Talbot County Board of Education, Talbotton, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2000

STATE OF GEORGIA

DEPARTMENT OF AUDITS AND ACCOUNTS

GA

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TALBOT COUNTY BOARD OF EDUCATION
TALBOTTON, GEORGIA
-
REPORT ON AUDIT OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2000
Russell W. Hinton State Auditor


TALBOT COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION I

FINANCIAL

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

EXHIBITS



GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUND

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ADDIDONAL FINANCIAL INFORMATION

COMBINING AND INDNIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

F

. COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

DEBT SERVICE FUND

G

COMBINING BALANCE SHEET

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPES

I

COMBINING BALANCE SHEET

J

STATEMENT OF CHANGES IN ASSETS AND LIABILfI'IES

AGENCYFUND

Page
2
4
7 8

20
22
24
25
26 27

TALBOT COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

2 SCHEDULE OF STATE REVENUE

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

ANALYSIS OF M ,.1.u, EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

5

BYPROGRAM

Page
28
30 31 33 34

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 AUDII'ING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULARA-133

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

H1NTON

STATE AUDITOR

(404) 656-2174

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DEPARTMENT OF AUDITS AND ACCOUNTS
254 Wasl1ingtc111 Street, S. W.. Suite 214 Atlanta, Gccirgia 30334-840()

April 24, 2001

Honorable Roy E. Barnes, Governor

Members of the General Assembly



Members of the State Board of Education

and

Superintendent and Members of the

Talbot County Board of Education

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

Ladies and Gentlemen:

We have audited the accompanying general purpose financial statements ofthe Talbot County Board of Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Talbot County Board ofEducation's

management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to :financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perforrn the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our op1 n1 on.

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:

2000ARL-13A

* The general purpose financial statements ofthe 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 confor1n to generally accepted accounting principles.
* The Board did not recognize as expenditures, in the year ended June 30, 2000, a portion
of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2000. Also funds received, subsequent to June 30, 2000, from the Georgia Department of Education 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, 1999, were improperly recorded in the year ended June 30, 2000. To confo1m 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 deter1nined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Talbot County Board ofEducation as of June 30, 2000, and the results of its operations for the year then ended, in confo1mity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated April 24, 2001, on our consideration ofthe Talbot County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit perfo1m_ed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was perfo11ned for the purpose of fo11ning an opinion on the general purpose financial statements of the Talbot County Board of Education taken as a whole. The accompanying

combining and individual fund statements (Exhibits E through J) and the financial schedules (Schedules 1 through 5), which includes the Schedule ofExpenditures ofFederal 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 of additional analysis and are not a
required part ofthe general purpose fmancial statements. Such info1mation has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such infonnation is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole.
2000ARL-13A

A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,


RWH:jb 2000ARL-13A

Ru sell W. Hinton Sta e Auditor







TALBOT COUNTY BOARD OF EDUCATION

TALBOT COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30, 2000

ASSETS

,

Cash and Cash Equivalents

Investments

Accounts Receivable

Inventories Food Donated Commodities Purchased Food

Amount Available in Debt Service Fund

Amount to be Provided in Future Years For Payment of Bond Debt

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

709,350.80 $

145,087.75 $

5,761.79

10,572.01

65,000.00

380,957.72

53,509.71

164,840.75


17,339.59 1,934.68

Total Assets

$

773,432:52 $

394,202.77 $-=-3=8=6.,,7,_1.9.....,51...,

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable Funds Held for Others General Obligation Bonds Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Continuation of State Programs For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For Purpose of Bond Issue Unreserved Undesignated
Total Fund Equity

$


52,613.32 $

78,122.97 $ 91,923.76 29,424.99

1,895.00
41,940.00 43,700.00

$

52,613.32 $

199 471.72 $ _ _....;8;.;.7..r.;;,5;.;;;.3.;;.;5.=00~

$

65,362.00

$

3,171.85

31,075.00

17,339.59 1,934.68 $

299,184.51

624,382.20

172,284.93

0.00

$


720,819.20

$

194,731.05 $

299,184.51

Total Liabilities and Fund Equity

$

773,432.52 $

s _ _ 394,202.11

3_B_6_,1_19;...;.5.1. ...,

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

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 301 2000

JUNE 301 1999

$

552,928.15 $

29,135.69

$ 1,442,264.18 $

996,969.89

456,529.73

1,159,092.07

69,868.89

288,219.35

170,269.06



$

622,797.04

1,527,202.96

17,339.59 1,934.68
622,797.04
1,527,202.96

15,506.90 1,388.69
278,659.49
1,941,340.51

$

622,797.04 $

29,135.69 $

2,150,000.00 $ 4,356,287.53 $


4,563,226.61

$

132,631.29 $

73,611.35

91,923.76

83,189.66

29,424.99

41,940.00

43,700.00

$

26,684.80

26,684.80

34,059.86

-

$

2,150,000.00

2,150,000.00

2,220,000.00



$

26,684.80 $

2,150,000.00 $ 2,516,304.84 $ 2,410,860.87

$

622,797.04

0.00 $ _ ___,;a2..,,4""5.0...._8__9__

$

622,797.04 $ ----=2:i...,4:..::5=.:0a.::.89"-

$

65,362.00 $

5,068.00

3,171.85.

26,446.65

1,890.04

622,797.04

278,659.49

31,075.00



17,339.59 1,934.68
299,184.51

15,506.90 1,388.69
1,091,647.64

799,118.02

731,758.33

$ 1,839,982.69 $ 2,152,365.74

$

622,797.04 $

29,135.69 $

211501000.00 $ 4,356,287.53 $ 4,563,226.61 - 3 ..

TALBOT COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUND
YEAR ENDED JUNE 30, 2000

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay Debt Service
Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTl-'IER FINANCING SOURCES (USES}
Accrued Interest on Bonds Sold Proceeds from General Obligation Bonds
Par Value Refunding Bond Issuance Cost Proceeds of Refunding Bonds
Par Value Discount on Bonds Sold Payments to Bond Escrow Agent Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

GOVERNMENTAL FUND

SPECIAL REVENUE

CAPITAL PROJECTS

FUND

FUND

$ 3,696,747.49 $

267,409.75

34,723.72

1,135,054.51

1,522,137.75

159,031.63

112,556.61 $ ___4.;.;:8c,.5:,"-'1"'"7."'"57=---

$ 5,412,640.59 $ 1,5151020.87 $ ___4.;.;:8"-',5c..;.1.;_;7'..;;..57'--

$ 3,220,974.23 $
290,444.06 162,074.09 106,751.25 217,958.19 263,261.51 46,332.55 354,757.31 370,809.22
19,037.26 18,643.00

718,852.24
85,804.96 81,444.82
5,799.70 108,539.36
6,226.35 4,200.00 63,699.36 21,307.33
164,597.11 461,074.14
1,558.11 $

840,980.70

$ 5,071,042.67 $ 1,723,103.48 $ _ _84.......c.0=,9.8..0.c...7...0.__

$

341,597.92 $

-208,082.61 $ _ _-7;.;:9;;:a2,.4.=, 63::..:..1..:..;:3;_


-

$
$ _ _.:.;19::.:,7..,2:::8=3:.:.38::..

197,283.38

$ -197,283.38 $ _ _.;.;19:;.;.7.i.;:,2:;.:;8=3=3-=--8


$

144,314.54 $

-10,799.23 $

576,504.66

203,151.60

-792,463.13 1,091,647.64

1,832.69 545.99

FUND BALANCE JUNE 30

$

720,819.20 $

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

-4-

194 731.05 $ ==2=9=9=,1=84==51==

EXHIBIT "B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$ 3,964,157.24

$ 3,964,157.24 $ 3,936,706.56

1,169,778.23

1,169,778.23

1,088,127.55

$

498,996.65

2,021,134.40

2,021,134.40

1,736,191.05

7,648.54

327,754.35 $ _ _ _____:,4~8-~54:,_

327,802.89

246,581.33

$

506,645.19 $ 7,482,824.22 $

48.54 $ 7,482,872.76 $ 7,007,606.49

$ 3,939,826.47 $

0.00 $ 3,939,826.47 $ 4,028,342.96

376,249.02

376,249.02

412,951.18

243,518.91

243,518.91

202,584.67

112,550.95

112,550.95

118,380.67

326,497.55

326,497.55

284,942.09

269,487.86

269,487.86

346,311.31

50,532.55 418,456.67 392,116.55
19,037.26 183,240.11 461,074.14 842,538.81

50,532.55 418,456.67 392,116.55
19,037.26 183,240.11 461,074.14 842,538.81

96,184.73 415,042.74 510,954.45
18,993.76 76,472.33 479,117.73 110,165.98



$

70,000.00

90,907.50

1 600.14

70,000.00 90,907.50
1,600.14

70,000.00 90,907.50
1 600.14

49,708.34 2,040.64

$

162,507.64 $ 7,797,634.49 $

0.00 $ 7,797,634.49 $ 7,152,193.58

$

344 137.55 $

-314,810.27 $

48.54 $

-314 761.73 $ _ _-1'-"4,.,;,J4,=58=7-'-'.0=-=9-

$

197,283.38

-197,283.38

$ _ _ ___,;0::..:..0=0'-

$

14,334.07

1,190,000.00



-35, 195.15

$

197,283.38

-197,283.38

1,030,000.00 -4,657.85
-990,147.00 8,991.12 -8,991.12

$

0.00 $ 1,204,334.07

$

344,137.55 $

-314,810.27 $

278,659.49

2,149,963.39

48.54 $ 2,402.35

-314,761.73 $ 2,152,365.74

1,059,746.98 1,094,800.68

1,832.69 545.99

1,832.69 545.99

-1,912.21 -269.71

$

622,797.04 $ 1,837,531.80 $

2,450.89 $ 1,839,982.69 $ 2,152,365.74

-5-

TALBOT COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - INON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2000

EXHIBIT c

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 3,436,052.00 $ 3,696,747.49

45,601.00

34,723.72

1,290,479.00

1,522,137.75

28,650.00

159,031.63

Total Revenues

$ 4,800,782.00 $ 5,412,640.59

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 Outlay



$ 3,126,053.00 $ 3,220,974.23

185,030.00 170,487.00
99,209.00 224,830.00 364,450.00
71,767.00 372,164.00 407,124.00
20,400.00

290,444.06 162,074.09 106,751.25 217,958.19 263,261.51 46,332.55 354,757.31 370,809.22
19,037.26 18,643.00

Total Expenditures

$ 5,041,514.00 $ 5,071,042.67

Excess of Revenues over (under) Expenditures

$ -240,732.00 $ 341,597.92

OTHER FINANCING SOURCES {USES)

Other Sources Other Uses

$ -150,000.00 $ -197,283.38

Total Other Financing Sources (Uses)

$

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

FUND BALANCE JULY 1, 1999

-150,000.00 $
-390,732.00 $ 845,810.28

-197,283.38
144,314.54 576,504.66

Food Inventory - Net Change in Period Donated Commodities Purchased Food

FUND BALANCE JUNE 30. 2000

$

455,078.28 $ _....,1_20.,.,81_9_.2_0_

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$

179,047.00 $

267,409.75

844,972.00

1,135,054.51

35,190.00

112,556.61

$ 1,059,209.00 $ 1,515,020.87

$

490,029.00 $

718,852.24

62,103.00 16,800.00 15,923.00
5,000.00

85,804.96 81,444.82
5,799.70 108,539.36
6,226.35 4,200.00 63,699.36 21,307.33

2,000.00 480,036.00

164,597.11 461,074.14
1 558.11

$ 1,071,891.00 $ 1,723,103.48

$

-12,682.00 $ -208,082.61

$

197,283.38

$ _ ___,1~9.:..,7,:;28~3~,3~8::_

$

-12,682.00 $

-10,799.23

179,258.41

203,151.60

1,832.69 545.99

$

166,576.41 $ _...,:1~9~4-7,.;;;.3.;.;1,,;;;;05::.,

The notes to the general purpose financial statements are an integral part of this statement.
-7-

TALBOT COUNTY BOARD OF EDUCATION NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30. 2000


EXHIBIT "D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Talbot County Board of Education (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The 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 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.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the 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 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 of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
-8-

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-te11n principal, interest and paying agent fees.
FIDUCIARY FUND TYPES-the funds 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. These funds include:

EXPENDABLE TRUST FUND Edna Pitts Finch Memorial Scholarship Fund - the fund used to account for the principal and earnings which may be expended to provide scholarships to business administration and business education students with junior standing at an accredited college or university.
AGENCY FUND - the fund used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding.
BASIS OF ACCOUNTING

The accounting and financial reporting treatment applied to a fund is dete1mined by its measurement focus. All governmental and expendable trust funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Te11n Debt Account Group.
Agency funds are purely custodial in nature and do not involve measurement ofresults ofoperations.

Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). ''Measurable'' means the amount of the transaction can be dete1mined and "available'' means collectible within the current period or soon enough thereafter to be used to pay liabilities of

-9-

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
the 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 departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia
Department of Education for the State's share of these contracts. During fiscal year 2000, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1999 and ending in early June 2000. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. 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, 2000, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2000, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 2000. Also, the State's portion ofthe compensation paid in July and August 2000 was received and recorded as revenue in the fiscal year subsequent to June 30, 2000. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were recorded in the year ended June 30, 2000. 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.
Agency funds are accounted for using the modified accrual basis ofaccounting in recognizing assets and liabilities.
BUDGET
The Talbot County Board of Education'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.

- 10 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT ''D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at

least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws OCGA 45-8-14 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 Investments 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 ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The_ Official Code of Georgia Annotated
Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment
or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:

(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation ofthe United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
- 11 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(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 infonn.. ation 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 Talbot County Board of Commissioners fixed the property tax levy for the 1999 tax year (calendar year) on October 20, 1999 (levy date). Taxes were due on December 20, 1999. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Talbot 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.

Tax millage rates levied for the 1999 tax year (calendar year) for the Talbot County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

13.66 mills 1.29 mills
14.95 mills

SALES TAXES
Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $353,935.44 and was recorded in the Debt Service Fund. The State will terminate collection ofthis tax once an additional $1,105,844.55 has been collected or on December 31, 2003, whichever occurs first.

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet

- 12 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources'' even though they are a component of net current assets.

GENERAL OBLIGATION BONDS

The Board issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements during the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount ofthese bonds is recorded in the General Long-Term Debt Account Group.

INTERFUND TRANSACTIONS

The Board has the following types of interfund transacti_ons:

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, 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 confor1n to the current year classifications.

Note 2: DEPOSITS AND INVESTMENTS

COLLATERALIZATION OF DEPOSITS
Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on
deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than
110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool

- 13 -

-

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO TIIE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

Note 2: DEPOSITS AND INVESTMENTS
balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion,
waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:
.
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by 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, 2000, the bank balances were $1,927,964.60. The amounts ofthe total bank balances are classified into three categories of credit risk:
Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the 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, 2000, as follows:
- 14 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

Note 2: DEPOSITS AND INVESTMENTS

Risk Category

Bank Balance

1

$ 814,142.59

2

680,591.47

3

433,230.54

Total

$ 1,927,964.60

CATEGORIZATION OF INVESTMENTS At June 30, 2000, the carrying value of the Board's total investments was $391,529.73 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 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. The investment policy ofthe State ofGeorgia, Office ofTreasury and Fiscal Services for the Local Government Investment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description 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. The pool is not
registered with the SEC as an investment company but does operate Georgia Fund 1 in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a Rule 2a7 like pool. The pool's primary objectives are safety of capiJal, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and values participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value ofthe shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia'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-tc1n1 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 of Georgia Fund 1 may not exceed 60 days. The
weighted average maturity for Georgia Fund 1 on June 30, 2000, was 23 days. The average investment duration for Fund 6 on June 30, 2000, was .80 year.

- 15 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 2000

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 ofloss 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 and errors or omissions. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the 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 these risks in the past three years.

The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

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

1999
2000

Beginning
ofYear Liability

Claims and Changes in Estimates

$

0.00 $

540.00 $

$

0.00 $

0.00 $

Claims Paid

End of Year Liability


540.00 $._ _ _..:,,o=.o=o o.oo $._ _ _..:,,o=.o=o

The Board participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool organized on December 1, 1991, to develop, implement and administer a program ofworkers' compensation self-insurance for its member organizations. The Board pays an annual premium to the Trust for its general insurance coverage. Additional insurance coverage is provided through an agreement by the Trust with the United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust in excess of $250,000.00 loss per occurrence, up to

$2,000,000.00.

.

-

The Board has purchased surety bonds to provide additional insurance coverage as follows:





- 16 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 4: RISK MANAGEMENT

Position Covered

Superintendent School Food Service Director Bookkeeper/Clerk Payroll Clerk

Note 5: GENERAL LONG-TERM DEBT

GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows:

Purpose

Interest Rates

General Government - Refunding - Series 1998 General Government - Series 1998

4.3%-4.5% 4%

Amount $ 30,000.00 $ 10,000.00 $ 10,000.00 $ 10,000.00
Amount $ 960,000.00
1,190,000.00 $ 2,150,000.00

The changes in General Long-Te11n Debt during the fiscal year ended June 30, 2000, were as follows:



General

Obligation

Bonds


Balance July 1, 1999

$ 2,220,000.00

Deductions Debt Retired

70,000.00

Balance June 30, 2000

$ 2,150,000.00

At June 30, 2000, payments due by fiscal year which includes principal and interest for these items are as follows:


- 17 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000


Note 5: GENERAL LONG-TERM DEBT

Fiscal Year Ended June 30

General Obligation
Bonds

2001

2002

2003



2004

2005

2006 - 2010

$ 309,790.00 388,757.50 390,610.00 391,847.50 426,777.50 602,803.75

Total Principal and Interest

$ 2,510,586.25

Note 6: PRIOR YEAR DEFEASEMENT OF DEBT

In fiscal year 1998, the Board defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 2000, $925,000.00 of bonds are outstanding and are considered defeased.

Note 7: ON-BEHALF PAYMENTS



The Board has recognized revenues and expenditures in the amount of $85,629.59 for health insurance and retirement contributions paid on the aoard's behalfby the following State Agencies.

Georgia Department of Education



Paid to the Georgia Department of Community Health

For Health Insurance of Non-Certified Personnel

In the amount of $70,281.59

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $15,348.00

Note 8: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests f-0r reimbursement to the grantor agency for any expenditures which are disallowed under grant te1ms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position.

- 18 -

TALBOT COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 8: CONTINGENT LIABILITIES

The Board is a defendant in various legal proceedings pertaining to matters incidental to the perfo11nance of routine Board operations. The ultimate disposition of these proceedings is not presently detenninable, but is not believed to be material to the general purpose financial statements.

Note 9: 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 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.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2000 1999 1998

100% 100% 100%

$ 379,586.08 $ 408,222.08 $ 383,465.96

- 19 -

TALBOT COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2000

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired-Grant Balances Payable

Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Continuation of State Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

109,232.57 $

25,652.92

65,000.00

16,510.57

12,045.78

17,339.59 1,934.68

$


210,017.41 $ ===3=7::1,,:,6=9=8.=7=0

$

10,022.77 $

4,985.02

17,404.62

19,913.22

12,800.46



$

27,427.39 $

37,698.70



$

17,339.59 1,934.68

163,315.75 $ _ _ _ __:O:.:.:0. ::.::0:...

$

182,590.02 $ _ _ _ _.;;.o.:.::.o~o

Total Liabilities and Fund Equity
See notes to the general purpose financial statements. - 20 -


$

210,017.41 $ ===3=7=,6=9=8..7...0=

EXHIBIT "E"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

8,690.05 $

1,512.21 $

145,087.75 $

151,857.53

65,000.00

65,000.00

136,284.40

164,840.75

83,512.55

17,339.59 1,934.68

15,506.90 1,388.69

$

144,974.45 $

1,512.21 $

394,202.77 $

317,265.67

========

$

63,115.18

54,605.92

16,624.53


$

134,345.63

$

3,849.70

$

78,122.97

27,074.71

91,923.76

83,189.66

29,424.99



$

199,471.72 $

114,114.07

$

3,171.85

$

3,171.85 $

26,446.65

1,890.04

17;339.59 1,934.68

15,506.90 1,388.69

7,456.97 $ _ _ _1..._,5_1_2._21_

172,284.93

157,919.32

$

10,628.82 $

1,512.21 $

194,731.05 $ _ _2_0_3~1,_5_1._60_

$

144,974.45 $

1,512.21 $

394,202.77 $ ===31=7=,2=6=5.=67=

- 21 -

TALBOT COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2000

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 School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Capital Outlay



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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

30,532.00 $

.416,557.79

25,588.08

183,234.75

$

472,677.87 $ _ _.:.:18:.;:3:.i2,:,:.::;3..;.;4:.:..7=-5

$

170,008.78

28,152.04

7,485.30

$

461,074.14

1,674.60 19,552.28

$

461 074.14 $ _ _.:2:.26::..i.::..87~3:.:._-O:;,;:O~

$

11,603.73 $

-43,638.25

$

11,603.73 $

168,607.61

1,832.69 545.99

41,748.21
-1,890.04 1,890.04

FUND BALANCE JUNE 30

See notes to the general purpose financial statements.
- 22 -

$

182,590.02 $ =====0-=00=

EXHIBIT "F"

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

53,643.00

$

718,496.72
- - - - - - $ _ __;8:;..;;6=,9;..;;.6..;;.;8...;;...53~

$

772,139.72 $

86,968.53 $

267,409.75 $ 1,135,054.51
112,556.61
1,515,020.87 $

282,832.63 1,052,062.32
103,532.79
1,438,427.74

$

548,843.46

57,652.92 81,444.82
5,799.70 101,054.06
6,226.35 4,200.00 62,024.76 1,755.05 72,933.49 $

1,558.11

$

943,492.72 $

$

-171,353.00 $

$
91,663.62 91,663.62 $ -4,695.09 $

718,852.24 $
85,804.96 81,444.82
5,799.70 108,539.36
6,226.35 4,200.00 63,699.36 21,307.33 164,597.11 461,074.14 1,558.11
1,723,103.48 $
-208,082.61 $

635,041.98
91,378.01 48,038.49
20,465.86
7,288.60 15,358.42 12,909.81 76,472.33 479,117.73 17,330.57
1,403,401.80
35,025.94

155,535.17

$

-15,817.83 $

26,446.65

$

10,628.82 $

197,283.38

-4,695.09 $

-10,799.23 $

35,025.94

6,207.30

203,151.60

170,307.58



1,512.21 $

1,832.69 545.99

-1,912.21 -269.71



194,731.05 $ ==2=0=3=,1=5=1.6...0=

- 23 -

TALBOT COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30, 2000

EXHIBIT "G"

ASSETS
Cash and Cash Equivalents Accounts Receivable

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS JUNE 30, 2000 JUNE 30, 1999

$

177,196.87 $

375,731.28 $

552,928.15 $

232,691.48

3218.73

66,650.16

69,868.89

45,968.01

Total Assets

$

180,415.60 $

442,381.44 $

622,797.04 $ ===27=8=,6=59=.=49==

FUND EQUITY
Fund Balances Reserved For Debt Service Unreserved Undesignated

$

180,415.60 $

442,381.44 $

622,797.04 $

278,659.49

. 0.00

0.00

0.00

0.00

Total Fund Equity $

180,415.60 $

442,381.44 $

622,797.04 $ ===27=8=,6=5=9.=49=



See notes to the general purpose financial statements.
- 24-

TALBOT COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND
YEAR ENDED JUNE 30, 2000

EXHIBIT"H"

PROPERTY TAXES FOR BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS YEAR ENDED
JUNE 30, 2000 JUNE 301 1999

REVENUES
Taxes Other Funds
Total Revenues

$

145,061.21 $

353,935.44 $

498,996.65 $

271,163.77

1 257.98

6,390.56

7 648.54

1685.11

$

146 319.19 $

EXPENDITURES

Debt Service Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures

$

70,000.00

$

70,000.00

22,406.25 $

68,501.25

90,907.50 $

49,708.34

1 070.14

530.00

1 600.14

2 040.64

$

93 476.39 $

162,507.64 $ _ _5~1.7-'4""8."'"98=-

$

344I137.55 $ ---=2=.21,..i;,0::,:9:,::.9:.::..90,._

OTHER FINANCING SOURCES (USES)
Accrued Interest on Bonds Sold Refunding Bond Issuance Cost Proceeds of Refunding Bonds
Par Value Discount on Bonds Sold Payments to Bond Escrow Agent Operating Transfers In

$

14,334.07

-35,195.15

1,030,000.00 -4,657.85
-990, 147.00 8,991.12

Total Other Financing Sources (Uses)

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $
FUND BALANCE JULY 1

52,842.80 $ . 127,572.80

291,294.75 $

344,137.55 $

244,425.09 34,234.40

FUND BALANCE JUNE 30

$ 180,415.60 $ 442,381.44 $ 622,797.04 $ _...,;;21_8_,6_5_9._49_

See notes to the general purpose financial statements.

-25

TALBOT COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30, 2000

EXHIBIT "I"

ASSETS
Cash and Cash Equivalents

EXPENDABLE TRUST FUND EDNA PITTS FINCH MEMORIAL SCHOLARSHIP
FUND

AGENCY FUND

$

2 450.89 $

TOTALS JUNE 30, 2000 JUNE 30, 1999
29,135.69 $ ~---2;;,;;6=,4=0_5.,;;.21=

LIABILITIES AND FUND EQUITY

LIABILITIES
Funds Held for Others


$

FUND EQUITY

Fund Balances Unreserved Undesignated

$ -----"'2'-'4-=-50"-'.8=9:...

26,684.80 $

26,684.80 $

24,002.86

0.00

2,450.89

2,402.35

Total Liabilities and Fund Equity $

2 450.89 $

26,684.80 $

29,135.69 $ ___2_6.,.4...,05_._21-=

See notes to the general purpose financial statements.

-26-

TALBOT COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30, 2000

EXHIBIT "J"

BALANCE JULY1,1999

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 2000

SCHOOL ACTIVITY FUNDS

ASSETS Cash and Cash Equivalents $

24,002.86 $

89,053.60 $

86,371.66 $ ===2=6:!.,6=8=4=80=

LIABILITIES
Funds Held for Others



$

24,002.86 $

89,053.60 $

86,371.66 $ ===26::!'=68=4=.8=0=





-



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

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2000

SCHEDULE "1"


FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
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

National School Lunch Program

Pass-Through From Office of School Readiness

Food and Nutrition Program



Summer Food Service Program for Children

Total Child Nutrition Cluster

10.553 10.555
10.559

NII>: $ 111,205.24

NIA

243,332.36 $

N/A

29,606.99

$ 384,144.59 $

(2)
439,897.44 (3)
(2) 439,897.44

Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1) Pass-Through From Office of School Readiness Food and Nutrition Program Child and Adult Care Food Program
Total U. S. Department of Agriculture

10.550 10.558

N/A

21,176.70

21,176.70

NIA

11,236.50

(2)

$ 416,557.79 $ _ _..:.46:::..1c,.;,0:.:.7..:.4:..:..1-'-4

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

84.173 84.027 84.173


NIA $

2,714.36 $

NIA

98,610.00

NIA

1,890.20

$ 103,214.56 $

2,714.36 110,432.04 (3)
1,890.20
115,036.60

Other Programs Pass-Through From Georgia Department of Education

Elementary and Secondary Education Act

-

Title I

Grants to Local Educational Agencies

Title II Eisenhower Professional Development

Title Ill Technology Literacy Challenge Fund Grants

Title VI Innovative Education Program Strategies

Title X Charter Schools

Vocational Education - Basic Grants to States

High School Program

Basic Grant

Total U. S. Department of Education

84.010
84.281 84.318 84.298 84.282
84.048

NIA

338,741.70

360,700.87

N/A

26,603.78

29,595.08 (3)

N/A

114,012.17

118,456.83

NIA

15,840.51

15,840.51

N/A

100,000.00

283,687.55 (3)

N/A

20,084.00

20,175.28 (3)

$

718,496.72 $ _ _..9.4;;3..,4;~9.2=.7;;2~

Defense, U.S. Department of Direct Department of the Army R.O.T.C. Program

$ --"-34.;.,.,7.;.:2:;;:c3.:7.:.= -2

(4)



Total Federal Financial Assistance
N/A = Not Available .

- -.....===---- $ 1,169,778.23 $ 1,404,566.86

-28-

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2000

SCHEDULE "1"

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 Child and Adult Care Food Program, the School Breakfast Program and the Summer Food Service Program for Children were not maintained separately and are included in the 2000 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 Talbot 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.

See notes to the general purpose financial statements.

-29-

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2000

SCHEDULE "2"

AGENCY/FUNDING

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

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

Sparsity Grant

Middle School Incentive Program

Special Instructional Assistance

In-School Suspension

Counselors

Technology Specialist

Local Five Mill Share

Educational Equalization Formula

Food Services

Vocational Education

Other State Programs

At-Risk Summer School Program

Alternative Programs

Health Insurance

Preschool Handicapped Program

Remedial Summer School

Year 2000 Project Funding

Lottery Programs

Computers in the Classroom

Human Resources, Georgia Department of

-

Family Connection

2,042,767.00 422,894.00 37,439.00 84,987.00 23,493.00 564,382.00
177,559.00 60,294.00
137,132.00 60,115.00
152,072.00 34,622.00 8,394.00 28,842.00
-551,656.00 141,803.00
$ 2,577.98
7,242.66
70,281.59 18,427.00 . 3,144.42
412.00
95,573.84

$
30,532.00 53,643.00 43,669.28

Georgia Department of Community Affairs
Governor's Emergency Funds (1)

10,000.00

Office of School Readiness Pre-Kindergarten Program

139,565.47

Office of Treasury and Fiscal Services
Public School Employees Retirement

15,348.00

CONTRACT Education, Georgia Department of Reading Challenge Grant

48,601.00

TOTAL
2,042,767.00 422,894.00 37,439.00 84,987.00 23,493.00 564,382.00
177,559.00 60,294.00
137,132.00 60,115.00
152,072.00 34,622.00 8,394.00 28,842.00
-551,656.00 141,803.00
30,532.00 2,577.98
7,242.66 53,643.00 70,281.59 18,427.00
3,144.42 412.00
43,669.28
95,573.84
10,000.00
139,565.47
15,348.00
48,601.00

$ 3,696,747.49 $


267,409.75 $ 3,964,157.24

(1) The purpose of the funds are for Talbot County lnteragency Council program expenses and equipment . See notes to the general purpose financial statements.
- 30-

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30. 2000

SCHEDULE "3"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3) (4)

AMOUNT EXPENDED
IN PRIOR YEARS

Payments on previously incurred bonded

indebtedness, including payments of

principal and interest due on Talbot

County School District's Series 1989

General Obligation Bonds (or any bonds

issued to refund those bonds), from

February 1, 2000 through and including

August 1, 2004

$

The expansion, remodeling, and renovation of existing school district facilities, including classrooms, instructional areas, support space, physical education and athletic facilities and grounds, and to provide furnishings, equipment and fixtures for such areas, acquisition of real estate for a central office complex and an athletic facility, and construction of new athletic and storage facilities and paying any expenses incident thereto, including capitalized interest during construction, at an estimated cost to be funded with sales and use tax proceeds

125,000.00 $

1,470,000.00

125,000.00 $
1,470,000.00

20,901.25 $
840,980.70

0.00 92,835.41

$

1,595,000.00 $

1,595,000.00 $

(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 Talbot County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

(4) In addition to the expenditures shown above, the Board has incurred interest expense to provide advance funding for the above projects as follows:

Prior Years Current Year Total

$

19,833.00

47,600.00

$ ~-...,..;;s,..1.4..3..3.=.o=o

See notes to the general purpose financial statements.

31

TALBOT COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND- QUALITY BASIC EDUCATION PROGRAMS
YEAR ENDED JUNE 30, 2000

SCHEDULE "4"

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 per Audit
Amount of Underexpenditure for Total Allotment

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100o/o TEST FOR
OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

.

$

2,588,087.00 $ - - - -79~, 15-2.0-0

$

3,004,977.23

180,51 0.04 $ _ ____,;15;.;;.9.:.;6;,_2_4._42_

$

3,185,487.27

-4,247.81 $ ___3_,_1_8_1~,2_3_9._46_

$

0.00 $ = = = = = =0.0=0



See notes to the general purpose financial statements.
- 33 -

TALBOT COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND-QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 2000

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*) Grades 1 - 3 (*) Sub-Total - K-3
Grades 4 - 5 (*) Grades 6 - 8 (*) Grades 9 - 12 (*) High School Laboratories (*) Vocational Education Laboratories (*)
Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category II (*) Category Ill (*) Category V (*) Category V (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM (*l
Total Fourteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

223,010.00

$

200,709.00 $

0.00

600,367.00

540,330.30

$

823,377.00 90 $

741,039.30 $

0.00

250,376.00 90

225,338.40

367,725.00 90

330,952.50

308,233.00 90

277,409.70

167,130.00 90

150,417.00

125,926.00 90

113,333.40

$ 2,042,767.00

$ 1,838,490.30 $ _ _ _ _..:::0.:.::.0.::..0

$

422,894.00

$

380,604.60 $

0.00

$

422,894.00 90 $

380,604.60 $ _ _ ___:0;;,:.0:,::..0

$

37,439.00 90 $

o 33,695.1 s____o;:.:.:;oo=-

$ 2,503,100.00

$ 2,252,790.oo s_ ___;____::O.:.::.o.:.o

$

68, 144.00 90 $

61,329.60 $

16,843.00 100

16,843.00

0.00

$

84,987.00

$

78,112.60 s-----"-o'"".o-"-o



Total Fourteen Weighted and Media Center Programs $ 2,588,087.00

$ 2,330,962.60 $

0.00

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Fourteen Weighted Programs.

$

7,625.00

15,868.00

$

7,625.00 $

15,868.00

0.00 0.00

$

23,493.00 100 $

23,493.00 $ ======O=.O==O

See notes to the general purpose financial statements.

- 34 -

SCHEDULE "5"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

200,709.00 $

213,046.26 $

4,118.52 $

217,164.78

540,330.30

556,976.89

16,932.23

573,909.12

$

741,039.30 $

770,023.15 $

21,050.75 $

791,073.90 $

0.00

225,338.40

225,465.62

15,060.25

240,525.87

0.00



330,952.50

485,422.01

23,244.10

508,666.11

0.00

277,409.70

273,842.91

65,957.37

339,800.28

0.00

150,417.00

178,467.02

2,453.45

180,920.47

0.00

113,333.40

211,742.52

12,421.25

224,163.77

0.00

$ 1,838,490.30 $ 2,144,963.23 $

140,187.17 $ 2,285,150.40

$

380,604.60

$

203,576.29 $ 168,446.08 372,022.37
1,110.12

178.73 $ 9,005.52 9,184.25

203,755.02 177,451.60 381,206.62
1,110.12

$

380,604.60 $

745,154.86 $

18,368.50 $ _ ____;.7..;.63;;..,5.;;.;;2_3_3.;;..6

0.00

$

33,695.10 $

46,509.95 $

- - - - - 1,068.75 $

47,578.70

0.00



$ 2,252,790.00 $ 2,936,628.04 $

159,624.42 $ 3,096,252.46

$

61,329.60 $

68,349.19

$

68,349.19

0.00

s_ _ _ 16,843.00 _ _ _ _ _ _

20__._88_5_.6_z-

20,885.62

0.00

$

78,172.60 $

68,349.19 $

- - - - - 20,885.62 $

89,234.81

$ 2,330,962.60 $

3,004,977.23 $

180,510.04 $ 3,185,487.27 $

0.00



$

7,625.00

15,868.00

$

23,493.00

$

17,597.17 $

17,597.17

7,304.24

7,304.24

$

24,901.41 $

24,901.41 $

0.00

- 35 -

SECTION II COMPLIANCE AND lNTERNAL CONTROL REPORTS



W. RussELl,

H1NTON

STATE AUDITOR

(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Wasl1ingtc)n Street. S.W.. Suite 214 Atlanta, Gcc)rgia 30334-840()
April24,2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Talbot County Board of Education

REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Ladies and Gentlemen:

We have audited the financial statements ofTalbot County Board ofEducation as ofand for the year

ended June 30, 2000, and have issued our report thereon dated April 24, 2001. This report was

qualified for various departures from generally accepted accounting principles, as identified in the

auditor's report on the general purpose financial statements. We conducted our audit in accordance

with auditing standards generally accepted in the United States of America and the standards

applicable to financial audits contained in Government Auditing Standards, issued by the

Comp-troller General of the United States.



Compliance
As part of obtaining reasonable assurance about whether Talbot County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.

Internal Control Over Financial Reporting
In planning and perfurming our audit, we considered Talbot County Board of Education's internal control over financial reporting in order to dete11nine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal

2000YB-40A

control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Talbot County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-7301-00-01 and FS-7301-00-02.
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 riskthat 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 norrnal course of performing their assigned functions. Our consideration ofthe internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions, and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, ofthe reportable conditions described above, we consider item FS-7301-0002 to be a material weakness.
This report is intended solely for the information and use of management, members of the Talbot 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:jb 2000YB-40A

Ru sell W. Hinton State Auditor
-

0 f....G. E

-.i:.

\0



=-

w. RUSSELL

HtNTON

STATE AUDITOR

(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 W,tsl1ingtc)n Street. S.W.. Suite 214 Atlanta. Gccirgia 3()334-840()
April 24, 2001

Honorable Roy E. Barnes, Governor

Members of the General Assembly

Members of the State Board of Education

md

.

Superintendent md Members of the

Talbot County Board of Education

REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133

Ladies md Gentlemen:

Compliance

We have audited the complimce ofTalbot County Board ofEducation with the types ofcomplimce
requirements described in the U.S. Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended
June 30, 2000. Talbot County Board of Education's major Federal programs are identified in the accompanying Schedule ofFindings md Questioned Costs. Complimce with the requirements of laws, regulations, contracts md grmts applicable to each of its major Federal programs is the responsibility ofTalbot County Board ofEducation's mmagement. Our responsibility is to express

m opinion on Talbot County Board of Education's complimce based on our audit.

We conducted our audit of complimce in accordmce with auditing standards generally accepted in the United States ofAmerica; the standards applicable to finmcial audits contained in Government Auditing Stmdards, issued by the Comptroller General ofthe United States; md 0MB Circular A-
133, Audits of States, Local Governments, and Non-Profit Organizations. Those stmdards md
0MB Circular A-133 require that we plm md perfo1111 the audit to obtain reasonable assurmce about whether noncomplimce with the types ofcomplimce requireinents refe11ed to above that could have a direct md material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Talbot County Board of Education's complimce with those requirements md perfu1n1ing such other procedures as we considered necessary in the circumstmces. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Talbot County Board of Education's complimce with those requirements.

2000SA-10A

In our opinion, the Talbot 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, 2000.
Internal Control Over Compliance
The management of Talbot County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and perfotming our audit, we considered Talbot 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 ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the no1n1al course ofperfotming 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 infotmation and use of management, members of the Talbot 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,
...
0 ~ . 0 ,1 1 l'rt ,
Ru sell W. Hinton State Auditor
RWH:jb 2000SA-10A


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


TALBOT COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000

,
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7301-98-01 FS-7301-99-01

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-7301-99-01

Accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group are not required by the Georgia Department of Education. Due to the expense that we would incur to establish this account group, we do not feel that this is economically feasible at this time.










.
SECTIONN FINDINGS AND QUESTIONED COSTS


TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000

I SUMMARY OF AUDITOR'S RESULTS

1. Type of Report Issued on the Financial Statements The auditor's opinion on the Talbot County Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.

.
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements
The audit report for the Talbot County Board of Education disclosed financial statement
reportable conditions related to the following control categories.


Expenditures/Liabilities/Disbursements

General Fixed Assets

Of the reportable conditions described above, General Fixed Assets is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit ofthe Talbot County Board ofEducation disclosed no instances ofnoncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Talbot 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 Talbot County Board ofEducation's report on compliance with

requirements applicable to major programs was unqualified.

_

6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-133 The Talbot County Board of Education's audit disclosed an audit finding required to be report~d by section .510(a) ofOMB Circular A-133. This audit finding is included in section IV of this report.

7. Major Programs Federal awards audited as major programs are as follows: 84.010 Elementary and Secondary Educ~tion Act - Title I - Grants to Local Educational Agencies

8. Type ''A'' Program Dollar Threshold The dollar threshold for type ''A'' programs was $300,000.00.

9. Low Risk Auditee The Talbot County Board ofEducation was audited as a low risk auditee based on a waiver granted by the U. S. Departtnent of Education.

- 1-

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURES/LIABILITIES/DISBURSEMENTS Lack of Expenditure/Obligation Documentation Reportable Condition Finding Control Number: FS-7301-00-01
An examination ofexpenditures posted to Talbot County Board ofEducation's Capital Projects Fund revealed the following:

(1) Four expenditures totaling $22,205.31 were paid from E-Mail advices from the Superintendent. There was no original invoice documentation supporting these payments.
(2) Two items totaling $15,918.40 were paid from faxed invoices from the vendor.
This condition occurred because of management's failure to adequately monitor and implement procedures to ensure that all expenditure vouchers are reviewed for accuracy and proper
'
documentation prior to payment.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-7301-00-02
The Talbot County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the fo11nal 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 inventory of land, 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.
-2-

TALBOT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS ALLOWABLE COSTS/COST PRINCIPLES Improper Salary Payments Reportable Condition Material Noncompliance U.S. Department of Education Through Georgia Department of Educat~on Amount: $31,075.00 Finding Control Number: FA-7301-00-01 Employee compensation testing procedures revealed that eleven employees were paid professional development stipends totaling $34,375.00 for two Staff Development Service Units (SDU) from Technology Literacy Challenge Grant (CFDA 84.318) program funds. The current policy of the Talbot County Board ofEducation limits professional development stipends to a rate of$150.00 per . SDU, or in this case a maximum of $3,300.00. The cost allowability criteria of Circular A-87, states, in part:
''Costs must be consistent with policies, regulations, and procedures that apply uniformly to both Federal awards and other activities of the governmental unit." This condition occurred because management did not adhere to Board policy and Circular A-87 . regulations for payment ofprofessional development stipends. This questioned cost of$31,075.00 should be refunded to the Georgia Department of Education.


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