Audit report, Stephens County Board of Education, Toccoa, Georgia, year ended June 30, 1999

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AUDIT REPORT STEPHENS COUNTY BOARD OF EDUCATION
TOCCOA, GEORGIA YEAR ENDED JUNE 30, 1999
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

STEPHENS COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

5

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

6

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

16

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

18

G

FIDUCIARY FUND TYPE

COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUNDS

20

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

21

2 SCHEDULE OF STATE REVENUE

23

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

24

4 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

25

ANALYSIS OF :MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

5

OVERALL

27

6

BYPROGRAM

28

STEPHENS COUNTY BOARD Of EDUCATION -TABLE OF CONTENTS -
SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133
SECTIONID AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 28, 2000

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Stephens County Board ofEducation
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general purpose financial statements of the Stephens County Board of Education, as of and for the year ended June 30, 1999, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Stephens County Board ofEducation's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures ~ 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, 1999, 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:

99ARL-13

* 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 aggregate effects on the general purpose financial statements ofthese 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 referred to above present fairly, in all material respects, the financial position of the Stephens County Board ofEducation as ofJune 30, 1999, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditin~ Standards, we have also issued our report dated January 28, 2000,
on our consideration of the Stephens County Board ofEducation's intern.al control over :financial reporting and our tests ofits compliance with certain provisions oflaws, regulations, contracts and grants.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Stephens County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through G) and the financial schedules (Schedules 1 through 6), which includes the Schedule of Expenditures of Federal Awards as required by U.S. Office of Management and Budget Circular A-133,
Audits ofStates, Local Governments, and Non-Profit Organizations, are presented for purposes ofadditional
analysis and are not a required part of the general purpose :financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effect of adjustments, if any, on the 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.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
Respectfully submitted,

RWH:gp 99ARL-13

~W-~
Russell W. Hinton
State Auditor

STEPHENS COUNTY BOARD OF EDUCATION

STEPHENS COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND lYPES JUNE 30, 1999

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

524,935.87

$ 3,504,176.46

2,466,144.75

233,281.47

50,662.12 19,833.17

Total Assets

$ 5,970,321.21 $ ====82=8=7,=1=2=63=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Funds Held for Others
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Inventories Food Donated Commodities Purchased Food For SPLOST Projects Unreserved Undesignated
Total Fund Equity

$

247,642.53

690,374.63 $

2,262,102.52

58,347.88 180,002.47

$ 3,200,119.68 $

238,350.35

$

50,662.12

19,833.17

$ 2,770,201.53 $ 2z770,201.53 $

519,866.99 590,362.28

Total Liabilities and Fund Equity

---======= $ 5,970,321.21 $

828,712.63

The notes to the general purpose financial statements are an integral part of this statement. -2-

EXHIBIT"A"

TYPES CAPITAL
PROJECTS FUND

FIDUCIARY FUND TYPE AGENCY
FUNDS

TOTALS

iMemorandum Onl~

JUNE 30, 1999

JUNE 30, 1998

$

5,729.86 $

530,665.73 $

526,211.03

$ 2,954,355.93

6,458,532.39

3,896,646.85

450,592.79

3,150,019.01

2,942,889.32

50,662.12 19,833.17

42,511.67 19,018.83

$ 3,404,948.72 $

5,729.86 $ 10,209,712.42 $ 7,427,277.70

$

247,642.53

748,722.51 $

809,883.53 .

2,442,104.99

2,683,845.00

$

5,729.86

5,729.86

686.99

$

5,729.86 $ 3,444,199.89 $ 3,494,415.52

$ 3,404,948.72 0.00
$ 3,404,948.72

$

23,136.50

$

50,662.12

19,833.17

3,404,948.72

42,511.67 19,018.83 798,394.09

3,290,068.52

3,049,801.09

$ 6,765,512.53 $ 3,932,862.18

$ 3,404,948.72 $

5,729.86 $ 10,209,712.42 $ 7,427,277.70

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STEPHENS COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1999

EXHIBIT"B"

REVENUES

GENERAL FUND

SPECIAL REVENUE
FUND

CAPITAL PROJECTS
FUND

TOTALS (Memorandum Only:}
YEAR ENDED JUNE 301 1999 JUNE 301 1998

State Funds Federal Funds Taxes Other Funds

$ 16,725,418.10 $ 343,312.04

$

4,288.31 2,228,719.03

7,038,230.65

$ 2,704,438.38

349,986.41

548,091.41

73,744.55

17,068,730.14 $ 2,233,007.34 9,742,669.03
971,822.37

15,993,860.26 2,225,837.14 7,801,398.86
808,017.51

Total Revenues EXPENDITURES

$ 24,117,923.47 $ 3,120,122.48 $ 2,778,182.93 $ 30,016,228.88 $ 26,829,113.77

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)

$ 16,462,618.34 $ 1,316,656.57

$ 17,779,274.91 $ 16,105,591.81

1,245,395.81 596,313.78 569,053.71 367,337.06
1,336, 198.59 163,438.68
1,765,385.73 1,082,715.66
150,279.81 59,936.38
173,931.51

4,568.65 143,636.77
2,402.00

30,693.39 50,290.00 124,206.43 1,375,881.25
$

171,628.30

1,249,964.46 739,950.55 569,053.71 369,739.06
1,336,198.59 163,438.68
1,765,385.73 1, 113,409.05
200,569.81 184,142.81 1,375,881.25 345,559.81

1,202,372.25 784,683.32 526,566.67 504,565.78
1,506,068.38 201,480.86
1,901,760.15 946,185.13 217,062.15 65,110.69
1,313,923.29 613,309.24

$ 23,972,605.06 $ 3,048,335.06 $ 171,628.30 $ 27, 192,568.42 $ 25,888,679.72

$ 145,318.41 $ 71,787.42 $ 2,606,554.63 $ 2,823,660.46 $ 940,434.05

Operating Transfers In Operating Transfers Out

$

25.10 $

68.77

-68.77

$

93.87 $ 157,969.59

-68.77

-157,969.59

Total Other Financing Sources (Uses)

$

-43.67 $

68.77

$

25.10 $

0.00

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

145,274.74 $

71,856.19 $ 2,606,554.63 $ 2,823,685.56 $

940,434.05

FUND BALANCE JULY 1

2,624,926.79

509,541.30

798,394.09

3,932,862.18

2,995,353.42

Food Inventory - Net Change in Period Donated Commodities Purchased Food

8,150.45 814.34

8,150.45 814.34

3,139.90 -6,065.19

FUND BALANCE JUNE 30

$ 2!110.201.53 $ 590.362.28 $ 31404.948.72 $ -Sg765.512.53 $ 3!9321862.18

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

STEPHENS COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30. 1999

EXHIBITc

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS}

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 16,226,884.81 9,000.00
6,616,396.00 302,090.20

$ 16,725,418.10 4,288.31
7,038,230.65 349,986.41

Total Revenues

$ 23,154,371.01 $ 24,117,923.47

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital OuUay

$ 16,349,824.27 $ 16,462,618.34

1,231,280.96 662,890.12 563,876.54 446,177.00
1,485,897.55 338,451.00
1,991,615.07 1,169,811.64
183,672.73 36,391.53

1,245,395.81 596,313.78 569,053.71 367,337.06
1,336, 198.59 163,438.68
1,765,385.73 1,082,715.66
150,279.81 59,936.38

192,131.43

173,931.51

Total Expenditures

$ 24,652,019.84 $ 23,972,605.06

Excess of Revenues over (under) Expenditures

$ -1,497,648.83 $ 145,318.41

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$

25.10

-68.77

Total Other Financing Sources (Uses)

$

-43.67

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -1,497,648.83 $

145,274.74

FUND BALANCE JULY 1, 1998

3,671,099.40

2,624,926.79

Adjustments Food Inventory
Donated Commodities Purchased Food

86,370.04

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS}

$ 414,010.05 $ 343,312.04 2,164,508.81 2,228,719.03

434,300.00

548,091.41

$ 3,012,818.86 $ 3,120,122.48

$ 1,340,965.41 $ 1,316,656.57

1,010.00 249,062.74

4,568.65 143,636.77

3,050.21

2,402.00

28,199.00 50,290.00 142,109.00 1,400,814.00

30,693.39 50,290.00 124,206.43 1,375,881.25

$ 3,215,500.36 $ 3,048,335.06 $ -202,681 .50 $ 71.787.42

$

68.77

$

68.77

$ -202,681.50 $ 71,856.19

504,454.52

509,541.30

21,106.43

8,150.45 814.34

FUND BALANCE JUNE 30. 1999

$ 2.259.820.61 $ 2,770,201.53

$ 322,879.45 $ 590,362.28

The notes to the general purpose financial statements are an integral part of this statement -5- .

STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Stephens County Board ofEducation (Board) was established under the laws ofthe State ofGeorgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board uses funds to report on its financial position and the results ofits operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental :functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the Board. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds ofspecific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department ofEducation and from the Federal government to accomplish specific educational objectives.

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STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
FIDUCIARY FUND TYPE - the fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:
AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for individuals.
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 of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1998 and ending in early June 1999. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1998 and ending in August 1999. State grants to fund the State's share of these contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements.

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STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

n,JNE30, 1999

Note 1; SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.

BUDGET

The Stephens County Board ofEducation's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level ofbudget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.

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

CASH AND CASH EQUIVALENTS

COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations.

INVESTMENTS

COMPOSITION OF INVESTMENTS

fuvestments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit)

and repurchase agreements are reported at cost. Participating interest-earning contracts and money market

investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating

interest-earning contracts and money market investments with a maturity at purchase greater than one year

are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to

invest its funds. fu selecting among options for investment or among institutional bids for deposits, the

highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may

be invested in the following:



(1) Obligations issued by the State of Georgia or by other states,

(2) Obligations issued by the United States government,

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STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

nJNE 30, 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,

(4) Obligations of any corporation ofthe United States government,

(5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,

(7) Repurchase agreements, and

(8) Obligations of other political subdivisions of the State of Georgia.

RECEIVABLES

Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but
not reimbursed and other receivables disclosed from information available. Receivables are recorded when
either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose
financial statements do not include any amounts which would necessitate the need for an allowance for
uncollectible receivables.

PROPERTY TAXES

The Stephens County Board of Commissioners fixed the property tax levy for the 1998 tax year (calendar year) on October 29, 1998_ (levy date). Taxes were due on January 29, 1999. The lien date for property taxes was January 1, 1998. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1999. The Stephens 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 oftaxes collected to the Board.

The tax millage rate levied for the 1998 tax year (calendar year) for the Stephens County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

14.85 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $2,704,438.38 and was recorded in the Capital Projects Fund. The State will terminate collection ofthis tax once an additional $13,177,450.06 has been collected or on December 31, 2002, whichever occurs first.

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STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 1: SUMMARY OF SIGNJFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component ofnet current assets.
INTERFUND TRANSACTIONS
The Board has the following types ofinterfund transactions:
Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than reimbursements.
MEMORANDUM ONLY -TOTAL COLUMNS
Total columns on the general pmpose :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 ofthis data.
Note 2: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS Official Code ofGeorgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate of the face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being
secured after the deduction ofthe amount ofdeposit insurance. OCGA Section 45-8ll (b) 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 ofor any combination ofthe following:
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STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 2: DEPOSITS AND INVESTMENTS
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates ofindebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates ofindebtedness or other obligations ofthe counties or municipalities ofthe State of Georgia,
(5) Bonds ofany public authority created by the laws ofthe State ofGeorgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and
(7) Bonds, bills, notes, certificates ofindebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Banlc, the Federal Home Loan Banlc, the Federal Intermediate Credit Banlc, the Central Banlc for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association..
CATEGORIZATION OF DEPOSITS At June 30, 1999, the banlc balances were $1,381,200.83. The amounts of the total banlc 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 banlc 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, 1999, as follows:

-11-

STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 2: DEPOSITS AND INVESTMENTS

Risk Categozy

Bank Balance

1

$ 100,000.00

2

1,281,200.83

3

0.00

Total

$ 1.381.200.83

CATEGORIZATION OF INVESTMENTS At June 30, 1999, the carrying value ofthe Board's total investments was $6,458,532.39 which is materially the same as fair value. This investment consisted entirely of funds invested in the Local Government Investment Pool administered by the State of Georgia, Office ofTreasury and Fiscal Services which are not required to be categorized since the Board did not own any specific identifiable securities in the pool. The investment policy ofthe State of Georgia, Office ofTreasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows:

The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a 2a-7 like pool. .The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety ofcapital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value ofthe shares. Participation in the pool is voluntary and deposits consist offunds from local governments; operating and trust funds ofGeorgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund.

Investments in Georgia Fund 1 and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity ofGeorgia Fund 1 may not exceed 60 days. Fund 6 maintains a duration ofapproximately one year. The weighted average maturity for Georgia Fund 1 on June 30, 1999 was 27 days. The average investment duration for Fund 6 on June 30, 1999 was 1.03 years.

-12-

STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1999

Note 3: NON-MONETARY TRANSACTIONS

The Board receives food commodities from the United States Department ofAgriculture (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 is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation.

The Board has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and job related illness or injuries to employees. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any ofthe past three years.

The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to this risk in the past three years.

The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the same fund that the. employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated.

Changes in the unemployment compensation claims liability during the last two fiscal years are as follows:

Beginning ofYear
Liability

Claims and Changes in
Estimates

Claims Paid

EndofYear Liability

1998

$

Q,QQ $

1,242,QQ $

l,Z42,QQ $

Q.QQ

1999

$

Q,QQ $

5,34f!,QQ $

5,34f!,QQ $

Q,QQ

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

Position Covered

Amount

All Employees

$ 100,000.00

- 13 -

STEPHENS COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Notes: ON-BEHALFPAYMENTS
The Board has recognized revenues and expenditures in the amount of $363,445.33 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies.
Georgia Department ofEducation Paid to the State Merit System ofPersonnel Administration For Health Insurance ofNon-Certified Personnel In the amount of$282,131.04
Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$14,510.29
Office ofTreasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$66,804.00
Note 6: 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 is not believed to be material to the general purpose financial statements.
Nore7: RETIR,EMENTPLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

- 14-

STEPHENS CQUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1999

Note 7: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.95% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1999

100%

$ 1,872,359.70

1998

100%

$ 1,673,525.65

1997

100%

$ 1,578,300.88

-15 -

STEPHENS COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 1999

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Inventories Food Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

593,958.92 $

2,424.25

92.53

50,662.12 19,833.17

Total Assets

$

664,546.74 $ =====2=,4=24=.2=5=

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity

$

14,073.48 $

60,110.98

$

74,184.46 $

2,424.25 2,424.25

$

50,662.12

19,833.17

519,866.99 $

0.00

$

590,362.28 $

0.00

Total Liabilities and Fund Equity
See notes to the general purpose financial statements. -16-

$

664,546.74 $ =======2=,4=24===25=

EXHIBIT"E"

FEDERAL
PROGRAMS

OTHER
PROGRAMS

TOTALS

JUNE 30, 1999

JUNE 30, 1998

$

0.00 $

596,383.17 $

531,969.47

$

233,188.94

233,281.47

257,990.75

50,662.12 19,833.17

42,511.67 19,018.83

$

233,188.94 $

0.00 $

900,159.93 $==8=51=,4=9=0.=72=

$

71,447.30

41,850.15

119,891.49

$

233,188.94

$

71,447.30 $

103,852.58

58,347.88

70,687.75

180,002.47

167,409.09

$

309,797.65 $

341,949.42

$

50,662.12 $

42,511.67

19,833.17

19,018.83

$

o.oo $ _ _ ___;a.,o.=oo.;;....

519,866.99

448,010.80

$

0.00 $

0.00 $

590,362.28 $ _ _5_09...._,5_4_1._30_

$

233, 188.94 $

0.00 $

900,159.93 $==8=51=,4=9=0.=72=

-17-

STEPHENS COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND
YEAR ENDED JUNE 30, 1999

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Student Transportation Services Central Support Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30
See notes to the general purpose financial statements. -18-

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

111,434.00 $

788,212.03

548,091.41

$ 1,447,737.44 $

94,363.47 94,363.47

$

94,363.47

$ 1,375,881.25

$ 1,375,881.25 $

$

71,856.19 $

94,363.47 0.00

$

71,856.19 $

0.00

509,541.30

0.00

8,150.45 814.34

$

590,362.28 $====0===00=

EXHIBIT"F"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 1999

JUNE 30, 1998

$

137,228.81 $

1,440,507.00

$ 1,577,735.81 $

285.76 $ 285.76 $

343,312.04 $ 2,228,719.03
548,091.41

296,482.85 . 2,217,652.99
522,400.04

3,120,122.48 $ 3,036,535.88

$ 1,222,293.10
4,568.65 143,501.84 $
2,402.00 30,693.39 50,290.00 124,055.60

$ 1,577,804.58 $

$

-68.77 $

68.77

$

0.00 $

0.00

$

0.00 $

$ 134.93
150.83 285.76 $
0.00 $

1,316,656.57 $
4,568.65 143,636.77
2,402.00 30,693.39 50,290.00 124,206.43 1,375,881.25
3,048,335.06 $
71,787.42 $

1,338,359.09
46,202.43 124,042.15
463.41 25,276.69 15,144.84 36,073.00 54,856.17 1,313,923.29
2,954,341.07
82,194.81

68.77

1,040.94

0.00 $ 0.00

71,856.19 $ 509,541.30

83,235.75 429,230.84

'8,150.45 814.34

3,139.90 -6,065.19

0.00 $

590,362.28 $ ==5=0=9:!::::,54:::::::::::::::1=30=

-19-.

STEPHENS COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30, 1999

CLEMSON UNIVERSITY TUITION FUND
ASSETS Cash and Cash Equivalents

BALANCE JULY 1, 1998

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 1999

$

0.00 $

12,000.00 $

12,000.00 s_____o_.o_o

LIABILITIES Funds Held for Others

$

0.00 $

12,000.00 $

s_ _ _ _ 12,000.00

o_.o_o

FLEX SPENDING - MEDICAL ASSETS
Cash and Cash Equivalents
LIABILITIES Funds Held for Others

$

219.35 $

42.602.00 $

s_ _ _ 381363.49

4..,.4_5_1_.8_6

$

219.35 $

42,602.00 $

s_ _ _ 38,363.49

4_.4_5_1._86_

FLEX SPENDING - DEPENDENT CARE

ASSETS

Cash and Cash Equivalents

$

LIABILITIES

Funds Held for Others

$

467.64 $

7.795.00 $

s_ _ _ 6,990.64

1_2_1_2_.o_o

1

467.64 $

7.795.00 $

s_ _ _ 6,990.64

1_.2_1_2_.o_o

TOTALS - AGENCY FUNDS
ASSETS Cash and Cash Equivalents

$

686.99 $

62,397.00 $

s_ _ _ 57,354.13

s_.1_2_9_.8.6..

LIABILITIES Funds Held for Others

$

686.99 $

62.397.00 $

s 57,354.13 _=_5.,.,1_2_9_.8_6

See notes to the general purpose financial statements.

-20-

STEPHENS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 1999

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASS-
THROUGH ENTITY ID NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1999 Grant National School Lunch Program 1999 Grant

* 10.553 * 10.555

N/A $ NIA

143,647.TT 540,237.51 $

(2) 1,271,554.50 (3)

Total Child Nutrition Cluster

$

683,885.28 $ 1,271,554.50 .

Other Programs

Pass-Through From Georgia Department of Education

Food and Nutrition Program

Food Distribution Program (1)

10.550

NIA

Pass-Through From Office of Treasury and Fiscal Services

National Forest Reserve Funds

10.665

NIA

104,326.75 4,288.31

104,326.75 (4)

Total U. S. Department of Agriculture

$

792,500.34 $ 1,375,881.25

Corporation for National and Community Service Pass-Through From Georgia Department of Education Learn and Serve America School and Community Based Programs 1999 Grant

94.004

NIA $

4,791.64 $

4 791.64

Education,U.S.Departmentof Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Flow Through 1999 Grant Preschool 1999 Grant Capacity Building Improvement Grant 1999 Grant

* 84.027 * 84.173 * 84.173

NIA $ NIA NIA

273,256.00 $ 30,TT5.71 14,498.00

273,256.00 30,TT5.71 14,498.00

Total Special Education Cluster

$

318,529.71 $

318,529.71

Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act TiUe I Grants to Local Educational Agencies 1999 Grant TiUe II Eisenhower Professional Development 1999 Grant TiUe VI Innovative Education Program Strategies 1999 Grant Comprehensive School Reform Demonstration 1999 Grant

84.010

N/A

84.281

N/A

84.298

NIA

84.332

NIA

725,174.11 18,643.64 27,332.00 25,000.00

725,174.11 18,643.64 27,332.00 25,000.00

-21-

STEPHENS COUNTY BOARD OF EDUCATION
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 1999

SCHEDULE 1

FUNDING AGENCY PROGRAM/GRANT
Education,U.S.Departmentof Other Programs Pass-Through From Georgia Department of Education Goals2000 State and Local Education Syste~ic Improvement Grants 1998 Grant 1999 Grant Technology Literacy Challenge Fund Grants 1998 Grant 1999 Grant
Vocational Education - Basic Grants to States
High School Program Basic Grant 1999 Grant
Tech-Prep Education 1999 Grant
Pass-Through From Georgia Department of Technical and Adult Education Adult Education 1999 Grant
Total U. S. Department of Education

CFDA
NUMBER

PASS-
THROUGH ENTITY ID NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.276 84.276
84.318 84.318

NIA $ NIA
NIA NIA

19,771.09 $ 149,989.00
6,947.72 75,000.00

19,771.09 149,989.00
6,947.72 75,000.00

84.048

NIA

84.243

NIA

46,684.00 5,000.00

46,684.00 5,000.00

84.002

NIA

171644.09

171644.09

$ 11435?15.36 $ 11435?15.36

Total Federal Financial Assistance

$ 2,233,007.34 $

NIA= Not Available

Notes to the Schedule of Expenditures of Federal Awards

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 1999 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Expenditures on this program were not maintained by fund source.

Major Programs are identified by an asterisk (") in front of the CFDA number.

The Board did not provide Federal Assistance to any Subrecipient

The accompanying schedule of expenditures of Federal Awards includes the Federal Grant Activity of the Stephens County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the general purpose financial statements.

2,816,388.25

See notes to the general purpose financial statements.

-22-

STEPHENS COUNTY BOARD OF EDUCATION
SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30, 1999

SCHEDULEz-

AGENCY/FUNDING
GRANTS Community Affairs, Georgia Deparbnent of Local Assistance Grant
Education, Georgia Deparbnent of Quality Basic Education General and career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Technology Specialist Local Fair Share Deferred Summer Salaries (Prior Year) Deferred Summer Salaries (Current Year) Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Program Apprenticeship Program At-Risk Summer School Program Charter Schools Environmental Science Program Health Insurance Innovative Programs Mentoring Program Mentor Teacher Program Pay for Performance Program Preschool Handicapped Program Remedial Summer School Program Special Education Low Incidence Grant Student Record Teachers' Retirement Year 2000 Project Funding Lottery Programs Assistive Technology Computers in the Classroom
Georgia Forestry Commission Urban and Community Forestry Grant
Human Resources, Georgia Deparbnent of Family Connection Grant
. Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACTS Communities in Schools of Georgia, Incorporated Communities in Schools Program Education, Georgia Deparbnent of Reading Challenge Program Grades 4 Through 8 Reading First Program Grades K - 3
OTHER Education, Georgia Deparbnent of Reimbursement for Registration

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$

6,250.00

$

6,250.00

10,131,160.00 1,938,335.00 385,455.00 433,239.00 113,527.00 2,656,983.00
509,138.00 163,672.00 352,650.00 381,921.00 93,646.00 43,159.00 57,685.00 -2,349,709.00 -2,052,511.00 2,210,937.00 697,161.00
$ 34,827.40
125,825.00 35,000.00 10,480.97
2,500.00 282,131.04
5,000.00 8,900.00 3,078.00 82,000.00 60,697.00 3,613.15 24,510.00 3,242.25 14,510.29 24,301.00

111,434.00 285.76
8,215.47 86,148.00

4,200.00

87,803.81

66,804.00

10,131,160.00 1,938,335.00 385,455.00 433,239.00 113,527.00 2,656,983.00
509,138.00 163,672.00 352,650.00 361,921.00 93,646.00 43,159.00 57,685.00 -2,349, 709.00 -2,052,511.00 2,210,937.00 697,161.00 111,434.00 34,827.40
125,825.00 35,000.00 10,480.97 285.76 2,500.00
282,131.04 5,000.00 8,900.00 3,078.00
82,000.00 60,697.00
3,613.15 24,510.00
3,242.25 14,510.29 24,301.00
8,215.47 86,148.00
4,200.00
87,803.81
66,804.00

25,000.00 156,000.00

49,425.00

25,000.00
156,000.00 49,425.00

100.00

100.00

See notes to the general purpose financial statements.

-23-

$ 16.725.418.10 $

343,312.04 $ 17.068,730.14

STEPHENS COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 1999

SCHEDULE "3"

PROJECT
(A) Constructing ten (10) regular education (K-12) classrooms or instructional units and making additions to and/or renovating and equipping existing schools and facilities, specifically including but without limitation: Stephens County High School. (B) Constructing and equipping one (1) middle school. (C) Upgrading buildings and making critical infrastructure improvements (for example, roofing, plumbing, wiring, painting, water piping, HVAC, repaving, safety and security, etc.) to the following facilities, specifically including, but not limited to: Stephens County High School. (D) Acquiring necessary land for the accomplishment of proposed capital projects. (E) Making systemwide technology improvements, including, but not limited to, acquisition and installation of instructional technology and information systems hardware and infrastructure at all schools and other selected facilities. (F) Replacing, purchasing, upgrading or supplementing capital equipment including, but not limited to, desks, chairs, tables, school buses, books, laboratory equipment, etc.

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS

$ 17,005,384.00 $ 17,005,384.00 $ 171,628.30 $ 328,371.70

(1) The Board's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The Board's current estimate of total cost for the projects. Includes all cost from project inception to completion.
(3) The voters of Stephens County approved the imposition of a 1% sales tax to fund the above projects. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.
See notes to the general purpose financial statements.
-24-

EXPENDITURES
Current Instruction

STEPHENS COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS
YEAR ENDED JUNE 30, 1999

SCHEDULE "4"

ASSISTIVE TECHNOLOGY

COMPUTERS INTHE
CLASSROOM

TOTAL

$

8,215.47 $

86,148.00 $ ===9=4,=36=3.4=7

See notes to the general purpose financial statements. -25-

STEPHENS COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1999

SCHEDULE "5"

Minimum Expenditure Requirements (Total Allotment)
Expenditures on Combined Program Basis Salaries (1) (2) Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expenditures per Audit

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

12,888,189.00 $

396,348.00

$

14,157,487.48

793,455.71 $ _ ___;_7.:,;09::.L,0::.;;3;,;;;8.~35;;;..

$

14,950,943.19

-122,814.51 $ _ ____,;1:..:,4.:.;::,8:;28::.!.,1.:.:2;.:;8.:.:;.6.;;.8

Amount of Underexpenditure for Total Allotment

$

0.00 $=======0.=00=

Note: (1) Salary accruals {July and August 1999 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
(2) Salary accruals {July and August 1998 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines.

See notes to the general purpose financial statements. - 27 -

STEPHENS COUNTY BOARD OF EDUCATION
ANALVSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS
YEAR ENDED JUNE 30. 1999

GENERAL Af!!D CAREER EDUCATION PROGRAMS Kindergarten r) Grades 1 - 3 r) Sub-Total - K-3 Grades 4 - 5 r) Grades 6 - 8 (*) Grades 9-12 r) High School Laboratories r) Vocational Education Laboratories r) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category II (*) Category Ill r) Category IV (*) Category V (*) Sub-Total - Regular Category VI (Gifted) (*) Total Special Education Programs
REMEDIAi. EDUCATION PROGRAM C:l
Total Fourteen Weighted Programs MEDIA CENTER PROGRAMS
Salaries Operations
Total Media Center Programs
Total Fourteen Weighted and Media Center Programs

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL ...li... ORIGINAL

MID-TERM

$ 1,116,352.00

$ 1,004,716.80 $

0.00

3,062,892.00

2,756,602.80

$ 4,179,244.00 90 $ 3,761,319.60 $

0.00

1,285,324.00 90

1,156,791.60

2,132,820.00 90

1,919,538.00

1,175,273.00 90

1,057,745.70

419,058.00 90

377,152.20

939,441.00 90

845,496.90

$ 10,131,160.00

$ 9,118,044.00 $

0.00

$ 1,627,548.00

$ 1,464,793.20 $

0.00

$ 1,627,548.00 90 $ 1,464,793.20 $

0.00

310,787.00 90

279:708.30

$ 1,938,335.00

$ 1,744,501.50 $

0.00

$

385,455.00 90 $

346,909.50 $

0.00

$ 121454,950.00

$ 11,209,455.00 $

0.00

$

349,608.00 90 $

314,647.20 $

0.00

83,631.00 100

83,631.00

$

433,239.00

$

398,278.20 $

0.00

$ 12,888,189.00

$ 11,607,733.20 $

0.00

STAFF DEVELOPMENT PROGRAMS
Cost of Instruction Professional Development
Total Staff Development Programs
(*) Identifies Fourteen Weighted Programs.
(1) Salary accruals (July and August 1999 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
See notes to the general purpose financial statements.

$

35,814.00

$

35,814.00 $

0.00

77,713.00

77,713.00

0.00

$

113,527.00 100 $

113,527.00 $

0.00

(2) Salary accruals (July and August 1998 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines.

- 28 -

SCHEDULE "6"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES

SALARIES (1 )(2) OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 1,004,716.80 $ 1,283,103.61 $

32,976.11 $ 1,316,079.72

2,756,602.80

3,088,452.85

111,308.60

3,199,761.45

$

3,761,319.60 ,

$

4,371,556.46 $

144,284.71 $ 4,515,841.17 $

0.00

1,156,791.60

1,547,672.28

47,533.51

1,595,205.79

0.00

1,919,538.00

2,074,630.99

47,881.64

2,122,512.63

0.00

1,057,745.70

1,TT4,404.76

212,138.65

1,986,543.41

0.00

3TT,152.20

597,020.22

20,066.11

617,086.33

0.00

845,496.90

865,539.24

198,080.95

1,063,620.19

0.00

$ 9,118,044.00 $ 11,230,823.95 $

669,985.57 $ 11,900,809.52

$ 1,464,793.20 $

493,037.66 $ 1,007,081.26
191,958.84 12,187.26

4,661.37 $ 15,TT2.76 3,936.51
73.00

497,699.03 1,022,854.02
195,895.35 12,260.26

$ 1,464,793.20 $ 1,704,265.02 $

24,443.64 $ 1,728,708.66

0.00

279,708.30

407,151.61

9,530.32

416,681.93

0.00

$ 1,744,501.50 $ 2,111,416.63 $

33,973.96 $ 2,145,390.59

$

346,909.50 $

343,610.75 $

5,078.82 $

348,689.57

0.00

$ 11,209,455.00 $ 13,685,851.33 $

709,038.35 $ 14,394,889.68

$

314,647.20 $

471,636.15

$

471,636.15

0.00

83,631.00

$

84,417.36

84,417.36

0.00

$

398,278.20 $

471,636.15 $

84,417.36 $

556,053.51

$ 11,607,733.20 $ 14,157,487.48 $

793,455.71 $ 14,950,943.19 $

0.00

$

35,814.00

n,713.oo

s_ _1_13..,,s_2_1._oo_

$

102,208.17 $

102,208.17

11,593.27

11,593.27

$

113,801.44 $

113,ao1.44 s_ _ _ _ _ _o_.o_o

- 29 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 28, 2000

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Stephens County Board ofEducation
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements ofStephens County Board ofEducation as ofand for the year ended June 30, 1999, and have issued our report thereon dated January 28, 2000. 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 the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States.
We did not observe the taking of either the Federal donated commodities inventory or the purchased foods inventory at June 30, 1999, nor could we satisfy ourselves as to the accuracy of the amounts stated as ~ventories through alternative procedures.
Compliance
As part of obtaining reasonable assurance about whether Stephens County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.

99YB-40

Internal Control Over Financial Reporting
In planning and performing our audit, we considered Stephens County Board ofEducation's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Stephens County Board of Education's ability to record, process, summarize and report financial data consistentwith assertions ofmanagement in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned
as Costs item FS-7271-99-01.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course ofperforming their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the reportable condition described above is also considered to be a material weakness.
This report is intended solely for the information and use of management, members of the Stephens County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:gp 99YB-40

~u)-~
Russell W. Hinton State Auditor

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 28, 2000

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board of Education
and Superintendent and Members of the Stephens County Board ofEducation
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Stephens County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1999. Stephens County Board ofEducation's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Stephens County Board of Education's management. Our responsibility is to express an opinion on Stephens County Board of Education's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditin~ Standards, issued by the Comptroller General of the United States; and 0MB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and 0MB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Stephens County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Stephens County Board ofEducation's compliance with those requirements.

99SA-10

In our opinion, the Stephens County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each ofits major Federal programs for the year ended June 30, 1999.
Internal Control Over Compliance
The management of Stephens County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. fu planning and performing our audit, we considered Stephens County Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with 0MB Circular A-133.
Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use ofmanagement, members of the Stephens County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~t.J.:td:::J;.
Russell W. Hinton State Auditor
RWH:gp 99SA-10

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

STEPHENS COUNTY BOARD OF EDUCATION
AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
YEAR ENDED ruNE 30, 1999

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7271-97-01 FS-7271-98-01

Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7271-98-01

The maintenance of a General Fixed Assets Account Group would require the hiring of additional administrative staff, additional equipment and software programs for the administrative office. Options are being considered in budget planning for recording of general fixed assets in future financial statements.

SECTION IV FINDINGS AND QUESTIONED COSTS

STEPHENS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 1999
I SUMMARY OF AUDITOR'S RESULTS
1. Type ofReport Issued on the Financial Statements The auditor's opinion on the Stephens County Board ofEducation's financial statements was qualified for a scope limitation and for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit ofthe Financial Statements
The audit report for the Stephens County Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements
The audit ofthe Stephens County Board of Education disclosed no instances ofnoncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Mruor Programs
The audit report for the Stephens County Board of Education did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs
The auditor's opinion on the Stephens County Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be Reported by Section ,SlO(a}ofOMB Circular A-133
The Stephens County Board of Education's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.027 Individuals with Disabilities Education Act - Part B - Special Education - Flow Through 84.173 Individuals with Disabilities Education Act - Part B - Special Education - Preschool 84.173 Individuals with Disabilities Education Act - Part B - Special Education - Capacity Building Improvement Grant
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
- 1-

STEPHENS COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1999
I SUMMARY OF AUDITOR'S RESULTS 9. Low Risk Auditee
The Stephens County Board ofEducation was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7271-99-01 The Stephens County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventoiy 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 of all additions and deletions to the General Fixed Assets Account Group. Management's Respo~e: The maintenance of a General Fixed Assets Account Group would require the hiring of additional administrative staff, additional equipment and software programs for the administrative office. Options are being considered in budgefplanning for recording of general fixed assets in future financial statements.
ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
-2-