Tift County Board of Education, Tifton, Georgia, annual financial report for the fiscal year ended 2015 June 30 (including independent auditor's reports)

TIFT COUNTY BOARD OF EDUCATION
TIFTON, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2015
(Including Independent Auditor's Reports)

TIFT COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S REPORT

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

EXHIBITS

BASIC FINANCIAL STATEMENTS

DISTRICT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET POSITION

B

STATEMENT OF ACTIVITIES

FUND FINANCIAL STATEMENTS

C

BALANCE SHEET

GOVERNMENTAL FUNDS

D

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET POSITION

E

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES

GOVERNMENTAL FUNDS

F

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT

OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES TO THE STATEMENT OF ACTIVITIES

G

STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS

H NOTES TO THE BASIC FINANCIAL STATEMENTS

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA
2 SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA 3 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 4 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND

Page
i
1 2 4 5 6 7 8 9
29 30 32 33

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TIFT COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I
FINANCIAL
SUPPLEMENTARY INFORMATION
5 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 6 SCHEDULE OF STATE REVENUE 7 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS 8 ALLOTMENTS AND EXPENDITURES
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE) BY PROGRAM

Page
34 35 36 37

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133

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

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

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SECTION I FINANCIAL

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Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
July 29, 2016

Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Tift County Board of Education
INDEPENDENT AUDITOR'S REPORT
Ladies and Gentlemen:
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Tift County Board of Education, as of and for the year ended June 30, 2015, and the related notes to the financial statements (Exhibits A through H), which collectively comprise the Board's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. 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 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 from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
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effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the basic financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Tift County Board of Education, as of June 30, 2015, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
As described in Note 2 to the financial statements, in 2015, the Tift County Board of Education adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions an amendment of GASB Statement No. 27 and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date an amendment of GASB Statement No. 68. The School District restated beginning Net Position for the cumulative effect of these accounting changes. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Schedule of Proportionate Share of the Net Pension Liability, Schedule of Contributions to Retirement Systems, Notes to the Required Supplementary Information and the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual as presented on pages i through ix and pages 29 through 33 respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Tift County Board of Education's basic financial statements. The accompanying supplementary information, consisting of Schedules 5 through 8, is presented for the
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purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is not a required part of the basic financial statements.
The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated July 29, 2016, on our consideration of the Tift County Board of Education's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Tift County Board of Education's internal control over financial reporting and compliance.
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,

GSG:er 2015ARL-11

Greg S. Griffin State Auditor

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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015
Introduction
The discussion and analysis of the Tift County Board of Education's financial performance provides an overall review of the School District's financial activities for the fiscal year ended June 30, 2015. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and notes to the basic financial statements to enhance their understanding of the School District's financial performance.
In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions and GASB Statement No. 71, Pension Transition For Contribution Made Subsequent to the Measurement Date An Amendment of GASB Statement No. 68. The adoption of these statements had a significant impact on the School District's District-wide financial statements, and in many cases distorts comparability of fiscal year 2015 financial statements with those of the prior year. Prior year financial statements, as presented within the Management's Discussion and Analysis, have not been restated for implementation of GASB No. 68 and GASB No. 71. The District's Governmental Fund Financial Statements were not affected by implementation of GASB No. 68 or GASB No. 71.
Financial Highlights
Key financial highlights for fiscal year 2015 are as follows:
The School District had an increase of $5,948,056.77 in net position as a result of governmental activities after the restatement of beginning net position for GASB No. 68 and GASB No. 71. Net position decreased $63,929,824.00 as a result of the implementation of GASB Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Period. In total, net position decreased $57,981,767.23 which represents a 60.43 percent decrease from fiscal year 2014.
General revenues accounted for $30,173,482.20 or 37.31 percent of all revenues. Program specific revenues in the form of charges for services and sales, grants and contributions accounted for $50,699,062.46 or 62.69 percent of total revenues which were $80,872,544.66.
The School District had $74,924,487.89 in expenses related to governmental activities; however, $50,699,062.46 of these expenses were offset by program specific charges for services, grants or contributions. General revenues (primarily taxes) of $30,173,482.20 and a healthy beginning equity were adequate to provide for these programs.
Among major funds, the general fund had $71,332,131.30 in revenues and $70,969,036.36 in expenditures.
Using the Basic Financial Statements
This annual report consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand the Tift County Board of Education as a financial whole, or as an entire operating entity.
i

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015
The Statement of Net Position and Statement of Activities provide information about the activities of the whole School District, presenting both an aggregate view of the School District's finances and a longerterm view of those finances. Fund financial statements provide the next level of detail. For governmental funds, these statements tell how services were financed in the short-term as well as what remains for future spending. The fund financial statements also look at the School District's most significant funds with all other nonmajor funds presented in total in one column. The general fund is by far the most significant fund in the case of the Tift County Board of Education.
Reporting the School District as a Whole
Statement of Net Position and the Statement of Activities
While these documents contain the large number of funds used by the School District to provide programs and activities, the view of the School System as a whole looks at all financial transactions and asks the question, "How did we do financially during fiscal year 2015?" The Statement of Net Position and the Statement of Activities answer this question. These statements include all assets and all liabilities using the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes in account all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the School District's net position and changes in Net Position. This change in net position is important because it tells the reader whether, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the result of many factors, some financial, some not. Nonfinancial factors include the School District's property tax base, facility conditions, required educational programs and other factors.
In the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity:
Governmental Activities All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, school activity accounts and various others.
Reporting the School District's Most Significant Funds
Fund Financial Statements Although the School District uses many funds to account for a multitude of transactions, the fund financial statements focus on the School District's most significant funds. The School District's major governmental funds are the General Fund and the Capital Projects Fund.
ii

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Governmental Funds: Most of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and Statement of Activities) and governmental funds is reconciled in the financial statements. Fiduciary Funds: The School District is the trustee, or fiduciary, for assets that belong to others such as school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the Districtwide financial statements because it cannot use these assets to finance its operations.
iii

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015
The School District as a Whole
The perspective of the Statement of Net Position is of the School District as a whole. Table 1 provides a summary of the School District's net position for fiscal year 2015, compared to fiscal year 2014.
Table 1 Net Position

Governmental Activities

Fiscal

Fiscal

Year 2015

Year 2014 (1)

Assets Current and Other Assets Capital Assets, Net

$

22,212,318.37 $

22,856,803.15

88,093,228.50

84,259,451.28

Total Assets

110,305,546.87

107,116,254.43

Deferred Outflow of Resources

5,212,691.72

0.00

Total Assets and Deferred Outflows of Resources

115,518,238.59

107,116,254.43

Liabilities Current and Other Liabilities Long-Term Liability

9,493,227.93 49,393,094.40

10,115,456.54 1,044,995.40

Total Liabilities

58,886,322.33

11,160,451.94

Deferred Inflows of Resources

18,657,881.00

0.00

Total Liabilities and Deferred Inflows of Resources

77,544,203.33

11,160,451.94

Net Position Investment in Capital Assets Restricted Unrestricted

88,093,228.50 5,970,663.49
-56,089,856.73

84,259,451.28 6,427,744.37 5,268,606.84

Total Net Position

$

37,974,035.26 $

95,955,802.49

(1) Fiscal Year 2014 balances do not reflect the effects on the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information.

Total Net Position decreased $57,981,767.23, primarily due to the implementation of GASB No. 68 and GASB No. 71.

iv

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015

Table 2 shows the change in net position for fiscal year 2015 compared to the net position in fiscal

year 2014.

Table 2

Change in Net Position

Governmental Activities

Fiscal Year

Fiscal Year

2015

2014 (1)

Revenues

Program Revenues:

Operating Grants and Contributions

$ 48,532,695.37 $ 45,934,798.81

Capital Grants and Contributions

888,463.30

242,018.90

Charges for Services and Sales

1,277,903.79

1,237,655.70

Total Program Revenues

50,699,062.46

47,414,473.41

General Revenues: Taxes Property Taxes Other Taxes Sales Taxes Special Purpose Local Option Sales Tax Other Sales Tax Grants and Contributions not Restricted to Specific Purpose Other General Revenues

18,096,597.34 18,458.37
8,654,948.30 198,016.16
2,077,556.00 1,127,906.03

15,124,278.12 15,981.54
8,406,918.66 178,887.08
3,104,050.00 1,033,238.76

Total General Revenues

30,173,482.20

27,863,354.16

Total Revenues

80,872,544.66

75,277,827.57

Program Expenses: 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 Operations of Non-Instructional Services Community Service Operations Food Services Interest on Short-Term and Long-Term Debt

49,565,220.34
2,259,077.92 3,151,438.52
967,692.90 489,608.98 4,410,392.36 428,063.73 5,650,247.45 2,582,510.54 313,269.04 250,243.47
4,800.00 4,805,889.31
46,033.33

49,561,329.51
2,273,156.85 3,258,766.53 1,027,073.50
447,244.00 4,488,239.72
402,893.43 5,450,242.88 2,647,876.92
311,012.79 265,134.87
4,800.00 4,503,087.66
48,589.79

Total Expenses

74,924,487.89

74,689,448.45

Increase in Net Position

$ 5,948,056.77 $

588,379.13

(1) Fiscal Year 2014 balances do not reflect the effects on the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information.

v

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015

Governmental Activities
Instruction comprises 66.15 percent of governmental program expenses. Interest expense comprises 0.06 percent of governmental program expenses. Interest expense was attributable to capital lease agreements.
The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements.
Table 3 Governmental Activities

Total Cost of Services

Fiscal

Fiscal

Year 2015

Year 2014 (1)

Net Cost of Services

Fiscal

Fiscal

Year 2015

Year 2014 (1)

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 Operations of Non-Instructional Services: Enterprise Operations Food Services Interest on Short-Term and Long-Term Debt

$ 49,565,220.34 $ 49,561,329.51 $ 14,880,547.04 $ 21,168,186.95

2,259,077.92 3,151,438.52
967,692.90 489,608.98 4,410,392.36 428,063.73 5,650,247.45 2,582,510.54 313,269.04 250,243.47

2,273,156.85 3,258,766.53 1,027,073.50
447,244.00 4,488,239.72
402,893.43 5,450,242.88 2,647,876.92
311,012.79 265,134.87

1,890,909.93 394,280.87 -41,112.86 -847,974.75
2,368,140.17 425,437.09
3,126,892.18 1,712,302.74
307,954.93 28,842.71

1,882,335.30 639,754.61 37,959.18 -749,817.78
2,476,197.09 344,776.06
2,118,254.68 775,866.45 147,764.47 29,580.85

4,800.00 4,805,889.31
46,033.33

4,800.00 4,503,087.66
48,589.78

4,800.00 -71,627.95 46,033.33

4,800.00 -1,649,272.61
48,589.78

Total Expenses

$ 74,924,487.89 $ 74,689,448.44 $ 24,225,425.43 $ 27,274,975.03

(1) Fiscal Year 2014 balances do not reflect the effects on the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information.
Although program revenues make up a majority of the revenues, the School District is still dependent upon tax revenues for governmental activities. 30 percent of instruction activities are supported through taxes and other general revenues; for all governmental activities general revenue support is 32.33 percent.
The School District's Funds
The School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $81,921,090.78 and expenditures and other financing uses of $82,123,180.02. The general fund had an overall increase of $363,094.94. The capital projects fund had an overall decrease of $565,184.18.

vi

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015
General Fund Budgeting Highlights
The School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund.
During the course of fiscal year 2015, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management.
For the General Fund, the final budgeted revenues of $63,861,732.14 exceeded the original budgeted amount of $61,297,747.17 by $2,563,984.97. This difference was primarily due to increases in state, federal and miscellaneous revenues. The actual revenues of $71,332,131.30 were above the final budgeted amount by $7,470,399.16.
The final budgeted expenditures of $73,407,046.62 exceeded the original budgeted amount of $61,301,174.16 by $12,105,872.46. This difference was primarily due to increases in Instruction, Improvement of Instructional Services, Maintenance and Operation Services and Other Support Services. The actual expenditures of $70,969,036.36 were under the final budgeted amount by $2,438,010.26.
General Fund revenues were $363,094.94 greater than expenditures. The School District has made a concerted effort to maintain fund balance for current operations and anticipated austerity reductions.
Capital Assets and Debt Administration
Capital Assets
At the end of fiscal year 2015, the School District had $88,093,228.50 invested in capital assets, all in governmental activities. Table 4 indicates balances at June 30, 2015.

Table 4 Capital Assets (Net of Accumulated Depreciation)

Governmental Activities

Fiscal

Fiscal

Year 2015

Year 2014

Land Land Improvements Construction in Progress Buildings and Improvements Equipment

$ 7,835,049.39 1,128,145.65 6,335,374.64
69,090,450.74 3,704,208.08

7,835,049.39 1,236,370.38 6,290,407.18 65,783,717.09 3,113,907.24

Total

$ 88,093,228.50

84,259,451.28

The primary increases occurred in Building and Improvements and Equipment as a result of the completion of numerous construction projects involving building renovations and modifications.

vii

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015

Debt Administration
At June 30, 2015, the School District had $1,246,641.40 in total debt outstanding which consisted solely of capital leases. Table 5 summarizes the School District's debt as compared to fiscal year 2014. Additional information on the School District's long-term debt can be found in the Notes to the Basic Financial Statements.

Table 5 Debt at June 30

Governmental Activities

Fiscal

Fiscal

Year 2015

Year 2014

Capital Leases

$ 1,246,641.40 $ 1,044,995.40

Current Issues

The Tift County School District has faced severe financial challenges in recent years but has remained relatively stable and financially sound. The financial challenges have included rising costs in employee benefits, historical state formula allotment reductions, new programmatic requirements, and an uncertain economy.
The School District's millage rate had remained at 14.964 mills for maintenance and operations since 2008. The School District endeavors to be responsive to taxpayer concerns over increasing millage rates and takes every step to refrain from raising taxes. However, while adopting the fiscal year 2015 general fund operating budget, the Board of Education adjusted the millage rate upwards by 3 mills to 17.964. This was necessary to offset the increases in the Board's contribution for employee benefits and to increase the staff work calendar from 184 days implemented in fiscal year 2014 to 187 days for fiscal year 2015.

Student enrollment is a factor in the State's education funding formula. According to the State's funding formula, student enrollment is converted to a "Full Time Equivalent (FTE)" count. As student enrollment and FTE increase or decrease so does State funding. The student enrollment for fiscal year 2015 and the three years prior is as follows:
Fiscal Year 2012 7,810
Fiscal Year 2013 7,906
Fiscal Year 2014 7,867
Fiscal Year 2015 7,942
The amended formula adjustment, the reduction in state funding, continued for fiscal year 2015 and the School District's portion was $3,373,379.00. Although this amount is a reduction over the prior year, any gain was partially offset by the reduction of the equalization funds received by the School District. Therefore, adjustments to school and staff work calendars along with other significant operational changes have been made.

viii

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015
In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Period. Implementation of this statement required the School District to record a charge (decrease) to the District-wide Net Position at July 1, 2014 for the School District's share of the Net Pension Liability for the pension plans administered through the Teachers' Retirement System of Georgia (TRS). Readers should understand implementation of (GASB) Statement 68 will not affect the School District's Governmental Activities Fund Statements. The Tift County School District recognizes its responsibility to the taxpayers in overseeing the spending of Federal, state and local funds. The School District is striving to maintain sound fiscal management while emphasizing student achievement. Contacting the Board's Financial Management This financial report is designed to provide our citizens, taxpayers, investors, and creditors with a general overview of the Board's finances and to show the Board's accountability for the money it receives. If you have questions about this report or need additional information, contact Mr. Klinton R. Guess at the Tift County Board of Education, PO Box 389, Tifton, Georgia 31793-0389.
ix

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TIFT COUNTY BOARD OF EDUCATION

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TIFT COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2015
ASSETS
Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Local Inventories Prepaid Items Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan
LIABILITIES
Accounts Payable Salaries and Benefits Payable Interest Payable Contracts Payable Deposits and Unearned Revenues Long-Term Liabilities
Due Within One Year Due in More Than One Year Net Pension Liability
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to Defined Benefit Pension Plan
NET POSITION
Investment in Capital Assets Restricted for
Continuation of Federal Programs Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

9,639,542.98

3,337,651.96

1,983,938.19 5,027,905.40 2,123,682.38
758.48 97,956.53
882.45 14,170,424.03 73,922,804.47

110,305,546.87

5,212,691.72

859,510.86 8,172,076.29
46,745.59 414,443.49
451.70
695,751.99 550,889.41 48,146,453.00
58,886,322.33

18,657,881.00

88,093,228.50
2,392,102.36 3,578,561.13 -56,089,856.73

$

37,974,035.26

The notes to the basic financial statements are an integral part of this statement. -1 -

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2015

GOVERNMENTAL ACTIVITIES
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 Operations of Non-Instructional Services Community Services Food Services Interest on Short-Term and Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Total General Revenues
Change in Net Position
Net Position - Beginning of Year, Restated
Net Position - End of Year

EXPENSES

CHARGES FOR SERVICES

PROGRAM REVENUES

$

49,565,220.34 $

1,115,234.16

2,259,077.92 3,151,438.52
967,692.90 489,608.98 4,410,392.36 428,063.73 5,650,247.45 2,582,510.54 313,269.04 250,243.47

62,581.00 16,323.40

4,800.00 4,805,889.31
46,033.33

83,765.23

$

74,924,487.89 $

1,277,903.79

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

EXHIBIT "B"

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

$

32,965,005.71 $

368,167.99 2,757,157.65
991,438.00 1,331,052.94 2,026,389.19
2,626.64 2,341,826.56
776,664.40 5,314.11
221,400.76

4,745,651.42

$

48,532,695.37 $

604,433.43 $
17,367.76 6,530.79
15,863.00 118,947.71
77,220.00
48,100.61
888,463.30

-14,880,547.04
-1,890,909.93 -394,280.87 41,112.86 847,974.75
-2,368,140.17 -425,437.09
-3,126,892.18 -1,712,302.74
-307,954.93 -28,842.71
-4,800.00 71,627.95 -46,033.33
-24,225,425.43

18,096,597.34 18,458.37

8,654,948.30 198,016.16
2,077,556.00 3,699.46
1,124,206.57
30,173,482.20
5,948,056.77
32,025,978.49

$

37,974,035.26

-3 -

ASSETS
Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Local Inventories Prepaid Items

TIFT COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2015
GENERAL FUND

DISTRICT-WIDE CAPITAL PROJECTS FUND

EXHIBIT "C" TOTAL

$

9,341,671.86 $

297,871.12 $

9,639,542.98

3,337,651.96

3,337,651.96

1,241,761.77 5,027,905.40 2,123,682.38
758.48 97,956.53
882.45

742,176.42

1,983,938.19 5,027,905.40 2,123,682.38
758.48 97,956.53
882.45

Total Assets

$

17,834,618.87 $

4,377,699.50 $

22,212,318.37

LIABILITIES
Accounts Payable Salaries and Benefits Payable Contracts Payable Deposits and Unearned Revenue
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - Property Taxes
FUND BALANCES
Nonspendable Restricted Assigned Unassigned
Total Fund Balances

$

543,654.21 $

8,149,983.65

451.70

8,694,089.56

315,856.65 $ 22,092.64
414,443.49
752,392.78

859,510.86 8,172,076.29
414,443.49 451.70
9,446,482.34

360,109.43

360,109.43

98,838.98 2,294,145.83
285,474.96 6,101,960.11
8,780,419.88

3,625,306.72 3,625,306.72

98,838.98 5,919,452.55
285,474.96 6,101,960.11
12,405,726.60

Total Liabilities, Deferred Inflows of Resources and Fund Balances

$

17,834,618.87 $

4,377,699.50 $

22,212,318.37

The notes to the basic financial statements are an integral part of this statement. -4 -

TIFT COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2015

Total Fund Balances - Governmental Funds (Exhibit "C")
Amounts reported for Governmental Activities in the Statement of Net Position are different because:
Capital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of:
Land Construction in Progress Land Improvements Buildings and Improvements Equipment Accumulated Depreciation
Total Capital Assets
Some liabilities, including net pension obligations, are not due and payable in the current period and, therefore, are not reported in the funds.
Net Pension Liability
Deferred Outflows and Inflows of Resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds.
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Long-Term Liabilities are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-Term Liabilities at year-end consist of:
Accrued Interest Capital Leases
Total Long-Term Liabilities
Net Position of Governmental Activities (Exhibit "A")

$

$

7,835,049.39

6,335,374.64

3,469,965.65

104,599,227.53

7,919,198.58

-42,065,587.29

$

-46,745.59

-1,246,641.40

$

EXHIBIT "D" 12,405,726.60
88,093,228.50 -48,146,453.00 -13,445,189.28
360,109.43
-1,293,386.99 37,974,035.26

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

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2015

EXHIBIT "E"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
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 Community Services Food Services Operation
Capital Outlay Debt Services
Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Capital Leases
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

GENERAL FUND

DISTRICT-WIDE CAPITAL PROJECTS FUND

TOTAL

$

17,933,879.09

198,016.16 $

39,540,891.33

11,257,023.10

1,277,903.79

211.26

1,124,206.57

71,332,131.30

$ 8,654,948.30
787,380.30
3,488.20
9,445,816.80

17,933,879.09 8,852,964.46
40,328,271.63 11,257,023.10
1,277,903.79 3,699.46
1,124,206.57
80,777,948.10

46,970,158.75
2,352,371.37 3,272,037.99
894,623.44 481,509.34 4,544,432.51 448,537.92 4,540,182.19 2,088,771.16 330,771.50 252,815.47
4,800.00 4,788,024.72
70,969,036.36
363,094.94

3,379,685.14
56,845.38
873,660.09 216,863.53
5,686,638.23 895,761.51 44,689.78
11,154,143.66 -1,708,326.86

50,349,843.89
2,352,371.37 3,272,037.99
951,468.82 481,509.34 4,544,432.51 448,537.92 5,413,842.28 2,305,634.69 330,771.50 252,815.47
4,800.00 4,788,024.72 5,686,638.23
895,761.51 44,689.78
82,123,180.02
-1,345,231.92

363,094.94 8,417,324.94

1,143,142.68
-565,184.18 4,190,490.90

1,143,142.68
-202,089.24 12,607,815.84

$

8,780,419.88 $

3,625,306.72 $

12,405,726.60

The notes to the basic financial statements are an integral part of this statement. -6 -

TIFT COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES T0 THE STATEMENT OF ACTIVITIES JUNE 30, 2015

EXHIBIT "F"

Total Net Change in Fund Balances - Governmental Funds (Exhibit "E")
Amounts reported for Governmental Activities in the Statement of Activities are different because:
Capital Outlays are reported as expenditures in Governmental Funds. However, in the Statement of Activities, the cost of Capital Assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are:
Capital Outlay Depreciation Expense
Excess of Capital Outlay over Depreciation Expense
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
Some of the Capital Assets acquired this year were financed with capital leases. In Governmental Funds, a capital lease arrangement is considered a source of financing, but in the Statement of Net Position, the lease obligation is reported as a Long-Term Liability.
Repayment of Long-Term Debt is reported as an expenditure in Governmental Funds, but the repayment reduces Long-Term Liabilities in the Statement of Net Position. In the current year, these amounts consist of:
Capital Lease Payments Capital Lease Trade-Ins
Total Long-Term Debt Repayments
Some items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in Governmental Funds. The net effect of these adjustments are:
Accrued Interest Pension Expense
Total Additional Expenditures
Change in Net Position of Governmental Activities (Exhibit "B")

$

-202,089.24

$

5,802,235.23

-1,968,458.01

3,833,777.22 181,176.62

-1,143,142.68

$

895,761.51

45,735.17

941,496.68

$

-1,343.55

2,338,181.72

2,336,838.17

$

5,948,056.77

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

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS JUNE 30, 2015
ASSETS Cash and Cash Equivalents
LIABILITIES Funds Held for Others

EXHIBIT "G"

AGENCY FUNDS

$

79,227.47

$

79,227.47

The notes to the basic financial statements are an integral part of this statement. - 8 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The Tift County Board of Education (School District) 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 School District is a primary government and consists of all the organizations that compose its legal entity.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the District-wide financial statements, fund financial statements and notes to the basic financial statements of the Tift County Board of Education.
District-wide Statements:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements:
The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements for each category (governmental and fiduciary) are presented. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
General Fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
District-wide Capital Projects Fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned to the expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets.
The School District reports the following fiduciary fund type:
Agency funds account for assets held by the School District as an agent for various funds, governments or individuals.

- 9 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The District-wide governmental and fiduciary financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds 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.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt and claims and judgments, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources.
The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, both restricted and unrestricted resources are available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
RESTATEMENT OF PRIOR YEAR NET POSITION
For fiscal year 2015, the School District made several prior period adjustments due to the adoption of GASB Statement No. 68 and GASB Statement No. 71, as described in "New Accounting Pronouncements" below, which require the restatement of the June 30, 2014, Net Position in Governmental Activities. The result is a decrease in Net Position at July 1, 2014 of $63,929,824.00. This change is in accordance with generally accepted accounting principles.

Net Position, July 1, 2014, as previously reported Prior Period adjustment - Implementation of GASB 68: Net Pension Liability (measurement date) TRS Deferred Outflows - School District's contribution made during fiscal year 2014 TRS
Net Position, July 1, 2014, as restated

$ 95,955,802.49 -68,704,211.00
4,774,387.00 $ 32,025,978.49

- 10 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

NEW ACCOUNTING PRONOUNCEMENTS
In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions. The provisions of this statement establish accounting and financial reporting standards for pensions that are provided to the employees of state and local governmental employers through pension plans that are administered through trusts. The adoption of this statement has a significant impact on the School District's financial statements. As noted above, the School District restated beginning Net Position for the cumulative effect of this accounting change.
In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 69, Government Combinations and Disposals of Government Operations. This statement provides specific accounting and financial reporting guidance for combinations in the governmental environment. This statement also requires that disclosures be made by governments about combination arrangements in which they engage and for disposals of government operations. The School District did not have any activities of this type during the fiscal year and the adoption of this statement does not have a significant impact on the School District's financial statements.
In fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement 71, Pension Transition for Contributions Made Subsequent to the Measurement Date - an amendment of GASB No. 68. The objective of this statement is to improve accounting and financial reporting by addressing an issue in Statement No. 68, Accounting and Financial Reporting for Pensions, concerning transition provisions related to certain pension contributions made to defined benefit pension plans prior to implementation of statement. This statement amends paragraph 137 of Statement No. 68 which limited recognition of pension-related deferred inflows of resources at the transition to circumstances in which it is practical to determine the amounts of all deferred outflows of resources and deferred inflows of resources related to pensions. The adoption of this statement has a significant impact on the School District's financial statements. As noted above, the School District restated beginning Net Position for the cumulative effect of this accounting change.
CASH AND CASH EQUIVALENTS
Composition of Deposits
Cash and cash equivalents consist of cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated Section 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
INVESTMENTS
Composition of Investments
Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
1. Obligations issued by the State of Georgia or by other states,
2. Obligations issued by the United States government,
3. Obligations fully insured or guaranteed by the United States government or a United States government agency,
- 11 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

4. Obligations of any corporation of the United States government,
5. Prime banker's acceptances,
6. The local government investment pool (Georgia Fund 1) administered by the State of Georgia, Office of the State Treasurer,
7. Repurchase agreements, and
8. Obligations of other political subdivisions of the State of Georgia.
The School District does not have a formal policy regarding investment policies that address credit risks, custodial credit risks, concentration of credit risks, interest rate risks or foreign currency risks.
RECEIVABLES
Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
PROPERTY TAXES
The Tift County Board of Commissioners adopted the property tax levy for the 2014 tax digest year (calendar year) on August 11, 2014 (levy date). Taxes were due on November 15, 2014 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2014 tax digest are reported as revenue in the governmental funds for fiscal year 2015. The Tift County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2015, for maintenance and operations amounted to $16,732,382.92.
The tax millage rate levied for the 2014 tax year (calendar year) for the Tift County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

17.964 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $1,183,037.80 during fiscal year ended June 30, 2015.
SALES TAXES
Education Special Purpose Local Option Sales Tax, at the fund reporting level, during the year amounted to $8,654,948.30 and is to be used for capital outlay for educational purposes. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.

- 12 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

INVENTORIES

Food Inventories
On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their federally assigned value and purchased foods inventories are reported at cost (first-in first-out). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.

PREPAID ITEMS
Payments made to vendors for services that will benefit periods subsequent to June 30, 2015, are recorded as prepaid items.

CAPITAL ASSETS
Capital assets purchased, including capital outlay costs, are recorded as expenditures in the fund financial statements at the time of purchase (including ancillary charges). On the District-wide financial statements, all purchased capital assets are valued at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at estimated fair market value on the date donated. Disposals are deleted at depreciated recorded cost. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. Depreciation is computed using the straight-line method. The School District does not capitalize book collections or works of art. During the fiscal year under review, no events or changes in circumstances affecting a capital asset that may indicate impairment were known to the School District.

Capitalization thresholds and estimated useful lives of capital assets reported in the District-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land

Any Amount

Land Improvements

$

50,000.00

Buildings and Improvements $

100,000.00

Equipment

$

20,000.00

Intangible Assets

$

500,000.00

N/A 20 years
25 to 80 years 5 to 20 years
10 to 20 years

Depreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives, with the exception of intangible assets which are amortized.
Amortization of intangible assets such as water, timber, and mineral rights, easements, patents, trademarks, copyrights and software is computed using the straight-line method over the estimated useful lives of the assets.
DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of net position and/or the balance sheet will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. Under the full accrual method of accounting, the School District has reported deferred outflows of resources related to a defined benefit pension plan, as discussed in Note 13 Retirement Plans.
- 13 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

In addition to liabilities, the statement of net position and/or the balance sheet will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. Under the full accrual method of accounting, the School District has reported deferred inflows of resources related to a defined benefit pension plan, as discussed in Note 13 Retirement Plans. This item is reported only in the District-wide Statement of Net Position. Additionally, the School District has one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from property taxes and grants, and these amounts are deferred and will be recognized as an inflow of resources in the period in which the amounts become available.
PENSIONS
For purposes of measuring the Net Pension Liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Teachers' Retirement System of Georgia (TRS) and the Public School Employees Retirement System (PSERS) and additions to/deductions from TRS/PSERS's fiduciary net position have been determined on the same basis as they are reported by TRS/PSERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. See Note 13 - Retirement Plans.
NET POSITION
The School District's Net Position in the District-wide Statements is classified as follows:
Net Investment in Capital Assets - This represents the School District's total investment in capital assets, net of outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of Net Investment in Capital Assets.
Restricted Net Position - This represents resources for which the School District is legally or contractually obligated to spend resources for continuation of Federal Programs and capital projects in accordance with restrictions imposed by external third parties.
Unrestricted Net Position - Unrestricted Net Position is the net amount of the assets, deferred outflows of resources, liabilities and deferred inflows of resources that are not included in the determination of Net Investment of Capital Assets and Restricted Net Position. Included in the net deficit reported is the School District's Net Pension Liability of $48,146,453.00 which is required for financial reporting.
FUND BALANCES
The School District's fund balances are classified as follows:
Nonspendable Amounts that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.
Restricted Constraints are placed on the use of resources are either (1) externally imposed conditions by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed Amounts that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board of Education. The Board of Education is the School District's highest level of decision-making authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.

- 14 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

Assigned Amounts that are constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board of Education or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

Unassigned The residual classification for the General Fund. This classification represents fund balances that have not been assigned to other funds and that have not been restricted, committed, or assigned to specific purposes within the General Fund.

Fund Balances of the Governmental Funds at June 30, 2015, are as follows:

Nonspendable Inventories Prepaid Assets
Restricted Continuation of Federal Programs Capital Projects
Assigned School Activity Accounts
Unassigned

$

97,956.53

882.45 $

98,838.98

$ 2,294,145.83 3,625,306.72

5,919,452.55

285,474.96 6,101,960.11

Fund Balance, June 30, 2015

$ 12,405,726.60

It is the goal of the School District to achieve and maintain a committed, assigned, and unassigned fund balance in the general fund at fiscal year end of not less than 8% of expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, in compliance with Official Code of Georgia Annotated Section 20-2-167(a)5. If the unassigned fund balance at fiscal year end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance.
When multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds.
USE OF ESTIMATES
The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general fund. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the General Fund was prepared in accordance with accounting principles generally accepted in the United States of America.
The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of Official Code of Georgia Annotated 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.
See Schedule 4 General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS
Official Code of Georgia Annotated (O.C.G.A.) 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 of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. Section 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110 percent of the daily pool balance.
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 of the State of Georgia, and

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

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 or securities guaranteed 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
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2015, the School District had deposits with a carrying amount of $9,718,770.45, and a bank balance of $12,650,485.63. The bank balances insured by Federal depository insurance were $671,688.60, and the bank balances collateralized with securities held by the pledging institution or by the pledging financial institution's trust department or agent in the School District's name were $11,978,797.03.
CATEGORIZATION OF INVESTMENTS
At June 30, 2015, the carrying value of the School District's total investments was $3,337,651.96, which is materially the same as fair value. This investment consisted entirely of funds invested in the Georgia Fund 1 (local government investment pool) administered by the State of Georgia, Office of the State Treasurer which is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1 (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at http://www.audits.ga.gov/SGD/cafr.html.
The Primary Liquidity Portfolio consists of Georgia Fund 1 which is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2015, was 56 days.
NOTE 5: NON-MONETARY TRANSACTIONS
The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 2 - Inventories.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

NOTE 6: CAPITAL ASSETS
The following is a summary of changes in the Capital Assets during the fiscal year:

Balances July 1, 2014

Increases

Decreases

Balances June 30, 2015

Governmental Activities Capital Assets, Not Being Depreciated:
Land Construction in Progress

$ 7,835,049.39

$ 7,835,049.39

6,290,407.18 $ 5,243,015.57 $ 5,198,048.11

6,335,374.64

Total Capital Assets, Not Being Depreciated

14,125,456.57

5,243,015.57

5,198,048.11

14,170,424.03

Capital Assets, Being Depreciated: Buildings and Improvements Equipment Land Improvements
Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements

99,884,921.38 6,876,236.96 3,469,965.65

4,714,306.15 1,042,961.62

34,101,204.29 3,762,329.72 2,233,595.27

1,407,572.50 452,660.78 108,224.73

0.00

104,599,227.53 7,919,198.58 3,469,965.65

35,508,776.79 4,214,990.50 2,341,820.00

Total Capital Assets, Being Depreciated, Net

70,133,994.71

3,788,809.76

0.00

73,922,804.47

Governmental Activity Capital Assets - Net

$ 84,259,451.28 $ 9,031,825.33 $ 5,198,048.11 $ 88,093,228.50

Current year depreciation expense by function is as follows:

Instruction

Support Services

Educational Media Services

$

General Administration

School Administration

Maintenance and Operation of Plant

Student Transportation Services

Food Services

43,419.57 16,327.03 39,657.65 297,370.37 309,934.02

$ 1,141,497.41
706,708.64 120,251.96

$ 1,968,458.01

NOTE 7: RISK MANAGEMENT
The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; acts of God and unemployment compensation.
The School District has obtained commercial insurance for risk of loss associated with torts, assets, and errors or omissions. The School District has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three years.
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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

The School District has elected to self-insure for all losses related to acts of God. The School District has not experienced any losses related to this risk in the past three years.
The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the same fund that the employees' salaries and benefits were paid. Claims are accounted for with expenditures 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:

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

2014 $ 2015 $

170.00 $ 4,410.00 $

6,218.00 $ 2,155.00 $

1,978.00 $ 5,980.00 $

4,410.00 585.00

The School District 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 of workers' compensation self-insurance for its member organizations. The School District pays an annual premium to the Trust for its general worker's compensation insurance coverage. Specific excess of loss insurance coverage is provided through an agreement by the Trust with the Safety National Casualty Company to provide coverage for potential losses sustained by the Trust in excess of $1.0 million loss per occurrence, up to the statutory limit. Employers' Liability insurance coverage is also provided with limits of $2.0 million. The Trust covers the first $1.0 million of each Employers liability claim with Safety National providing additional Employers Liability limits up to a $2.0 million per occurrence maximum. Safety National Casualty Company also provides $2.0 million in aggregate coverage to the Trust, attaching at 110% of the loss fund and based on the Fund's annual normal premium.

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

Position Covered

Amount

Superintendent Bookkeeper Director of Finance High School Principal

$

100,000.00

$

100,000.00

$

100,000.00

$

100,000.00

NOTE 8: LONG-TERM LIABILITIES
CAPITAL LEASES
The Tift County Board of Education entered into various lease agreements for computer equipment. These lease agreements qualify as capital leases for accounting purposes, and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

The changes in Long-Term Liabilities during the fiscal year ended June 30, 2015, were as follows:

Balance July 1, 2014

Additions

Governmental Activities

Balance

Deductions

June 30, 2015

Due Within One Year

Capital Leases

$ 1,044,995.40 $ 1,143,142.68 $ 941,496.68 $ 1,246,641.40 $ 695,751.99

At June 30, 2015, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30:

Capital Leases

Principal

Interest

2016 2017 2018

$

695,751.99 $

463,541.61

87,347.80

50,517.51 21,655.99
3,317.48

Total Principal and Interest

$

1,246,641.40 $

75,490.98

NOTE 9: ON-BEHALF PAYMENTS
The School District has recognized revenues and costs in the amount of $188,290.06 for retirement contributions paid on the School District's behalf by the following State Agencies.

Georgia Department of Education Paid to the Teachers' Retirement System of Georgia For Teachers' Retirement System (TRS) Employer's Cost In the amount of $82,999.06

Office of the State Treasurer Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $105,291.00

Funds paid on behalf of the School District are reported in governmental funds. See Note 13 Retirement Plans for the State support related to the Net Pension Liability.

NOTE 10: SIGNIFICANT COMMITMENTS
The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2015, together with funding available:

Project

Unearned Executed Contracts

Funding Available From State

Matt Wilson, RMA

$

Charles Spencer, RMA

GO Bailey, RMA

$

221,465.36 $ 94,875.00 24,150.00
340,490.36 $

87,486.70 87,486.70

The amounts described in this note are not reflected in the basic financial statements.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

NOTE 11: SIGNIFICANT 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 costs which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the basic financial statements.
NOTE 12: POST-EMPLOYMENT BENEFITS
GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND
Plan Description. The Georgia School Personnel Post-employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees' Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). The Department of Community Health, which includes the School OPEB Fund, issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.
Funding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012, pay approximately 25 percent of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State provides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy.
Participating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all benefits due under the health insurance plans for both active and retired employees based on projected "payas-you-go" financing requirements. Contributions are not based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

The combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2015:

For certificated teachers, librarians and regional educational service agencies and certain other eligible participants:

July 1, 2014 June 30, 2015

$945.00 per member per month

For non-certificated school personnel:

July 1, 2014 June 30, 2015

$596.20 per member per month

No additional contribution was required by the Board for fiscal year 2015 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation.

The School District's combined active and retiree contributions to the health insurance plans, which equaled the required contribution, for the current fiscal year and the preceding two fiscal years were as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2015 2014 2013

100% 100% 100%

$ 8,059,507.39 $ 8,051,626.69 $ 7,546,949.55

NOTE 13: RETIREMENT PLANS
Tift County Board of Education participates in various retirement plans administered by the State of Georgia, as further explained below.
TEACHERS' RETIREMENT SYSTEM OF GEORGIA (TRS)
Plan Description: All teachers of the School District as defined in 47-3-60 of the Official Code of Georgia Annotated (O.C.G.A.) and certain other support personnel as defined by 47-3-63 are provided pension through the Teachers' Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers' Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications.
Benefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2015. The School District's contractually required contribution rate for the year ended June 30, 2015 was 13.15% of annual school district payroll. Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2015 2014 2013

100% 100% 100%

$ 5,309,453.15 $ 4,861,305.59 $ 4,620,099.01

PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS)
Plan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs.
Benefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension
At June 30, 2015, the School District reported a liability of $48,146,453.00 for its proportionate share of the Net Pension Liability for TRS.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

The TRS Net Pension Liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the Net Pension Liability, the related State of Georgia support, and the total portion of the Net Pension Liability that was associated with the School District were as follows:

School District's proportionate share of the Net Pension Liability State of Georgia's proportionate share of the Net Pension Liability
associated with the School District
Total

$ 48,146,453.00 879,178.00
$ 49,025,631.00

The Net Pension Liability was measured as of June 30, 2014. The total pension liability used to calculate the Net Pension Liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The School District's proportion of the Net Pension Liability was based on contributions to TRS during the fiscal year ended June 30, 2014.
At June 30, 2014, the School District's TRS proportion was 0.381096%, which was a decrease of 0.013192% from its proportion measured as of June 30, 2013.
At June 30, 2015, the School District did not have a PSERS liability for a proportionate share of the Net Pension Liability because of a Special Funding Situation with the State of Georgia, which is responsible for the Net Pension Liability of the plan. The amount of the State's proportionate share of the Net Pension Liability associated with the School District is $413,355.00.
The PSERS Net Pension Liability was measured as of June 30, 2014. The total pension liability used to calculate the Net Pension Liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The State's proportion of the Net Pension Liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2014.
For the year ended June 30, 2015, the School District recognized pension expense of $2,874,510.00 for TRS and $35,897.00 for PSERS and revenue of $65,813.00 for TRS and $35,897.00 for PSERS were recognized. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

At June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources:

TRS

Deferred Outflows of

Deferred Inflows of

Resources

Resources

Net difference between projected and actual earnings on pension plan investments

Changes in proportion and differences between School District contributions and proportionate share of contributions

School District contributions subsequent to the

measurement date

$

Total

$

$ 16,784,874.00
1,873,007.00 5,212,691.72 5,212,691.72 $ 18,657,881.00

Tift County Board of Education contributions subsequent to the measurement date of June 30, 2014 for TRS are reported as deferred outflows of resources and will be recognized as a reduction of the Net Pension Liability in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2016 2017 2018 2019 2020

$ -4,621,901.00 $ -4,621,901.00 $ -4,621,901.00 $ -4,621,905.00 $ -170,273.00

Actuarial assumptions: The total pension liability as of June 30, 2014 was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers' Retirement System: Inflation Salary increases Investment rate of return

3.00%

3.75% 7.00% average, including inflation

7.50%

net of pension plan investment

expense, including inflation

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females set back two years for males and set back three years for females.
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

Public School Employees Retirement System:

Inflation Salary increases Investment rate of return

3.00%
N/A 7.50% net of pension plan investment expense, including inflation

Mortality rates were based on the RP-2000 Combined Mortality Table set forward one year for males for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females for the period after disability retirement.

The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.

The long-term expected rate of return on TRS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Total
* Rates shown are net of the 3.00% assumed rate of inflation

Target allocation
30.00% 39.70%
3.70% 1.60% 18.90% 6.10%
100.00%

Long-term expected real rate of return*
3.00% 6.50% 10.00% 13.00% 6.50% 11.00%

Discount rate: The discount rate used to measure the total TRS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2015

EXHIBIT "H"

Sensitivity of the Tift County Board of Education's proportionate share of the Net Pension Liability to changes in the discount rate: The following presents the School District's proportionate share of the Net Pension Liability calculated using the discount rate of 7.50%, as well as what the School District's proportionate share of the Net Pension Liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate:

Teachers' Retirement System:

1% Decrease (6.5%)

Current discount rate (7.50%)

1% Increase (8.50%)

School District's proportionate share of the Net Pension Liability

$ 88,727,453.00 $

48,146,453.00 $ 14,728,842.00

Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publically available at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs.

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TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30, 2015

SCHEDULE "1"

School District's proportion of the net pension liability School District's proportionate share of the net pension liability State of Georgia's proportionate share of the net pension liability
associated with the School District Total
School District's covered-employee payroll School District's proportionate share of the net pension liability
as a percentage of its covered employee payroll Plan fiduciary net position as a percentage of the total pension liability

2015 0.381096% $ 48,146,453.00
879,178.00 $ 49,025,631.00 $ 39,587,179.13
121.62% 84.03%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available. Schedule includes all significant plans and funds administered by Tift County Board of Education.
-29 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIRMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

Contractually required contribution Contributions in relation to the contractually required contribution Contribution deficiency (excess) School District's covered-employee payroll Contributions as a percentage of covered-employee payroll

2015

$ 5,309,453.15 $

$ 5,309,453.15 $

$

0.00 $

$ 40,376,069.47 $

13.15%

2014 4,861,305.59 4,861,305.59
0.00 39,587,179.13
12.28%

This schedule is intended to show information for 10 years. Due to the retention policy of the Tift County Board of Education, the School District could only provide 6 years. Additional years will be displayed as they become available.
-30 -

SCHEDULE "2"

2013

2012

2011

2010

$ 4,620,099.01 $ 4,203,138.09 $ 4,211,329.03 $ 3,983,474.55

$ 4,620,009.01 $ 4,203,138.09 $ 4,211,329.03 $ 3,983,474.55

$

0.00 $

0.00 $

0.00 $

0.00

$ 40,491,665.36 $ 40,886,563.75 $ 40,966,254.39 $ 40,898,042.99

11.41%

10.28%

10.28%

9.74%

-31 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2015

SCHEDULE "3"

Teachers' Retirement System
Changes of assumptions : In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
Method and assumptions used in calculations of actuarially determined contributions : The actuarially determined contribution rates in the schedule of contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2015 reported in that schedule:

Valuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation rate Salary increases Investment rate of return

June 30, 2012 Entry age Level percentage of payroll, open 30 years Seven-year smoothed market 3.00% 3.75 7.00%, including inflation 7.50%, net of pension plan investment
expense, including inflation

-32 -

TIFT COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2015

SCHEDULE "4"

REVENUES
Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
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 Enterprise Operations Food Services Operations
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Other Sources Other Uses
Total Other Financing Sources (Uses)
Net Change in Fund Balance
Fund Balances - Beginning
Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL

FINAL

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$

18,184,222.00 $

18,184,222.00 $

17,933,879.09 $

-250,342.91

175,000.00

175,000.00

198,016.16

23,016.16

37,533,092.00

38,966,715.50

39,540,891.33

574,175.83

4,425,998.22

4,604,967.22

11,257,023.10

6,652,055.88

395,834.95

462,031.01

1,277,903.79

815,872.78

3,000.00

3,157.56

211.26

-2,946.30

580,600.00

1,465,638.85

1,124,206.57

-341,432.28

61,297,747.17

63,861,732.14

71,332,131.30

7,470,399.16

40,708,621.86
2,029,341.00 858,959.91 935,748.00 472,709.00
4,480,020.00 459,055.00
3,829,732.00 2,135,493.00
299,262.00 30,200.00 4,800.00
5,057,232.39
61,301,174.16
-3,426.99

48,235,264.86
2,404,051.36 3,647,386.99
894,623.44 632,249.72 4,544,432.51 448,537.92 4,540,182.19 2,243,856.47 334,467.50 347,510.28
4,800.00 5,129,683.38
73,407,046.62
-9,545,314.48

46,970,158.75
2,352,371.37 3,272,037.99
894,623.44 481,509.34 4,544,432.51 448,537.92 4,540,182.19 2,088,771.16 330,771.50 252,815.47
4,800.00 4,788,024.72
70,969,036.36
363,094.94

1,265,106.11
51,679.99 375,349.00
0.00 150,740.38
0.00 0.00 0.00 155,085.31 3,696.00 94,694.81 0.00 341,658.66
2,438,010.26
9,908,409.42

140,000.00 -140,000.00
0.00 -3,426.99 8,417,324.94 37,985.55

526,187.22 -511,246.82
14,940.40 -9,530,374.08 8,417,324.94
-31,337.25

363,094.94 8,417,324.94

-526,187.22 511,246.82 -14,940.40 9,893,469.02
0.00 31,337.25

Fund Balances - Ending

$

8,451,883.50 $

-1,144,386.39 $

8,780,419.88 $

9,924,806.27

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements. -33 -

TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2015

SCHEDULE "5"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program
Total Child Nutrition Cluster
Pass-Through From Georgia Department of Education Food Services Child Nutrition Discretionary Grants Limited Availability Farm to School
Total U. S. Department of Agriculture
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants
Total Special Education Cluster

CFDA NUMBER
* 10.553 * 10.555
10.579 10.575
* 84.027 * 84.173

Other Programs Pass-Through From Georgia Department of Education ARRA - Race-to-the-Top Incentive Grant Career and Technical Education - Basic Grants to States English Language Acquisition Grants Improving Teacher Quality State Grants Migrant Education - State Grant Program Rural Education Title 1 Grants to Local Educational Agencies
Total Other Programs
Total U. S. Department of Education

84.395 84.048 84.365 84.367 84.011 84.358 84.010

Health and Human Services, U.S. Department of Child Care and Development Fund Cluster Pass-Through From Bright From the Start Georgia Department of Early Care and Learning ARRA - Child Care and Development Block Grant
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

93.575

Total Expenditures of Federal Awards N/A = Not Available

Notes to the Schedule of Expenditures of Federal Awards
(1) Includes the Federally assigned value of donated commodities for the Food Donation Program in the amount of $156,145.06.
(2) Expenditures for the funds earned on the School Breakfast Program ($1,173,798.75) were not maintained separately and are included in the 2015 National School Lunch Program.
Major Programs are identified by an asterisk (*) in front of the CFDA number.
The School District did not provide Federal Assistance to any Subrecipient.
The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Tift 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 fund financial statements.

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

N/A

N/A

$

(2) 4,571,719.66 (1)
4,571,719.66

N/A

12,617.00

N/A

5,900.80

4,590,237.46

N/A

1,473,988.29

N/A

75,474.00

1,549,462.29

N/A

2,871.91

N/A

97,467.82

N/A

117,709.80

N/A

350,222.83

N/A

216,403.48

N/A

138,177.04

N/A

4,067,928.48

4,990,781.36

6,540,243.65

N/A

67,233.79

58,803.95

$

11,256,518.85

See notes to the basic financial statements.

- 34 -

TIFT COUNTY COUNT OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2015

SCHEDULE "6"

AGENCY/FUNDING
GRANTS Bright from the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program
Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category III Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program English For Speakers of Other Languages ( ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Amended Formula Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Education Equalization Funding Grant Other State Programs Classroom Connections Grant Food Services Math and Science Supplements Preschool Handicapped Program Pupil Transportation - State Bonds Teacher of the Year Teachers Retirement Vocational Education Vocational Supervisors
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Office of State Treasurer Public School Employees Retirement

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$

1,181,707.87

$

1,181,707.87

2,194,029.00 645,332.00
6,020,790.00 705,028.00
2,250,051.00 888,324.00
4,343,395.00 3,635,684.00 1,330,569.00
475,034.00 478,566.00 2,529,426.00 953,464.00 502,255.00 2,778,825.00 930,509.00 307,484.00 855,900.00 909,259.00 249,752.00 150,167.00
3,175.00
1,017,679.00 1,695,720.00 1,998,678.00 -3,373,379.00
660,895.00 146,006.00 2,077,556.00
173,724.00 115,782.00
72,532.63 186,770.00
77,220.00 1,014.25
82,999.06 157,541.52
26,136.00

2,194,029.00 645,332.00
6,020,790.00 705,028.00
2,250,051.00 888,324.00
4,343,395.00 3,635,684.00 1,330,569.00
475,034.00 478,566.00 2,529,426.00 953,464.00 502,255.00 2,778,825.00 930,509.00 307,484.00 855,900.00 909,259.00 249,752.00 150,167.00
3,175.00
1,017,679.00 1,695,720.00 1,998,678.00 -3,373,379.00
660,895.00 146,006.00 2,077,556.00
173,724.00 115,782.00
72,532.63 186,770.00
77,220.00 1,014.25
82,999.06 157,541.52
26,136.00

$ 105,291.00

787,380.30

787,380.30 105,291.00

$

39,540,891.33 $

787,380.30 $

40,328,271.63

See notes to the basic financial statements. -35 -

TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2015

SCHEDULE "7"

PROJECT SPLOST III 2007 The cost of funding the constructing, equipping, and furnishing a new alternative school; adding to, renovating, repairing, improving, and equipping existing educational facilities, including but not limited to school buildings and facilities, physical education/athletic buildings and facilities, support facilities, and other facilities deemed necessary for efficient and effective school operations; purchasing or acquiring miscellaneous new equipment, fixtures and furnishings for the School System to include but not be limited to instructional and administrative technology equipment and software, textbooks, library books, athletic equipment, band and musical instruments, and other instructional materials; acquiring or purchasing any real or personal property and equipment deemed necessary for schools or School System purposes and operations; purchasing school vehicles, to include school buses, School System motor vehicles, and equipment; and repairing and upgrading school buses, School System motor vehicles, and equipment.
$
SPLOST IV 2012 (a) Constructing school buildings or facilities necessary to accommodate future population growth and mandated minimum class size
(b) Adding to, renovating, repairing, expanding, improving, and equipping existing educational facilities, including but not limited to Tift County High School, its Northeast Campus and Eighth Street Middle School, physical education/athletic buildings and facilities, support facilities, and other facilities necessary for efficient and effective school operations
(c) Purchasing or acquiring miscellaneous new equipment, fixtures and furnishings for the School System to include but not be limited to instructional and administrative technology equipment and software, textbooks, library books, physical education equipment, band and musical instruments, and other instructional materials
(d) Acquiring or purchasing any real or personal property and equipment necessary for schools or School System purposes and operations
(e) Purchasing school vehicles, to include school buses, School System motor vehicles, and equipment
(f) Repairing and upgrading school buses, School System motor vehicles, and equipment.
(g) Paying all expenses incident to the planning and accomplishing of the foregoing.

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

TOTAL COMPLETION
COST

EXCESS PROCEEDS NOT
EXPENDED

44,000,000.00 $ 46,574,856.36 $ 203,783.42 $ 46,371,072.94 $ 46,574,856.36 $

0.00

10,000,000.00

10,000,000.00

0.00

345,283.72

0.00

0.00

16,600,000.00

16,600,000.00

5,596,998.19

4,711,890.27

17,500,000.00

17,500,000.00

2,999,985.71

7,410,937.00

1,200,000.00 1,550,000.00 1,100,000.00
50,000.00 48,000,000.00

1,200,000.00 1,550,000.00 1,100,000.00
263,291.99 48,213,291.99

804,987.86

349,619.36

151,715.31 211,461.13 119,289.36 9,884,437.56

414,297.46 520,316.55 144,002.63 13,896,346.99

0.00

0.00

ESTIMATED COMPLETION
DATE
Completed 6/30/2017
6/30/2017
6/30/2017 6/30/2017 6/30/2017 6/30/2017 6/30/2017

$ 92,000,000.00 $ 94,788,148.35 $ 10,088,220.98 $ 60,267,419.93 $ 46,574,856.36 $

0.00

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

See Notes to the basic financial statements. -36 -

TIFT COUNTY BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)
ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2015

SCHEDULE "8"

DESCRIPTION
Direct Instructional Programs Kindergarten Program Kindergarten Program-Early Intervention Program Primary Grades (1-3) Program Primary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Early Intervention (4-5) Program Middle Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Category I Category II Category III Category IV Category V Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL)
TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Media Center Program Staff and Professional Development

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)(2)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

$ 2,494,655.00 $ 829,380.00
6,981,448.00 839,241.00
2,631,955.00

1,554,023.34 1,408,372.85 4,296,774.79 $ 4,081,921.54 2,641,575.06

1,011,115.00 5,109,921.00 4,179,445.00 1,546,724.00 5,681,122.00
3,021,367.00 1,084,047.00
358,556.00 1,055,078.00

916,312.67 35.22
6,052,357.26 5,181,668.50 1,591,839.52
139,765.79 667,106.13 2,972,165.03 737,857.57 345,285.29 3,221,354.23 821,339.47 852,746.25 802,003.15

36,824,054.00

38,284,503.66

990,780.00 173,744.00

894,623.44 67,822.91

$ 16,752.53
1,333.15
22,814.67 28,314.87 26,373.55
3,611.61 99,200.38 97,710.33

1,554,023.34 1,408,372.85 4,313,527.32 4,081,921.54 2,642,908.21
916,312.67 35.22
6,075,171.93 5,209,983.37 1,618,213.07
139,765.79 667,106.13 2,972,165.03 737,857.57 345,285.29 3,221,354.23 821,339.47 856,357.86 802,003.15
38,383,704.04
894,623.44 165,533.24

TOTAL QBE FORMULA FUNDS

$ 37,988,578.00 $ 39,246,950.01 $ 196,910.71 $

39,443,860.72

(1) Comprised of State Funds plus Local Five Mill Share. (2) Allotments do not include the impact of the State amended formula adjustment.

See notes to the basic financial statements. -37 -

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SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

(This page left intentionally blank)

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
July 29, 2016

Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Tift County Board of Education
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited, 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 Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Tift County Board of Education as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise Tift County Board of Education's basic financial statements, and have issued our report thereon dated July 29, 2016.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered Tift County Board of Education's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Tift County Board of Education's internal control. Accordingly, we do not express an opinion on the effectiveness of the Tift County Board of Education's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

2015YB-30

(This page left intentionally blank)

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. We did identify a certain deficiency in internal control, described in the accompanying Schedule of Findings and Questioned Costs as item FS 2015-001, that we consider to be a significant deficiency.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Tift County Board of Education's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
We noted certain matters that we have reported to management of Tift County Board of Education in a separate letter dated July 29, 2016.
Tift County Board of Education's Response to Findings
Tift County Board of Education's response to the finding identified in our audit is described in the accompanying Schedule of Findings and Questioned Costs. Tift County Board of Education's response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,

GSG:er 2015YB-30

Greg S. Griffin State Auditor

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Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
July 29, 2016

Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Tift County Board of Education
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133
Ladies and Gentlemen:
Report on Compliance for Each Major Federal Program
We have audited Tift County Board of Education's compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. Tift County Board of Education's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs.
Management's Responsibility
Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of Tift County Board of Education's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, 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 Tift 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 on compliance for each major federal program. However, our audit does not provide a legal determination of Tift County Board of Education's compliance.
2015SA-10

(This page left intentionally blank)

Opinion on Each Major Federal Program
In our opinion, the Tift County Board of Education complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015.
Report on Internal Control over Compliance
Management of Tift County Board of Education is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Tift County Board of Education's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Tift County Board of Education's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose.
Respectfully submitted,

GSG:er 2015SA-10

Greg S. Griffin State Auditor

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

(This page left intentionally blank)

TIFT COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2015
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.

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SECTION IV FINDINGS AND QUESTIONED COSTS

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TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2015

I SUMMARY OF AUDITOR'S RESULTS

Financial Statements

Type of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Aggregate Remaining Fund Information

Unmodified

Internal control over financial reporting:

Material weakness identified?

No

Significant deficiency identified?

Yes

Noncompliance material to financial statements noted:

No

Federal Awards

Internal Control over major programs: Material weakness identified? Significant deficiency identified?

No None Reported

Type of auditor's report issued on compliance for major programs: All major programs

Unmodified

Any audit findings disclosed that are required to be reported in

accordance with OMB Circular A-133, Section 510(a)?

No

Identification of major programs:

CFDA Numbers

Name of Federal Program or Cluster

10.553, 10.555 84.027, 84.173

Child Nutrition Cluster Special Education Cluster

Dollar threshold used to distinguish between Type A and Type B programs:

$337,695.57

Auditee qualified as low-risk auditee?

No

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TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2015

II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FS 2015-001 Control Category: Internal Control Impact: Compliance Impact:

Inadequate Internal Controls over Financial Reporting Financial Reporting Significant Deficiency None

Description: The School District did not have adequate internal controls in place over the financial statement reporting process.

Criteria: Management is responsible for having adequate controls over the preparation of financial statements in accordance with Generally Accepted Accounting Principles (GAAP). The School District's internal controls over GAAP financial reporting should include adequately trained personnel with the knowledge, skills and experience to prepare GAAP based financial statements and include all disclosures as required by the Governmental Accounting Standards Board (GASB).

GASB Statement No. 34, Basic Financial Statement Management's Discussion and Analysis for State and Local Governments (Statement), requires governments to present government-wide and fund financial statements as well as a summary reconciliation of the (a) total governmental funds balances to the net position of governmental activities in the Statement of Net Position, and (b) total change in governmental fund balances to the change in the net position of governmental activities in the Statement of Activities. In addition, the Statement requires information about the government's major and nonmajor funds in the aggregate, to be provided in the fund financial statements.

Chapter 22A Annual Financial Reporting of the Financial Management for Georgia Local Units of Administration provides that School Districts must prepare their financial statements in accordance with generally accepted accounting principles.

Condition: During the audit, the following corrections were proposed and accepted by the School District to properly present the entity's financial statements and notes to the financial statements:
An audit adjustment of $333,476.55 was necessary to decrease Retainage Payable and Expenditures for the District-wide Capital Projects Fund.
An audit adjustment of $333,476.55 was necessary to decrease Retainage Payable and NonDepreciable Capital Assets on the Statement of Net Position.
The Significant Commitment Note was increased by $333,476.55 to properly disclose unearned executed construction contracts.
Current year additions to Construction in Progress were decreased by $333,476.55 in the Capital Asset Note Disclosure.

Cause: In discussing the issue with management, the Finance Director stated that the issues noted were due to miscalculations for the current year and subsequent year expenditures related to contractor and architect fees.

Effect or Potential Effect: A significant misstatement was included in the financial statements presented for audit along with note disclosure errors. The lack of controls could impact the reporting of the School District's financial position and results of operations.

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TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2015

II

FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

Recommendation: The School District should strengthen review procedures over construction pay requests to ensure that the financial statements and disclosures are complete and accurate.

Views of Responsible Officials and Corrective Action Plans: We concur with this finding. The significant overstatements resulted from miscalculations when determining expenditures related to the current fiscal year for contractor pay requests that crossed fiscal years. Auditors provided guidance on the calculation of contracts and retainage payables for pay requests that cross fiscal years. Management will hold discussions with architects to determine completion of work performed during the architect's documents/drawings/planning phase.

Estimated Corrective Action Date: July 1, 2015

Contact Person: Klinton Guess, Director of Finance

Telephone: (229) 387-2400

Fax:

(229) 386-1020

E-mail:

Klinton.guess@tiftschools.com

III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

No matters were reported.

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