Tift County Board of Education, Tifton, Georgia, annual financial report for the fiscal year ended 2018 June 30 (including independent auditor's reports)

TIFT COUNTY BOARD OF EDUCATION
TIFTON, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2018
(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

GOVERNMENT-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

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FIDUCIARY FUNDS

I 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 PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA
3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
4 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND
5 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SEAD OPEB
6 SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA

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4 5 6 7 8 9 10
39 40 41 42 43 44

TIFT COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I
FINANCIAL
SCHEDULES
REQUIRED SUPPLEMENTARY INFORMATION
7 SCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 8 SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND 9 SCHEDULE OF CONTRIBUTIONS SEAD OPEB 10 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 11 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND
SUPPLEMENTARY INFORMATION
12 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 13 SCHEDULE OF STATE REVENUE 14 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

Page
45 46 47 48 49
50 51 53

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 FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE

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

SECTION I FINANCIAL

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 11, 2019

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Superintendent and Members of the Tift County Board of Education
INDEPENDENT AUDITOR'S REPORT
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 (School District), as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the School District'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 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 financial statements referred to above present fairly, in all material respects, the respective financial position of the of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2018, and the respective changes in financial position 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 and 15 to the financial statements, in 2018, the School District adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, as amended by GASB Statement No. 85, Omnibus 2017. The School District restated beginning net position for the effect of GASB Statement No. 75. Our opinions are 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 and required supplementary information listed in the table of contents 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 about 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 School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the 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 Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also 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 taken as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated July 11, 2019 on our consideration of the School District'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 solely 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 the effectiveness of the School District's 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 the School District'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,
Greg S. Griffin State Auditor

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018
INTRODUCTION
The discussion and analysis of the Tift County Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal years ended June 30, 2018 and June 30, 2017. 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 the notes to the basic financial statements to enhance their understanding of the School District's financial performance.
FINANCIAL HIGHLIGHTS
Key financial highlights for the fiscal years 2018 and 2017 are as follows:
In fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) No. 75, Accounting and Financial Reporting for Other Postemployment Benefits Other than Pensions. This standard directly impacts the School District's liabilities and unrestricted net position on the government-wide financial statements and resulted in significant changes in how the School District reflects its future responsibilities and liabilities to its employees. The current financial stability of the organization is not materially impacted by the adoption of this standard.
The School District had an increase of $8.8 million in net position as a result of governmental activities after the restatement of beginning net position for GASB No.75. Beginning net position decreased $70.0 million as a result of the implementation of GASB No. 75. See Note 15 in the Notes to the Basic Financial Statements for more information about the restatement of net position. In total, net position decreased $61.2 million which represents a 125 percent decrease from fiscal year 2017.
The School District had $85.4 million and $82.5 million in expenses relating to governmental activities for the fiscal years ended June 30, 2018 and June 30, 2017, respectively. Only $61.9 million and $54.9 million of the above-mentioned expenses for 2018 and 2017 were offset by program specific charges for services, grants and contributions. General revenues (primarily property and sales taxes) of $32.3 million and $30.7 million, respectively, for 2018 and 2017, along with fund balance were adequate to provide for these programs.
The current ratio, which measures the School District's ability to transform current assets into cash and pay its short-term liabilities, was 2.17 and 2.50 for the fiscal years ended June 30, 2018 and June 30, 2017, respectively. Generally, a ratio greater than 2.0 is considered very financially stable.
Long-term debt increased by $10.3 million for 2018 and increased by $4.5 million for 2017. This increase for 2018 was due primarily to the advances made by the bond purchaser of the general obligation sale tax bonds issued in 2017.
The general fund (the primary operating fund), presented on a current financial resource basis, ended the fiscal year with a fund balance of $18.4 million, an increase of $3.4 million from the June 30, 2017 fund balance of $15.0 million.
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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018
OVERVIEW OF THE FINANCIAL STATEMENTS
This annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the School District. These include the government-wide and fund financial statements.
The government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status.
The fund financial statements focus on individual parts, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the shortterm as well as what remains for future spending. The fiduciary funds statements provide information about the financial relationships in which the School District acts solely as a trustee or agent for the benefit of others.
The fund financial statements reflect the School District's most significant funds. For the years ending June 30, 2018 and 2017, the general fund, the capital projects fund, and the debt service fund represent the most significant funds.
The financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements.
Government-wide Statements
The government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid.
The two government-wide statements report the School District's net position and how it has changed. Net position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in net position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors.
The School District adopted the Governmental Accounting Standards Board's (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions which will replace GASB Statement No. 45. This statement required the Board of Education to restate fiscal year 2017 at transition (fiscal year 2018) through the recognition of a beginning net OPEB liability and a beginning deferred outflow of resources for its related OPEB plan contributions made subsequent to the measurement date of the beginning net OPEB liability.
The OPEB liability discloses the School District's proportionate share of the collective net OPEB liability related to providing postemployment benefits to its employees. The School District participates in Georgia's School Personnel Post-Employment Health Benefit Plan. As a result of implementation of GASB No. 75, the School District is presenting a more significant deficit balance in unrestricted net
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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018
position following fiscal year 2015's implementation of GASB No. 68 and GASB No.71. This is a reflection of the School District's future responsibility and liability to its employees for their health benefits when those employees retire. The School District makes the required contributions to the plan to ensure sufficient resources are available to make postemployment benefit payments. 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, student activity accounts and various others.
Fund Financial Statements The School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, the capital projects fund, and the debt service fund. Governmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of 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 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 the Statement of Activities) and governmental funds are reconciled to 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 governmentwide financial statements because it cannot use these assets to finance its operations.
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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE

Recall that the Statement of Net Position provides the perspective of the School District as a whole. Table 1 provides a summary of the School District's net position for fiscal years 2018 and 2017.

Table 1 Net Position

Fiscal Year 2018

Governmental Activities Fiscal
Year 2017 (1)

Net Change

Assets Current and Other Assets Capital Assets, Net

$

34,763,705 $ 28,445,957 $

115,931,613

98,073,656

6,317,748 17,857,957

Total Assets

150,695,318

126,519,613

24,175,705

Deferred Outflows of Resources Related to Defined Benefit Pension Plans Related to OPEB Plan

11,125,392 2,465,573

18,771,532 -

(7,646,140) 2,465,573

Total Deferred Outflows of Resources

13,590,965

18,771,532

(5,180,567)

Liabilities Current and Other Liabilities Net Pension Liability Net OPEB Liability Long-Term Liabilities

15,947,979 67,143,569 67,876,550 16,041,148

11,397,960 76,544,522
5,773,928

4,550,019 (9,400,953) 67,876,550 10,267,220

Total Liabilities

167,009,246

93,716,410

73,292,836

Deferred Inflows of Resources Related to Defined Benefit Pension Plans Related to OPEB Plan

3,580,979 5,957,103

2,649,257 -

931,722 5,957,103

Total Deferred Inflows of Resources

9,538,082

2,649,257

6,888,825

Net Position Net Investment in Capital Assets Restricted Unrestricted (Deficit)

96,386,402 8,368,213
(117,015,660)

91,394,654 7,244,642
(49,713,818)

4,991,748 1,123,571 (67,301,842)

Total Net Position

$ (12,261,045) $ 48,925,478 $

(61,186,523)

(1) Fiscal year 2017 balances do not reflect the effects of the restatement of net position. See Note 15 in the Notes to the Basic Financial Statements for additional information.

Net position decreased $61.2 million in fiscal year 2018. This decrease is primarily due to the adoption of GASB Statement No.75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. Although the total liability effect of these pensions causes a large deficit balance in
unrestricted net position, it should not be considered a financial weakness as these costs are spread
out over multiple years well into the future.

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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018
Table 2 shows the changes in net position for fiscal years ending June 30, 2018 and June 30, 2017.
Table 2 Change in Net Position

Revenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions
Total Program Revenues
General Revenues: Taxes Property Taxes For Maintenance and Operations Railroad Cars Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Taxes Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Total General Revenues
Total Revenues
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 Services Food Services Interest on Short-Term and Long-Term Debt
Total Expenses
Increase in Net Position

Fiscal Year 2018

Governmental Activities Fiscal
Year 2017 (1)

$

1,161,719 $

1,196,368 $

55,448,988

53,535,323

5,267,330

161,396

61,878,037

54,893,087

18,611,670 28,206

18,344,311 23,142

8,633,849 282,848
3,592,534 34,406
1,118,172
32,301,685
94,179,722

8,319,251 258,586
2,558,722 9,351
1,222,543
30,735,906
85,628,993

56,980,780

54,970,633

3,009,221 3,245,610 1,242,947
595,216 5,542,834
635,640 5,532,127 2,814,954
339,792 42,182

3,033,277 3,706,473 1,131,884
580,502 5,268,471
585,724 5,130,683 2,668,738
334,995 57,434

14,865 5,122,366
238,034

8,670 4,985,213
86,270

85,356,568

82,548,967

$

8,823,154 $

3,080,026 $

(1) Fiscal year 2017 balances do not reflect the effects of the restatement of net position. See Note 15 in the Notes to the Basic Financial Statements for additional information.

Net Change
(34,649) 1,913,665 5,105,934 6,984,950
267,359 5,064
314,598 24,262
1,033,812 25,055
(104,371) 1,565,779 8,550,729
2,010,147
(24,056) (460,863) 111,063
14,714 274,363
49,916 401,444 146,216
4,797 (15,252)
6,195 137,153 151,764 2,807,601 5,743,128

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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018

Program revenues, in the form of charges for services, operating grants and contributions and capital grants and contributions increased $7.0 million for governmental activities. This increase is largely due to an increase in funds earned through the State Quality Basic Education (QBE) Funding Formula, capital grants received from the Georgia State Financing and Investment Commission (GSFIC) to offset certain construction projects, decrease in QBE Austerity Reduction from one fiscal period to the next.

General revenues increased by $1.6 million during fiscal year 2018. This increase was mainly due to equalization funding along with economic improvement resulting in larger sales tax revenue and better property tax collections.

Governmental Activities

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows the total cost of services and the net cost of services. Net cost of services can be defined as the total cost less fees generated by the activities and intergovernmental revenue provided for specific programs. The net cost reflects the financial burden on the School District's taxpayers by each activity.

Table 3 Governmental Activities

Total Cost of Services

Fiscal

Fiscal

Year 2018

Year 2017 (1)

Net Cost of Services

Fiscal

Fiscal

Year 2018

Year 2017 (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: Community Services Food Services Interest on Short-Term and Long-Term Debt

$

56,980,780 $

3,009,221 3,245,610 1,242,947
595,216 5,542,834
635,640 5,532,127 2,814,954
339,792 42,182

14,865 5,122,366
238,034

54,970,633 $
3,033,277 3,706,473 1,131,884
580,502 5,268,471
585,724 5,130,683 2,668,738
334,995 57,434
8,670 4,985,213
86,270

12,844,921 $
2,403,437 905,885 83,644 (952,822)
3,308,418 634,489
2,286,945 1,875,560
335,771 34,159
14,865 (534,775) 238,034

16,445,297
2,384,232 914,247 141,735 (739,859)
3,229,355 585,724
2,720,913 1,676,168
328,208 31,407
8,670 (156,486)
86,270

Total Expenses

$

85,356,568 $

82,548,967 $

23,478,531 $

27,655,881

(1) Fiscal year 2017 balances do not reflect the effects of the restatement of net position. See Note 15 in the Notes to the Basic Financial Statements for additional information.

Although program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. For 2018, 30 percent of instruction and support activities were supplemented by taxes and other general revenues compared to 36 percent in 2017.

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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS

The School District's governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues and other financing sources of $106.2 million and total expenses and other financing uses of $104.6 million. There was an increase in the fund balance totaling $1.8 million for the governmental funds as a whole. This increase is due to higher state funding received from Equalization and Vocational Construction grants.

General Fund Budgeting Highlights

The School District's budget is prepared according to Georgia Law. The most significant budgeted fund is the general fund, funded primarily through state revenue and local property tax revenue. During the course of fiscal years 2018 and 2017, the School District amended its general fund budget as needed.

During fiscal year 2018 the general fund had final actual revenues and other financing sources totaling $80.6 million, which represented an increase from the original budgeted amount of $76.9 million by $3.7 million. This difference (final actual vs. original budget) was due to conservative estimates by the Board that were exceeded slightly in all major categories along with federal grant original budgets being unavailable until later in the fiscal year.

Final actual expenditures during fiscal year 2018 totaling $76.5 million represented a decrease from the original budgeted amount of $76.6 million by $0.1 million. The decrease in actual expenditures versus original budget expenditures was due primarily to reduction in federal grant allocations.

CAPITAL ASSETS

At the fiscal years ended June 30, 2018 and June 30, 2017, the School District had $115.9 million and $98.1 million, respectively, invested in capital assets, net of accumulated depreciation. These assets are made up of a broad range of capital assets, including land; buildings; transportation, food service and maintenance equipment. Table 4 reflects a summary of these balances, by class, net of accumulated depreciation.

Table 4 Capital Assets (Net of Depreciation)

Governmental Activities

Fiscal

Fiscal

Year 2018

Year 2017

Land

$

8,456,737 $

Construction In Progress

26,955,905

Building and Improvements

76,265,784

Equipment

3,341,410

Land Improvements

911,777

7,835,049 7,653,873 77,855,478 3,686,079 1,043,177

Total

$ 115,931,613 $

98,073,656

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TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018

The overall capital assets increased in fiscal year 2018 by $17.8 million due to construction in progress and land purchase.
Construction in progress increased primarily due to renovations and additions being made to Tift County High School.
DEBT ADMINISTRATION
The Board issued General Obligation Sales Tax Bonds Series 2016 and General Obligation Sales Tax Bonds Series 2017 in fiscal year 2017. The purpose of these bonds is to finance all or a portion of the cost of certain capital outlay projects. Table 5 summarizes the long-term debt outstanding at June 30, 2018 as compared to the prior fiscal year.
The Board entered into two new capital leases in fiscal year 2018. Capital leases are generally used as a way to purchase computers without a large lump sum payment. The leases are paid during a period of 3-4 years. Table 5 summarizes capital lease obligations outstanding at June 30, 2018 and 2017. A schedule of future payments can be found in the Notes to the Basic Financial Statements.
At June 30, 2018, the School District had $16.0 million in total debt outstanding with $696,840 due within one year. Table 5 summarizes debt outstanding at June 30, 2018 and 2017.

Table 5 Debt at June 30

Governmental Activities

Fiscal

Fiscal

Year 2018

Year 2017

General Obligation Sales Tax Bonds Outstanding Capital Lease Obligations Outstanding

$ 14,620,000 $ 1,421,148

4,455,000 1,318,929

Total

$ 16,041,148 $

5,773,929

CURRENT ISSUES
In fiscal year 2018, the cost of the employer portion of TRS pension rose from 14.27 percent to 16.81 percent and will increase again to 20.90 percent in fiscal year 2019. This will add approximately $1.7 million in expenditures to the budget. Regardless, the School District holds a strong financial position and will continue to maintain a full 190-day instructional staff calendar.
Approximately 86 percent of general fund expenses, the main operating fund for the School District, were related to salaries and employee benefits for the year ended June 30, 2018. With such personnel heavy expenses, it is difficult to offset mandated expense increases such as TRS and health insurance premium expenses. The School District consistently evaluates how funds can be spent smarter and more effectively to ensure that Tift County students receive a quality education from effective personnel.
The School District's millage rate for fiscal year 2018 was 17.946. The net digest for fiscal year 2018 was $982.3 million, which produced approximately $982,296 per mill. As shown in Table 3, property tax and sales tax are responsible for covering 30 percent of the School District's costs. It is anticipated that this pressure to provide local monies to meet mandated educational requirements and operational costs will continue.
viii

TIFT COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018
The most significant challenge facing the School District is the relative uncertainty regarding how School Districts will be funded moving forward. Even though the General Assembly removed the amended formula adjustments (austerity reductions) for FY2019, they are always in the process of exploring new funding formulas that would change the way personnel salaries are calculated. It is uncertain at this point what type of financial impact these changes might have on the School District's finances. By using its Charter System status that allows flexibility and broad waivers from the state's Title 20 requirements, the School District can continue to offer students a variety of instructional programs and extracurricular opportunities while maintaining a cost effective system.
Fiscal year 2018 saw substantial completion of the Tift County High School Construction and Renovation project. This project provided a new wing addition to house 9th grade students in preparation of the County's new grade level configuration at all schools to be implemented in the 2018-2019 school year. Also included is the addition of the College and Career Academy and the addition of an auxiliary gym. This project will be fully completed in the 2018-2019 school year and upon completion, the construction cost is projected to be $31.1 million. New projects are under consideration for bathroom renovations at Northeast Middle School, Eighth Street Middle School, and Tift County High School. Preliminary estimates indicate a cost of $1.0 million for these additional projects, which will be funded from ESPLOST revenues not required for debt service. A matter that is of concern to the School District is the impact of GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions, on the financial statements for fiscal year 2018 and beyond. Implementation of this statement required the School District to record a charge (decrease) to the net position at July 1, 2017 for the School District's share of the Net OPEB Liability for the State Health Benefit Plan administered through the Department of Community Health. Readers should understand implementation of GASB Statement No. 75 will not affect the School District's governmental fund statements.
CONTACTING THE SCHOOL DISTRICT'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Klinton R. Guess, Chief Financial Officer at the Tift County Board of Education, PO Box 389, Tifton, Georgia 31793.
ix

TIFT COUNTY BOARD OF EDUCATION

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2018
ASSETS
Cash and Cash Equivalents Receivables, Net
Taxes State Government Federal Government Local Other 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 Plans Related to OPEB Plans
Total Deferred Outflows of Resources
LIABILITIES
Accounts Payable Salaries and Benefits Payable Payroll Withholdings Payable Interest Payable Contracts Payable Retainages Payable Deposits and Unearned Revenues Net Pension Liability Net OPEB Liability Long-Term Liabilities
Due Within One Year Due in More Than One Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to Defined Benefit Pension Plans Related to OPEB Plans
Total Deferred Inflows of Resources
NET POSITION
Net Investment in Capital Assets Restricted for
Continuation of Federal Programs Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

22,546,728.66

1,704,889.95 9,081,776.99 1,265,553.10
471.56 55,343.61 107,275.48
1,665.80 35,412,641.20 80,518,971.35

150,695,317.70

11,125,392.00 2,465,573.00
13,590,965.00

1,707,537.16 8,597,671.59
284,679.84 111,898.91 2,412,703.39 2,512,507.58 320,980.50 67,143,569.00 67,876,550.00
696,840.47 15,344,307.27
167,009,245.71

3,580,979.00 5,957,103.00
9,538,082.00

96,386,401.58
3,487,377.43 4,880,836.21 (117,015,660.23)

$

(12,261,045.01)

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, 2018

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)

EXPENSES

CHARGES FOR SERVICES

PROGRAM REVENUE

$

56,980,780.47 $

1,031,839.18

3,009,221.26 3,245,610.43 1,242,947.01
595,215.76 5,542,833.64
635,639.71 5,532,127.20 2,814,953.86
339,792.16 42,181.54

67,126.73 8,407.35 -

14,864.96 5,122,365.65
238,034.37

54,345.75
-

$

85,356,568.02 $

1,161,719.01

Net Position - End of Year

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

$ 39,444,098.77 $
605,783.79 2,339,725.01 1,023,595.00 1,505,164.08 2,120,807.48
1,150.63 2,319,533.09
853,667.40 4,021.18 8,023.02
5,223,418.78
-
$ 55,448,988.23 $

3,659,921.36 $
135,708.40 42,874.08 113,607.78 858,522.53 77,319.58 -
379,375.78
-
5,267,329.51

(12,844,921.16)
(2,403,437.47) (905,885.42) (83,643.61) 952,822.40
(3,308,418.38) (634,489.08)
(2,286,944.85) (1,875,559.53)
(335,770.98) (34,158.52)
(14,864.96) 534,774.66 (238,034.37)
(23,478,531.27)

18,611,670.14 28,205.93
8,633,849.37 282,848.10
3,592,534.00 34,406.31
1,118,171.45
32,301,685.30
8,823,154.03
(21,084,199.04)

$

(12,261,045.01)

- 3 -

TIFT COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2018

EXHIBIT "C"

ASSETS
Cash and Cash Equivalents Receivables, Net
Taxes State Government Federal Government Local Other Due from Other Funds Inventories Prepaid Items

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 20,126,345.66 $ 2,420,383.00 $

- $ 22,546,728.66

941,252.00 6,735,863.15 1,265,553.10
471.56 722.61
107,275.48
665.80

763,637.95 2,345,913.84
54,621.00 1,000.00

-
67,524.15 -

1,704,889.95 9,081,776.99 1,265,553.10
471.56 55,343.61 67,524.15 107,275.48
1,665.80

Total Assets
LIABILITIES
Accounts Payable Salaries and Benefits Payable Due to Other Funds Payroll Withholdings Payable Contracts Payable Retainages Payable Deposits and Unearned Revenue
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - GSFIC Unavailable Revenue - Property Taxes
Total Deferred Inflows of Resources
FUND BALANCES
Nonspendable Restricted Committed Assigned Unassigned
Total Fund Balances

$ 29,178,149.36 $ 5,585,555.79 $ 67,524.15 $ 34,831,229.30

$ 1,457,447.29 $ 250,089.87 $

8,576,533.69

21,137.90

-

67,524.15

284,679.84

-

-

2,412,703.39

-

2,512,507.58

387.60

-

10,319,048.42

5,263,962.89

- $ 1,707,537.16

-

8,597,671.59

-

67,524.15

-

284,679.84

-

2,412,703.39

-

2,512,507.58

-

387.60

-

15,583,011.31

449,815.03
449,815.03

320,592.90 -
320,592.90

-

320,592.90

-

449,815.03

-

770,407.93

107,941.28 3,380,101.95 2,000,000.00
153,412.66 12,767,830.02
18,409,285.91

1,000.00 -
1,000.00

67,524.15
-
67,524.15

108,941.28 3,447,626.10 2,000,000.00
153,412.66 12,767,830.02
18,477,810.06

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 29,178,149.36 $ 5,585,555.79 $ 67,524.15 $ 34,831,229.30

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, 2018

EXHIBIT "D"

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.
Land Construction in progress Buildings and improvements Equipment Land improvements Accumulated depreciation
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Net pension liability Net OPEB liability
Deferred outflows and inflows of resources related to pensions and OPEB are applicable to future periods and, therefore, are not reported in the funds.
Related to pensions Related to OPEB
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Long-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds.
Bonds payable Accrued interest payable Capital leases payable

$ 18,477,810.06

$

8,456,736.59

26,955,904.61

116,596,425.66

8,619,625.84

3,608,365.96

(48,305,446.11)

115,931,612.55

$ (67,143,569.00) (67,876,550.00)

(135,020,119.00)

$

7,544,413.00

(3,491,530.00)

4,052,883.00 449,815.03

$ (14,620,000.00) (111,898.91)
(1,421,147.74)

(16,153,046.65)

Net position of governmental activities (Exhibit "A")

$ (12,261,045.01)

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, 2018

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
Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Proceeds of Bonds Capital Leases Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

18,600,868.35 $

- $

282,848.10

8,633,849.37

48,030,153.01

4,910,657.04

11,358,456.93

-

1,161,719.01

-

56.07

34,350.24

1,118,171.45

-

80,552,272.92

13,578,856.65

- $ -
-

18,600,868.35 8,916,697.47
52,940,810.05 11,358,456.93
1,161,719.01 34,406.31
1,118,171.45
94,131,129.57

50,333,678.35
2,992,472.87 3,247,227.97 1,053,483.24
575,426.72 5,453,210.90
631,846.44 4,308,304.56 2,246,049.57
337,956.33 42,181.54 14,864.96
5,281,610.35 -
-
76,518,313.80
4,033,959.12

4,748,910.19
121,351.49 682.00 792,533.27 302,088.93 19,947,713.44
997,231.12 75,899.50
26,986,409.94
(13,407,553.29)

-
-
103,926.86
103,926.86
(103,926.86)

55,082,588.54
2,992,472.87 3,247,227.97 1,174,834.73
575,426.72 5,453,210.90
632,528.44 5,100,837.83 2,548,138.50
337,956.33 42,181.54 14,864.96
5,281,610.35 19,947,713.44
997,231.12 179,826.36
103,608,650.60
(9,477,521.03)

(677,308.20)
(677,308.20)
3,356,650.92
15,052,634.99

10,165,000.00 1,099,450.00 677,308.20 (160,639.01)
11,781,119.19
(1,626,434.10)
1,627,434.10

160,639.01 -
160,639.01
56,712.15
10,812.00

10,165,000.00 1,099,450.00 837,947.21 (837,947.21)
11,264,450.00
1,786,928.97
16,690,881.09

Fund Balances - Ending

$

18,409,285.91 $

1,000.00 $

67,524.15 $

18,477,810.06

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 TO THE STATEMENT OF ACTIVITIES JUNE 30, 2018

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense.
Capital outlay Depreciation expense
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position.
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities.
General obligation bonds issued Capital leases issued Capital lease payments
District pension and OPEB contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension and OPEB liability is measured a year before the District's report date. Pension and OPEB expenses, which is the change in the net pension and OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions and OPEB, are reported in the Statement of Activities.
Pension expense OPEB expense
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.
Accrued interest on issuance of bonds and capital leases

$ 1,786,928.97

$ 20,129,183.44 (2,243,868.22)

17,885,315.22 (27,358.99) 39,007.72

$ (10,165,000.00) (1,099,450.00) 997,231.12

(10,267,218.88)

$

823,091.00

(1,358,403.00)

(535,312.00)

(58,208.01)

Change in net position of governmental activities (Exhibit "B")

$ 8,823,154.03

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

- 7 -

ASSETS Cash and Cash Equivalents Investments
Total Assets
LIABILITIES
Funds Held for Others NET POSITION
Held in Trust for Private Purposes

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS JUNE 30, 2018

EXHIBIT "G"

PRIVATE PURPOSE TRUSTS

AGENCY FUNDS

$

- $

110,317.74

18,226.07

-

$

18,226.07 $

110,317.74

$

110,317.74

$

18,226.07

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

- 8 -

TIFT COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2018
ADDITIONS Investment Earnings Interest
DEDUCTIONS Scholarships Change in Net Position
Net Position - Beginning
Net Position - Ending

EXHIBIT "H"

PRIVATE PURPOSE TRUSTS

$

76.88

1,000.00 (923.12)
19,149.19

$

18,226.07

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

- 9 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

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 board elected by the voters and a Superintendent appointed by the Board. The School District 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
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
BASIS OF PRESENTATION
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
GOVERNMENT-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 Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by 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.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
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.

- 10 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

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 financial statements are presented for governmental and fiduciary funds. 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:
The 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.
The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), Bond Proceeds and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general long-term principal and interest.
The School District reports the following fiduciary fund types:
Private purpose trust funds are used to report all trust arrangements, other than those properly reported elsewhere, in which principal and income benefit individuals, private organizations or other governments.
Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations.
BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund 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, grants and donations. 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 and donations 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. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end.
- 11 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

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 longterm debt, 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, there are both restricted and unrestricted net assets 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.
NEW ACCOUNTING PRONOUNCEMENTS
In fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. This statement establishes standards for recognizing and measuring liabilities, deferred outflows of resources, deferred inflows of resources, and expense/expenditures. For defined benefit OPEB, this statement identifies the methods and assumptions that are required to be used to project benefit payments, discount projected benefit payments to their actuarial present value, and attribute that present value to periods of employee service. Note disclosure and required supplementary information requirements about defined benefit OPEB also are addressed. The adoption of this statement has a significant impact on the School District's financial statements. As noted in the Restatement of Net Position note disclosure, the School District restated beginning net position for the cumulative effect of this accounting change.
In fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 81, Irrevocable Split-Interest Agreements. This statement requires that a government that receives resources pursuant to an irrevocable split-interest agreement recognize assets, liabilities, and deferred inflows of resources at the inception of the agreement. Furthermore, this statement requires that a government recognize assets representing its beneficial interests in irrevocable split-interest agreements that are administered by a third party, if the government controls the present service capacity of the beneficial interests. This statement requires that a government recognize revenue when the resources become applicable to the reporting period. The adoption of this statement does not have a significant impact on the School District's financial statement.
In fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 85, Omnibus 2017. The objective of this statement is to address practice issues that have been identified during implementation and application of certain GASB Statements. This statement addresses a variety of topics including issues related to blending component units, goodwill, fair value measurement and application, and postemployment benefits (pensions and other postemployment benefits [OPEB]). The adoption of this statement does not have a significant impact on the School District's financial statement.
In fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 86, Certain Debt Extinguishment Issues. The primary objective of this statement is to improve consistency in accounting and financial reporting for in-substance defeasance of debt by providing guidance for transactions in which cash and other monetary assets acquired with only existing resources--resources other than the proceeds of refunding debt--are placed in an irrevocable trust for the sole purpose of extinguishing debt. This statement also improves accounting and financial reporting for prepaid insurance on debt that is extinguished and notes to financial statements for debt that is defeased in substance. The adoption of this statement does not have a significant impact on the School District's financial statement.

- 12 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) 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 (O.C.G.A.) 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
The School District can invest its funds as permitted by O.C.G.A. 36-83-4. 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.
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. All other investments are reported at fair value.
For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.
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.
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 (calculated on the first-in, first-out basis). 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 future accounting periods are recorded as prepaid items, in both the government-wide and governmental fund financial statements.
CAPITAL ASSETS
On the government-wide financial statements, capital assets are recorded 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 the acquisition value on the date donated. 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. The School District does not capitalize book collections or works of art.
Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.

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

Capitalization Policy

Estimated Useful Life

Land Land Improvements

Any Amount $ 50,000.00

Buildings and Improvements Equipment Intangible Assets

$ 100,000.00 $ 20,000.00 $ 500,000.00

DEFERRED OUTFLOWS/INFLOWS OF RESOURCES

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

In addition to assets, the statement of financial position 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.

In addition to liabilities, the statement of financial position 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.
LONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS

In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straight-line method. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.

In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures.
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 pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. 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.
POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB)

For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.

- 14 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (SEAD - OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the State Employees' Assurance Department Retired and Vested Inactive Members Trust Fund (SEADOPEB) plan (the Plan) and additions to/deductions from the SEAD-OPEB's fiduciary net position have been determined on the same basis as they are reported by SEAD-OPEB. For this purpose, death benefits are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
FUND BALANCES
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Nonspendable consists of resources 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 consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking 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.
Assigned consists of resources 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 or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.
Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.
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.
PROPERTY TAXES
The Tift County Board of Commissioners adopted the property tax levy for the 2017 tax digest year (calendar year) on July 18, 2017 (levy date) based on property values as of January 1, 2017. Taxes were due on November 15, 2017 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2017 tax digest are reported as revenue in the governmental funds for fiscal year 2018. 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, 2018, for maintenance and operations amounted to $17,166,219.93.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

The tax millage rate levied for the 2017 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

17.946 mills

Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $1,406,442.49 during fiscal year ended June 30, 2018.
SALES TAXES
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $8,633,849.37 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years.
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, as well as the School District's website. 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 O.C.G.A. 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 the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review.
NOTE 4: DEPOSITS AND CASH EQUIVALENTS
COLLATERALIZATION OF DEPOSITS
O.C.G.A. 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% 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. 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% 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,
- 16 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

(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
(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, 2018, the School District had deposits with a carrying amount of $20,322,539.76, which includes $18,226.07 for a Certificate of Deposit recorded as investments, and a bank balance of $22,383,463.22. The bank balances insured by Federal depository insurance were $668,401.53.
At June 30, 2018, $21,715,061.69 of the School District's bank balance was exposed to custodial credit risk as follows:
The School District participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered Deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased to amount of up to 125% if economic or financial conditions warrants. The program lists the type of eligible collateral. The OST approves authorized custodians.
In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository's collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Cash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position

$ 22,546,728.66 110,317.74

Total cash and cash equivalents

22,657,046.40

Add: Deposits with original maturity of three months or more reported as investments

18,226.07

Less: Investment pools reported as cash and cash equivalents
Georgia Fund 1

2,352,732.71

Total carrying value of deposits - June 30, 2018

$ 20,322,539.76

CATEGORIZATION OF CASH EQUIVALENTS
The School District reported cash equivalents of $2,352,732.71 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 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, which approximates fair value. 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, 2018, was 10 days.
Georgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, 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, 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 www.audits.ga.gov/SGD/CAFR.html.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

NOTE 5: CAPITAL ASSETS

The following is a summary of changes in the capital assets for governmental activities during the fiscal year:

Balances July 1, 2017

Increases

Decreases

Corrections

Balances June 30, 2018

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

$ 7,835,049.39 $ 621,687.20 $ 7,653,873.37 19,302,031.24

- $ -

- $ 8,456,736.59

-

26,955,904.61

Total Capital Assets Not Being Depreciated

15,488,922.76 19,923,718.44

-

-

35,412,641.20

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

116,596,425.66 8,555,648.84 3,608,365.96

205,465.00
-

141,488.00
-

-

116,596,425.66

-

8,619,625.84

-

3,608,365.96

38,740,947.85 4,869,569.57 2,565,189.48

1,634,072.04 494,651.43 115,144.75

86,005.48
-

(44,378.58) -
16,255.05

40,330,641.31 5,278,215.52 2,696,589.28

Total Capital Assets, Being Depreciated, Net

82,584,733.56

(2,038,403.22)

55,482.52

28,123.53

80,518,971.35

Governmental Activity Capital Assets - Net $ 98,073,656.32 $ 17,885,315.22 $ 55,482.52 $ 28,123.53 $ 115,931,612.55

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

$ 1,380,021.66

51,661.01 16,327.03 43,252.76 326,904.37 281,264.63

719,409.80 144,436.76

$ 2,243,868.22

NOTE 6: INTERFUND ASSETS, LIABILITIES, AND TRANSFERS INTERFUND ASSETS AND LIABILITIES

Due to and due from other funds are recorded for interfund receivables and payables which arise from interfund transactions. Interfund balances at June 30, 2018, consisted of the following:

Due From Other Funds

Due To Other Funds

Capital Projects Fund

$

-

$

67,524.15

Debt Service Fund

67,524.15

-

$

67,524.15

$

67,524.15

Funds are due to the debt service fund to provide for the service of debt.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

INTERFUND TRANSFERS

Interfund transfers for the year ended June 30, 2018, consisted of the following:

Transfers to

Transfers From

General Fund

Capital Projects Fund

Capital Projects Fund Debt Service Fund

$ 677,308.20 -

$

-

160,639.01

Total

$ 677,308.20 $ 160,639.01

Transfers are used to move property tax revenues collected by the general fund to the capital projects fund as required match or supplemental funding source for capital construction projects, and to move Education Special Purpose Local Option Sales Tax (ESPLOST) proceeds from the capital projects fund to the debt service fund for the retirement of debt.
NOTE 7: LONG-TERM LIABILITIES
The changes in long-term liabilities during the fiscal year for governmental activities, were as follows:

Balance July 1, 2017

Additions

Governmental Activities Deductions

Balance June 30, 2018

Due Within One Year

General Obligation Sales Tax Bonds Capital Leases

$ 4,455,000.00 $ 1,318,928.86

10,165,000.00 $ 1,099,450.00

- $ 997,231.12

14,620,000.00 $

-

1,421,147.74

696,840.47

$ 5,773,928.86 $ 11,264,450.00 $

997,231.12 $ 16,041,147.74 $ 696,840.47

GENERAL OBLIGATION DEBT OUTSTANDING
The School District's bonded debt consists of various issues of general obligation sales tax bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation sales tax bonds from voter-approved Education Special Purpose Local Option Sales Tax (ESPLOST). General obligation bonds are direct obligations and pledge the full faith and credit of the School District.
Voters have authorized $20,000,000.00 of general obligation debt of which $17,801,840.00 of general obligation sales tax bonds has been issued for acquiring or constructing capital facilities. Advances up to the principal amount of these bonds are made to the School District by the bond purchaser. Currently, $3,181,840.00 remain undrawn by the School District. Of the total amount originally authorized, $2,198,160.00 remains unissued.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

General obligation bonds currently outstanding are as follows:

Description

Interest Rates

Issue Date

Maturity Date

Amount Available

Amount Issued

General Government - Series 2016A General Government - Series 2016B General Government - Series 2016C General Government - Series 2017D General Government - Series 2017E General Government - Series 2017F

1.51% 1.51% 1.51% 1.60% 1.60% 1.60%

10/14/2016 10/14/2016 10/14/2016
4/14/2017 4/14/2017 4/14/2017

9/1/2022 $ 9/1/2021 9/1/2020 9/1/2020 9/1/2019 9/1/2018

4,320,000.00 $ 4,150,000.00
431,840.00 3,568,160.00 3,840,000.00 1,491,840.00

4,320,000.00 4,150,000.00
431,840.00 3,568,160.00 2,150,000.00
-

$ 17,801,840.00 $ 14,620,000.00

The following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable:

Fiscal Year Ended June 30:

General Obligation Debt

Principal

Interest

2019 2020 2021 2022 2023

$

- $

225,908.34

2,150,000.00

197,351.63

4,000,000.00

138,702.21

4,150,000.00

75,876.47

4,320,000.00

11,080.50

Total Principal and Interest

$

14,620,000.00 $

648,919.15

CAPITAL LEASES
The School District has acquired computer equipment under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term.
The following is a schedule of total capital lease payments:

Fiscal Year Ended June 30:

2019

$

2020

2021

2022

Total Principal and Interest

$

Principal
696,840.47 $ 388,609.85 281,587.43
54,109.99
1,421,147.74 $

Interest
44,374.76 19,894.37
8,271.56 279.81
72,820.50

NOTE 8: RISK MANAGEMENT
INSURANCE
Commercial Insurance
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; and natural disasters. Except as described below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceed commercial insurance coverage in any of the past three fiscal years.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

WORKERS' COMPENSATION Georgia Education Workers' Compensation Trust

The School District participates in the Georgia Education Workers' Compensation Trust (the 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 workers' 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.
UNEMPLOYMENT COMPENSATION

The School District is self-insured with regard to unemployment compensation claims. A premium is charged when needed by the general fund to each user program on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The School District accounts for claims with expenses/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

2017 $ 2018 $

4,284.00

$

-

$

6,598.00

$

10,882.00

$

1,650.00

$

-

$

1,650.00

SURETY BOND

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

Position Covered

Amount

Superintendent Chief Financial Officer Comptroller High School Principal

$ 100,000.00 $ 100,000.00 $ 100,000.00 $ 100,000.00

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS

The School District's financial statements include the following amounts presented in the aggregate at June 30, 2018:

Nonspendable Inventories Prepaid Assets
Restricted Continuation of Federal Programs Debt Service
Committed Local Capital Outlay Projects
Assigned School Activity Accounts
Unassigned

$ 107,275.48 1,665.80 $

108,941.28

$ 3,380,101.95 67,524.15

3,447,626.10

2,000,000.00

153,412.66 12,767,830.02

Fund Balance, June 30, 2018

$ 18,477,810.06

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.

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 O.C.G.A. 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.
NOTE 10: BROADBAND SPECTRUM LEASE

Effective January 01, 2012, the School District entered into a 10 year lease agreement with Utopian Wireless Corporation for the lease of excess spectrum capacity on Education Broadband Service licenses currently held by School District. These licenses were granted to the School District by the Federal Communications Commission. The School District received the full lease amount of $20,000.00 in January 2012 and no payments are due to the School District until 2022 when the lease renews.
NOTE 11: SIGNIFICANT COMMITMENTS
COMMITMENTS UNDER CONSTRUCTION CONTRACTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2018, together with funding available:

Project

Unearned Executed Contracts (1)

Payments through Funding Available June 30, 2018 (2) From State (1)

Tift Co High School, RMA 18-737-001 $ Tift Co High School, RMA 19-737-001
$

2,131,275.03 $ 20,499,224.97 $ 3,205,929.00

3,955,744.39

6,317,154.30

4,665,676.00

6,087,019.42 $ 26,816,379.27 $ 7,871,605.00

(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts and retainages payable at year end.

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TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

OPERATING LEASES

The School District leases copiers under the provisions of one or more long-term lease agreements classified as operating leases for accounting purposes. Rental expenditures under the terms of the operating leases(s) totaled $284,446.64 for governmental activities for the year ended June 30, 2018. The following future minimum lease payments were required under operating leases at June 30, 2018:

Year Ending

Governmental Funds

2019 2020

$ 245,560.08 245,560.08

Total

$ 491,120.16

NOTE 12: SIGNIFICANT CONTINGENT LIABILITIES
FEDERAL GRANTS
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. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
LITIGATION
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 have a material adverse effect on the financial condition of the School District.
NOTE 13: OTHER POST-EMPLOYMENT BENEFITS (OPEB)
GEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND
Plan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.
Benefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.

- 24 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Contributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $2,445,717.00 for the year ended June 30, 2018. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB

At June 30, 2018, the School District reported a liability of $67,886,455.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2017. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2016. An expected total OPEB liability as of June 30, 2017 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2017. At June 30, 2017, the School District's proportion was 0.483179%, which was a decrease of 0.006250% from its proportion measured as of June 30, 2016.

For the year ended June 30, 2018, the School District recognized OPEB expense of $3,805,606.00. At June 30, 2018, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred Outflows of Resources

OPEB

Deferred Inflows of Resources

Changes of assumptions

$

- $ 5,169,381.00

Net difference between projected and actual

earnings on OPEB plan investments

19,856.00

-

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

-

785,068.00

School District contributions subsequent to

the measurement date

2,445,717.00

-

Total

$ 2,465,573.00 $ 5,954,449.00

- 25 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

School District contributions subsequent to the measurement date of $2,445,717.00 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2019 2020 2021 2022 2023 2024

$ (1,065,980.00) $ (1,065,980.00) $ (1,065,980.00) $ (1,065,980.00) $ (1,070,944.00) $ (599,729.00)

Actuarial assumptions: The total OPEB liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2017:
OPEB:

Inflation

2.75%

Salary increases

ERS

3.25% - 7.00%, including inflation

JRS

4.50%, including inflation

LRS

None

TRS

3.25 -- 9.00%, including inflation

PSERS

N/A

Long-term expected rate of return
Healthcare cost trend rate

3.88%, compounded annually, net of investment expense, and including inflation

Pre-Medicare Eligible

7.75%

Medicare Eligible

5.75%

Ultimate trend rate

Pre-Medicare Eligible

5.00%

Medicare Eligible

5.00%

Year of Ultimate trend rate

2022

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:
For ERS, JRS and LRS members: The RP-2000 Combined Mortality Table projected to 2025
with projection scale BB and set forward 2 years or both males and females is used for the period after service retirement and for dependent beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB and set back 7 years for males and set forward 3 years for females is used for the period after disability retirement.
- 26 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection
scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement.
For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with
projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement.

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014.

Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.

Additionally, there was a change of assumptions that affected measurement of the total OPEB liability since the prior measurement date. The methodology used to determine employee and retiree participation in the School OPEB Fund is based on their current or last employer payroll location. Current and former employees of public school districts, libraries, regional educational service agencies and community colleges are allocated to the School OPEB Fund irrespective of retirement system affiliation. In addition, the discount rate increased from 3.07% to 3.58%.
The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of 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 allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class

Target Allocation

Long-Term Expected Real Rate of Return*

Local Government Investment Pool

100.00%

1.13%

*Rate shown is net of the 2.75% assumed rate of inflation.
Discount rate: In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.58% was used as the discount rate. This is comprised mainly of the yield or index rate for 20 year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.56% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2115. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2029. Therefore, the calculated discount rate of 3.58% was applied to all periods of projected benefit payments to determine the total OPEB liability.

- 27 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Sensitivity of the District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability
calculated using the discount rate of 3.58%, as well as what the District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.58%) or 1 percentage-point higher (4.58%) than the current discount rate:

1% Decrease (2.58%)

Current Discount Rate (3.58%)

1% Increase (4.58%)

Net OPEB Liability

$ 80,603,005.00 $

67,886,455.00 $ 57,850,522.00

Sensitivity of the District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB
liability, as well as what the District's proportionate share of the net OPEB liability would be if it were
calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point
higher than the current healthcare cost trend rates:

1% Decrease

Current Healthcare Cost Trend Rate

1% Increase

Net OPEB Liability

$ 56,270,138.00 $ 67,886,455.00 $ 83,010,884.00

OPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports.

POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (SEAD OPEB)

Plan Description: SEAD-OPEB was created in 2007 by the Georgia General Assembly to amend
Title 47 of the O.C.G.A., relating to retirement, so as to establish a fund for the provision of term life
insurance to retired and vested inactive members of the Employees' Retirement System of Georgia
(ERS), the Legislative Retirement System, (LRS), and the Georgia Judicial Retirement System (GJRS).
The plan is a cost-sharing multiple-employer defined benefit other postemployment benefit plan as defined in Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefit Plans other than OPEB Plans. The SEAD-OPEB trust fund accumulates
the premiums received from the aforementioned retirement plans, including interest earned on
deposits and investments of such payments.

Benefits Provided: The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance in effect on the date of retirement. The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance in effect at age 60 or at termination, if earlier. Life insurance proceeds are paid in a lump sum to the beneficiary upon death of the retiree.

Contributions: Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable compensation. There were no employer contributions required for the fiscal year ended June 30, 2018.

OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB

At June 30, 2018, the School District reported a liability of ($9,905.00) for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2017. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2016. An expected total OPEB liability as of June 30, 2017 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was based on actual member salaries reported to the SEAD-OPEB plan during the fiscal year ended June 30, 2017. At June 30, 2017, the School District's proportion was 0.003811%, which was an increase of 0.000872% from its proportion measured as of June 30, 2016.
- 28 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

For the year ended June 30, 2018, the School District recognized OPEB expense of ($1,485.00). At June 30, 2018, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

SEAD - OPEB

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

Net difference between projected and actual

earnings on OPEB plan investments

$

- $

1,513.00

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

-

1,141.00

Total

$

- $

2,654.00

School District contributions subsequent to the measurement date of $0 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

SEAD - OPEB

2019 2020 2021 2022

$

(948.00)

$

(949.00)

$

(378.00)

$

(379.00)

Actuarial assumptions: The total OPEB liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016 using the following actuarial assumptions, applied to all periods included in the measurement:
OPEB:

Inflation

2.75%

Salary increases

Includes inflation

ERS

3.25% - 7.00%

GJRS

4.50%

LRS

N/A

Investment rate of return

7.50%, net of OPEB plan investment expense, including inflation

- 29 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Postretirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. There is a margin for future mortality improvement in the tables used by the plan.

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of 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 allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

Target allocation

Long-term expected real rate of return*

Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative

30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%

(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

Total

100.00%

*Rates shown are net of the 2.75% assumed rate of inflation

Discount rate: The discount rate used to measure the total OPEB 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 State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the OPEB 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 OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability.
Sensitivity of the District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 7.50%, as well as what the District's proportionate share of the net OPEB 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 discount rate:

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

School District's porportionate share of the net pension liability

$

(5,421.00) $

(9,905.00) $

(13,579.00)

OPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the separately issued ERS comprehensive annual financial report which is publically available at www.ers.ga.gov/financials.

- 30 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

NOTE 14: RETIREMENT PLANS
The School District 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 O.C.G.A 47-3-60 and certain other support personnel as defined by 47-3-63 are provided a 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 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.
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 2018. The School District's contractually required contribution rate for the year ended June 30, 2018 was 16.81% of annual School District payroll, of which 16.73% of payroll was required from the School District and 0.08% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $7,111,745.00 and $30,557.24 from the School District and the State, respectively.
EMPLOYEES' RETIREMENT SYSTEM
Plan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs.
Benefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS.

- 31 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60.
Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
Contributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's required contribution rate for the year ended June 30, 2018 was 24.81% of annual covered payroll for old and new plan members and 21.81% for GSEPS members. The rates include the annual actuarially determined employer contributions rate of 24.69% of annual covered payroll for old and new plan members and 21.69% for GSEPS members, plus a 0.12% adjustment for the HB 751 one-time benefit adjustment of 3% to retired state employees. 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. Employer contributions to the pension plan were $14,120.00 for the current fiscal year.
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.

- 32 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

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. The current fiscal year contribution was $107,768.00.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2018, the School District reported a liability of $67,143,569.00 for its proportionate share of the net pension liability for TRS ($67,051,702.00) and ERS ($91,867.00).

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

$ 67,051,702.00

State of Georgia's proportionate share of the net pension liability associated with the School District

968,295.00

Total

$ 68,019,997.00

The net pension liability for TRS and ERS was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2017.
At June 30, 2017, the School District's TRS proportion was 0.360778%, which was a decrease of 0.009802% from its proportion measured as of June 30, 2016. At June 30, 2017, the School District's ERS proportion was 0.002262%, which was an increase of 0.000365% from its proportion measured as of June 30, 2016.
At June 30, 2018, 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 $473,778.00.
The PSERS net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017 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, 2017.
For the year ended June 30, 2018, the School District recognized pension expense of $6,306,896.00 for TRS, $51,202.00 for ERS and $95,485.00 for PSERS and revenue of $52,425.00 for TRS and $95,485.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

- 33 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

At June 30, 2018, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS Deferred Outflows of Resources

Deferred Inflows of Resources

ERS

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

Differences between expected and actual experience

$ 2,508,147.00 $ 253,046.00

$

1,007.00 $

1.00

Changes of assumptions

1,469,856.00

-

209.00

-

Net difference between projected and actual earnings on pension plan investments

-

461,428.00

-

229.00

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

-

2,866,275.00

20,308.00

-

School District contributions subsequent to the measurement date

7,111,745.00

-

14,120.00

-

Total

$ 11,089,748.00 $ 3,580,749.00

$ 35,644.00 $

230.00

The School District contributions subsequent to the measurement date of $7,111,745.00 for TRS and $14,120.00 for ERS 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, 2019. 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

ERS

2019

$ (1,525,165.00) $ 15,675.00

2020

$ 2,702,744.00 $

7,193.00

2021

$ 1,289,474.00 $

1,031.00

2022

$ (2,077,149.00) $

(2,605.00)

2023

$

7,350.00 $

-

Actuarial assumptions: The total pension liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:

Inflation

2.75%

Salary increases

3.25% 9.00%, average, including inflation

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries'

- 34 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
Employees' Retirement System:

Inflation

2.75%

Salary increases

3.25% - 7.00%, average, including inflation

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future
mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set
forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP- 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society
of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females
was used for death after disability retirement. There is a margin for future mortality improvement in
the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the
actual number of deaths that occurred during the study period for service retirements and
beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
Public School Employees Retirement System:

Inflation

2.75%

Salary increases

N/A

Investment rate of return

7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
The long-term expected rate of return on TRS, ERS and PSERS pension plan investments were 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

- 35 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

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 Alternative
Total

TRS Target allocation
30.00% 39.80%
3.70% 1.50% 19.40% 5.60%
-
100.00%

ERS/PSERS Target
allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-term expected real rate of return*
(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

* Rates shown are net of the 2.75% assumed rate of inflation

Discount rate: The discount rate used to measure the total TRS, ERS 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, ERS 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.
Sensitivity of the School District'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:
School District's proportionate share of the net pension liability

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

$ 110,039,711.00 $

67,051,702.00 $ 31,639,246.00

Employees' Retirement System:
School District's proportionate share of the net pension liability

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

$

129,666.00 $

91,867.00 $

59,624.00

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

- 36 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2018

EXHIBIT "I"

NOTE 15: RESTATEMENT OF PRIOR YEAR NET POSITION

For fiscal year 2018, the School District made prior period adjustments due to the adoption of GASB Statement No. 75, as described in "New Accounting Pronouncements", which require the restatement of the June 30, 2017, net position in Governmental Activities. The result is a decrease in net position at July 1, 2017 of $70,009,677.00 This change is in accordance with generally accepted accounting procedures.

Net Position, July 1, 2017 as previously reported

$ 48,925,477.96

Prior Period Adjustment - Implementation of GASB No. 75: Net OPEB Liability (measurement date)

(72,529,011.00)

Deferred Outflows - School District's Contributions made during fiscal year 2017

2,519,334.00

Net Position, July 1, 2017, as restated

$ (21,084,199.04)

NOTE 16: SUBSEQUENT EVENTS
In the subsequent fiscal year, the School District made draws totaling $1,690,000.00 on their general obligation sales tax bonds. Advances up to the principal face amount of these bonds are made to the School District by the bond purchaser. The remaining undrawn balance of $1,491,840.00 will not be drawn by the School District due to the September 1, 2018 maturity date of these funds.

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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

SCHEDULE "1"

Year Ended

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 payroll

2018 2017 2016 2015

0.360778% $ 0.370580% $ 0.375543% $ 0.381096% $

67,051,702.00 $ 76,454,786.00 $ 57,172,693.00 $ 48,146,453.00 $

968,295.00 1,442,115.00 1,061,266.00
879,178.00

$ 68,019,997.00 $ 77,896,901.00 $ 58,233,959.00 $ 49,025,631.00

$ 42,079,987.71 $ 41,416,509.32 $ 40,376,069.47 $ 39,587,179.12

School District's proportionate share of the net pension liability as a percentage of its
covered payroll

Plan fiduciary net position as a
percentage of the total pension liability

159.34% 184.60% 141.60% 121.62%

79.33% 76.06% 81.44% 84.03%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 39 -

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

SCHEDULE "2"

Year Ended
2018 2017

School District's proportion of the net pension liability

School District's proportionate share of the net pension liability

0.002262% $ 0.001897% $

91,867.00 89,736.00

School District's covered payroll

School District's proportionate share of the net pension liability as a percentage of its covered
payroll

Plan fiduciary net position as a percentage
of the total pension liability

$

55,491.36

$

44,098.30

165.55% 203.49%

76.33% 72.34%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 40 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOLS EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "3"

Year Ended
2018 2017 2016 2015

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

0.00% $ 0.00% $ 0.00% $ 0.00% $

-

$

-

$

-

$

-

$

473,778.00 $ 670,455.00 $ 478,538.00 $ 413,355.00 $

Total

School District's covered payroll

School District's proportionate share of the net pension liability as a percentage of its
covered payroll

Plan fiduciary net position as a
percentage of the total pension liability

473,778.00 $ 1,097,561.91 670,455.00 $ 1,170,234.97 478,538.00 $ 1,241,888.00 413,355.00 $ 1,208,847.44

N/A

85.69%

N/A

81.00%

N/A

87.00%

N/A

88.29%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 41 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30

SCHEDULE "4"

Year Ended 2018

School District's proportion of the net OPEB liability

School District's proportionate share of the net OPEB liability

State of Georgia's proportionate share of the net OPEB liability
associated with the School District

0.483179% $

67,886,455.00 $

-

Total

School District's covered-employee
payroll

School District's proportionate share of the
net OPEB liability as a percentage of its covered-
employee payroll

Plan fiduciary net position as a
percentage of the total OPEB liability

$ 67,886,455.00 $ 36,290,834.92

187.06%

1.61%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 42 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SEAD - OPEB FOR THE YEAR ENDED JUNE 30

SCHEDULE "5"

Year Ended

School District's proportion of the net OPEB liability

2018

0.003811%

School District's proportionate share of the net OPEB liability

State of Georgia's proportionate share
of the net OPEB liability associated
with the School District

$ (9,905.00) $

-

Total
$ (9,905.00)

School District's covered-employee
payroll
$ 55,491.36

School District's proportionate share of the net OPEB liability as
a percentage of its covered-employee
payroll

Plan fiduciary net position as a
percentage of the total OPEB liability

-17.85%

130.17%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 43 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTAL INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHER'S RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "6"

Year Ended
2018 2017 2016 2015

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

$

7,111,745.00 $

7,111,745.00 $

-

$

5,919,444.00 $

5,919,444.00 $

-

$

5,800,443.00 $

5,800,443.00 $

-

$

5,212,691.72 $

5,212,691.72 $

-

School District's covered payroll

$

42,497,984.92

$

42,079,987.71

$

41,416,509.32

$

40,376,069.47

Contribution as a percentage of covered
payroll
16.73% 14.07% 14.01% 12.91%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 44 -

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

SCHEDULE "7"

Year Ended

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

2018

$

14,120.00 $

14,120.00 $

-

2017

$

13,767.00 $

13,767.00 $

-

School District's covered payroll

$

56,913.54

$

55,491.36

Contribution as a percentage of covered
payroll
24.81% 24.81%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 45 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND
FOR THE YEAR ENDED JUNE 30

SCHEDULE "8"

Year Ended

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

School District's covered-employee
payroll

2018

$

2,445,717.00 $

2,445,717.00 $

-

$ 36,610,361.34

Contribution as a percentage of covered-
employee payroll
6.68%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 46 -

TIFT COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SEAD - OPEB
FOR THE YEAR ENDED JUNE 30

SCHEDULE "9"

Year Ended 2018

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency School District's covered-

(excess)

employee payroll

Contribution as a percentage of covered-
employee payroll

$

-

$

-

$

-

$

56,913.54

0.00%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 47 -

TIFT COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2018

SCHEDULE "10"

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.
On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
Employees' Retirement System
Changes of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases.
Public School Employees 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.
On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females).
School OPEB Fund
Changes of benefit terms: In June 30, 2010 actuarial valuation, there was a change of benefit terms to require Medicare-eligible recipients to enroll in a Medicare Advantage plan to receive the State subsidy.
Changes in assumptions: In the revised June 30, 2017 actuarial valuation, there was a change relating to employee allocation. Employees were previously allocated based on their Retirement System membership, and currently employees are allocated based on their current employer payroll location. Additionally, there were changes to the discount rate and an icrease in the investment rate of return due to a longer-term investment strategy.
In the June 30, 2015 actuarial valuation, decremental and underlying inflation assumptions were changed to reflect the Retirement Systems' experience studies.
SEAD-OPEB Employer
Changes of assumptions: On December 17, 2015, the Bond of Trustees adopted recommended changes to the economic and demographic assumptions utilized by the Plan. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases.

- 48 -

TIFT COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2018

SCHEDULE "11"

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
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 Balances
Fund Balances - Beginning
Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL

FINAL

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$

17,916,000.00 $

175,000.00

45,713,387.00

11,709,775.00

382,536.00

-

1,016,850.00

76,913,548.00

17,938,349.20 $ 282,848.10
46,743,595.87 11,441,807.98
474,611.48 56.07
1,498,467.15
78,379,735.85

18,600,868.35 $ 282,848.10
48,030,153.01 11,358,456.93
1,161,719.01 56.07
1,118,171.45
80,552,272.92

662,519.15 -
1,286,557.14 (83,351.05) 687,107.53 -
(380,295.70)
2,172,537.07

49,802,710.56
3,004,257.00 3,874,795.00 1,033,016.00
711,465.00 5,556,858.00
599,167.00 4,399,779.00 1,924,711.00
332,291.00 35,000.00 15,000.00
5,281,500.00
76,570,549.56
342,998.44

50,789,010.12
3,160,947.02 3,375,390.43 1,053,483.24
721,789.75 5,453,210.90
631,846.44 4,308,304.56 2,292,421.78
338,356.33 42,181.54 14,864.96
5,339,916.18
77,521,723.25
858,012.60

50,333,678.35
2,992,472.87 3,247,227.97 1,053,483.24
575,426.72 5,453,210.90
631,846.44 4,308,304.56 2,246,049.57
337,956.33 42,181.54 14,864.96
5,281,610.35
76,518,313.80
4,033,959.12

455,331.77
168,474.15 128,162.46
146,363.03
46,372.21 400.00 58,305.83
1,003,409.45
3,175,946.52

210,000.00 (210,000.00)
342,998.44 15,879,123.71
36,458.63

1,563,037.15 (2,227,495.51)
(664,458.36) 193,554.24 15,879,123.71
18,290.93

(677,308.20) (677,308.20) 3,356,650.92 15,052,634.99
-

(1,563,037.15) 1,550,187.31
(12,849.84) 3,163,096.68
(826,488.72) (18,290.93)

Fund Balances - Ending

$

16,258,580.78 $

16,090,968.88 $ 18,409,285.91 $

2,318,317.03

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.

- 49 -

TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2018

SCHEDULE "12"

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 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 Grants to States Preschool Grants Preschool Grants
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States English Language Acquisition Grants English Language Acquisition Grants Migrant Education - State Grant Program Migrant Education - State Grant Program Rural Education Rural Education Student Support and Academic Enrichment Program Supporting Effective Instruction State Grants Supporting Effective Instruction State Grants Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies
Total Other Programs
Total U. S. Department of Education
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 Child Care and Development Block Grant
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

18185GA324N1099 $ 18185GA324N1100

1,272,268.88 3,726,666.87
4,998,935.75

84.027 84.027 84.173 84.173

H027A160073 H027A170073 H173A160081 H173A170081

84.048 84.365 84.365 84.011 84.011 84.358 84.358 84.424A 84.367 84.367 84.010 84.010

V048A170010 S365A160010 S365A170010 S011A160011 S011A170011 S358B160010 S358B170010 S424A170011 S367A160001 S367A170001 S010A160010 S010A170010

279,072.00 1,122,367.08
50.00 79,225.86
1,480,714.94
83,966.00 6,352.00
60,734.25 41,421.00 151,920.62 40,927.00 111,244.93 94,110.00 73,454.00 295,912.81 244,963.00 3,490,042.59
4,695,048.20
6,175,763.14

93.575

17175GA368N1099

12.UNKNOWN

95,567.37 53,891.01

Total Expenditures of Federal Awards

$

11,324,157.27

Notes to the Schedule of Expenditures of Federal Awards
Note 1. Basis of Presentation
The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Tift County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2018. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board.
Note 2. Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

See notes to the basic financial statements.

- 50 -

TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2018

SCHEDULE "13"

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 Gifted Student - Category VI Remedial Education Program Alternative Education Program English 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 Charter System Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Education Equalization Funding Grant Other State Programs Agriculture Construction Bonds Food Services Math and Science Supplements Preschool Disability Services Pupil Transportation - State Bonds Teacher of the Year Teachers Retirement Vocational Education Vocational Supervisors
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Governor's Office of Student Achievement Scaling/Coding Grant
Office of the State Treasurer Public School Employees Retirement

GOVERNMENTAL FUND TYPES

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$ 1,432,195.13 $

- $ 1,432,195.13

1,288,022.00 1,949,632.00 4,869,167.00 1,744,249.00 2,538,894.00 1,240,772.00 4,922,859.00 3,856,760.00 1,605,523.00 5,029,361.00 2,799,169.00 1,096,548.00
347,484.00 956,367.00 894,789.00 266,883.00 154,329.00
2,935.00
1,166,814.00 1,794,645.00 1,993,736.00
(667,866.00) 723,082.00
691,925.00 154,843.00 3,592,534.00
279,352.89 129,306.00
49,672.78 165,800.00
77,319.58 507.25
30,557.24 315,949.11
33,005.84

-

1,288,022.00

-

1,949,632.00

-

4,869,167.00

-

1,744,249.00

-

2,538,894.00

-

1,240,772.00

-

4,922,859.00

-

3,856,760.00

-

1,605,523.00

-

5,029,361.00

-

2,799,169.00

-

1,096,548.00

-

347,484.00

-

956,367.00

-

894,789.00

-

266,883.00

-

154,329.00

-

2,935.00

-

1,166,814.00

-

1,794,645.00

-

1,993,736.00

-

(667,866.00)

-

723,082.00

-

691,925.00

-

154,843.00

-

3,592,534.00

-

279,352.89

-

129,306.00

-

49,672.78

-

165,800.00

-

77,319.58

-

507.25

-

30,557.24

-

315,949.11

-

33,005.84

395,263.19 107,768.00

4,910,657.04 -

4,910,657.04 395,263.19 107,768.00

$ 48,030,153.01 $ 4,910,657.04 $ 52,940,810.05

See notes to the basic financial statements.

- 51 -

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TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
FOR THE YEAR ENDED JUNE 30, 2018

SCHEDULE "14"

PROJECT

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 Eight Street Middles 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 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.

Splost V 2017 (i) Constructing school buildings or facilities necessary to accommodate future population growth, mandated minimum class size and instructional models:
(ii) Adding to, renovating, repairing, expanding, improving, and/or equipping existing educational facilities, including but not limited to the facilities currently bearing the names Tift County High School, Tift County High School Northeast Campus, Eight Street Middle School, Len Lastinger Primary School, Northside Primary School, G.O. Bailey Primary School and Tift County Pre-K Center, physical education/ athletic buildings and facilities, support facilities and other facilities necessary for efficient and effective school operations:
(iii) Purchasing or acquiring miscellaneous new equipment fixtures and furnishings for the school system, including but not limited to instructional and administrative technology equipment and software, textbooks, library books, physical education equipment, band and musical instruments and other instructional materials;
(iv) Acquiring or purchasing any real or personal property and equipment necessary or desirable for schools or school system purposes and operations;
(v) Purchasing school vehicles, to include school buses, school system motor vehicles and equipment;
(vi) Capital repairs and upgrades to school buses, school systems motor vehicles and equipment;
(vii) Paying all expenses incident to the planning and accomplishing of the foregoing (collectively, the "Projects"). Capitalized interest on the Debt and Cost of issuing the Debt.

ORIGINAL ESTIMATED
COST (1) 10,000,000.00 $
16,600,000.00
17,500,000.00 1,200,000.00 1,550,000.00 1,100,000.00 50,000.00
48,000,000.00
18,200,000.00
9,000,000.00
16,000,000.00 1,700,000.00 1,250,000.00 1,750,000.00 100,000.00
48,000,000.00

CURRENT ESTIMATED COSTS (2)
6,600,000.00 $
18,289,931.00
20,491,848.98 2,200,000.00 1,264,754.36 1,100,000.00 500,989.93
50,447,524.27
18,200,000.00
26,111,798.86
16,000,000.00 1,700,000.00 1,250,000.00 1,750,000.00 268,011.00
65,279,809.86

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

TOTAL COMPLETION
COSTS

EXCESS PROCEEDS NOT
EXPENDED

- $

345,283.72 $

- $

-

111,616.32

18,178,314.68

-

-

2,329,278.41

18,162,570.57

-

-

-

2,165,385.11

-

-

163,351.82

1,101,402.54

-

-

43,769.73

1,049,543.24

-

-

5,734.00

495,255.93

-

-

2,653,750.28

41,497,755.79

-

-

-

-

-

-

19,502,720.40

6,609,078.46

-

-

2,752,696.91
621,687.20 209,320.00 180,882.33

-

-

-

-

-

-

-

-

-

-

-

-

203,861.41

64,149.59

-

-

23,471,168.25

6,673,228.05

-

-

ESTIMATED COMPLETION
DATE 6/30/2019
6/30/2019
6/30/2019 6/30/2019 6/30/2019 6/30/2019 6/30/2019
6/30/2022
6/30/2022
6/30/2022 6/30/2022 6/30/2022 6/30/2022 6/30/2022

$

96,000,000.00 $ 115,727,334.13 $

26,124,918.53 $ 48,170,983.84 $

(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 the 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 and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the basic financial statements.

- $

-

- 53 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

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 11, 2019

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia 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
We have audited, in accordance with the 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 the Tift County Board of Education (School District), as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated July 11, 2019.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District'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 School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District'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.
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. 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.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District'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.
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 School District'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 School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor

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 11, 2019

The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia 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 FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
Report on Compliance for Each Major Federal Program
We have audited the Tift County Board of Education (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018. The School District'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 federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the School District'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 the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance 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 School District'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 the School District's compliance.

Opinion on Each Major Federal Program
In our opinion, the School District 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, 2018.
Report on Internal Control over Compliance
Management of the School District 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 the School District'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 the Uniform Guidance, 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 School District'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 the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor

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

TIFT COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2018
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.

SECTION IV FINDINGS AND QUESTIONED COSTS

TIFT COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2018

I SUMMARY OF AUDITOR'S RESULTS

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

Unmodified

Internal control over financial reporting: Material weakness identified? Significant deficiency identified?

No None Reported

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 2 CFR 200.516(a)?

No

Identification of major programs: CFDA Numbers

Name of Federal Program or Cluster

10.553, 10.555

Child Nutrition Cluster

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

$750,000.00

Auditee qualified as low-risk auditee?

No

II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported.

III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.