-404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Screven County Board ofEducation INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE Ladies and Gentlemen: We have audited the general purpose financial statements (Exlubits A through D) of the Screven County Board of Education, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility ofthe Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose 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 of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: 94ARL-14 * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. * School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. * The Board did not recognize as expenditures, in the year ended June 30, 1994, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1994. Also funds received, subsequent to June 30, 1994, from the Georgia Department ofEducation for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1993, were improperly recorded in the year ended June 30, 1994. 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 Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories 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 present fairly, in all material respects, the financial position of the Screven County Board ofEducation as of June 30, 1994, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles. As discussed in Note I to the general purpose financial statements, during fiscal year 1994, the Board changed its method ofaccounting to include revenues and expenditures associated with Federal donated commodities in its general purpose financial statements. This change is in accordance with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements ofthe Screven County Board ofEducation taken as a whole. The combining statements (Exhibits E through H) and the financial schedules (Schedules 1 through 11 which includes the Schedule of Federal Financial Assistance) are presented for purposes ofadditional analysis and are not a required part of the general purpose financial statements of the Screven County Board ofEducation. 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 Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the food service inventories as discussed in the third paragraph, and except for the effects of the matters referred to in the fourth paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. 94ARL-14 A copy ofthis report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code ofGeorgia Annotated Section 50-6-24. Respectfully submitted, tP~~ Claude L. Vickers State Auditor CLV:cm 94ARL-14 SCREVEN COUNTY BOARD OF EDUCATION - 1- EXHIBITA ~ Cooh and C o o h - -Accounl5 Receivable -Food Oonalad Commoctm.s ...,_Food Amoe.Int to be Provided in Future Years For Payment ti Capital Leae AgrNflMll'lt& TOIBI- GOVERNMENTAL FUNO TYPES SPECIAL CAPITA!. GENERA!. RE\IENUE PROJECTS FUND FUND FUND s 1,098,256.28 S 456,53-C.98 S 27,853.61 1,862,731.98 343,123.00 96,3'0.96 268,878.22 ACCOUNT GROUP GENERAi. l~TERM OEBT TOTALS {Memorandum Q!!!rl JUNE30 1994 JUNE30 1993 1,582,644.87 $ 1,579,256..W 2,206,854.98 2,410,590.51 385,219.18 224,566.73 20,326.39 6,821.71 s 3 057 329.22 S 752561.30 S 370976.81 $ 74112.82 20,326.39 6,821.71 74112.82 .W,650.19 4,544.03 109786.74 74112.82 S 4 254 979.95 $ 4369394.80 LY !!11;~12 B.!t:12 liQ!.!II:! ~ ...- _Gnl,. _ _ Account& Payable Salaries Payable Uneomod"-''- Total Liabilities = R - Fund ea.noes For Bus Replacement Funds For Continuation ti Federal Program For Expired Grant BalanceslQuastion Colt& For k'IYenlDrie& Food Oonal8d Commodities PurdlaMcl Food ForSmlac.pital OUtlayPrqilds un.u- Total Fund Equity s 8,525.91 8525.91 $ 17,316.52 s 33,818.20 51,134.72 $ 2997668.59 3 048 803.31 S 38,349.n 165,382.09 6,235.61 209987.47 1,802.30 20,326.39 8,821.71 28,750..W $ 513843.43 542593.83 S 370976.61 370,976.61 0.00 370976.61 Total Liabililia& and Fund Equity s 3057329.22 $ 752561.30 $ 370976.61 S 7411282 74112.82 $ 38.3'9.n s 165,382.09 8,525.91 6,235.61 74112.82 292606.20 S 45,452.72 153.343.15 8,126.22 3,245.01 109786.74 319953.84 17,316.52 $ 1,602.30 33,818.20 22,060.-46 222.'3 15,174.39 20,326.39 6,821.71 370976.61 450,861.73 $ 3511 512.02 3 962 373.75 $ .W,650.19 4,544.03 394621.99 4n,273.49 3572167.27 4049440.76 74112.82 S 4 254 979.95 $ 4369394.80 The notes to the general purpose financial statements are an integral part d this slatament -2- QB~N QQ.!fill'.: aQaBQ QE fQUCATJON QQMa!NEQ I6IEMEtfi Qf BE~W!i; !i;2!;~~Hm!JB!i; &iQ ~G.E~ lli BJt:m Ml~S ~Bt:JM~lil.AL EU~Q mEs YEARENOEPJUNE30 1994 EXHIBIT"B" ~ S-Funds Fodenll Fundo Local and other Funds TotalRevenu. s--EXfENOOURES eu.Instruction PuplServicM lmpn,yemantd-lServicM Educationol Media ServicM Getwal Administration School Adminislration BusinNS A d - ~ n e e and Operation d Plant -Transportation ServicM Central Support Sarvic:as otherS-ServicM Community Service Operations Food SerYicos Operation -other Operations d Non-Instructional Sarvic:as Capital Oullay Oal>ISonricl Principal Tatali;__,,.. Excess d R - - ( - ) ~ QTtifB FINANClNG Q!JB~ES WESl Operating Transfers In Openlling Transfers Out Total other F.,.nc:ing Sources (Uses) Excess d Revenues and Other Financing Sources ..., ( . . - ) ~ - a n d other Financing Uses FUND BALANCE JULY 1 Food--, - Net Chango In Period ~ Commodities -Food GENERAL FUND SPECIAL REVENUE FUND CAPITAL PROJECTS FUND TOTALS 8,739,541.89 $ 215,567.02 $ 95,452.57 1,987,405.10 2856345.97 297274.15 11 691 340.43 $ 2500246.27 $ 0.00 $ 8,955,108.91 $ 2,082,857.67 3153620.12 8,514,205.26 1,724,382.61 3194 TT4.49 0.00 $ 14 191 586.70 $ 13 433 362.36 7,334,576.38 $ 1,013,886.93 438.219.54 314,979.95 265,041.21 250,067.88 817,869.66 113,514.42 943,071.23 792,661.85 24,812.45 54,480.80 20,044.20 98,120.70 197,107.18 86,076.18 31,381.04 69,652.18 85,490.58 1,226.83 22,888.80 19,855.00 1,922.86 43,560.65 1,100,837.75 45,373.92 12240.4" 11 720181.81 $ 2 458 780.40 $ -28841.38 $ 43465.87 $ 8,348,463.31 $ 7,976,308.11 83,645.38 524,297.72 346,360.99 334,893.39 315,558.46 819,096.29 113,514.42 965,959.83 812,516.85 26,735.31 98,041.45 20,044.20 1,100,837.75 86,120.70 280,752.56 493,452.24 2TT,327.86 244,057.12 230,571.12 815,150.29 116,920.TT 983,913.66 758,674.66 165,851.81 40,310.40 17,857.29 740,118.87 84,920.82 128,455.50 45,373.92 12240.4" 83845.38 $ 142!!Q807.59 $ 13 053 890.32 -83845.38 $ .Ql020.99 $ 379472.04 $ -63259.58 -83259.58 $ 3,259.58 $ 80,000.00 $ 3259.58 $ 80000.00 $ 83,259.58 $ -63 259.58 0.00 $ 343,750.01 -343 750.01 0.00 -82,100.86 $ 3,140,904.27 46,725.45 $ 513,914.50 -23,845.38 $ 394,821.99 .Ql,020.89 $ 4,049,440.76 379,472.04 3,824,TT4.50 -20,323.80 22TT.88 -20,323.80 22TT.88 40,650.19 4 544.03 FUND BALANCE JUNE 30 3 048 803.31 $ 542593.83 $ 370976.61 $ 3982373.75 $ 4049440.76 Tho .-S lo the gonen,1 purpose financial statements ara an integral part dthis - . -3- r--Y I , QBE~H QQ!.!HI:! ~BP QE EPU~IQH CQMalHEQ m!EMEHI Qf BE~ti!.!ES EXeEHQII!.!BES 6HQ ~t:16H!;iES IH E!.lHQ ML6H~ES 6CIU&. ~tU2 a!-!tEI ~BHMEHI!I E!.!HQ M~ YEAR EHPsP JUNE 30 1994 EXHIBIT"C" ACTUAL PER EXHIBIT"B" ADJUSTMENTS ACTUAL PER BUDGET BASIS BUDGET VARIANCE FAVORABLE (UNFAVORABLE) ~ S-FIHm F - Funds Local ond Other FIHm TotalR- $ 8,955,108.91 $ 2,082,857.67 3153620.12 $ 14 191 586.70 $ 0.00 $ 0.00 $ 8,955,108.91 $ 2,082,857.67 3153620.12 8,921,589.00 $ 2.183,439.n 2 536195.00 s 14 191 586.70 $ 13641~.n 33,519.91 -100,582.05 617 425.12 550,362.98 SXPENP!I!.!BES eurr.nt Instruction s--PupilSeoviceo lrnproyomont of Instructional Servicao Educational Media Servicao -----School- - - - ond Operation of Ptonl -T..._-Seoviceo Cenlnil~Seoviceo Other~- Cornmunily Sorvioo Operations Food - Operation Other Operations of NorHnstructional - Capitalo..tay DoblSorvioo $ 8,348,-163.31 $ 524,297.n 346,360.99 334,893.39 315,558.48 819,096.29 113,514.42 965,959.83 812,516.85 28,735.31 98,041.45 20,044.20 1,100,837.75 96,120.70 280,752.56 57,614.36 0.00 $ 8,348,-163.31 $ 8,831,684.38 $ 524,297.n 346,360.99 334,893.39 315,558.48 819,096.29 113,514.42 965,959.83 812,516.85 28,735.31 98,041.45 20,044.20 1,100,637.75 98,120.70 280,752.58 57,614.36 586,558.00 379,222.82 351,414.00 279,358.00 815,376.00 128,031.00 1,107,808.00 624,451.00 54,719.00 122,314.52 19,500.00 991,468.50 112,750.00 229,500.00 -163,221.07 62,281.28 32,861.83 16,520.61 -36,200.48 3,720.29 12,516.58 141,848.17 11,934.15 27,983.69 24,273.07 -544.20 -109, 169.25 16,629.30 -51,252.56 -57,614.36 Total~ 14,280,607.59 $ 0.00 $ 14 260 607.59 $ 14,832,156.22 $ 571548.63 Exc:ouof R - . - --(under) ExpenditUfN -69 020.89 $ 0.00 $ -69,020.89 $ -1,190932.50 $ 1,121,911.61 QTtiEB FIN~~~ Q!..!BCSS (YSEl Other Sources Other Uses $ 63,259.58 $ -&,259.58 0.00 $ 63,259.58 $ -&259.58 75,065.91 $ -12,508.98 11,806.33 -50,750.60 Total Other F,,_ncing Sources (Uses) $ 0.00 $ 0.00 $ 0.00 $ 62556.93 $ -62,556.93 Exc:ou of R_,_ ond Other F"18ncing Sources . _ (under) Expenditun,s and Other Financing u... $ -69,020.89 $ 0.00 $ -69,020.89 $ -1,128,375.57 $ 1,059,354.68 FUNQ ~1.e!N"t.; J!.!LY l 1~ 4,049,440.76 -45,194.22 4,004,248.54 4,027,357.67 -23,111.33 ADJUSIMEHTS v . , Prior (Net) 0.00 0.00 -17,115.92 17,115.92 EQQQ IN~EtUQBY ~l;I "t:IANGE IN PERIQQ Donaled Commodities ~Food -20,323.80 20,323.80 0.00 0.00 2,2TT.68 -2,277.68 0.00 0.00 FYNQ ~~N~E J!.!NE ~ 1~ $ 3,962,373.75 $ -27,148.10 $ 3,935,225.65 $ 2,881,866.38 $ 1,053,359.27 Tho notes to the general purpose financial - . . . - are an Integral port of this - 5. SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO Tiffi GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Screven County Board ofEducation (Board) was established under the laws ofthe State of Georgia and operates under the guidance of a school board and Superintendent, both elected by the voters. With the exception of the departures from generally accepted accounting principles disclosed in the following paragraphs, the financial statements ofthe Board have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards. The more significant of the Board's accounting policies are described below. REPORTING ENTITY In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the Screven County Board ofEducation. Based upon the application ofthe above criteria, the Screven County Board ofEducation is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Screven County, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards. Board members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval. FUND ACCOUNTING The Board uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources. General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types. - 6- SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 confonn 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, Local and Other Funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows: GOVERNMENTAL FUND TYPES - are used to account for all or most of a Board's general activities. Governmental Fund Types include: GENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a board ofeducation. 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 primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. Also included are proceeds received from State, Federal, Local and Other sources for operations of the school food services fund. This fund could be accounted for as an enterprise fund; however, the Board chooses not to provide for depreciation, but to maintain the fund on a modified accrual basis and to report the fund as a special revenue fund under governmental fund types, which is acceptable under generally accepted accounting principies for governmental entities. CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction ofmajor capital facilities. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for material capital lease obligations. BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental 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 of these 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 ofavailable spendable resources. - 7- SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30 1994 Note I: 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. Governmental funds are accounted for using the modified accrual basis ofaccounting under which: Revenues are recogniz.ed when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe 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. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end. 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 ofthese contracts. During fiscal year 1994, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1993 and ending in early June 1994. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1993 and ending in August 1994. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 1994, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1994, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1994. Also, the State's portion of the compensation paid in July and August 1994 was received and recorded as revenue in the fiscal year subsequent to June 30, 1994. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1993, were recorded in the year ended June 30, 1994. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed. BUDGET The Screven County Board ofEducation has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure of the aggregate budget. The budget process begins when the Board's administration prepares a tentative aggregated 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 ofthe Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education. - 8- SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Board prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements. The budget comparison on Exhibit "C" presents actual and budget data for all governmental funds on a combined basis. To facilitate comparison with the budget, donated and purchased food inventories as reflected on Exhibit "B" have been eliminated from fund balance. CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofdeposits (including certificates of deposit, savings and N. 0.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State. INVESTMENTS COMPOSITION OF INVESTMENTS Investments made by the Board are stated at cost. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds 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 Office of Treasury and Fiscal Services, (7) Repurchase agreements, and (8) Obligations of other political subdivisions of the State of Georgia. - 9- SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECEIVABLES Receivables consist ofgrant reimbursements due from Federal, State or other grantors 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 Screven County Board ofCommissioners fixed the property tax levy for the 1993 tax year (calendar year) on September 16, 1993 (levy date). Taxes were due on December 20, 1993. The lien date for property taxes was January 1, 1993. Taxes collected within the current fiscal year or within 60 days after year end are reported as revenue in fiscal year 1994 since their collection meets the criteria of GASB codification section P70. l 03. The Screven County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection, and remits the balance of taxes collected to the Board. The tax millage rate levied for the I993 tax year (calendar year) for the Screven County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): School Operations 14 20mills 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. Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets. For fiscal year 1994, the Board began accounting for donated food commodities by recording revenues and expenditures associated with donated food commodity items received and consumed by the Board. The reporting of the revenues and expenditures associated with donated commodities is a change in accounting principles. INTERFUND TRANSACTIONS The Board has the following types ofinterfund transactions: - 10 - SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEl\,ffiNTS JUNE30 1994 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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. 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 of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Certain reclassifications have been made to the comparative data to conform to the current year classifications. Note 2: DEPOSITS AND INVESTl\,ffiNTS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral in an amount of not less than 110 percent of the public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts. 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 ofGeorgia, (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 ofindebtedness or other obligations of the counties or municipalities ofthe State ofGeorgia, (5) Bonds ofany 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, - 11 - SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO TIIB GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30 1994 Note 2: DEPOSITS AND INVESTMENTS (6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and (7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 1994, the bank balances were $2,546,925.31. The amounts of the total bank balances are classified into three categories of credit risk: Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.) The Board's deposits are classified by risk category at June 30, 1994, as follows: Risk Category 1 2 3 Total CATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: Bank Balance $ 105,042.19 0.00 2441883.12 $ 2 546 925 3] Category 1 - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. Funds invested in an investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. - 12 - SCREVEN COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 2: DEPOSITS AND INVESTMENTS At June 30, 1994, the carrying amount of the Board's total investments was $2,205,854.98 and consisted entirely offunds in the Local Government Investment Pool administered by the Office of Treasury and Fiscal Services which are not required to be categorized since the Board did not own any specific identifiable securities in the pool. Note 3: NON-MONETARY TRANSACTIONS The Board 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: RISK MANAGEMENT The Board has established a limited risk management program for Unemployment Compensation. Estimated claims are budgeted by management based on known claims and prior experience. During fiscal year 1994, a total of $858.00 was paid in claims. Note 5: GENERAL LONG-TERM DEBT CAPITAL LEASES The Screven County Board ofEducation has entered into various lease agreements as lessee for the purchase ofequipment. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value ofthe future minimum lease payments as of the date of their inception. The changes in General Long-Tenn Debt during the fiscal year ended June 30, 1994, were as follows: Capital Leases Balance July I, 1993 $ 202,148.14 Retroactive Restatement ofPrior Year Balances -92 361.40 Balance July I, 1993 Restated $ 109,786.74 Additions 9,700.00 Deletions Balance June 30, 1994 45 373.92 $ 74 112 82 - 13 - SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE30 1994 Note5: GENERALLONG-TERMDEBT At June 30, 1994, payments due, by fiscal year which includes principal and interest for these items: Fiscal Year Ended June 30 Capital Leases 1995 1996 1997 $ 42,742.40 39,156.59 295.56 Total Principal and Interest $ 82 194.55 Deduct: Imputed Interest $ 8 081.73 Net Present Value ofFuture Minimum Lease Payments $ :z~ 11282 Note 6: SIGNIFICANT COMMITMENTS At June 30, 1994, the Board had encumbrances in the amount of$64,673.82 for the unperformed portion of purchase orders, contracts and other commitments for goods and services associated with the lottery programs. Lottery funds in the amount of $64,666.44 are available to fund these encumbrances. Encumbrances outstanding do not constitute expenditures or liabilities in the current year because these commitments will be honored during the subsequent year. These encumbrances are identified by lottery program as follows: Computers in Classrooms Distant Learning Media Center and Library Equipment Safe Schools Grant $ 4,420.38 1,800.00 11,296.44 47 157.00 $ 64 673 82 The amounts described in this note are not reflected in the general purpose financial statements. Note 7: CONTINGENT LIABILITIES Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position. The Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition ofthese proceedings is not presently determinable, but are not believed to be material to the general purpose financial statements. - 14 - SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 8: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS). TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement after 30 years ofcreditable service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number ofyears of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 1Oyears ofservice) and compensation up to the time of disability or death. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contnbutions occurs, but the member's contributions are refunded with interest. The Board's payroll for employees covered by TRS for the year ended June 30, 1994, was $8,172,342.29; total payroll was $9,134,961.97. TRS CONT.RIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required to contribute 6% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1994 that rate for employer contributions was 11.81%. The interest rate assumption (rate ofreturn on investments) was 7.50%. Total contnbutions made during fiscal year 1994 amounted to $1,455,609.85, of which $965,153.23 was made by the Board and $490,456.62 was made by employees. These contnbutions represented 11.81% (Board) and 6% (employees) of covered payroll. - 15 - SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 8: RETIREMENT PLANS TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected sa1aiy increases. A standardized measure ofthe pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers. Total unfunded pension benefit obligation ofTRS as ofJune 30, 1993, was as follows: Total pension benefit obligation $13,912,014,000.00 Net assets available for benefits, at cost 12 821 722 000.00 Unfunded pension benefit obligation $ 1 090 292 000 00 The measurement ofthe total pension benefit obligation is based on an actuarial valuation as ofJune 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers. Total contributions from all employers to TRS for fiscal year ended June 30, 1994 were $521,550,000.00. The Board's contribution for the year ended June 30, 1994 of$965,153.23 was actuarially determined and represented .1850% oftotal contributions made by all participating employers. Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due. PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS) PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia. - 16 - SCREVEN COUNTY BOARD OF EDUCATION EXIIlBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30 1994 Note 8: RETIREMENT PLANS PSERS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years ofservice and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as Jong as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund ofthe employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life halfof what the employee would have received upon retirement. Members become fully vested after ten years of service. Ifa member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. There were 82 employees covered under PSERS for the year ended June 30, 1994. PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees. Total contributions from employees ofthe Board made during fiscal year 1994 amounted to $2,816.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1994, was $9,150,000.00. Note 9: SURETY BONDS The School Superintendent, Ms. Patricia Bazemore, is bonded in the amount of $10,000.00 with the Western Surety Company, Sioux Falls, South Dakota, their Bond No. 58549383, on which premium was paid to August 1, 1994. - 17 - -- -~ C:..,,andc:..t,Equivalenls Food ~ Commoditleo ""'"'-Food Total- LIABILmEs ANO BJNQ FOUfTY ~ C:..,,o-dn,ft AccaunloPayable u.-n.d-ea.._ SalariooPayable Expin,d Grant Payable Total Liabilities -FUNPFOU[[Y Fund- Far Continuation d F-..1 Progn,m For bwenlories Food -~ Cornmodilieo """"- Food Undeoig- TotaJFundEquily Total Liabilities and Fund Equily SC".RMN COUNTV RQABP OF FOIJCAitQN -Prep Education 1994 Grant 84.186 84.186 s 84.186 84.009 84.009 84.009 84.010 84.010 84.010 84.010 84.010 84.151 84.151 84.151 84.164 84.164 84.027 84.027 84.027 84.027 84.173 84.173 84.173 84.048 84.048 84.243 s 12,478.00 40,471.00 5,049.00 6,372.00 6,552.00 6,806.00 202,975.00 775,181.00 1,542.00 27,088.00 30,000.00 14,219.00 11,325.00 97,474.00 123.00 14,460.00 36,151.00 56,360.00 -7,300.06 7,300.00 S 31,734.37 9,842.70 S 31,734.37 9,842.70 31,734.37 -789.74 5,049.00 936.50 6,552.00 105,780.40 70,219.24 202,975.00 540,000.00 5,049.00 936.50 6,552.00 70,219.24 202,975.00 660,743.46 1,542.00 24,701.17 30,000.00 1,542.00 24,701.17 30,000.00 5,049.00 936.50 6,552.00 70,219.24 202,975.00 660,743.46 1,542.00 24,701.17 33,259.58 (3) 8,519.00 8,000.00 8,019.00 8,000.00 8,241.43 6,397.70 140.00 10,496.64 11,325.00 96,500.00 4,78228 123.00 5,617.68 11,325.00 96,672.77 123.00 5,617.68 11,325.00 96,672.77 123.00 5,617.68 11,807.00 19,644.00 36,151.00 (4) 18,274.00 56,360.00 (4) 24 SCBEYEN COUNTV ROABP OE EDUCATION SCHEDULE OF FF PERAL FINANCIM ASSISTANCE VEAR ENDED JUNE 30 1994 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT CFDA ~ AWARDS IN PERIOD FEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDSl FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD Educallon, U.S. Department of ThroUgh First D181rict Regional Educational SeNiceAgency dlbla Live Oak Migrant Education Ager,ey Elementaly and Secondary Educallon Act Chapter 1 Migratory Education Program 1993 Regular 1994 Regular Total U. S. Department of Education 84.011 84.011 $ $ 36632.68 s 1 381 258.68 $ 11,197.20 35880.03 $ 36632.68 $ 1 261 005.71 $ 1 303 196.57 $ 36632.68 1212565.28 Justice, U. S. Department of Through Children and Youth Coordinating Council lnteNenlicn Program 92J-02-9204-0015 16.540 s 6197.00 $ 1357.87 $ 2941.57 $ 3746.51 (3) Labor, U. S. Department of Through Central Savannah River Employment and Training Consortium Job Training Partner8hip Act 09-2-12-43-251 09-2-12-44-252 Total U. S. Depa- of Labor 17.250 17.250 s 16,809.52 11718.19 s 28 527.71 Total Federal Financial Assistance $ 2164175.21 $ 1 991 893.08 $ 2 082 857.67 $ Major Programs are Identified by an asterisk (") in front of the CFDA number. (1) The amounts shown for the Food Distribution Program represents the Federally assigned value of oonmonetary a&Sistanoe for donated commodities received and/or consumed by the system during the ourrent fiscal year. (2) Expenditures for the School Breakfast Program - . not maintained separately and are included in the 1994 National School Lunch Program. (3) Expenditures for this program include state, and/or Local and Other Funds. Expenditures are not maintained by fUnd source. (4) Expenditures on this program_., not maintained by fUnd soo,ce. 2315827.89 See notes to the general purpose financial statements. 25. SCREVEN COUNTY BOARD OF EDUCATION ANALYSIS OF CASH AND CASH EQUIVALENTS JUNE 30 1994 SCHEDULE "2" INTEREST BEARING ACCOUNTS Farmers and Merchants Bank, Sylvania, Georgia N.O.W. Accounts (2.84%) Passbook Savings Account (3.00%) Certificates of Deposit No. 21373 (3.50%) No. 21374 (3.50%) First Liberty Bank, Sylvania, Georgia Money Market Account (Variable) OTHER Petty Cash $ 554,970.89 22,460.79 500,000.00 500,000.00 $ 1,577,431.68 5,042.19 171.00 $ 1,582,644.87 See notes to the general purpose financial statements. - 26 - SCREVEN COUNTY BOARD OF EDUCATION INVESTMENTS JUNE 30 1994 INVESTMENT POOL Office of Treasury and Fiscal Services Local Government Investment Pool (4.237%) SCHEDULE "3" $ 2,205,854.98 See notes to the general purpose financial statements. - 27 - SCREVEN COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30 1994 SCHEDULE "4" Children and Youth Coordinating Council Intervention Program Federal Funds Education, Georgia Department of Food Services School Breakfast Program National School Lunch Program Vocational Education Federal Funds Lottery Funds Algebra Classrooms Computers In Classrooms Distant Leaming Media Center and Library Equipment Safe Schools Grant Federal Programs Drug-Free Schools and Communities Act ESEA - Chapter 1 Education of Deprived Children Individuals with Disabilities Education Act Title VI, B - Flow Through First District Regional Educational Service Agency d/b/a Live Oak Migrant Education Agency ESEA - Chapter 1 Migratory Education Program Screven County Tax Commissioner County Wide School Tax Various Sources Interest Earned Other GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 1,583.70 $ 1,583.70 $ 54,593.00 1,907.38 5,500.73 2,316.00 48,355.00 2,200.00 58,652.07 24,059.95 2,542.70 120,743.46 172.77 1,907.38 5,500.73 54,593.00 2,316.00 48,355.00 2,200.00 58,652.07 24,059.95 2,542.70 120,743.46 172.77 23,789.42 16,107.84 267.00 752.65 1,675.51 752.65 23,789.42 16,107.84 1,942.51 $ 96,340.96 $ 268,878.22 $ 365,219.18 See notes to the general purpose financial statements. - 28 - SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30 1994 SCHEDULE "5" AGENCY/FUNDING GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Special Instructional Assistance In-School Suspension Mid-term Adjustment Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education other State Programs Mentor Teacher Program Preschool Handicapped Program Supervision and Assessment of Student and Beginning Teachers and PerformanceBased Certification Tuition for the Multi-Handicapped Lottery Programs Algebra Classrooms Computers in Classrooms Distant Leaming Media Center and Library Equipment Safe Schools Grant OTHER Education, Georgia Department of Student Informations Systems Project GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 4,835,170.00 969,313.00 261,020.00 214,177.00 73,904.00 1,505,824.00 447,803.00 138,903.00 202,628.00 125,085.00 64,499.00 126,755.00 -969,122.00 709,683.00 $ 1,365.80 720.00 18,699.09 $ 4,835,170.00 969,313.00 261,020.00 214,177.00 73,904.00 1,505,824.00 70,868.00 447,803.00 138,903.00 202,628.00 125,085.00 64,499.00 126,755.00 -969, 122.00 709,683.00 70,868.00 1,365.80 720.00 18,699.09 4,150.00 7,965.00 2,316.00 57,471.00 2,200.00 58,652.07 24,059.95 4,150.00 7,965.00 2,316.00 57,471.00 2,200.00 58,652.07 24,059.95 1,000.00 1,000.00 $ 8,739,541.89 $ 215,567.02 $ 8,955,108.91 See notes to the general purpose financial statements. - 29 - SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF LOCAL AND OTHER REVENUE YEAR ENDED JUNE 30 1994 SCHEDULE "6'' Taxes County Wide School Tax Railroad Car Tax Real Estate Transfer Tax Other Indirect Cost Special Revenue Fund Interest Earned Sales Breakfasts and Lunches School Assets Tuition Other GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 2,618,272.05 204.97 4,644.98 $ 2,618,272.05 204.97 4,644.98 21,023.61 126,916.45 $ 42,000.00 24,129.00 19,154.91 14,605.23 280,025.94 2,642.98 21,023.61 141,521.68 280,025.94 42,000.00 24,129.00 21,797.89 $ 2,856,345.97 $ 297,274.15 $ 3,153,620.12 See notes to the general purpose financial statements. - 30 - SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30 1994 SCHEDULE '7" EXPENDITURES Operating Costs Salaries $ Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Property Services Insurance Communications Tuition Commodity Hauling Shared Services other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Federal Indirect Costs other Expenditures Nonoperating Costs Principal and Interest Land and Land Improvements Building and Building Improvements Equipment GENERAL FUND SPECIAL REVENUE FUND 7,977,432.81 $ 1,715,902.96 38,636.30 112,064.06 6,816.89 167,243.42 92,342.43 155.05 94,132.35 71,682.40 31,331.52 10,738.00 16,491.60 17,789.00 336,178.60 361,328.84 105,628.65 23,714.70 10,154.00 1,157,529.16 $ 257,740.01 9,558.81 54,697.92 960.00 2,721.33 100.00 300.00 5,078.70 10,583.64 181,506.46 15,154.25 535,394.28 64.00 12,711.33 21,023.61 3,823.34 57,614.36 156,252.87 34,145.07 282,405.93 187,833.56 TOTAL 9,134,961.97 1,973,642.97 48,195.11 166,761.98 6,816.89 168,203.42 95,063.76 255.05 94,132.35 71,682.40 31,631.52 10,738.00 5,078.70 16,491.60 28,372.64 517,685.06 376,483.09 535,394.28 105,692.65 36,426.03 21,023.61 13,977.34 57,614.36 156,252.87 34,145.07 470,239.49 Total Expenditures $ 11,720,181.81 $ 2,456,780.40 $ 14,176,962.21 See notes to the general purpose financial statements. - 31 - SCREVEN COUNTY BOARP OF eQlJCAJJQN SCMePIJLe OF exPENPfIUBes BY OB.Jeer LQUsBY PBQGRAMS YeAB eNPeD JUNe 3Q 1994 SCHEDULE"&" exeeNPITUBES 0pending Cools Prof-land TedvlicalServicea Supplioo ~Cools Equipment ALGEBRA CIASSROOMS COMPUTERS IN CIASSROOMS DISTANT LEARNING IIEDIA CENTER AND LIBRARY EQUIPMENT SAFE SCHOOLS GRANT $ 2,316.00 2,<400.00 $ 55 071.00 $ 2,200.00 8,600.00 7,857.07 $ ,42195.00 $ 10,091).,45 13969.50 TOTAL 11,000.00 22,463.52 111 235.50 Tola!~ 2 316.00 $ 57 71.00 $ 2 200.00 $ 58 652.07 $ 24059.95 $ 144699.02 See no1es to the general purpo&e fmancial statements. 32. SCREVEN COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND- QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30 1994 SCHEDULE "9" Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis Salaries Operations Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures for Staff Development Programs in Excess of Total Staff Development Allotment for: Cost of Instruction Expenditures per Audit THIRTEEN WEIGHTED AND MEDIA CENTER PROGRAMS STAFF DEVELOPMENT PROGRAM $ 6,368,770.00 $ _ _ _7'-'3'-",9=0..;.4;.;:;.o.a.o $ 6,652,318.26 335,214.01 $ _ _ _7_3~,9_2_0._55_ $ 6,987,532.27 $ 73,920.55 -43,980.21 -18,660.36 $ 6,943,552.06 $ _ _ _5"-'5'-",2=6-"0""-.1.a..9 Amount of Underexpenditure for Total Allotment $ 0.00 $ ===1=8=,6=4=3.=8=1 See notes to the general purpose financial statements. - 33 - SCBEYEN COI.JNJY ROABP Of EQl !CATJQN ANAi YSIS Of MINIMI IM EXfENPmJBE BEO\ HBEMEN'TS BY PROC--BAM GENERAi BJNP QI IAI TTY RASIC EQl JCATIQN PROGRAMS YEAR ENDP JlJNE 30 1994 GENERAL AND CAREER EQl JCATION ffiOGBAMS Kindergarten (") Sub-Total K--3 G.-4-5(") G.-6-8(") G.-9-12(") High SChool L.abo1810!ie& (") Vocational Education Laboratories (") Total Genefal and career Education Programs SPECIAi EQI.JCATION P8QGBAM Regular Programs category I (") category JI (") category JJJ (") category JV (") Itinerant S - 1 Speech Sub-Total Regular category V (Gifted) (") Total Special Education Programs REMfQIA! EQlJCATIQN PROGRAM,, MfQIA CfNTfR PRQGRAMS Total Thirteen Weighted and Media Center - ISTAFF PEYEI 9PMENT PRQGBAMS (1) Cost rllnatruction De,eJopment Tolal staff De,eJopment (") I -Thrteen Weighted Programs. Note: (1) $8,596.SOrltheallotmentforProfessional Der,telopment has been transferred to Cost cl lnstrucbon as authorized by OCGA 20-2-182 See note& to the general purpose financial &tatements. ALLOTMENTS FROM DEPARTMENT OF EDUCATION REQUIRED TOTAL ORIGINAL ...!L ORIGINAL MID-TERM REQUIRED 471,344.00 1 289124.00 1,760,468.00 555,797.00 1,133,497.00 790,787.00 270,872.00 323 749.00 4 835170.00 90 s 90 90 90 90 90 s 424,209.60 S 1160 211.60 1,584,421.20 $ 500,217.30 1,020,147.30 711,708.30 243,784.80 291 374.10 4 351 653.00 $ 0.00 S 424,209.60 1160211.60 0.00 $ 1,584,421.20 500,217.30 1,020,147.30 91,703.00 803,411.30 243,784.80 291 374.10 91 703.00 $ 4 443 356.00 908,517.00 817,665.30 $ -2,168.00 $ 815,497.30 908,517.00 60796.00 969313.00 261 020.00 2141TT.OO 90 s 90 90 $ 90 s 817,665.30 $ 54 716.40 872 381.70 $ 234 918.00 S 192 759.30 S -2,168.00 S 152.00 2 320.00 $ -293.00 $ 0.00 $ 815,497.30 54 564.40 870 061.70 234 625.00 192 759.30 $ 6 279,680.00 s 5 651 712.00 $ 89,090.00 $ 5,740,802.00 25,188.80 100 S 48 715.20 100 25,188.80 S 48 715.20 73 904.00 73904.00 $ 0.00 S 25,188.80 48 715.20 0.00 $ 73,904.00 S 6 353 584.00 5,725,616.00 $ 89,090.00 $ 5,814,706.00 . 34. SCHEDULE"10" REQUIRED ALLOTMENT SALARIES ACTUAL DISTRIBUTION BY RESPECTIVE PORTIONS AMOUNT OF UNOEREXPENOITURE FOR REQUIRED ALLOTMENT REQUIRED ALLOTMENT OPERATIONS AMOUNT OF UNOEREXPENDmJRE FOR REQUIRED ACTUAL ALLOTMENT 413,282.70 $ 1123 936.20 1,537,218.90 $ 4841,970.40 990,040.50 761,383.40 233,145.00 253 716.30 4 260 474.50 $ 527,777.04 1163147.11 1,690,924.15 $ 588,638.57 1,086,529.16 1,059,357.19 241,248.89 363 001.08 5 029699.04 $ 10,926.90 $ 12,574.39 36 275.40 34632.14 0.00 47,202.30 $ 47,206.53 $ 0.00 15,246.90 23,927.n 0.00 30,106.80 36,123.32 0.00 42,027.90 86,2-15.83 0.00 10,639.80 15,238.54 0.00 37 657.80 37 670.17 0.00 182 881.50 s 246 412.16 $ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 36,280.80 $ 254,524.50 435,369.60 67,724.10 1,390.50 1 039.50 51,737.81 442,304.67 434,896.78 73,245.70 1,847.70 $ 5,411.70 11,n4.70 134.20 2,789.54 8,305.25 5,138.74 3,101.66 796,329.00 $ 1,001,984.96 $ 0.00 19,168.30 $ 19,335.19 $ 0.00 53211.60 60876.83 s 0.00 1 352.80 1 393.52 S 0.00 849 540.60 s 1062861.79 20 521.10 S 20 728.71 230 841.00 s 365 819.65 s 0.00 3 784.00 s 3853.71 $ 0.00 148 569.30 $ 193 937.78 s 0.00 44190.00 $ 64219.43 S 0.00 5 489 425.40 s 6 652 318.26 $ 0.00 251,376.60 S 335,214.01 s 0.00 5 489 425.40 $ 6 652318.26 s 25,188.80 s 48 715.20 43,849.16 S 30071.39 73,904.00 $ 73 920.55 s 0.00 18 643.81 18 643.81 0.00 325,280.60 S 409134.56 $ 18,643.81 - 35 - SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS YEAR ENDED JUNE 30 1994 SCHEDULE "11" BOARD MEMBER ADDRESS Mr. Ainsworth Zeagler, Chairman(") 135 Indian Trail Sylvania, Georgia 30467 Mr. Joseph Boddiford (") 475 Mercer Road Sylvania, Georgia 30467 Mr. Richard Boykin (") 2355 Poor Robin Road Sylvania, Georgia 30467 Mr. Raleigh Cail, Jr. (") 582 Arnett Road Sylvania, Georgia 30467 Mr. Michael Daley (") 206 Holly Road Sylvania, Georgia 30467 r> Ms. Samantha B. Marchant 1044 Harmony Road Sylvania, Georgia 30467 Mr. Charles Wilkins (") 1575 Friendship Road Sylvania, Georgia 30467 COMPENSATION TRAVEL $ 1,000.00 900.00 850.00 1,000.00 $ 68.62 800.00 25.62 750.00 367.65 1,000.00 55.00 (") Denotes Board Members Serving as of June 30, 1994 $ 6,300.00 $ 516.89 See notes to the general purpose financial statements. - 36 - SECTION IT COMPLIANCE CLAUDE L. VICKERS STATE AUDITOR <04) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Screven County Board ofEducation COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 19, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. Compliance with laws, regulations, contracts, and grants applicable to Screven County Board of Education is the responsibility ofthe Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. 94CRL-10 The results ofour tests indicate that, with respect to the items tested, the Screven County Board of Education complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects, with those provisions. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution ohhis report which is a matter ofpublic record. Respectfully submitted, tf~ Claude L. Vickers State Auditor CLV:cm 94CRL-10 CLAUDE L. VICKERS STATE AU0ITOR(404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Screven County Board ofEducation SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 19,1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have applied procedures to test the Screven County Board of Education's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994: (l) Political Activity (5) Allowable Costs/Cost Principles (2) Civil Rights (6) Audit Follow-Up/Resolution (3) Cash Management (7) Administrative Requirements (4) Federal Financial Reports Our procedures were limited to the applicable procedures described in the Office ofManagement and Budget's "Compliance Supplement for Single Audits ofState and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression ofan opinion on the Screven County Board of Education's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. 94CRL-70 Material instances of noncompliance consist offailures to follow the general requirements that caused us to conclude that the misstatements resulting from those failures are material to the Federal financial assistance programs. The results of our tests of compliance disclosed a material instance of noncompliance that is described in the Schedule ofFmdings and Improper or Questioned Costs. We considered this material instance ofnoncompliance in forming our opinion on whether the Screven County Board of Education's general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated July 19, 1995, on those financial statements. Except as described above, the results of our procedures to determine compliance indicate that, with respect to the items tested, the Screven County Board of Education, complied, in all material respects, with the requirements listed in the second paragraph of this report, and with respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects with those requirements. Additionally, the results ofour procedures disclosed an immaterial instance of noncompliance with those requirements which is also described in the Schedule of Findings and Improper or Questioned Costs. This report is intended for the information of management, the Federal cognizant audit agency and other Federal granter agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. ~~ Claude L. Vickers State Auditor CLV:cm 94CRL-70 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Screven County Board ofEducation SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated July 19, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Screven County Board of Education's compliance with the requirements governing: (1) Types of Services Allowed or Unallowed (5) Applicable Special Tests and Provisions (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (6) Other Requirement Claims for Advances and Reimbursements (4) Reporting These requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994. The management of the Screven County Board ofEducation is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. 94CRL-80 Except as discussed in the following paragraph, we conducted our audit of compliance in accordance with generally accepted auditing standards: Government Auditing Standards issued by the Comptroller General of the United States; and Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. However, this matter has no affect on the Board's compliance with the requirements listed in the-second paragraph ofthis report. In our opinion, the Screven County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1994. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~ Claude L. Vickers State Auditor CLV:cm 94CRL-80 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Screven County Board ofEducation SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board ofEducation as of and for the year ended June 30, I994, and have issued our report thereon dated July 19, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. In connection with our audit ofthe fiscal year 1994 general purpose financial statements of the Screven County Board of Education and with our consideration of the Board's internal control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, "Audits ofState and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing: (I) Types of Services Allowed or Unallowed (3) Applicable Special Tests and Provisions (2) Eligibility Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Screven County Board ofEducation's compliance with these requirements. Accordingly, we do not express such an opinion. 94CRL-120 With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Screven County Board ofEducation had not complied, in all material respects, with those requirements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter ofpublic record. Respectfully submitted, ?f~~ Claude L. Vickers State Auditor CLV:cm 94CRL-120 SECTION III INTERNAL CONTROL CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members of the Screven County Board ofEducation REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated July 19, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards, and 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 general purpose financial statements are free of material misstatement. We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. In planning and performing our audit ofthe general purpose financial statements of the Screven County Board of Education for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of the Screven County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, 94ICL-3 assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation ofpolicies and procedures may deteriorate. For the purposes of this report, we have classified the significant internal control structure policies and procedures in the following categories: (I) Cash and Cash Equivalents (2) Investments (3) Inventories (4) Revenue/Receivables/Receipts (5) Procurement (6) Expenditures/Liabilities/ Disbursements (7) Employee Compensation (8) General Ledger (9) General Fixed Assets For all ofthe internal control categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. As descnbed in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories: (I) Accounting Controls (Overall) (2) General Fixed Assets A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may 94ICL-3 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 structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses. These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Screven County Board of Education's financial statements and this report does not affect our report thereon dated July I9, 1995. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution ohhis report which is a matter of public record. Respectfully submitted, L_~ Claude L. Vickers State Auditor CLV:cm 94ICL-3 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 July 19, 1995 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Superintendent and Members ofthe Screven County Board ofEducation SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe Screven County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated July 19, 1995. This report was qualified for a scope limitation and for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Screven County Board of Education's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated July 19, 1995. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Screven County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. We did not observe the taking of either the Federal donated commodities inventory or purchased foods inventory at June 30, 1994, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. In planning and performing our audit for the year ended June 30, 1994, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Board's general purpose financial statements and on its compliance with requirements applicable to major 94ICL-8 Federal financial assistance programs and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration ofinternal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated July 19, 1995. The management of the Screven County Board ofEducation is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that, assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in-accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection ofany evaluation ofthe structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories: GENERAL REQUIREMENTS SPECIFIC REQUIREMENTS (!) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (I) Types of Services Allowed or Unallowed (2) Eligibility (3) Matching, Level ofEffort, and/or Earmarking (5) Allowable Costs/Cost Principles (4) Reporting (6) Audit Follow-Up/Resolution (7) Administrative Requirements (5) Applicable Special Tests and Provisions (6) Other Requirements Claims for Advances and Reimbursements For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. 94ICL-8 During the year ended June 30, 1994, the Screven County Board of Education expended 71% of its total Federal financial assistance under major Federal financial assistance programs. We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements and specific requirements as descnbed above that are applicable to each of the Board's major Federal financial assistance programs, which are identified in the Schedule ofFederal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the Board's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations. As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control category: Administrative Requirements A material weakness is a reportable condition in which the design or operation of one or more ofthe internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program 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 structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, as described in the Schedule ofFindings and Improper or Questioned Costs, the following control category includes reportable conditions that are also considered to be material weaknesses: Administrative Requirements These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Screven County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance programs for the year ended June 30, 1994, and this report does not affect our report thereon dated July 19, 1995. 94ICL-8 This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution ofthis report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:cm 94ICL-8 SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR AUDIT FOLLOW-UP/RESOLUTION Inadequate Sick and Personal Leave Records Financial Statements Finding Resolved Audit Control Number 7241-93-02 The audit report for the year ended June 30, 1993, disclosed that sick and personal leave records were not maintained for principals and assistant principals. This noncompliance occurred because of management's failure to adequately monitor sick and personal leave records maintained for all administrative personnel. In the year under review, the Board implemented procedures to ensure that complete sick and personal leave records are maintained for all personnel employed by the Board. AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $1,307.30 Audit Control Number 7241-93-04 For the year ended June 30, 1993, the Board had an underexpenditure ofQuality Basic Education (QBE) funds of$1,307.30 for the salaries portion of the High School Laboratories Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditure of $1,307.30 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for QBE programs in a subsequent period. AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements A.mount: $13,867.09 Audit Control Number 7241-93-05 The audit report for the year ended June 30, 1993, disclosed that the Staff Development - Professional Development Program had an underexpenditure ofQuality Basic Education (QBE) funds of$13,867.09 for the required minimum allotment. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditure of$13,867.09 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for QBE programs in a subsequent fiscal year. SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR/CURRENT YEAR ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation of Duties Reportable Condition - Material Weakness Audit Control Number 7241-93-01 The audit report for the year ended June 30, 1993, stated that the Board did not provide for adequate separation ofemployee duties in the performance ofaccounting functions and related procedures. During the year under review, our audit noted some improvement in adequate separation of employee duties, but still did not achieve an adequate degree ofinternal control. This deficiency was a result of management's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree ofinternal control with existing staff. Note: All Federal financial assistance programs listed in the Schedule ofFederal Financial Assistance, Schedule "1 " ohhis report are affected by this finding. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7241-93-03 The audit report for the year ended June 30, 1993, noted that the management ofthe Screven County Board ofEducation had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained ofall additions and deletions to the General Fixed Assets Account Group. SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 PRIOR YEAR/CURRENT YEAR ADMINISTRATIVE REQUIREMENTS Inadequate Inventory Records Federal Financial Assistance Major Program Reportable Condition - Material Weakness Material Noncompliance Audit Control Number 7241-93-06 The audit report for the year ended June 30, 1993, stated that the Board failed to perform an annual physical inventory of equipment for the National School Lunch Program (CFDA 10.555). For the year under review, the Board performed a physical inventory of equipment but failed to reconcile the results of the physical inspection to the property management records. The Board also failed to include equipment expenditures which were recorded on the general ledger as additions to the property management records. This condition occurred because management disregarded the provisions of Chapter 41 of the Financial Management for Georgia Local Units of Administration and 7 CFR 3015.169. Periodic physical inventory counts should be performed and reconciled to the property records to ensure the accuracy of the Board's inventory records. Detailed records should be maintained for all deletions and procedures should be established to ensure that additions to the inventory records are reconciled to the general ledger. CURRENT YEAR EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $18,643.81 Audit Control Number 7241-94-01 For the year under review, the Board reported to the Georgia Department ofEducation on DE form 0420 "General Fund QBE Program Expenditure Summary" expenditures totaling $43,849.16 for the Staff Development - Cost ofInstruction Program. A review ofthe underlying source documentation for the Quality Basic Education (QBE) program disclosed that the Board expended more than 15 percent of its initial allotment of funds for the Professional Development Stipends for StaffDevelopment - Cost of Instruction program purposes resulting in an underexpenditure of$18,643.81 for the minimum required allotment of $48,715.20 for the StaffDevelopment - Professional Development Stipends Program. This questioned cost resulted from management's reliance on incorrect information received from the Georgia Department ofEducation, resulting in a violation ofOfficial Code ofGeorgia 20-2-182. The underexpenditure of$18,643.81 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. SCREVEN COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30 1994 CURRENT YEAR ALLOWABLE COSTS/COST PRINCIPLES Salary Overpayment Federal Financial Assistance Nonmaterial Noncompliance Amount: $3,188.64 Audit Control Number 7241-94-02 The Board overpaid an employee from the School Food Services Fund in the amount of$3, 188.64 as a result of a miscalculation by payroll personnel. Appropriate action should be taken by the Board to ensure that all personnel are paid in accordance with contracted services for work actually performed. Reimbursement of $3,188.64 should be secured and deposited to the Board's School Food Services Fund. ADMINISTRATIVE REQUIREMENTS Failure to Adhere to Free and Reduced-Price Meal Policy Federal Financial Assistance Reportable Condition Nonmaterial Noncompliance Audit Control Number 7241-94-03 For the year under review, the Board failed to properly administer operational procedures in accordance with the Board's "Free and Reduced Price Meal Policy". According to the policy, if a student forgets his/her lunch money, the student will be allowed to charge the meal. A student is allowed to charge up to three (3) meals and the cashier is to notify the student by letter each week of the amount owed. Deficiencies were noted as follows: 1. Students were allowed to charge more than three (3) meals. 2. No documentation was available to verify that the cashier notified students of the amounts owed. 3. No policy as been established for the collection of charges. This condition occurred because ofmanagement's failure to establish adequate procedures to monitor its lunch payment policy. The Board should establish procedures to ensure that meals charged are maintained in accordance with the Board's "Free and Reduced Price Meal Policy", that students are notified of amounts owed, and that the Board establish collection methods for charges. SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCREVEN COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEAR ENDED JUNE 30 1994 AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $1,307.30 Audit Control Number 7241-93-04 We concur with this finding. This finding will be resolved by the Georgia Department ofEducation during FY96 by an increase in the Board's local fair share portion ofQBE Allotments. AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $13,867.09 Audit Control Number 7241-93-05 We concur with this finding, however the transfer of more than 15 percent of the allotment of funds for Professional Development to StaffDevelopment Cost ofInstruction program was made per instructions from the Georgia Department of Education. This finding will be resolved by Georgia Department ofEducation during FY96 by an increase in the Board's local fair share portion of QBE Allotments. ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7241-93-01 We concur with the finding, and realize the importance of separation of duties as an internal control mechanism. However, due to current budgetary constraints, the Board is unable to hire the additional staff required to clear this finding. The Board feels it has provided for the most appropriate assignment of duties with the number of personnel available to perform the accounting functions. Management will continue to periodically review this decision to determine ifemployee duties can be reassigned to achieve a higher degree of internal control with existing staff. GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7241-93-03 We concur with the recommendation. However, due to current staffing limitations and budgetary considerations prohibiting the hiring ofadditional administrative staffand to the lack of technical support from the State Department ofEducation, the Board has decided not to pursue the recording ofgeneral fixed assets on the financial statements at the present time. SCREVEN COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEAR ENDED JUNE 30 1994 ADMINISTRATIVE REQUIREMENTS Inadequate Inventory Records Federal Financial Assistance Major Program Reportable Condition - Material Weakness Material Noncompliance Audit Control Number 7241-93-06 We concur with this finding. Procedures will be established to ensure that the periodic physical inventory counts are reconciled to the property records as required by the National School Lunch Program (CFDA 10.555) and to the provision of Chapter 41 of the Financial Management for Georgia Local Units of Administration and 7 CFR 3015.169. EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $18,643.81 Audit Control Number 7241-94-01 We concur with this finding, however, this transfer of more than 15 percent of the allotment of funds for Professional Development to StaffDevelopment Cost of Instruction program was made per instruction from the Georgia Department ofEducation. The finding will be resolved by the Georgia Department ofEducation through a future increase in the Board's local fair share portion of QBE allotments. ALLOWABLE COSTS/COST PRINCIPLES Salary Overpayment Federal Financial Assistance Nonmaterial Noncompliance Amount: $3,188.64 Audit Control Number 7241-94-02 We concur with the recommendation. Procedures have been implemented to ensure that employees are paid in accordance with contracted services for work actually performed. School Food Services department is currently working with the school system's attorney in an effort to have the overpayment reimbursed by the individual involved. SCREVEN COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEAR ENDED JUNE 30 1994 ADMINISTRATIVE REQUIREMENTS Failure to Adhere to Free and Reduced-Price Meal Policy Federal Financial Assistance Reportable Condition Nonmaterial Noncompliance Audit Control Number 7241-94-03 We concur with the finding. Procedures have been implemented to ensure that meals charged are maintained in accordance with the Board's "Free and Reduced Price Meal Policy", that students are notified of amounts owed, and that collection methods for charges are established.