Washington County Board of Education, Sandersville, Georgia, report on audit of the fiscal year ended June 30, 2000

STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
GA
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WASHINGTON COUNTY BOARD OF EDUCATION SANDERSVILLE, GEORGIA REPORT ON AUDIT
OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2000
Russell W. Hinton State Auditor

WASHINGTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION!

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

AND EXPENDABLE TRUST FUND

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

COMBINED STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUNDS

8

E

COMBINED STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUNDS

9

F NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

11

ADDIDONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

24

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

26

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

28

K

FIDUCIARY FUND TYPES

COMBINING BALANCE SHEET

30

WASHINGTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

32

2 SCHEDULE OF STATE REVENUE

34

ANALYSIS OF MINWUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

3

OVERALL

35

4

BY PROGRAM

36

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133

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

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

SECTION I FINANCIAL

w. RUSSELL

HINTON

STATE AUDITOR

(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 8, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Washington County Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general purpose financial statements ofthe Washington County Board of Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe Washington County Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An .audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:
* The general purpose financial statements of the Board did not contain a General Fixed
Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles.
2000ARL-13

* School activity accounts maintained at the individual schools are not included in the
general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Washington County Board of Education as of June 30, 2000, and the results of its operations and the cash flows of its nonexpendable trust funds for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated February 8, 2001, on our consideration ofthe Washington County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Washington County Board of Education taken as a whole. The accompanying combining statements (Exhibits G through K) and the financial schedules (Schedules 1 through 4), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.
Respectfully submitted,
~... fli w~ 1;t'sell W. Hinton State Auditor
RWH:jb 2000ARL-13

WASHINGTON COUNTY BOARD OF EDUCATION

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

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food
Amount Available in Debt Service Fund
Amount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$ 3,318,925.40 $

691,324.78 $

174,627.35

2,032,435.29

295,206.07

267,015.43

20,677.18 13,212.22

Total Assets

$ 5,351 ,360.69 $ 1,020,420.25 $ ==4=4=1=,64=2==78=

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts _Payable Salaries Payable Expired Grant Balances Payable Retainages Payable Capital Lease Agreements General Obligation Bonds Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Debt Service For Endowment Corpus For Inventories Food Donated Commodities Purchased Food For Purposes of Bond Issue For State Capital Outlay Projects Unreserved Designated for Self-Insurance Undesignated
Total Fund Equity

$ 1,121,931.40 $ 1,855,908.67

212,529.69 $ 194,533.76
2,205.25

20,424.29

$ 2,977,840.07 $

409,268.70 $

20,424.29

$

7,973.08

20,677.18 13,212.22
$

$

83,585.66

2,289,934.96

$ 2,373,520.62 $

569,289.07 611,151.55 $

344,634.04
76,584.45 421,218.49

Total Liabilities and Fund Equity

$ 5,351,360.69 $ 1,020,420.25 $

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

441,642.78

EXHIBIT"A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST FUNDS

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only}

JUNE 301 2000

JUNE 30, 1999

$

631,430.30 $

5,880.78

$ 4,822, 188.61 $ 4,563,541.97

32,576.69

32,576.69

32,576.69

20,258.24

1,437.29

2,616,352.32

2,212,937.54

$

651,688.54

20,677.18 13,212.22
651,688.54

19,177.01 13,220.57
552,860.98

11,433,311.46 1,863,882.29

11,433,311.46 1,863,882.29

12,102,139.02 2,215,088.18

$

651,688.54 $

39,894.76 $

13,948,882.29 $ 21,453,889.31 $ 21,711,541.96

$ 1,354,885.38 $ 1,127,983.49

2,050,442.43

1,952,388.82

2,205.25

9,584.55

7,165.00

$

1,863,882.29

1,863,882.29

2,215,088.18

12,085,000.00

12,085,000.00

12,655,000.00

$

13,948,882.29 $ 17,356,415.35 $ 17,967,210.04

$

651,688.54

$

29,052.02

0.00

$

651,688.54 $

10 842.74 39,894.76

$

7,973.08 $

5,014.20

651,688.54

552,860.98

29,052.02

29,052.02

20,677.18 13,212.22 344,634.04

19,177.01 13,220.57 470,329.52 120,294.00

83,585.66 2,946,651.22

83,585.66 2,450,797.96

$ 4,097,473.96 $ 3,744,331.92

$

651,688.54 $

39,894.76 $

13,948,882.29 $ 21,453,889.31 $ 21,711,541.96

-3-

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

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support services Other Support Services Food Services Operation Community Services Operations
Capital Outlay Debt Service
Principal Interest Paying Agent Fees
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES {USES)
Capital Leases Sale of Assets Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND
$ 14,270,983.83 $
18,051.47 7,310,788.10
221,161.58
$ 21,820,984.98 $

$ 12,601,549.66 $
895,249.99 821,114.40 544,547.28 484,001.58 1,626,554.48 109,951.82 2,505,009.37 1,230,915.67
1,382.91 35,649.49
7,000.00

350,928.55 136,105.55

$ 21 ,349,960.75 $

$

471,024.23 $

$

$

-3,938.03

$

-3,938.03 $

$

467,086.20 $

1,906,434.42

GOVERNMENTAL FUND

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

496,832.43 2,717,968.58
217,284.58 $
3,432,085.59 $

83,347.80 83,347.80

1,508,469.47
80,631.83 73,198.45 21,386.76 74,096.46
2,149.02 23,978.47 35,545.99
2,668.89 1,592, 177.87
$

319,083.57

3,414,303.21 $ 17,782.38 $

319,083.57 -235,735.77

3,938.03

3,938.03

21,720.41 $
587,939.32

-235,735.77 656,954.26

1,500.17 -8.35

FUND BALANCE JUNE 30

$ 2,373,520.62 $

611, 151.55 $ ==4=2=1=,2=18=.4==9=

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

EXHIBIT"B"

TYPES DEBT
SERVICE FUND

TOTAL

FIDUCIARY FUND TYPE EXPENDABLE TRUST FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$ 14,767,816.26

2, 736, 020. 05

$ 1,262,948.07

8,573,736.17

18 077.86

539,871.82 $

$ 1,281,025.93 $ 26,617,444.30 $

$ 3,860.87

14,767,816.26 $ 2,736,020.05 8,573,736.17
543,732.69

15,622,384.60 2,547,723.06 7,592,728.35
438,184.83

3 860.87 $ 26,621,305.17 $ 26,201,020.84

$ 14,110,019.13 $

975,881.82 894,312.85 565,934.04 558,098.04 1 ,626,554.48 112,100.84 2,528,987.84 1,266,461.66
1,382.91 38,318.38 1,592,177 .87
7,000.00 319,083.57

$

570,000.00

610,957.50

1 240.87

920,928.55 747,063.05
1 240.87

$ 1,182,198.37 $ 26,265,545.90 $

$

98,827.56 $

351,898.40 $

4,000.00 $ 14,114,019.13 $ 14,868,620.79

975,881.82 894,312.85 565,934.04 558,098.04 1 ,626,554.48 112,100.84 2,528,987.84 1,266,461.66
1,382.91 38,318.38 1,592, 177.87
7,000.00 319,083.57

1,003,089.21 718,400.66 605,961.97 534,068.90
2,048,585.39 117,029.42
2,025,867.98 1z150,554.20
1,354.52 42,369.91 1 ,620,043.47
6,500.00 2,636,707.30

920,928.55 747,063.05
1 240.87

746,443.00 687,115.95
1,302.87

4 000.00 $ 26,269,545.90 $ 28,814,015.54

-139.13 $

351,759.27 $ -2,612,994.70

$

3,938.03

-3 938.03

$

0.00

$

98,827.56 $

351,898.40 $

552,860.98

3,704,188.98

1,500.17 -8.35

$ 2,097,459.37

800,000.00

$

3,938.03

36,529.05

-3,938.03

-36,529.05

$

0.00 $ 2,897,459.37

-139.13 $ 6,019.91

351,759.27 $ 3,710,208.89

284,464.67 3,422,387.49

1,500.17 -8.35

5,555.57 -2,198.84

$

651,688.54 $ 4,057,579.20 $

5,880.78 $ 4,063,459.98 $ 3,710,208.89 -5-

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

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 13,901,145.00 $ 14,270,983.83

51, 109.00

18,051.47

7, 109,913.00

7,310,788.10

55,000.00

221, 161.58

Total Revenues

$ 21, 117,167.00 $ 21,820,984.98

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Community Services Operations
Debt Service

$ 12,779,071.98 $ 12,601,549.66

840,807.00 903,559.00 564,176.00 462,098.00 2, 114,030.00 111,398.00 2,410,080.35 1,079,838.00
6,800.00 30,665.00

895,249.99 821, 114.40 544,547.28 484,001.58 1,626,554.48 109,951.82 2,505,009.37 1,230,915.67
1,382.91 35,649.49

7,000.00

7,000.00 487 034.10

Total Expenditures

$ 21,309,523.33 $ 21,349,960.75

Excess of Revenues over (under) Expenditures

$ -192,356.33 $ 471,024.23

OTHER FINANCING SOURCES {USES}

Other Sources Other Uses

$

-3,938.03

Total Other Financing Sources (Uses)

$

-3,938.03

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

-192,356.33 $

467,086.20

FUND BALANCE JULY 1, 1999

2, 197,854.07

1,906,434.42

Food Inventory - Net Change in Period Donated Commodities Purchased Food
Adjustments

29,697.96

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$

431,714.00 $

496,832.43

2,900,664.00

2,717,968.58

136,295.00

217,284.58

$ 3,468,673.00 $ 3,432,085.59

$ 1,505,490.02 $ 1,508,469.47

99, 132.00 146,036.00
9,689.00 118,919.00

80,631.83 73, 198.45 21,386.76 74,096.46

2,149.00 23,916.00 38,200.00

2,149.02 23,978.47 35,545.99

11,810.00 1,432,549.00

2,668.89 1,592, 177.87

$ 3,387,890.02 $ 3,414,303.21

$

80,782.98 $

17,782.38

$

6,500.00 $

3,938.03

$

6 500.00 $

3,938.03

$

87,282.98 $

21,720.41

589,218.27

587,939.32

17,321.36

1,500.17 -8.35

FUND BALANCE JUNE 30, 2000

$ 210351195. 70 $ 213731520.62

$

6931822.61 $

6111151.55

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

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "D"

COMBINED STATEMENT OF REVENUES. EXPENSES AND CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUNDS

YEAR ENDED JUNE 30. 2000

OPERATING REVENUES Donations
OPERATING EXPENSES Current Support Services Pupil Services Operating Income (Loss)
NONOPERATING REVENUES Interest Earned Net Income
FUND BALANCE JULY 1

ENDOWMENT FUNDS

VETERANS OF

VIRGINIA

FOREIGN WARS

SMITH

SCHOLARSHIP SCHOLARSHIP

FUND

FUND

TOTALS {Memorandum Onll'.)
YEAR ENDED JUNE 30, 2000 JUNE 30, 1999

$

0.00 $

0.00 $

0.00 $

5,000.00

$

984.60 $

999.16 $

1 983.76 $

1 669.77

$

-984.60 $

-999.16 $

-1 ,983.76 $

3,330.23

920.33

954.38

1 874.71

1,909.94

$

-64.27 $

-44.78 $

-109.05 $

5,240.17

16,696.16

17 426.87

34,123.03

28,882.86

FUND BALANCE JUNE 30

$

16,631.89 $

17,382.09 $

34,013.98 $ ===3=4=,1=2=3=.0=3

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

WASHINGTON COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30. 2000

EXHIBIT"E"

ENDOWMENT FUNDS

VETERANS OF

VIRGINIA

FOREIGN WARS

SMITH

SCHOLARSHIP SCHOLARSHIP

FUND

FUND

TOTALS {Memorandum Only}
YEAR ENDED JUNE 30, 2000 JUNE 30, 1999

Cash Flows from Operating Activities:

Cash Paid for Scholarships

$

Donations Made to Funds

-984.60 $

-999.16 $

-1,983.76 $

-1,669.77 5,000.00

Net Cash Provided (Used) by Operating

Activities

$

-984.60 $

-999.16 $

-1 ,983.76 $

3,330.23

Cash Flows from Investing Activities: Proceeds from Maturity of Investments $ Interest Received on Investments Purchase of Investments

15,923.96 $ 984.60
-15,923.96

16,652.73 $ 999.16
-16,652.73

32,576.69 $ 1,983.76
-32,576.69

27,343.40 1,670.79
-32,576.69

Net Cash Provided by Investment

Activities

$

984.60 $

999.16 $

1 983.76 $

-3,562.50

Net Increase (Decrease) in Cash

$

0.00 $

0.00 $

0.00 $

-232.27

Cash and Cash Equivalents - July 1

$

0.00 $

0.00 $

0.00 $

232.27

Cash and Cash Equivalents - June 30

$

0.00 $

0.00 $

o.oo $ ======o=.o=o

The notes to the general purpose financial statements are an integral part of this statement. -9-

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

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

- 11 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBTSERVICE FUND- the fund used to account forthe accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUNDS Veterans of Foreign Wars Scholarship Fund - the fund used to account for an endowment of which the corpus is to be invested and preserved intact with the resultant income to be used to provide scholarship aid to the second and third honor graduates each year at Washington County High School.
Virginia Smith Scholarship Fund - the fund used to account for an endowment ofwhich the corpus is to be invested and preserved intact with the resultant income to be used to provide scholarship aid to the valedictorian of each graduating class at Washington County High School.
EXPENDABLE TRUST FUND Minority Scholarship Fund - the fund used to account for contributions used to provide scholarship aid to graduating minority students.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and capital lease obligations.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
- 12 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
All nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation ofthese funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1999 and ending in early June 2000. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share ofthese contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements.
The accrual basis.ofaccounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
BUDGET
The Washington County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.

- 13 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
- 14 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

RECEIVABLES

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

PROPERTY TAXES

The Washington County Board of Commissioners fixed the property tax levy for the 1999 tax year (calendar year) on November 10, 1999 (levy date). Taxes were due on January 10, 2000. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Washington County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board.

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

School Operations School Bonds

16.33 mills 2.72 mills

19.05 mills

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

GENERAL OBLIGATION BONDS

The Board issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in

- 15 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
the financial statements during the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount ofthese bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements ofexpenditures/expenses initially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and ~s reductions of expenditures/expenses in the fund that is reimbursed.
Operating transfers are recorded for all interfund transactions other than reimbursements.
MEMORANDUM ONLY -TOTAL COLUMNS
Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results ofoperations or cash flows in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not l;>een made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such s~ety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13 .1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
- 16 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 2: DEPOSITS

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,

(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,

(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,

(6) Industrial revenue bonds and bonds ofdevelopment 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 the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 2000, the bank balances were $6,053,165.52. Theamountsofthetotal bank balances are classified into three categories of credit risk:

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

The Board's deposits are classified by risk category at June 30, 2000, as follows:

Risk Category

Bank Balance

1

$ 1,021,665.13

2

3,143,197.90

3

1,888,302.49

Total

$ 6.053.165.52

- 17 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 3: NON-MONETARY TRANSACTIONS

The Board receives food commodities from the United States Department ofAgriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories

Note 4: RISK MANAGEMENT

The Board is exposed to various risks ofloss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation.

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

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

The Board is self-insured with regard to unemployment compensation claims. In connection with this program, a self-insurance reserve has been established within the General Fund by the Board. The Board accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred and the amount ofthat loss can be reasonably estimated.

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

1999 2000

Beginning of Year Liability

Claims and Changes in Estimates

$

0.00 $

4,953.00 $

$

4,953.00 $

1,016.00 $

Claims Paid

End ofYear Liability

0.00 $ 5,969.00 $

4,953.00 0.00

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

Position Covered

Amount

Superintendent Bookkeeper All Other Employees

$ 100,000.00 $ 475,000.00 $ 25,000.00

- 18 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Washington County Board ofEducation entered into an agreement in the prior fiscal year with the Georgia School Boards Association (GSBA), Incorporated for the lease-purchase of new administrative office facilities for the Board ofEducation. Under the terms ofthe lease agreement, the Board will make quarterly payments through January 15, 2006. The lease includes an annual renewable clause.

The Washington County Board ofEducation has entered into various lease agreements as lessee for office and instructional equipment. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

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

Purpose

Interest Rates

Amount

General Government - Series 1994 General Government - Refunding - Series 1998

4.9%-6.3% $ 2,805,000.00

3.6%-4.75%

9,280,000.00

$ 12.085.000.00

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

Balance July 1, 1999
Deductions Debt Retired Trade-Ins
Balance June 30, 2000

Ca12ital Leases

GSBA

Other

General Obligation
Bonds

Total

$ 1,976,348.37 $ 238,739.81 $12,655,000.00 $14,870,088.18

241,961.37

108,967.18 277.34

570,000.00

920,928.55 277.34

$ 1734387 00 $ 122 425.22 $12 Q85,QQQ.QQ $13 248 882.22

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

- 19 -

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 5: GENERAL LONG-TERM DEBT

Fiscal Year Ended June 30
2001 2002 2003 2004 2005 2006 - 2010 2011 - 2014
Total Principal and Interest
Deduct: Imputed Interest
Net Present Value of Future Minimum Lease Payments

CaJ;!ital Leases

GSBA

Other

General Obligation
Bonds

Total Debt

$ 362,811.52 $ 85,291.52 $ 907,807.50 $ 1,355,910.54

362,811.52

54,613.40 1,206,810.00 1,624,234.92

362,811.52

7,719.71 1,210,390.00 1,580,921.23

362,811.52

1,210,980.00 1,573,791.52

362,811.52

1,208,565.00 1,571,376.52

272,210.20

6,032,507.50 6,304,717.70

4,749,172.50 4,749,172.50

$ 2,086,267.80 $ 147,624.63 $16 526 232.50 $18 760 124.93

351,880.80

18,129.34

$ l :Z34 387.QQ $ 122 ~25.22.

Note 6: PRIOR YEAR DEFEASEMENT OF DEBT

In fiscal year 1998 the Board defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for a portion ofthe future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 2000, $8,015,000.00 of bonds are outstanding and are considered defeased.

Note 7: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $209,319.99 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance ofNon-Certified Personnel In the amount of $167,113.99

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $42,206.00

Note 8: CONTINGENT LIABILITIES

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

-20-

WASHINGTON COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2000

Note 9: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

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

Fiscal Year

Percentage Contributed

Required Contribution

2000 1999 1998

100% 100% 100%

$ 1,607,574.63 $ 1,604,988.00 $ 1,537,091.03

- 21 -

WASHINGTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 2000

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

635,916.52 $

47,001.55

895.36

15,358.17

20,677.18 13,212.22

Total Assets

$

670,701.28 $ ===6=2=,3=5=9=.7==2

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated
Total Fund Equity

$

22,834.65 $

34,926.73

44,688.16

25,227.74

2,205.25

$

67,522.81 $

62,359.72

$

20,677.18

13,212.22

569,289.07 $

0.00

$

603,178.47 $

0.00

Total Liabilities and Fund Equity
See notes to the general purpose financial statements. - 22 -

$

670,701.28 $ =====6=2=,3=5=9=.7=2=

EXHIBIT"G"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

8,406.71 $

691,324.78 $

666,630.76

278,952.54

295,206.07

181,439.66

20,677.18 13,212.22

19,177.01 13,220.57

$

287,359.25 $ 1,020,420.25 $ ==8=8=0=,4=68==00=

$

154,768.31 $

212,529.69 $

107,792.61

124,617.86

194,533.76

175,151.52

2,205.25

9,584.55

$

279,386.17 $

409,268.70 $ _ _2=9=2=,5=28=.;;..;68""-

$

7,973.08 $

7,973.08 $

5,014.20

20,677.18 13,212.22

19,177.01 13,220.57

0.00

569,289.07

550,527.54

$

7!973.08 $

611,151.55 $

587,939.32

$

287,359.25 $ 1,020,420.25 $ ==8=8=0=,4=68==00=

- 23 -

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

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

113,870.00 $

1,279,784.82

217,284.58

$ 1,610,939.40 $

328,982.43 328,982.43

$

$ 1,592,177.87

$ 1,592,177.87 $

$

18,761.53 $

288,118.01 35,357.88 254.95 1,515.00 2,149.02 1,860.16
329,255.02 -272.59

$

18,761.53 $

582,925.12

1,500.17 -8.35

272.59
0.00 0.00

FUND BALANCE JUNE 30
See notes to the general purpose financial statements. -24-

$

603,178.47 $ ========0.=00=

EXHIBIT"H"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

53,980.00 $

496,832.43 $

420,534.69

1,438,183.76

2,717,968.58

2,507,686.87

217,284.58

215,376.84

$ 1,492,163.76 $ 3,432,085.59 $ 3,143,598.40

$ 1,220,351.46 $ 1,508,469.47 $ 1,322,910.65

45,273.95 72,943.50 19,871.76 74,096.46
23,978.47 33,685.83 2,668.89

80,631.83 73,198.45 21,386.76 74,096.46
2,149.02 23,978.47 35,545.99
2,668.89 1,592, 177 .87

50,019.50 85,424.13
907.95 89,089.69
2,162.35 23,920.61 29,840.53
3,800.98 1,620,043.4 7

$ 1,492,870.32 $ 3,414,303.21 $ 3,228,119.86

$

-706.56 $

17,782.38 $

-84,521.46

3,665.44

3,938.03

11,490.05

$

2,958.88 $

21,720.41 $

-73,031.41

5,014.20

587,939.32

657,614.00

1,500.17 -8.35

5,555.57 -2,198.84

$

7,973.08 $

611,151.55 $ ===58=7=,9=3=9.=32=

- 25 -

WASHINGTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30. 2000

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Accounts Payable Retainages Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For Purposes of Bond Issue For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity
Total Liabilities and Fund Equity

REGULAR

BOND PROCEEDS

$

365,058.33

$ _ __;2=6:....:..7.!..::,0...:...15=.4...;..;3~

$

267,015.43 $ ===36=5=,0=5=8..3..3. ==

$

190,430.98

$

$

190,430.98 $

20,424.29 20,424.29

$

344,634.04

$

76,584.45

0.00

$

76,584.45 $

344,634.04

$

============ 267,015.43 $

365,058.33

See notes to the general purpose financial statements. - 26 -

EXHIBIT"!"

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

0.00 $

LOTTERY PROJECT

TOTALS

JUNE 30, 2000

JUNE 30, 1999

0.00 $

365,058.33 $

585,091.60

267,015.43

110,474.00

$

0.00 $

0.00 $

632,073.76 $ ==6=9=5=,5=6=5.=60=

$

190,430.98

20,424.29 $

31,446.34 7,165.00

$

210,855.27 $ _ _.....;3'-"8..:..;;,6_1_1._34~

$

344,634.04 $

470,329.52

120,294.00

$

0.00 $ _ _ _ _..;;..;0.~00.;;_

76,584.45

66,330.74

$

0.00 $

0.00 $

- - - - - - - - 421,218.49 $

656,954.26

$

0.00 $

0.00 $

632,073.76 $ ===6=95=,5=65=.60=

- 27 -

WASHINGTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30. 2000

REVENUES
State Funds Other Funds
Total Revenues
EXPENDITURES
Capital Outlay Building and Building Improvements Equipment
Debt Service Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES}
Capital Leases Sale of Asset Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Residual Equity Transfer
FUND BALANCE JUNE 30

REGULAR

BOND PROCEEDS

$

3,089.71 $

80,258.09

$

3,089.71 $

80,258.09

$

0.00 $

308,620.07

10,463.50

$

0.00 $

319,083.57

$

3,089.71 $

-238,825.48

$

7,164.00

$

-7,164.00

$

7,164.00 $

-7,164.00

$

10,253.71 $

-245,989.48

66,330.74

470,329.52

120,294.00

$

=========== 76,584.45 $

344,634.04

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

EXHIBIT "J"

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

0.00 $

0.00

$

110,474.00

_ _ _ _ _ _ $ _ _ _8_3.._.,3_47_._8o._

24,807.14

$

0.00 $

0.00 $

--------- 83,347.80 $

135,281.14

$

0.00 $

0.00 $

308,620.07 $ 2,636,707.30

10,463.50

58,651.63 32,051.25

$

0.00 $

0.00 $

319,083.57 $ 2,727,410.18

$

0.00 $

0.00 $

-235,735.77 $ -2,592, 129.04

$ 2,035,000.00

800,000.00

$

7, 164.00

506,7'.09.72

-7,164.00

-481,670.72

$

0.00 $ 2,860,039.00

$

0.00 $

0.00 $

-235,735.77 $

267,909.96

22,095.00

98,199.00

656,954.26

389,044.30

-22,095.00

-98,199.00

0.00

$

0.00 $

0.00 $

421,218.49 $ ==6=5=6=,9=54=.2=6=

- 29 -

WASHINGTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30. 2000

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

NONEXPENDABLE TRUST FUNDS

ENDOWMENT FUNDS

VETERANS OF

VIRGINIA

FOREIGN WARS

SMITH

SCHOLARSHIP

SCHOLARSHIP

FUND

FUND

$

15,923.96 $

16,652.73

707.93

729.36

Total Assets

$

16,631.89 $ ===1=7=,3==8==2.=09==

FUND EQUITY
Fund Balances Reserved For Endowment Corpus .Unreserved Undesignated

$

15,000.00 $

14,052.02

1,631.89

3,330.07

Total Fund Equity

$

16,631.89 $ ====1=7,=38=2.=09=

See notes to the general purpose financial statements. - 30-

EXHIBIT "K"

EXPENDABLE TRUST FUND
MINORITY SCHOLARSHIP
FUND

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

5,880.78 $

5,880.78 $

6,019.91

32,576.69

32,576.69

1,437.29

1,546.34

$

5,880.78 $

39,894.76 $ ====40=,1=42=.94=

$ $ _ ____;;;5...,;;,8..;;.8..:;_;0...;...78~

29,052.02 $ 10,842.74

29,052.02 11,090.92

$

5,880.78 $

39,894.76 $ ===4=0,1=42=.94=

- 31 -

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

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program National School Lunch Program
Total Child Nutrition Cluster
Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1)
Total U.S. Department of Agriculture
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Flow Through Preschool Capacity Building Grant
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development Title Ill Technology Literacy Challenge Fund Grants Title VI Innovative Education Program Strategies Class Size Reduction Goals 2000 State and Local Education Systemic Improvement Grants Safe and Drug-Fre!'J Schools and Communities Vocational Education - Basic Grants to States High School Program Basic Grant
Total U.S. Department of Education
Health and Human Services, U. S. Department of Pass-Through From Georgia Child Care Council Child Care and Development Block Grant
Defense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE INPERIOD

EXPENDITURES IN PERIOD

10.553 10.555

N/A

$

305,733.87

N/A

870,519.08 $

$ 1,176,252.95 $

(2) 1,488,646.00 (3)
1,488,646.00

10.550

NIA

103,531.87

$ 1,279,784.82 $

103,531.87 1,592, 177.87

84.027 84.173 84.173

N/A

$

191,100.09 $

NIA

22,513.04

NIA

8, 139.64

$

221,752.77 $

191,559.00 (3) 22,513.04 8,139.64
222,211.68

84.010 84.281 84.318 84.298 84.340 84.276 84.186
84.048

N/A

880,777.17

881,599.12 (3)

NIA

17,153.67

17,153.67

N/A

514.54

5,636.70 (3)

NIA

29,205.73

29,205.73

N/A

114,259.54

114,259.54

NIA

90,360.09

136,934.75 (3)

N/A

17,579.00

19,288.10 (3)

N/A

66,581.25

$ 1,438,183.76 $

66,581.03 1,492,870.32

93.575

NIA $

4,381.89

(4)

$

13,669.58

(4)

Total Federal Financial Assistance N/A =Not Available

-32-

$ 2,736,020.05 $

3,085,048.19

WASHINGTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30. 2000
Notes to the Schedule of Expenditures of Federal Awards
(1) The amounts shown for the Food Distribution Program represent the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 2000 National School Lunch Program.
(3) Expenditures for this program include State and/or Other Funds. Expenditures are not maintained by fund source.
(4) Expenditures on this program were not maintained by fund source.
Major Programs are identified by an asterisk (*) in front of the CFDA number.
The Board did not provide Federal Assistance to any Subrecipient.
The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Washington County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the general purpose financial statements.

SCHEDULE "1"

See notes to the general purpose financial statements.

- 33-

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

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Quality Basic Education
General and Career Education Programs $
Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation
Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Counselors Grades 4 and 5 Technology Specialist Local Five Mill Share Deferred Summer Salaries (Prior Year) Deferred Summer Salaries (Current Year) Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Program At-Risk Summer School Program Health Insurance Innovative Programs Mentor Teacher Program Pay for Performance Program Preschool Handicapped Program Remedial Summer School Program Lottery Programs Assistive Technology Computers in the Classroom Distant Leaming
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Reading First Program

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

9,094,860.00 1,233,099.00
314,449.00 379,613.00 101,165.00 2,383, 148.00
546,653.00 173,207.00 292,635.00
41,511.00 68,410.00
6,047.00 38,698.00 57,685.00 -1,989,774.00 -1, 795,350.00 1,888,392.00 931,421.00
$
20,261.73
79,656.00 16,184.85 167,113.99
5,000.00 3,888.00 116,000.00 45,561.00 9,243.26
42,206.00

$
113,870.00
13,564.18 89,744.00
2,494.00 223,180.25

53,980.00

TOTAL
9,094,860.00 1,233,099.00
314,449.00 379,613.00 101,165.00 2,383, 148.00
546,653.00 173,207.00 292,635.00
41,511.00 68,410.00
6,047.00 38,698.00 57,685.00 -1,989,774.00 -1,795,350.00 1,888,392.00 931,421.00 113,870.00 20,261.73
79,656.00 16,184.85 167,113.99
5,000.00 3,888.00 116,000.00 45,561.00 9,243.26
13,564.18 89,744.00
2,494.00
223,180.25
42,206.00
53,980.00

$ 14,270,983.83 $

496,832.43 $ 14,767,816.26

See notes to the general purpose financial statements. -34-

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

SCHEDULE "3"

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

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

11,022,383.00 $

336,907.33

$

11,878, 178.68

574,927.97 $ _ _ _4_9_5-'-,8_3_3._84_

$

12,453, 106.65

-155,506.83
$ _ _1.;..2.:.;,2;;.;9_7.:.;;,5..;.9.;..9...;...82_

Amount of Underexpenditure for Total Allotment

$

0.00 $ = = = = = =0.0=0

Note: (1) Salary accruals (July and August 2000 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
(2) Salary accruals (July and August 1999 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines.

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

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

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

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL _'.&,_

ORIGINAL

MID-TERM

$

937,3n.oo

$

843,639.30 $

2,616,859.00

2,355, 173.10

$ 3,554,236.00 90 $ 3, 198,812.40 $

1,154,695.00 90

1,039,225.50

1,778,871.00 90

1,600,983.90

1,374,268.00 90

1,236,841.20

548,954.00 90

494,058.60

683,836.00 90

615,452.40

$ 9,094,860.00

$ 8,185,374.00 $

-11,193.30 145,265.00 134,071.70
50,734.00 31,740.00 -14,037.30 -29,745.00
172,763.40

$ 1,081,440.00

$

973,296.00 $

-8,700.40

$ 1,081,440.00 90 $

151,659.00 90

$ 1,233,099.00

$

$

314,449.00 90 $

$ 10,642,408.00

$

973,296.00 $ 136,493.10 1,109,789.10 $ 283,004.10 $ 9,578.167.20 $

-8,700.40
-8,700.40 -163,701.00
362.00

$

303,700.00 90 $

273,330.00 $

75,913.00 100

75,913.00

$

379,613.00

$

349,243.00 $

0.00 0.00

$ 11,022,021.00

$ 9,927,410.20 $

362.00

STAFF DEVELOPMENT PROGRAMS
Cost of Instruction Professional Development
Total Staff Development Programs
(*) Identifies Fourteen Weighted Programs.
(1) Salary accruals (July and August 2000 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines.
See notes to the general purpose financial statements.

$

32,870.00

68,295.00

$

32,870.00 $

68,295.00

$

101,165.00 100 $

101,165.00 $

(2) Salary accruals (July and August 1999 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines.

36

0.00 0.00
0.00

SCHEDULE "4"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES SALARIES (1 )(2) OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

832,446.00 $

912,986.33 $

17,917.74 $

930,904.07

2,500,438.10

2,488:803.95

71,182.97

2,559,986.92

$ 3,332,884.10 $ 3,401,790.28 $

89,100.71 $ 3,490,890.99 $

0.00

1,089,959.50

1,497,122.79

54,556.92

1,551,679.71

0.00

1,632,723.90

2,004,169.04

98,694.52

2, 102,863.56

0.00

1,222,803.90

1,844,505.62

128,259.32

1,972,764.94

0.00

464,313.60

458,947.62

19,834.88

478,782.50

0.00

615,452.40

754,557.05

76,483.70

831,040.75

0.00

$ 8,358,137.40 $ 9,961,092.40 $

466,930.05 $ 10,428,022.45

$

964,595.60

$

21,316.40 $ 375,054.25 677,139.34

2,325.38 $ 2,078.40 18,219.25

23,641.78 377,132.65 695,358.59

$

964,595.60 $

1,073,509.99 $

22,623.03 $ 1,096,133.02

0.00

136,493.10

210,218.77

3,447.78

213,666.55

0.00

$ 1,101,088.70 $

1,283,728.76 $

26,070.81 $ 1,309,799.57

$

119,303.10 $

177,331.82 $

2,832.98 $

180,164.80

0.00

$ 9,578,529.20 $ 11,422,152.98 $

495,833.84 $ 11,917,986.82

$

273,330.00 $

456,025.70

$

456,025.70

0.00

75,913.00

$

79,094.13

79,094.13

0.00

$

349,243.00 $

456,025.70 $

79,094.13 $

535,119.83

$ 9,927,772.20 $ 11,878,178.68 $

574,927.97 $ 12,453,106.65 $

0.00

$

32,870.00

68,295.00

$ ===10=1=.1=6,.5=.o..,,o

$

53,007.08 $

53,007.08

48,431.95

48,431.95

$

101,439.03 $

101,439.03 $ _ _.._._ _,.,....,..=o..o...,,o

- 37 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 8, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Washington County Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements ofWashington County Board ofEducation as ofand for the year ended June 30, 2000, and have issued our report thereon dated February 8, 2001. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part ofobtaining reasonable assurance about whether Washington County Board ofEducation's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Washington County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2000YB-40

control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect Washington County Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions ofmanagement in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-7501-00-01 and FS-7501-00-02.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions, and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, ofthe reportable conditions described above, we consider item FS-7501-0002 to be a material weakness.
This report is intended solely for the information and use of management, members of the Washington County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:jb 2000YB-40

State Auditor

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
February 8, 2001

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Washington County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Washington County Board of Education with the types of compliance requirements described in the US. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2000. Washington County Board of Education's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Washington County Board of Education's management. Our responsibility is to express an opinion on Washington County Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Washington County Board ofEducation's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Washington County Board of Education's compliance with those requirements.
2000SA-10

In our opinion, the Washington County Board ofEducation complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30, 2000.
Internal Control Over Compliance
The management of Washington County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Washington County Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe interned control components does not reduce to a relatively low level of risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course ofperforming their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use of management, members of the Washington County Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:jb 2000SA-10

State Auditor

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

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

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7501-98-01 FS-7501-98-02 FS-7501-99-01 FS-7501-99-02

Further Action Not Warranted Further Action Not Warranted Partially Resolved - See Corrective Action/Responses Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

CASH AND CASH EQUNALENTS GENERAL LEDGER Inadequate Separation ofDuties Finding Control Number: FS-7501-99-01

Changes have been implemented in this area. However, the changes have not completely resolved the separation of duties issue. We are changing responsibilities as we have the personnel available to do so.

GENERAL FIXED ASSETS _Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7501-99-02

Due to current staffing and budgetary constraints, we have not pursued the recording of fixed assets on the financial statements.

SECTIONN FINDINGS AND QUESTIONED COSTS

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

I SUMMARY OF AUDITOR'S RESULTS

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

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

Cash and Cash Equivalents General Fixed Assets

General Ledger

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

3. Noncompliance Material to the Financial Statements The audit of the Washington County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Washington County Board of Education did not disclose any reportable conditions in internal control over major programs.

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

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

7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.010 Elementary and Secondary Education Act - Title I- Grants to Local Educational Agencies

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

- 1-

WASHINGTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
I SUMMARY OF AUDITOR'S RESULTS
9. Low Risk Auditee The Washington County Board ofEducation did not qualify as a low risk auditee as defined by Section .530 of OMB Circular A-133.
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
CASH AND CASH EQUIVALENTS GENERAL LEDGER Inadequate Separation ofDuties Reportable Condition Repeated from Prior Year Finding Control Number: FS-7501-00-01
A review ofthe Board's internal control policies and procedures noted deficiencies in providing for adequate internal control over the following functions and related procedures for the School Food Services program:
1) The Board has only one employee who maintains the general ledger, prepares checks, signs checks and reconciles the bank statements for the School Food Services program.
2) Journal entries for the School Food Services fund are not reviewed and approved by someone independent of the general ledger function.
These conditions were a result ofmanagement's decision to limit the number of administrative staff made responsible for accounting functions over the School Food Services program. The Board should review the accounting procedures in place, design procedures that would enhance segregation of duties relative to the above control categories and implement those procedures to strengthen the internal control over the School Food Services' accounting functions.
Management's Response:
Changes have been implemented in this area. However, the changes have not completely resolved the separation ofduties issue. We are changing responsibilities as we have the personnel available to do so.
-2-

WASHINGTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2000
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number: FS-7501-00-02 The Washington County Board ofEducation did not maintain a system:.wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. Subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. Management's Response: Due to current staffing and budgetary constraints, we have not pursued the recording offixed assets on the financial statements. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
-3-