Audit report, Tattnall County Board of Education, Reidsville, Georgia, year ended June 30, 1998

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AUDIT REPORT TATTNALL COUNTY BOARD OF EDUCATION
REIDSVILLE, GEORGIA YEAR ENDED JUNE 30, 1998
''--------------------~/
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

TAJTNALL COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUND

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

8

ADDmONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

20

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

21

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

23

DEBT SERVICE FUND

I

COMBINING BALANCE SHEET

24

J

COMBINING-STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

25

FIDUCIARY FUND TYPES

K

COMBINING BALANCE SHEET

26

L

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

27

TATINALLCQUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDmONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

28

2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

29

3 SCHEDULE OF STATE REVENUE

31

4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

32

5 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

33

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

6

OVERALL

35

7

BY PROGRAM

36

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 OMB CIRCULAR A-133

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

TATTNALL COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 26, 1999

Honorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Tattnall 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 Tattnall County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Tattnall County Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:
* The general purpose financial statements of the Board 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.

98ARL-13B

* School activity accounts maintained at the individual schools are not included in the general purpose
financial statements. To confonn to generally accepted accounting principles, these accounts should be included in the general purpose financial statements.
* The Board did not recognize as expenditures, in the year ended June 30, 1998, a portion of salaries
and the corresponding employer's cost ofrelated benefits earned for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department ofEducation for the State's share ofthese 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, 1997, were improperly recorded in the year ended June 30, 1998. To confonn 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 detennined, 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 Tattnall County Board of Education as of June 30, 1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated July 26, 1999, on our consideration ofthe Tattnall County Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
The year 2000 supplementary infonnation on Schedule "1" is not a required part of the basic financial statements but is supplementary infonnation required by the Governmental Accounting Standards Board. We have applied certain limited procedures,which consisted principally ofinquiries ofmanagement regarding the methods ofmeasurement and presentation ofthe supplementary infonnation. However we did not audit the infonnation and do not express an opinion on it. In addition, we do not provide assurance that Tattnall County Board ofEducation is or will become year 2000 compliant, that the Board's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Tattnall County Board ofEducation does business are or will become year 2000 compliant.
Our audit was perfonned for the purpose offorming an opinion on the general purpose financial statements ofthe Tattnall County Board ofEducation taken as a whole. The accompanying combining and individual fund statements (Exhibits E through L) and the financial schedules (Schedules 2 through 7), which includes the Schedule of Expenditures of Federal Awards as required byU. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes ofadditional analysis and are not a required part ofthe general purpose financial statements. Such infonnation has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such infonnation is fairly presented in all material respects in relation to the general purpose financial stat~ents taken as a whole.
98ARL-13B

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 98ARL-13B

Ru sell W. Hinton State Auditor

TATINALL COUNTY BOARD OF EDUCATION

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS

ACCOUNT GROUP GENERAL LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 30, 1998

JUNE 30, 1997

$

252,319.18

$ 7,715,554.38 $ 2,261,868.92

$

30,764.49

30,764.49

446,010.56

446,010.56

443,nO.45

231.392.75

582,735.47

389,524.06

3,330.00

$

483,711.93

34,375.97 10,690.86
483,711.93

20,416.51 9,547.06
266,834.37

2,748,783.88 180,851.96
5,397.504.19

2,748,783.88 180,851.96
5.397,504.19

2,903,165.63 213,056.79

$

483,711.93 $

476,n5.05 $

8,810.851.96 $ 17,634,313.69 $ 6,508,183.79

$

60,893.67 $

120,252.29

225,615.48

198,891.06

17,410.21

1,678.30

$

446,010.56

446,010.56

443,nO.45

$

180,851.96

180,851.96

213,056.79

3,015,000.00

3,015,000.00

3,170,000.00

5,615,000.00

5,615,000.00

$

446,010.56 $

8,810,851.96 $ 9,560,781.88 $ 4,147,648.89

$

483,711.93

0.00 $

$

483,711.93 $

30,764.49 30,764.49

$

25,459.50 $

41,484.52

483,711.93

266,834.37

114,658.96

376.58

34,375.97 10,690.86 5.588,240.15

20,416.51 9,547.06

1,816,017.86

2,022.252.44

$ 8,073,531.81 $ 2,360.534.90

$

483.711 .93 $

476,n5.05 $

8,810.851.96 $ 17,634.313.69 $ 6,508.183.79

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TATTNALL 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. 1998

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
OTHER FINANCING SOURCES (USES)
Operating Transfers In Operating Transfers Out Proceeds from Loan
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

$ 12,412,039.93 $
100,720.23 2,015,724.03
131,618.12
$ 14,660,102.31 $

966,806.71 2,409,239.66
296,195.86 $
3,672,242.23 $

41,646.35 41,646.35

$

9,571,094.42 $

1,644,515.56

904,793.61 544,952.51 319,214.17 335,344.99 979,096.63
71,152.41 1,260,469.00
759,693.76 35,976.77 1,500.00
68,340.71

205,539.52 38,440.87
36,179.04 360.00
1,022.19 84,497.79 16,843.71
1,132.89 1,489,705.06
$

32,204.83 12,300.96

$ 14,896,134.77 $

$

-236,032.46 $

3,518,236.63 $ 154,005.60 $

95,351.36
95,351.36 -53,705.01

$

-236,032.46 $

1,295,489.11

$ 5,615,000.00

$

5,615,000.00

154,005.60 $
625,517.37

5,561,294.99 143,677.52

13,959.46 1,143.80

FUND BALANCE JUNE 30

$ 1,059,456.65 $

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

-4-

794,626.23 $

5,704,972.51

EXHIBIT"B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

TOTALS
(Memorandum Only)
YEAR ENDED JUNE 30,1998 JUNE 30,1997

$ 13,378,846.64

2,509,959.89

$

576,203.76

2,591,927.79

17,195.95

486,656.28 $

$

593,399.71 $ 18,967,390.60 $

$
1,747.96 1,747.96 $

13,378,846.64 $ 2,509,959.89 2,591,927.79
488,404.24
18,969,138.56 $

12,488,001.05 2,071,304.70 2,707,765.81
410,862.44
17,677,934.00

$ 11,215,609.98 $

1,110,333.13 583,393.38 319,214.17 371,524.03 979,456.63 71,152.41
1,261,491.19 844,191.55 52,820.48 2,632.89
1,489,705.06 163,692.07

$

155,000.00

218,680.00

2,842.15

187,204.83 230,980.96
2,842.15

$

376,522.15 $ 18,886,244.91 $

$

216,877.56 $

81,145.69 $

0.00 $
0.00 $ 1,747.96 $

11,215,609.98 $
1,110,333.13 583,393.38 319,214.17 371,524.03 979,456.63 71,152.41
1,261,491.19 844,191.55 52,820.48 2,632.89
1,489,705.06 163,692.07
187,204.83 230,980.96
2,842.15
18,886,244.91 $
82,893.65 $

10,201,496.94
887,911.17 510,944.63 290,507.84 320,593.75 891,429.34
71,218.66 1,051,913.52
721,285.12 26,581.94
1,245.72 1,331,875.81
37,128.53
247,061.64 250,419.89
1,376.90
16,842,991.40
834,942.60

$ 5,615,000.00 $ 5,615,000.00

$

216,877.56 $ 5,696,145.69 $

266,834.37

2,331,518.37

13,959.46 1,143.80

$ $ 5,615,000.00 $ 5,615,000.00 $

2,528.65 -2,528.65
0.00

1,747.96 $ 29,016.53

5,697,893.65 $ 2,360,534.90

834,942.60 1,542,805.07

13,959.46 1,143.80

-15,959.27 -1,253.50

$

483,711.93 $ 8,042,767.32 $

30,764.49 $ 8,073,531.81 $ 2,360,534.90

-5-

TATTNALL 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 30,1998

EXHIBIT"C"

FUND BALANCE JUNE 30, 1998

$ 1,287,298.95 $ 1,059,456.65

$ 707,366.71 $ 749,559.40

The notes to the general purpose financial statements are an integral part of this statement.
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TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Tattnall County Board ofEducation (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 ofits operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the 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 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 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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TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

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.

DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.

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 4-H Club Trust Fund - the fund used to account for proceeds from the sale of 4-H property and used to provide for the assistance of Tattnall County children enrolled at the College of Agriculture of the University of Georgia.

AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for otherfunds, governments, or individuals.

ACCOUNT GROUP

GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and material capital lease obligations.

BASIS OF ACCOUNTING

The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental 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 (Le., revenues and other financing sources) and decreases (Le., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.

Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.

Agency funds are purely custodial in nature and do not involve measurement ofresults of operations.

Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting

under which:

.

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TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be detennined 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 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 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in early June 1998. Personnel contracts for this employment period specify that compensation
be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. State
grants to fund the State's share ofthese contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1998, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were recorded in the year ended June 30, 1998. 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 of accounting in recognizing assets and

liabilities.

.

BUDGET

The Tattnall 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 ofthe 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

-10 -

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

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.

The Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to fund balance as reflected on Exhibit "B" of this report:.

Special Revenue
Fund

FUND BALANCE JULY 1, 1997

$ 625,517.37

Adjustments Inventories - July 1, 1997 Food Donated Commodities Purchased Foods

-20,416.51 -9.547.06

Fund Balance July 1, 1997 (Budget Basis)

$ 595,553.80

Excess ofRevenues and Other Financing Sources over (under) Expenditures and Other Financing Uses

154,005.60

FUND BALANCE JUNE 30, 1998 (Budget Basis)

$ 749.559.40

CASH AND CASH EQUIVALENTS

COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofdeposits 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 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

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TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES .

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 of the 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.

INVESTMENTS HELD BY TRUSTEE

Investments held by trustee consist of contributions from employees who have elected to participate in the Board's deferred compensation plan. See Note 9 - Deferred Compensation Plan

RECEIVABLES

Receivables consist ofgrant 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 Tattnall County Board ofCommissioners fixed the property tax levy for the 1997 tax year (calendar year) on October 20, 1997 (levy date). Taxes were due on January 15, 1998. The lien date for property taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are reported

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TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES

as revenue in fiscal year 1998. The Tattnall 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.

Tax millage rates levied for the 1997 tax year (calendar year) for the Tattnall County Board ofEducation were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

10.38 mills 1.82 mills

12.20 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 $217,495.81 and was recorded in the Debt Service Fund. The State will terminate collection of this tax once an additional $7,232,504.19 has been collected or on March 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 of purchase. The mventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 1998, are recorded as prepaid items.

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. General obligation bonds are direct obligations and pledge the

-13 -

TATINALL COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES
full faith and credit of the government. The outstanding amount of these bonds is recorded in the General Long-Tenn Debt Account Group.
INTERFUND TRANSACTIONS
The Board has the following type 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.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results ofoperations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe 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 of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of anyone ofor 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 ofindebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations ofthe counties or municipalities ofthe State of Georgia,
-14 -

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1998

Note 2: DEPOSITS

(5) Bonds ofany public authority created by the laws ofthe 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 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 and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 1998, the bank balances were $8,651,215.39. The amounts of the total bank balances are classified into three categories of credit risk:

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, orby its trust department or agent but not in the Board's name.)

The Board's deposits are classified by risk category at June 30, 1998, as follows:

Risk CategOly

Bank Balance

1

$ 384,847.50

2

3,144,846.41

3

5,121.521.48

Total

$ 8,651.215.39

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

- 15-

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FJNANCIAL STATEMENTS

JUNE 30. 1998

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, errors or omissions and job related illness or injuries to employees. However, the errors or omissions policy excludes coverage for sexual harassment and discrimination. 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 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: .

1997 1998

Beginning ofYear Liability

Claims and Changes in Estimates

$

0.00 $

3.417.00 $

$

0.00 $

4,999.00 $

Claims Paid

End ofYear Liability

3.417.00 $

0.00

4,999.00 $

0.00

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

Position Covered

Amount

Superintendent All Employees

$ 50,000.00 $ 150,000,00

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES .The Tattnall County Board ofEducation has entered into various lease agreements as lessee for purchase of equipment. These lease agreements qualify as capita11eases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as ofthe date oftheir inception.

-16 -

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1998

Note 5: GENERAL LONG-TERM DEBT

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

Pumose

Interest Rates

Amount

General Government - Series 1990

6.55% - 9.00%

$ 3,015,000.00

Promissory Notes currently outstanding are as follows:

Purpose

Interest Rates

Amount

General Government - Series 1998

4.50%

$ 5,615,000.00

The changes in General Long-Term Debt during the fiscal year ended June 30, 1998, were as follows:

Balance July 1, 1997
Additions Deductions
Payments
Balance June 30, 1998

Capital Leases

Promissory Notes

General Obligation
Bonds

Total

$ 213,056.79 $

0.00 $ 3,170,000.00 $ 3,383,056.79

5,615,000.00

5,615,000.00

32,204.83

155,000.00

187,204.83

$ 180,851.96 $ 5,615,000.00 $ 3,015,000.00 $ 8,810,851.96

At June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30
1999 2000 2001 2002 2003 2004- 2008 2009 -2013
Total Principal and Interest
Deduct: Imputed Interest
Net Present Value of Future Minimum Lease Payments

Capital Leases

Promissory Notes

General Obligation
Bonds

Total Debt

$ 39,960.00 $ 727,675,00 $ 372,287.50 $ 1,139,922.50

39,960.00 1,126,300.00

376,480.00 1,542,740.00

39,960,00 1,381,025.00

374,600.00 1,795,585.00

39,960,00 1,482,475,00

376,965.00 1,899,400.00

39,960.00 1,786,950.00

378,230.00 2,205,140.00

13,320.00

1,901,330.00 1,914,650.00

768.850.00

768,850.00

$ 213,120,00 $ 6,504.425.00 $ 4.548.742.50 $ 11.266.287.50

32,268.04

$ 180.851.96

- 17-

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

WNE30.1998

Note 6: ON-BEHALF PAYMENTS
The Board has recognized revenues and expenditures in the amount of$226,381.44 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$187,124.44
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 $39,257.00
Note 7: CONTINGENT LIABILITIES
Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position.
Note 8: SUBSEQUENT EVENTS
On December 14, 1998, the Tattna11 County Board ofEducation passed a resolution authorizing the advanced refunding and insubstance defeasance ofthe 1990 Series Bonds through the issuance of Series 1999 General Obligation Refunding Bonds to be dated December 1, 1998.
Note 9: DEFERRED COMPENSATION PLAN
The Board offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Board employees, permits them to defer a portion oftheir salary until future years. Participation in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency.
All amounts of compensation deferred under the plan, all property and rights purchased with those-amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights ofthe Board subject only to the claims ofthe Board's general creditors. Participants' rights under the plan are equal to those of general creditors of the Board in an amount equal to the fair market value ofthe deferred account for each participant.
It is the opinion ofthe Board that the Board has no liability for losses under the plan but does have the duty ofdue care that would be required ofan ordinary prudent investor. The Board believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future.
- 18-

TATTNALL COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1998

Note 9: DEFERRED COMPENSATION PLAN

Investments are managed by the plan's trustee, ITT Hartford Insurance Group. Under this plan, participants select from an investment option, or combination ofinvestment options, determined by the Board.

Note 10: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

IRS 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.

IRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by IRS are required by State statute to contribute 5% of their gross earnings to IRS. The Board makes monthly employer contributions to IRS 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 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1998 1997 1996

100% 100% 100%

$ 1,207,444.78 $ 1,100,238.76 $1,020,147.16

- 19-

TATINALL COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30,1998

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

SCHOOL FOOD
SERVICES FUND

LOTIERY PROGRAMS

FEDERAL PROGRAMS

TOTALS JUNE 30, 1998 JUNE 30,1997

$ 689,915,81 $ 103,289,11 $ 107,116,22 $ 900,321,14 $ 751,211,83

20,237,08

116,075.41

136,312.49

210,282,63

34,375,97 10,690,86

34,375,97 10,690,86

20,416,51 9,547.06

$ 755,219,72 $ 103,289,11 $ 223,191,63 $ 1,081,700.46 $ 991,458,03

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 Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity

$ 12,923.02 $
62,329.43

19,402,59 $
83,096,50 790,02

18,991,91 $
80,189.55 9,351,21

$ 75,252,45 $ 103,289.11 $ 108,532,67 $

$
51,317.52 225,615.48
10,141,23
287,074,23 $

114,652,48 52,397.12
198,891,06
365,940.66

$ 34,375.97
10,690,86
634,900.44 $
$ 679,967,27 $

$ 114,658,96 $ 114,658.96

0.00

0,00

0.00 $ 114,658.96 $

34,375.97 $
10,690,86
634,900,44
794,626.23 $

20,416,51 9,547.06
595,553.80
625,517.37

Total Liabilities and Fund Equity

$ 755,219.72 $ 103,289.11 $ 223,191.63 $ 1,081,700.46 $ 991,458.03

See notes to the general purpose financial statements,

-20-

TATTNALL COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30,1998

EXHIBIT"F"

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30,1998 JUNE 30,1997

REVENUES

State Funds Federal Funds Other Funds

$ 96,754,00 $
1,135,075.42 296,195,86

870,052.71

$

$ 1,274,164.24

966,806.71 $
2,409,239,66 296,195.86

826,401.17 2,070,628.70
289,716.22

Total Revenues

$ 1,528,025.28 $ 870,052.71 $ 1,274,164.24 $ 3,672,242.23 $ 3,186,746.09

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services central SlIPport Services Other Support Services Food Services Operation

$ 678,335.94 $ 966,179.62 $ 1,644,515.56 $ 1,364,173.35

110,900.89
80,815.88
$ 1,488,678.64

94,638.63 38,440,87 36,179.04
360.00
1,022.19 3,681.91 16,843.71 1,132.89 1,026.42

205,539.52 38,440.87 36,179.04 360.00
1,022.19 84,497.79 16,843.71
1,132.89 1,489,705.06

166,430.92 81,676.82 41,832.32 22,059.91 7,028.28 27,897.99 22,925.50 14,428.44 1,245.72
1,331,875.81

Total Expenditures

$ 1,488,678.64 $ 870,052.71 $ 1,159,505.28 $ 3,518,236.63 $ 3,081,575.06

Excess of Revenues over (under) Expenditures

$ 39,346.64 $

0.00 $ 114,658.96 $ 154,005.60 $ 105,171.03

OTHER FINANCING SOURCES

Operating Transfers In

2,528.65

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$ 39,346.64 $

0,00 $ 114,658,96 $ 154,005.60 $ 107,699,68

FUND BALANCE JULY 1

625,517,37

0,00

0.00

625,517,37

535,030,46

Food Inventory - Net Change in Period Donated Commodities Purchased Food

13,959,46 1,143,80

13,959.46 1,143.80

-15,959,27 -1,253,50

FUND BALANCE JUNE 30

$ 679,967,27 $

0.00 $ 114,658,96 $ 794,626.23 $ 625,517,37

See notes to the general purpose financial statements,

- 21-

TATTNALL COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND
JUNE 3D. 1998

EXHIBIT"G"

ASSETS Cash and Cash Equivalents

REGULAR

LOAN PROCEEDS
FUND

TOTALS

JUNE 30.1998

JUNE 30.1997

$

116.732.36 $ 5,588.240.15 $ 5,704.972.51 $===14=30!0.6..7..:::.:7.:=52=

FUND EQUITY

Fund Balances Reserved For Purposes of SPLOST Projects Unreserved Undesignated

$ $ _ _-",1"""16",,7;.;:;3=2=.3-=-6

5,588.240.15 $ 0.00

5.588,240.15 116,732.36 $ _ _-,-14=3""",6;.;.7"",7.;.;.;52=.,

Total Fund Equity

$

116.732.36 $ 5.588.240.15 $ 5,704.972.51 $ ===14=3=,6..7...7..,.;:;;52=

See notes to the general purpose financial statements.

-22-

TATINALL COUNTY BOARD OF EDUCATION

EXHIBIT "H"

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

YEAR ENDED JUNE 30, 1998

REGULAR

LOAN PROCEEDS
FUND

TOTALS YEAR ENDED JUNE 30,1998 JUNE 30, 1997

REVENUES

Other Funds

$ 10,406.20 $

31,240.15 $

41,646.35 $

7,664.49

EXPENDITURES

Capital Outlay Building and Building Improvements

$ 37,351.36 $

58,000.00 $

95,351.36 $

0.00

Excess of Revenues over (under) Expenditures

$ -26,945.16 $

-26,759.85 $

-53,705.01 $

7,664.49

OTHER FINANCING SOURCES

Proceeds from Loan

5,615,000.00

5,615,000.00

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$

-26,945.16 $

5,588,240.15 $

5,561,294.99 $

7,664.49

FUND BALANCE JULY 1

143,677.52

0.00

143,677.52

136,013.03

FUND BALANCE JUNE 30

$ 116,732.36 $ 5,588,240.15 $ 5,704,972.51 $ 143,677.52

See notes to the general purpose financial statements,

-23-

TATINALL COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30,1998

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets

PROPERTY TAXES FOR
BOND DEBT

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30,1998

JUNE 30,1997

$

252,319.18

$

252,319.18 $

260,996.38

13,896.94 $

217.495.81

231,392.75

5,837.99

$

266,216.12 $

217.495.81 $

483,711.93 $ =====2=6=6=,8=34,;,;;.3=7=

FUND EQUITY
Fund Balances Reserved For Debt Service Unreserved Undesignated

$

266,216.12 $

217,495.81 $

483,711.93 $

266,834.37

0.00

0.00

0.00

0.00

Total Fund Equity

$

266,216.12 $

217,495.81 $

483,711.93 $ =====2=6=6=,8=34,;,;;.3=7=

See notes to the general purpose financial statements.

-24-

TAlTNALL COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
DEBT SERVICE FUND YEAR ENDED JUNE 3D. 1998

EXHIBIT RJR

FUND BALANCE JUNE 30

$

266,216.12 $ 217,495.81 $ 483,711.93 $ 266.834.37

See notes to the general purpose financial statements.

-25-

TATINALL COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30,1998

EXHIBITnKn

ASSETS Investments Investments Held by Trustee
Total Assets

EXPENDABLE TRUST FUND
4-H CLUB TRUST FUND

AGENCY FUND

TOTALS JUNE 30,1998 JUNE 30,1997

$

30,764.49

$

30,764.49 $

29,016.53

-----$

446,010.56

446,010.56

443,770.45

$

30,764.49 $

446,010.56 $

476,775.05 $

472,786.98

LIABILITIES AND FUND EQUITY
LIABILITIES
Deferred Compensation Plan
FUND EQUITY
Fund Balances Unreserved Undesignated

$

446,010.56 $ 446,010.56 $

443,770.45

$ _---=.3=0,.;..;764~.4~9

0.00

30,764.49

29,016.53

Total Liabilities and Fund Equity

$

30,764.49 $

446,010.56 $

476,775.05 $

472,786.98

See notes to the general purpose financial statements.

-26-

TATINALL COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30. 1998

EXHIBIT"L"

DEFERRED COMPENSATION PLAN
ASSETS Investments Held by Trustee

BALANCE JULY 1,1997

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 1998

$

443,nO.45 $

41,114.25 $

38,874.14 $

446,010.56

LIABILITIES Deferred Compensation Plan

$

443,no.45 $

41,114.25 $

38,874.14 $ ==........4..4=6.,.0..1..0.....,5=6

See notes to the general purpose financial statements.

-27 -

TATTNALL COUNTY BOARD OF EDUCATION

SCHEDULE "1"

SCHEDULE OF REQUIRED SupPLEMENTARY INFORMATION

YEAR 2000 DISCLOSURES

YEAR ENDED JUNE 30. 1998

At June 30, 1998, the Tattnall County Board of Education had no outstanding contractual commitments for the purpose ofmaking computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result ofshortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is ofprimary concern for the Board's financial accounting system. The following stages have been identified as necessary to implement a year 2000 compliant systems.
Awareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 issue.
Assessment Stage - The actual process of identifying all of its systems and individual components of the systems to check for compliance.
Remediation Stage - When changes are made to systems and equipment.
Validation/Testing Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system.
It will be necessary for the Board to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As ofJune 30, 1998, the financial accounting system was detennined to be at the Awareness Stage.
The Board's financial accounting software (GENESIS) and hardware (Wang VS) are owned by the State (Georgia Department ofEducation). These systems have been detennined to be critical to the Board's ability to successfully conduct operations. As of June 30, 1998, the State had not contracted for the remediation of either the Wang VS operating system or the GENESIS accounting software. In the subsequent period, the Georgia Department of Education remediated the Wang VS operating system and the updated operating system was installed at all GENESIS sites as ofbecember 9, 1998. The Georgia Department ofEducation has remediated the GENESIS software and conducted tests at nine pilot sites. The remediated GENESIS software has been provided to all boards ofeducation currently utilizing the GENESIS accounting software.

See notes to the general purpose financial statements. - 28-

TATINALL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,1998

SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Agriculture, U. S. Department of Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program
1998 Grant
National School Lunch Program
1998 Grant Food Distribution Program (1)
Pass-Through From Office of School Readiness Food and Nutrition Program Child and Adult Care Food Program
1998 Contract

* 10.553 * 10.555
10.550
10.558

Total U. S. Department of AgriCUlture

Education, U. S. Department of Direct Impact Aid
1997 Grant
Pass-Through From First District RESA d/b/a Live Oak Migrant Education Agency Elementary and Secondary Education Act Title I Migrant Education
1997 Summer 1998 Regular 1998 Summer
Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies
1998 Grant
Title II Eisenhower Professional Development
1998 Grant
Title VI Innovative Education Program Strategies
1998 Grant Goals 2000
State and Local Education Systemic Improvement Grant
1998 Grant
Technology Literacy Challenge Fund Grant
1998 Grant
Individuals with Disabilities Education Act Part B - Special Education Flow Through
1998 Grant
Preschool
1998 Grant

84.041
84.011 84.011 84.011
84.010 84.281 84.298
84276 84.318
84,027 84.173

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

N/A

$ 317,979.07

(2)

N/A

694,778.28 $ 1,392,599.38 (3)

N/A

96,079.26

96,079.26

N/A

26,238.81

(2)

$ 1,135,075.42 $ 1,488,678.64

$

3,147.14

(4)

N/A

54,463.27 $

54,463.27

N/A

59,841.06

59,841.06

N/A

24,497.46

24,497.46

NlA

579,597.79

579,597.79

N/A

17,500.00

17,500.00

NlA

21,873.00

21,873.00

NlA

96,210.17

96,210.17

N/A

199,999.00

85,340.04

NlA

145,938.00

145,938.00

NlA

17,943.70

17,943.70

-29-

TATTNALL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,1998

SCHEDULE "2"

FUNDING AGENCY PROGRAM/GRANT
Education, U. S. Department of Pass-Through From Georgia Department of Education Vocational Education - Basic Grants to States High School Program Basic Grant 1998 Grant Tech-Prep Education 1998 Grant
Total U. S. Department of Education
Labor, U. S. Department of Direct School-ta-Work Opportunities Act of 1994 Urban/Rural Opportunities Grant 1998 Grant

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.048 84.243

N/A

$ 44,256.76 $

44,256.76

N/A

12,044.03

12,044.03

$ 1,277,311.38 $ 1,159,505.28

84.278A

$ 97,573.09 $

97,573.09

Total Federal Financial Assistance

$ 2,509,959.89 $ 2,745,757.01

N/A= 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 Child and Adult Care Food Program and the School Breakfast Program were not maintained separately and are included in the 1998 National School Lunch Program.
(3) Expenditures for this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Funds earned on this program do not require reporting of expenditures.

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 Tattnall County Board of Education and is presented on the modified accrual basis of accounting which is the same basis of accounting used in the presentation of the general purpose financial statements.

See notes to the general purpose financial statements.

-30-

TATINALL COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30,1998

SCHEDULE "3"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation RegUlar Bus Replacement Limited English Speaking Special Instructional Assistance In-School Suspension Migrant Mid-term Adjustment Counselors Grades 4 and 5 Technology Specialist Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Ad Valorem Tax Adjustment Alternative Program Apprenticeship Program At-Risk Summer School Program Health Insurance Innovative Programs Mentor Teacher Program Preschool Handicapped Program Remedial Summer School Program Special Education Low Incidence Grant Lottery Programs Alternative School Program Instructional Technology Assistive Technology Classroom Technology
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 7,006,954.00 1,189,257.00 157,108.00 290,317.00 88,464.00 1,929,021.00
418,167.00 126,518.00
18,428.00 426,995.00
41,534.00 44,347.00 28,736.00 28,842.00 -922,080.00 899,035.00
$ 26,687.51
73,222.00 128,155.00 100,000.00
15,432.02 187,124.44
5,000.00 2,820.00 42,161.00 3,599.96 16,938.00

$
96,754.00
4,132.00 5,644.98 90,041.00

7,006,954.00 1,189,257.00
157,108.00 290,317.00 88,464.00 1,929,021.00
418,167.00 126,518.00
18,428.00 426,995.00
41,534.00 44,347.00 28,736.00 28,842.00 -922,080.00 899,035.00 96,754.00 26,687.51
73,222.00 128,155.00 100,000.00
15,432.02 187,124.44
5,000.00 2,820.00 42,161.00 3,599.96 16,938.00
4,132.00
5,644.98 90,041.00

770,234.73

770,234.73

39,257.00

39,257.00

See notes to the general purpose financial statements.

$ 12,412,039.93 $

966,806.71 $ 13,378,846.64

- 31 -

TATTNALL COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 1998

SCHEDULE "4"

PROJECT
i) To renovate the former Glennville High School for use as a middle grades (6, 7, 8) school; (ii) to renovate the former Reidsville High School for use as a middle grades (6,7,8) school; (iii) to enlarge and renovate Collins Elementary School; and (iv) to purchase personal property to be used in the above described renovated and expanded facilities

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COST (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS

$ 7,450,000.00 $ 6,021,624.61 $

58,000.00 $ ====0,=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 project. Includes all costs from project inception to completion and retire associated debt.
(3) The voters of Tattnall County approved the imposition of a 1% sales tax to fund the above project and retire
associated debt. Amounts expended for this project may include sales tax proceeds, state, local property taxes and other funds over the life of the project.

See notes to the general purpose financial statements.

- 32-

TATTNALL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30. 1998

SCHEDULE -5"

EXPENDITURES
Current Instruction Support Services Pupil Services Student Transportation Services

ALTERNATIVE SCHOOL PROGRAM

INSTRUCTIONAL TECHNOLOGY

ASSISTIVE

CLASSROOM

TECHNOLOGY TECHNOLOGY

PRE-KINDERGARTEN PROGRAM

TOTAL

$

4,132.00 $

5,644.98 $

90,041.00 $

578,517.96 $ 678,335.94

110,900.89 80,815.88

110,900.89 80,815.88

Total Expenditures

$

4,132.00 $

5.644.98 $

90,041.00 $_-====7;.;.7,;;00':0;;234;.,;,;,;,.7==3 $ 870.052.71

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures A1temative School Program Instructional Technology Assistive Technology Classroom Technology Pre-Kindergarten Program

$ 681,212.84
4,132.00
5,644.98 90,041.00 89,021.89

$ 870,052.71

see notes to the general purpose financial statementS.

-33-

TATTNALL COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1998

SCHEDULE "6"

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

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

8,643,636.00 $ _ _....;2;;;..4=2;:.;;,9~8.;;;.;9.""-00;;;..

$

8,356,674.63

569,979.12 $

$

8,926,653.75

5;;.;0;.;.7..:..1:~,9.:;.:6.:.:..70;;;..

-18,966.28 $ _ _.=.8z.;,9.=.,:07:..l,;,6:;:8;.:.7:.:.4.:..7

$

0.00 $=====0='0==0

See notes to the general purpose financial statements. - 35 -

TATTNALL COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENIS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1998

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*)
Grades 1 - 3 r)
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 III (*) Category IV (*) category V (*) Sub-Total Regular
category VI (Gifted) r)
Total Special Education Programs REMEDIAL EDUCATION PROGRAM Cl
Total Fourteen Weighted Programs MEDIA CENTER PROGRAMS
salaries Operations
Total Media Center Programs
Total Fourteen Weighted and Media Center Programs

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

ORIGINAL ~

ORIGINAL

MID-TERM

$

804,739.00

$

724,265,10 $

0.00

2,062,000,00

1,855,800.00

$ 2,866,739,00 90 $ 2,580,065.10 $

0,00

856,695,00 90

n1,025,50

1,544,407,00 90

1,389,966.30

m,949.00 90

700,154,10

545,280,00 90

490,752,00

415,884.00 90

374,295,60

$ 7,006,954,00

$ 6,306,258,60 $

0.00

$ 1,065,458.00

$

958,912.20 $

0.00

$ 1,065,458.00 90 $

958,912.20 $

0,00

123,799,00 90

111,419.10

$ 1,189,257,00

$ 1,070,331.30 $

0,00

$

157,108,00 90 $

141,397.20 $

0,00

$ 8,353,319.00

$ 7,517,987.10 $

0,00

$

236,984.00 90 $

213,285,60 $

0,00

53,333.00 90

47,999,70

$

290,317,00

$

261,285.30 $

0.00

$ 8,643,636.00

$ 7,n9,272,40 $

0,00

STAFFDEYELOPMENTPRQGRAMS Cost of Instruction Professional Development
Total Staff Development Programs
r) Identifies Fourteen Weighted Programs.
See notes to the general purpose financial statements.

$

25,669.00

$

25,669.00 $

0.00

62,795.00

62,795.00

0.00

$

88,464.00 100 $

88,464.00 $ .....==-==00.""0

- 36

SCHEDULE '7"

TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

724,265.10 $

1.855.800.00

$ 2.580.065.10 $

n1.025.50

1.389,966.30

700,154.10

490,752.00

374,295.60

$ 6.306.258.60 $

729.097.87 $ 1.889.728.52 2.618,826.39 $
953.489.43 1.637.262.61
n5.986.15 480,411.44 414.038.10 6.880,014.12 $

25.815.70 $ 85,860.38 111.676.08 $ 52.207.43 104,230.92 70.268.14
9,963.98 89.265.15 437.611.70 $

754.913.57 1.975.588.90 2.730,502.47 $ 1,005.696.86 1,741,493.53
846,254.29 490.375.42 503.303.25 7.317.625.82

0.00 0.00 0.00 0.00 376.58 0.00

$

958.912.20

$

216,580.05 642.063.94 $
85.056.45 7,924.28

$ 38.575.93

216.580.05 680.639.87
85.056.45 7.924.28

$

958.912.20 $

951.624.72 $

38.575.93 $

990,200.65

0.00

111,419.10

138.282.38

21.431.29

159.713.67

0.00

$ 1.070.331.30 $ 1.089.907.10 $

60,007.22 $ 1.149.914.32

$

141,397.20 $

140.252.55 $

9,sn.78 $

149.830.33

0.00

$ 7,517.987.10 $ 8,110.173.n $

507.196.70 $ 8,617.370.47

$

213.285.60 $

246.500.86

$

246.500.86

0.00

47.999.70

$

62.782.42

62.782.42

0.00

$

261,285.30 $

246.500.86 $

62.782.42 $

309,283.28

$ 7.n9.272.40 $ 8.356.674.63 $

569.979.12 $ 8.926.653.75 $

376.58

$

25.669.00

62.795.00

$ _.......88;;0;;,,;.4..6.4..0..0.

$

37.519.86 $

37.519.86

61.756.94

61.756.94

$

99.276.80 $

99,276.80 $

.....0.0.0.

- 37 -

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 26, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board ofEducation
and Superintendent and Members of the Tattnall 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 ofTattnall County Board of Education as of and for the year ended June 30, 1998, and have issued ourreportthereon dated July 26, 1999. 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 genera11y accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Tattnall County Board of Education's financial
statements are free ofmaterial misstatement, we performed tests ofits compliance with certain provisions of
laws, 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 of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Re.porting
In planning and performing our audit, we considered Tattnall 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 certain matters involving the internal control over financial reporting and its
98YB-40

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 ourjudgement, could adversely affect Tattnall County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule of Findings and Questioned Costs as items FS-7321-98-02 and FS-7321-98-03.
A material weakness is a condition in which the design or operation of one or more ofthe 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 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, all ofthe reportable conditions described above are considered to be material weaknesses.
This report is intended solely for the information and use of management, members of the Tattnall 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,
~w.~~ Russell W. Hinton State Auditor
RWH:gp 98YB-40

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 26, 1999

Honorable Roy E. Barnes, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Tattnall County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCIn-ARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Tattnall County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1998. Tattnall County Board of Education'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 Tattnall County Board of Education's management. Our responsibility is to express an opinion on Tattnall County Board ofEducation's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the st"andards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB 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 Tattnall 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 detennination on Tattnall County Board of Education's compliance with those requirements.

98SA-10

In our opinion, the Tattnall 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, 1998.
Internal Control Over Compliance
The management of Tattnall County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Tattnall 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 detennine 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 OMB 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 of management, members of the Tattnall 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 98SA-I0

R sell W. Hinton State Auditor

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

TATTNALL COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARy SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30. 1998

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

7321-93-07 FS-7321-97-01

Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7321-97-01

Due to current staffing limitations and budgetary considerations prohibiting the hiring ofadditional administrative staff, the Board has decided not to pursue the recording of general fixed assets on the financial statements.

SECTIONN FINDINGS AND QUESTIONED COSTS

TATTNALL COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 1998

I SUMMARy OF AUDITOR'S RESULTS

I. Type ofRsmort Issued on the Financial Statements The auditor's opinion on the Tattnall County Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles.

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

Employee Compensation

General Fixed Assets

All ofthe reportable conditions described above are considered to be material weaknesses.

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

4. R'4lortable Conditions in Internal Control Over Major Programs The audit report for the Tattnall County Board ofEducation did not disclose any reportable conditions in internal control over major programs.

5. Type ofRe.port Issued on Compliance for Major Programs The auditor's opinion on the Tattnall County Board of Education's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Rsmorted by Section .510(a) ofOMB Circular A-133 The Tattnall County Board ofEducation's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133.

7. Major Programs Federal 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

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

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

-1-

TATTNALL COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1998
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EXPENDITURESILIABILITIESIDISBURSEMENTS Failure to Meet Expenditure Requirements Nonmaterial Noncompliance Amount: $376.58 Finding Control Number: FS-7321-98-01
The Tattnall County Board ofEducation reported an underexpenditures of Quality Basic Education (QBE) funds of$376.58 for the General and Career Education Programs - High School Laboratories Program. The underexpenditure of funds occurred because the Board did not expend the minimum required amount for this QBE Program. The underexpenditure of$376.58 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period.
EMPLOYEE COMPENSATION Salary Underpayments/Overpayments Reportable Condition - Material Weakness Amount: $428.57 (Net) Finding Control Number: FS-7321-98-02
The accounting procedures of the Board were insufficient to provide adequate control over the employee compensation process. A sample of 51 personnel files revealed the following deficiencies:
(1) Two employees were underpaid in the amount of$I,198.30 due to an incorrect calculation of extended year payments.
(2) One employee was underpaid in the amount of$436.88 due to an incorrect calculation of extended year payment and an error in calculating excessive leave deductions.
(3) One employee was overpaid in the amount of $44.10 due to an incorrect calculation of excessive leave deduction.
(4) One employee was overpaid in the amount of $75.24 due to an incorrect calculation ofa local salary supplement.
(5) Two employees were overpaid a total of$I,087.27 because the Board continued to issue paychecks after the two employees were no longer employed. by the Board.
These deficiencies were the results ofmanagement's failure to correctly calculate extended year payments, excessive leave deductions, local supplement payments and failure to update the payroll system once individuals were no longer employed by the Board.
-2-

IATTNALL COUNTY BOARD OF EDUCATION
SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED nINE 30. 1998
IT FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
EMPLOYEE COMPENSATION Salary Underpayments/Overpayments Reportable Condition - Material Weakness Amount: $428.57 (Net) Finding Control Number: FS-7321-98-02
Management should develop and implement policies and procedures to ensure that salaries are calculated correctly. Excessive leave should be deducted from the employees' pay. When an employee retires or is terminated he or she should be immediately removed from the payroll system and management should establish appropriate internal controls over employee compensation.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeat From Prior Year Finding Control Number: FS-7321-98-03
The Tattnall County Board ofEducation 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 pUIpose financial statements ofthe Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory 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.
ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
-3-