Audit report, Webster County Board of Education, Preston, Georgia, year ended June 30, 1994

GA A800 ,Rl
E2G
V\)3'1
/Ojq 3--94
STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET ATLANTA. GEORGIA 30334

AUDIT REPORT WEBSTER COUNTY BOARD OF EDUCATION
PRESTON, GEORGIA YEAR ENDED JUNE 30, 1994

WEBSTER COUNTY BOARD OF EDUCATION -TABLE OF CONTENTS-

SECTION I

FINANCIAL

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

EXlllBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

GOVERNMENTAL FUND TYPES

3

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - ACTUAL AND BUDGET

GOVERNMENTAL FUND TYPES

5

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

6

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

16

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

18

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

20

2 ANALYSIS OF CASH AND CASH EQUIVALENTS

21

3 ACCOUNTS RECEIVABLE

22

SCHEDULE OF REVENUE

4

STATE FUNDS

23

5

LOCAL AND OTHER FUNDS

24

SCHEDULE OF EXPENDITURES BY OBJECT

6

GOVERNMENTAL FUND TYPES

25

7

LOTTERY PROGRAM

26

WEBSTER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

8

OVERALL

27

9

BY PROGRAM

28

10 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS

30

SECTION II
COMPLIANCE
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS

SECTION III
INTERNAL CONTROL
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS

WEBSTER COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

SECTION I FINANCIAL

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~epzirtment nf ~uhits
254 WASHINGTON STREET. S. W. ROOM 214
J\thmbt, ~rnrgia 30334-8400
February 3, 1995

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Webster County Board ofEducation
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
Ladies and Gentlemen:
We have audited the general purpose financial statements (Exhibits A through D) of the Webster County Board of Education, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial st~tements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose 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 significan_t 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.
94ARL-14

* School activity accounts maintained at the individual school 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 present fairly, in all material respects, the financial position of the Webster County Board of Education as of June 30, 1994, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.
As discussed in Note 1 to the general purpose financial statements, during fiscal year 1994, the Board changed its method ofaccounting to include revenues and expenditures associated with Federal donated commodities in its general purpose financial statements. This change is in accordance with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements ofthe Webster County Board ofEducation taken as a whole. The combining statements (Exhibits E and F) and the financial schedules (Schedules 1 through 10 which includes the Schedule of Federal Financial Assistance) are presented for purposes ofadditional analysis and are not a required part of the general purpose
financial statements ofthe Webster County Board ofEducation. 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 of the matters referred to in the third paragraph, such information is fairly presented 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 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.
Rz:~

CLV:gp 94ARL-14

Claude L. Vickers State Auditor

WEBSTER COUNTY BOARD OF EDUCATION - 1-

WEBSTER COUNTY BOARD OF EDUCATION COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30, 1994

EXHIBIT "A"

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

GOVERNMENTAL FUND TYPES

-------------------S-P-E-C-IA-L----

GENERAL

REVENUE

FUND

FUND

------------- -------------

TOTALS (Memorandum Only)
----------------------------
JUNE 30, 1994 JUNE 30, 1993
------------- -------------

$ 205,939.71 $ 59,917.02 $ 265,856.73 $ 213,433.82

111,070.85

21,237.66

132,308.51

113,165.06

716.02

716.02

1,422.07

524.30

524.30

861.90

------------- ------------- ------------- -------------

$ 317,010.56 $ 82,395.00 $ 399,405.56 $ 328,882.85
============= =--=-=------- ============= =============

LIABILITIES AND FUND EQUITY
---------------------------
LIABILITIES
-----------
Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities
FUND EQUITY
-----------
Fund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food
Unreserved Undesignated
Total Fund Equity

$ 23,013.42 $ 5,152.25 $ 28,165.67 $ 25,011.00

106,720.36

21,245.14

127,965.50

129,810.04

115. 09

115.09

19,116.50

19,116.50

------------- ------------- ------------- -------------

$ 129,733.78 $ 45,628.98 $ 175,362.76 $ 154,821.04
------------- ------------- ------------- -------------

$ 21,902.48 49,840.54

$ 21,902.48 $ 18,228.48 4,357.22

49,840.54

33,725.80

$

716.02

716.02

1,422.07

524.30

524.30

861.90

------------- ------------- ------------- -------------

$ 71,743.02 $ 1,240.32 $ 72,983.34 $ 58,595.47

115,533.76

35,525.70

151,059.46

115,466.34

------------- ------------- ------------- -------------

$ 187,276.78
-------------

$ 36,766.02
-------------

$ 224,042.80
-------------

$ 174,061.81
-------------

Total Liabilities and Fund Equity $ 317,010.56 $ 82,395.00 $ 399,405.56 $ 328,882.85
============= ------------- ============= =============

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

WEBSTER COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES ANO CHANGES IN FUND BALANCES
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

EXHIBIT "B"

GENERAL FUND

SPECIAL REVENUE
FUND

TOTALS
------(M--e-m-Yo-ErA-anR-d-u-Em-N-D-EO-Dn-l-y-)------
JUNE 30, 1994 JUNE 30, 1993

REVENUES

State Funds Federal Funds Local and Other Funds

$ 980,036.04$ 24,953.50$ 1,004,989.54 $ 945,351.28

264,113.34

264,113.34

273,241.19

520,105.88

5,915.46

526,021.34

529,390.75

Total Revenues

$1,500,141.92$ 294,982.30$ 1,795,124.22 $1,747,983.22

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 Other Operations of Non-Instructional Services
Capital Outlay Total Expenditures
Excess of Revenues over (under) Expenditures

$ 804,228.16 $ 155,636.52 $ 959,864.68 $ 925,971.38

3,822.71 13,331.57 54,753.16 101,930.20 92,281.34 23,418.61 113,152.74 209,658.98
7,217.85 894.00

3,312.59 3,487.28 154,918.85

3,822.71 13,331.57 54,753.16 105,242.79 92,281.34 23,418.61 113,152.74 209,658.98
7,217.85 4,381.28 154,918.85

16,541.45 9,458.00 53,104.04 137,227.38 89,739.23 24,341.66 95,743.42 232,873.19 5,883.00
0.00 121,516.46

2,055.02

2,055.02

1,345.89

------------- ------------- ------------- ------8-,9--0-2-.0--0

$--1-,4--2-6-,7--4-4-.-3-4 $----3-1-7-,-3-5-5-.-2-4 $--1-,7--4-4-,-0-9-9-.-5-8$--1-,7-2--2-,6--4-7-.1--0

$ 73,397.58$ -22,372.94 $ 51,024.64 $ 25,336.12

OTHER FINANCING SOURCES (USES)

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

$

16.45 $

16.45

$---------1--6-.4--5 ------------- ---------1--6-.4--5

$----------1-6-.4--5 $---------1-6-.-4-5 $----------0-.0--0

$ 73,381.13 $ -22,356.49 $ 51,024.64 $ 25,336.12

113,895.65

60,166.16

174,061.81

146,441.72

Food Inventory Donated Commodities July 1 June 30 Purchased Food July 1 June 30

-1,422.07 716.02

-1,422.07 716.02

1,422.07

-861.90

-861. 90

------------- --------5-2-4-.-3-0 --------5-2-4-.-3-0 --------8-6-1-.-9-0

FUND BALANCE JUNE 30

$ 187,276.78
=============

$=====3=6=,7==6=6=.0==2

$====2=2=4=,0==4=2=.8=0=

$====1=7=4=,0==6=1=.8=1=

The notes to the general purpose financial statements are an integral part of this statement.
- 3-

WEBSTER COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ACTUAL AND BUDGET - GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1994

EXHIBIT "C"

ACTUAL

ACTUAL

PER

PER

EXHIBIT "B" ADJUSTMENTS BUDGET BASIS

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

REVENUES

State Funds Federal Funds Local and Other Funds

$1,004,989.54$ 264,113.34 526,021.34

0.00 $1,004,989.54$ 947,553.00$ 264,113.34 242,043.00 526,021.34 509,448.00

57,436.54 22,070.34 16,573.34

Total Revenues

$1,795,124.22$

0.00 $1,795,124.22$ 1,699,044.00$ 96,080.22

EXPENDITLRES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Acininistration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services Total Expenditures
Excess of Revenues over (under) Expenditures

$ 959,864.68$

0.00 $ 959,864.68$ 921,972.78 $ -37,891.90

3,822.71 13,331.57 54,753.16 105,242.79 92,281.34 23,418.61 113,152.74 209,658.98 7,217.85 4,381.28 154,918.85

3,822.71 13,331.57 54,753.16 105,242.79 92,281.34 23,418.61 113,152.74 209,658.98 7,217.85 4,381.28 154,918.85

17,752.80 10,770.85 68,708.68 128,051.16 89,509.38 25,215.28 89,127.87 189,982.56 3,956.00 8,632.00 156,094.65

13,930.09 -2,560.72 13,955.52 22,808.37 -2,771.96 1,796.67 -24,024.87 -19,676.42 -3,261.85 4,250.72 1,175.80

2,055.02

2,055.02

2,194.60

139.58

------------- ------------- ------------- ------------ -------------

$1,744,099.58$

0.00 $1,744,099.58$ 1,711,968.61 $ -32,130.97

------------- ------------- ------------- ------------- -------------

$ 51,024.M $

0.00 $ 51,024.64 $ -12,924.61 $ 63,949.25

OTHER FINANCING SOLRCES (USES)

Other Sources Other Uses

$

16.45 $

-16.45

0.00 $

16.45 $ -16.45

0.00 $

16.45 -16.45

Total Other Financing Sources

(Uses)

$

0.00 $

0.00 $

0.00 $

0.00 $

0.00

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1, 1993

$ 51,024.64$ 174,061.81

0.00 $ 51,024.64 $ -12,924.61 $ 63,949.25 -2,283.97 171,777.84 202,838.44 -31,060.60

ADJUSTMENTS

Prior Year (Net) FOOD INVENTORY

0.00

0.00

-5,546.86

5,546.86

Donated Commodities July 1, 1993 June 30, 1994
Purchased Food July 1 1993 June 36, 1994

-1,422.07

1,422.07

0.00

0.00

716. 02

-716.02

0.00

0.00

-861. 90

861.90

0.00

0.00

524.30

-524.30

0.00

0.00

------------- ------------- ------------- ------------- -------------

FUND BALANCE JUNE 30, 1994

$====2=2=4=,=0=4=2=.=8=0$====-=1=,=2=4=0=.3==2

$===2=2=2=,8=0=2=.=4=8

$ 184,366.97
============

$ 38,435.51
===========

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

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Webster County Board ofEducation (Board) was established under the laws of the State of Georgia and operated under the guidance of a school board and Superintendent, both elected by the voters. With the exception of the departures from generally accepted accounting principles disclosed in the following paragraphs, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards.
The more significant of the Board's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the Webster County Board ofEducation.
Based upon the application ofthe above criteria, the Webster County Board ofEducation is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Webster County, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards.
Board members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval.
FUND ACCOUNTING
The Board 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.
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.

- 6-

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Although "school activity accounts" are maintained at the school, 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, Local and Other Funds under control ofthe Board, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all of the Board's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department ofEducation and from the Federal government to accomplish specific objectives and are required to be accounted for separately. Also included are proceeds received from State, Federal, Local and Other sources for operations of the school food services fund. This fund could be accounted for as an enterprise fund; howeyer, the Board chooses not to provide for depreciation, but to maintain the fund on a modified accrual basis and to report the fund as a special revenue fund under governmental fund types, which is acceptable under generally accepted accounting principles for governmental entities.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental 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 of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds.
Governmental 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 ofthe 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
- 7-

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
considered susceptible to accrual are property taxes, intergovernmental grants, and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end.
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 1993 and ending in early June 1994. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1993 and ending in August 1994. 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 fiinge benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements.
BUDGET
Webster County Board of Education has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure of the aggregate budget. The budget process begins when the Board's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation.
The Board prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements. The budget comparison on Exhibit "C" presents actual and budget data for all governmental funds on a combined basis. To facilitate comparison with the budget, donated and purchased food inventories as reflected on Exhibit "B" have been eliminated from fund balance.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits (including certificates of deposit and N.O.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement ofproceeds from bond issues in certificates of deposit is limited to financial institutions located within this State.

- 8-

WEBSTER COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RECEIVABLES

Receivables consist ofgrant reimbursements due from Federal, State or other grantors 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 Webster County Tax Commissioner fixed the property tax levy for the 1993 tax year (calendar year) on October 1, 1993 (levy date). Taxes were due on December 20, 1993. The lien date for property taxes was January 1, 1993. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1994 since their collection meets the criteria of GASB codification section P70.103. The Webster 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 1993 tax year (calendar year) for the Webster County Board ofEducation were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

13.55 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. Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

For fiscal year 1994, the Board began accounting for donated food commodities by recording revenues and expenditures associated with donated food commodity items received and consumed by the Board. The reporting of the revenues and expenditures associated with donated commodities is a change in accounting principles.

- 9-

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
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 or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral in an amount of not less than 110 percent of the public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of any one of or any combination ofthe following:
( 1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities ofthe State of Georgia,

- 10 -

WEBSTER COUNTY BOARD OF EDUCATION

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 2: DEPOSITS

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

(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and

(7) Bonds, bills, notes, certificates 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 and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

CATEGORIZATION OF DEPOSITS At June 30, 1994, the bank balances were $319,577.43. The amounts ofthe total bank balances are classified into three categories of credit risk:

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

The Board's deposits are classified by risk category at June 30, 1994, as follows:

Risk Category

Bank Balance

1

$ 100,000.00

2

200,000.00

3

19,577.43

Total

$ 319.577 43

Note 3: NON-MONETARY TRANSACTIONS

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

- 11 -

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 4: SIGNIFICANT COMMITMENTS

At June 30, 1994, the Board had encumbrances in the amount of$19,451.25 for the unperformed portion of purchase orders, contracts and other commitments for goods and services associated with the Lottery Programs. The Georgia Department of Education has funding available to the Board in the amount of $19,116.50 to fund these encumbrances. The revenues and expenditures associated with these encumbrances will be recognized in the subsequent fiscal year. Encumbrances outstanding do not constitute expenditures or liabilities in the current year because these commitments will be honored during the subsequent year. These encumbrances are identified by Lottery Program as follows:

Computers in Classrooms Distant Learning - Satellites Media Center and Library Equipment

$

616.50

1,255.75

17,579.00

$ 19,451.25
The amounts described in this note are not reflected in the general purpose financial statements.

Note 5: CONTINGENT LIABILITIES

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

Note 6: 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 public employee retirement system (PERS).

TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of a_ge 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death.

- 12 -

WEBSTER COUNTY BOARD OF EDUCATION

EXI-IlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 6: RETIREMENT PLANS

Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the mamber's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.

Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest.

The Board's payroll for employees covered by TRS for the year ended June 30, 1994, was $808,537.17; total payroll was $984,131.61.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required to contribute 6% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1994 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.

Total contributions made during fiscal year 1994 amounted to $144,000.78, of which $95,488.35 was made by the Board and $48,512.43 was made by employees. These contributions represented 11.81% (Board) and 6% (employees) of covered payroll.

TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure ofthe pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers.

Total unfunded pension benefit obligation ofTRS as of June 30, 1993, was as follows:

Total pension benefit obligation

$13,912,014,000.00

Net assetsavailable for benefits, at cost

12,821,722,000.00

Unfunded pension benefit obligation

$ 1,090.292,000.00

- 13 -

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 6: RETIREMENT PLANS
The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers.
Total contributions from all employers to TRS for fiscal year ended June 30, 1994 were $521,550,000.00. The Board's contribution for the year ended June 30, 1994 of $95,488.35 was actuarially determined arid represented .0183% of total contributions made by all participating employers.
Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due.
PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS)
PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia.
PSERS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years ofservice and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement provisions include death and disability benefits. Disability benefits are the same as ifthe employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life half of what the employee would have received upon retirement.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contnbutions are refunded with interest.
There were 15 employees covered under PSERS for the year ended June 30, 1994.
PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees.
- 14 -

WEBSTER COUNTY BOARD OF EDUCATION

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 6: RETIREMENT PLANS
Total contributions from employees ofthe Board made during fiscal year 1994 amounted to $572.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1994, was $9,150,000.00.
Note 7: SURETY BONDS
Mr. Foy Meredith Walker, School Superintendent through June 30, 1994, was bonded in the amount of $50,000.00 with the Allstate Insurance Company, Northbrook, Illinois, their Bond No. 074-013-636.
Mr. James B. WIiey, Interim School Superintendent from July 1, 1994 through July 31, 1994, was bonded in the amount of$10,000.00 with the Allstate Insurance Company, Northbrook, Illinois, their Bond No. 074-005816.
The School Superintendent, Mr. Jimmy Herring, effective August 1, 1994, is bonded in the amount of $50,000.00 with the Allstate Insurance Company, Northbrook, Illinois, their Bond No. 074-018-931, on which premium is paid through June 30, 1997.

- 15 -

WEBSTER COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND
JUNE 30, 1994

ASSETS
Cash and Cash Equivalents Accounts Receivable Inventories
Food Donated Commodities Purchased Food
Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food
Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

SCHOOL

FOOD

SERVICES

LOTTERY

FUND

PROGRAM

------------- -------------

$ 39,321.88 $ 20,131.50

406.46

716.02 524.30
------------- -------------

$ 40,968.66 $ 20,131.50
------------- =============

$

602.64 $ 1,015.00

3,600.00

19,116.50
------------- -------------

$ 4,202.64 $ 20,131.50
------------- -------------

$

716.02

524.30

-------------

$

1,240.32

35,525.70 $

0.00

------------- -------------

$ -----3-6-,7--6-6-.0--2

$

0.00
-------------

$ 40,968.66 $ 20,131.50
============= =============

See notes to the general purpose financial statements. - 16 -

EXHIBIT "E"

ELEMENTARY AND SECONDARY EDUCATION ACT

CHAPTER 1
------------EDUCATION OF
DEPRIVED CHILDREN

CHAPTER 2 ------------BLOCK GRANT -
FLOW THROUGH

TITLE II EISENHOWER MATHEMATICS
AND SCIENCE EDUCATION

TOTALS ---------------------------JUNE 30, 1994 JUNE 30, 1993

$

463.64 $

20,831.20

0.00 $

0.00 $

59,917.02 $ 21,237.66

70,761.54 17,195.41

716.02 524.30

1,422.07 861. 90

$ 21,294.84$

0.00 $

0.00 $ 82,395.00 $ 90,240.92

============= ============= ============= ============= =============

$ 3,534.61 17,645.14 115.09
-------------
$ 21,294.84
-------------

$ 5,152.25 $ 3,853.04

21,245.14

26,221.72

115.09

19,116.50

------------- -------------

$ 45,628.98
-------------

$-----3-0-,0--7-4-.7--6

$

0.00 $

-------------

$

0.00 $

-------------

0.00 $ 0.00 $

$ 4,357.22

$

716.02

1,422.07

524.30

861.90

$ 0.00

1,240.32 $ 35,525.70

6,641.19 53,524.97

0.00 $ 36,766.02 $ 60,166.16

$ 21,294.84
=--==========

$

0.00

=============

$

0.00

====-======--

$ 82,395.00
==--=-===---=

$ 90,240.92
-----=-----==

- 17 -

WEBSTER COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND
YEAR ENDED JUNE 30, 1994

REVENUES
State Funds Federal Funds Local and Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services General Administration 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 Donated Commodities July 1 June 30 Purchased Food July 1 June 30
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAM

$

7,570.00 $ 17,383.50

119,076.90

5,915.46

------------- -------------

$ 132,562.36 $ 17,383.50
------------- -------------

$ 17,399.95

$ 154,918.85
------------- -------------

$ 154,918.85 $ 17,399.95
------------- -------------

$ -22,356.49 $

-16.45

$ -22,356.49 $ 60,166.16

16.45
0.00 0.00

-1,422.07 716.02
-861. 90 524.30

$ 36,766.02 $

0.00

See notes to the general purpose financial statements. - 18 -

EXHIBIT "F"

ELEMENTARY AND SECONDARY EDUCATION ACT

CHAPTER 1
------------EDUCATION OF
DEPRIVED CHILDREN

CHAPTER 2 ------------BLOCK GRANT FLOW THROUGH

TITLE II EISENHOWER MATHEMATICS AND SCIENCE
EDUCATION

TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993

$ 134,336.44 $ $ 134,336.44 $

3,700.00 $ 3,700.00 $

$ 24,953.50$

7,402.00

7,000.00

264,113.34

273,241.19

5,915.46

18,154.70

7,000.00$ 294,982.30$ 298,797.89

$ 127,544.98 $

3,691.59 $

7,000.00 $ 155,636.52 $ 156,407.71

3,304.18

8.41

3,312.59

3,005.05

3,487.28

3,487.28

-------------

-------------

-------------

154,918.85
-------------

121,516.46
-------------

$ 134,336.44
-------------

$------3-,7-0--0-.0--0

$ 7,000.00
-------------

$ 317,355.24
-------------

$ 280,929.22
-------------

$

0.00 $

0.00 $

0.00 $ -22,372.94 $ 17,868.67

16.45

$

0.00 $

0.00 $

0.00 $ -22,356.49 $ 17,868.67

0.00

0.00

0.00

60,166.16

40,013.52

-1,422.07 716.02
-861. 90 524.30

1,422.07 861.90

$

0.00 $

0.00 $

0.00 $ 36,766.02 $ 60,166.16

============= ============= ============= ==-======---- -------------

- 19 -

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30. 1994

SCHEDULE "l"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

AWARDS IN PERIOD

FEDERAL FUNDS RECEIVED IN PERIOD (NET OF REFUNDS)

FEDERAL REVENUE IN PERIOD

EXPENDITIRES IN PERIOD

Agriculture, U. S. Department of Direct Sumner Food Service for Children Through Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1994 Grant National School Lunch Program 1994 Grant Nutrition Education and Training Program 1993 Contract Food Distribution Program (1)
Total U. S. Department of Agriculture
Education, U. S. Department of Through Georgia Department of Education Elementary and Secondary Education Act Chapter 1 Education of Deprived Children 19.93 Regular 1993 Carry-Over 1994 Regular Chapter 2 Block Grant - Flow Through 1994 Regular Title II Eisenhower Mathematics and Science Education 1994 Regular

10.559

$ 1,159.00$ 1,159.00$ 5,542.88(3)

10.553 $ 37,108.53

37,108.53

37,108.53

(2)

10.555

70,273.11

69,866.65

70,273.11 138,839.68(3)

10. 564

2,082.00

2,082.00

2,082.00

2,082.03(3)

10.550

8,454.26

N/A

8,454.26

8,454.26

------------- ------------- ------------- -------------

$ 117,917.90 $ 110,216.18 $ 119,076.90 $ 154,918.85
------------- ------------- ------------- -------------

84.010

$ 17,195.41

84.010 $ 11,548.00

11,548.00 $ 11,548.00 $ 11,548.00

84.010 126,343.00 102,072.33 122,788.44 122,788.44

84.151

3,700.00

3,700.00

3,700.00

3,700.00

84.164

7,000.00

7,000.00

7,000.00

7,000.00

Total U. S. Department of Education

$ 148,591.00$ 141,515.74 $ 145,036.44 $ 145,036.44

Total Federal Financial Assistance

$ 266,508.90 $ 251,731.92 $ 264,113.34 $ 299,955.29

The Board had no major programs as defined by the Single Audit Act of 1984.
(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonnonetary 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 1994 National School Lunch Program.
(3) Expenditures for this program include State, and/or Local and Other Funds. Expenditures are not maintained by fund source.

See notes to the general purpose financial statements. - 20 -

WEBSTER COUNTY BOARD OF EDUCATION ANALYSIS OF CASH AND CASH EQUIVALENTS
JUNE 30, 1994
INTEREST BEARING ACCOUNTS
Citizens Bank of Americus, Americus, Georgia
Certificates of Deposit No. 26001 (3.50%) No. 32525 (3.75%)
N.O.W. Accounts (2.50%)

SCHEDULE "2"
$ 5,000.00 12,500.00 248,356.73
$ 265,856.73

See notes to the general purpose financial statements. - 21 -

WEBSTER COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30 1 1994

SCHEDULE "3"

Education, Georgia Department of Quality Basic Education Deferred Summer Salaries - FY 1994 Food Services National School Lunch Program Federal Program ESEA - Chapter 1 Education of Deprived Children
Webster County Tax Commissioner County Wide School Tax
Various Sources Vendor Overpayment

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 98,993.00 $

$ 406.46

98,993.00 406.46

20,831.20

20,831.20

11,405.32

11,405.32

672.53

672.53

------------- ------------- -------------

$ 111,070.85 $ 21,237.66$ 132,308.51
============= ============= =============

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

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1994

SCHEDULE "4"

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 Sparsity Grant Special Instructional Assistance Mid-term Adjustment Local Fair Share Deferred Summer Salaries - FY 1993 Deferred Summer Salaries - FY 1994 Food Services Educational Equalization Funding Grant Other State Programs Supervision and Assessment of Student and Beginning Teachers and Performance-Based Certification Lottery Program Computers in Classrooms

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 551,772.00 49,727.00 20,578.00 26,498.00 6,723.00
153,008.00
115,523.00 27,524.00 74,685.00 57,923.00 17,580.00
-161,045.00 -94,177 .96 98,993.00 $ 34,675.00

$ 551,772.00 49,727.00 20,578.00 26,498.00 6,723.00
153,008.00

7,570.00

115,523.00 27,524.00 74,685.00 57,923.00 17,580.00
-161,045.00 -94,177.96 98,993.00 7,570.00 34,675.00

50.00

17,383.50

50.00 17,383.50

$ 980,036.04$ 24,953.50 $ 1,004,989.54

See notes to the general purpose financial statements. - 23 -

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF LOCAL AND OTHER REVENUE
YEAR ENDED JUNE 30. 1994

SCHEDULE "5"

Taxes County Wide School Tax Railroad Car Tax Real Estate Transfer Tax
Other Interest Earned Royalties Ruralvision South, Incorporated Sales Lunch and Breakfast Other

GOVERNMENTAL FUND TYPES

----------------------------

SPECIAL

GENERAL

REVENUE

FUND

FUND

------------- -------------

TOTAL
-------------

$ 502,408.56 74.34
3,169.52

$ 502,408.56 74.34
3,169.52

2,717.38 $

845.81

3,563.19

7,500.00

7,500.00

4,728.15

4,728.15

4,236.08

341. so

4,577.58

------------- ------------- -------------

$ 520,105.88$

5,915.46$ 526,021.34

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

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1994

SCHEDULE "6"

EXPENDITURES
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Insurance Communications Tuition Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures
Nonoperating Costs Equipment
Total Expenditures

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 841,204.21 $ 142,927.40$ 984,131.61

173,992.51

30,075.84

204,068.35

7,586.33

1,370.32

8,956.65

15,656.55

660.10

16,316.65

5,897.94

5,897.94

10,241.18

420.00

10,661.18

47,558.44

3,772.79

51,331.23

2,502.04

2,502.04

24,010.64

24,010.64

4,893.06

618.38

5,511.44

107,100.00

107,100.00

624.97

624.97

894.00

7,893.69

8,787.69

12,465.81

7,000.00

19,465.81

51,637.35

16,754.18

68,391.53

56,226.48

56,226.48

65,793.00

65,793.00

19,119.26

19,119.26

4,229.00

951. 44

5,180.44

6,978.75

6,978.75

34,550.79

38,493.13

73,043.92

$1,426,744.34$ 317,355.24 $1,744,099.58


See notes to the general purpose financial statements. - 25 -

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT
LOTTERY PROGRAM YEAR ENDED JUNE 30. 1994
EXPENDITURES Operating Costs Supplies Nonoperating Costs Equipment
Total Expenditures

SCHEDULE "7"

COMPUTERS IN
CLASSROOMS

$

1,230.82

16,169.13

$ 17,399.95
=============

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

WEBSTER COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 1994

SCHEDULE "8"

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

THIRTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS
-------------

STAFF
DEVELOPMENT
PROGRAM
-------------

$ 666,155.00 $

6,723.00

------------- -------------

$ 606,491.20

58,933.09 $

6,352.82

------------- -------------

$ 665,424.29 $

6,352.82

-14,258.03

-755.82
------------- -------------

$ 651,166.26 $

5,597.00

------------- -------------

$ 14,988.74$

1,126.00

Note: (1) Salary accruals (July and August 1994 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 1993 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. - 27 -

WEBSTER COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS
YEAR ENDED JUNE 30. 1994

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*) Grades 1 - 3 (*) Sub-Total - K-3 Grades 4 - 5 (*) Grades 6 - B (*) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category I I (*) Category III (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM(*) MEDIA CENTER PROGRAMS

ORIGINAL

ALLOTMENTS FROM DEPARTMENT OF EDUCATION

REQUIRED

TOTAL

...!...

ORIGINAL

MID-TERM

REQUIRED

$ 64,529.00 222,757.00
$ 287,286.00 90 126,576.00 90 137,910.00 90

$ 58,076.10$ 200,481.30
$ 258,557.40 $ 113,918.40 124,119.00

17,580.00$ 75,656.10 200,481.30
17,580.00$ 276,137.40 113,918.40 124,119.00

$ 551,772.00

$ 496,594.80$ 17,580.00 $ 514,174.80

$ 49,727.00

$ 44,754.30$

0.00 $ 44,754.30

$ 49,727.00 90 $ 44,754.30 $ $ 20,578.00 90 $ 18,520.20$ $ 26,49B.OO 90 $ 23,848.20 $

0.00 $ 0.00 $ 0.00 $

44,754.30 18,520.20 23,848.20

Total Thirteen Weighted and Media Center $ 648,575.00

$ 583.717.50 $ 17.580.00 $ 601.297.50

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development

$ 1,516.00 100 $ 1,516.00$

5,207.00 100

5,207.00

0.00 $

1,516.00 5,207.00

Total Staff Development

$ 6,723.00

$ 6.723.00 $

0.00 $ 6.723.00

$ 655,298.00

$ 590.440.50 $ 17.580.00 $ 608.020.50

(*) Identifies Thirteen Weighted Programs.
Note: (1) Salary accruals (July and August 1994 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 1993 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.

- 28 -

SCHEDULE "9"

REQUIRED ALLOTMENT

SALARIES
ACTUAL (1) (2)

DISTRIBUTION BY RESPECTIVE PORTIONS

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

REQUIRED ALLOTMENT

OPERATIONS ACTUAL

AMOUNT OF UNDEREXPENDIT~E
FOR REQUIRED ALLOTMENT

$ 74,278.20$

78,466.77

$ 1,377.90 $

3,586.49

194,710.50

191,497.65

5,770.80

19,393.74

$ 268,988.70 $ 269,964.42 $

0.00

$ 7,148.70 $ 22,980.23 $

0.00

110,782.80

110,891.52

0.00

3,135.60

6,256.28

0.00

120,812.40

131,228.53

0.00

3,306.60

6,720.93

0.00

$ 500,583.90$ 512,084.47 $

0.00

$ 13,590.90$ 35,957.44$

0.00

$ 4,968.90 $ 38,747.70

6,599.58 34,504.22

$

95.40 $

37.30

942.30

15,622.31

$ 43,716.60 $

41,103.80 $

2,612.80

$ 1,037.70$ 15,659.61 $

0.00

$ 18,224.10 $

19,536.94 $

0.00

$

296.10 $

326.00 $

0.00

$ 19,467.00$

33,765.99 $

0.00

$ 4,381.20 $

6,990.04 $

0.00

$ 5811991.60 $ 6061491.20 $

21612.80

$ 191305.90 $ 581933.09 $

0.00

$ 1,516.00$ 5,207.00

390.00 $ 5,962.82

1,126.00 0.00

$ 581.991.60 $ 606,491. 20 $_,._......2='=61=2=.8..,o

$ 6,723.00$

6.352 .82 $_=_1_1_12..6.....o_o

$ 26,028.90$

65 285.91 $_ _ _1__12..6.....0...0.

1

1

- 29 -

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS
YEAR ENDED JUNE 30 1 1994

SCHEDULE "10"

BOARD MEMBER ADDRESS
------------
Mr. Marvin Harris, Chairman (*) Route 2 Preston, Georgia 31824
Mr. Phil Addy Route 1, Box 64A Preston, Georgia 31824
Ms. Vernette Goodwin Route 2, Box 6-A Preston, Georgia 31824
Ms. Bonita Hightower (*) p. 0. Box 238 Preston, Georgia 31824
Mr. Rex Kennedy Route 1 Parrott, Georgia 31777
Mr. Jonah McCluster (*) Route 1. Box 136 Preston, Georgia 31824
Mr. Jeff Schramm (*) Route 1. Box 225 Richland, Georgia 31825
Ms. Eugenia Stephens Route 1, Box 65A Buena Vista, Georgia 31803
Mr. Horace G. Wiggins (*) Route 1, Box 85 Preston, Georgia 31824

COMPENSATION

TRAVEL

------------- -------------

$ 1,000.00

300.00

250.00

700.00 $

566.47

150.00

650.00

28.00

600.00

104.62

300.00

500.00

748.85

------------- -------------

$ 4,450.00 $ 1,447.94

(*) Denotes Board Members Serving as of June 30, 1994

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

SECTION II COMPLIANCE

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~epartmeut nf J\units
254 WASHINGTON STREET. S. W. ROOM 214
J\thnda, ~eorgia 30334-8400
February 3, 1995

FINANCIAL AUDl1S (404) 656-2180
PROGRAM AUDl1S (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Webster County Board ofEducation
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Webster County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated February 3, 1995_ 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 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 general purpose financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to Webster County Board ofEducation is the responsibility ofthe Board's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Board's
compliance with certain provisions oflaws, regulations, contracts, and grants_ However, the objective of our
audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.
The results ofour tests indicate that, with respect to the items tested, the Webster County Board of Education complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects, with those provisions.
94CRL-10

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
c:t~;c~
Claude L. Vickers State Auditor
CLV:gp 94CRL-I0

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~epartmeut nf J\uhits
254 WASHINGTON STREET, S. W. ROOM 214
J\thmbt, .enrBht 30334-8400
February 3, 1995

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members ofthe Webster County Board ofEducation

SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Webster County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated February 3, 1995. 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 have applied procedures to test the Webster County Board ofEducation's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1994:

(1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-Up/Resolution

(4) Federal Financial Reports

(8) Administrative Requirements

Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits of State and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Board's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion.

94CRL-50

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Webster County Board of Education had not complied, in all material respects, with those requirements. However, the results of our procedures disclosed an immaterial instance of noncompliance with those requirements, which is described in the Schedule ofFindings and Improper or Questioned Costs.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
L~
Claude L. Vickers State Auditor
CLV:gp 94CRL-50

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~eparfmeuf nf J\units
254 WASHINGTON STREET, S. W. ROOM 214
J\thmht, &;enrght 30334-8400
February 3, 1995

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Webster County Board ofEducation

SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Webster County Board of Education as of and for the year ended June 30, 1994, and have issued our report thereon dated February 3, 1995. 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.

In connection with our audit of the fiscal year 1994 general purpose financial statements of the Webster County Board of Education and with our consideration of the Board's internal control structure used to administer Federal financial assistance programs, as required by Office ofManagement and Budget (0MB) Circular A-128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing:

(I) Types of Services Allowed or Unallowed

(2) Eligibility

Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Webster County Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion.

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Webster County Board of Education had not complied, in all material respects, with those requirements.

94CRL-120

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,

CLV:gp 94CRL-120

Claude L. Vickers State Auditor

SECTION ill INTERNAL CONTROL

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~epa:rtmeut of J\units
254 WASHINGTON STREET, S. W. ROOM 214
J\tfonht, (1(}nrgia 30334-8400
February 3, 1995

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Webster County Board ofEducation
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Webster County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated February 3, 1995. 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 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 general purpose financial statements are free of material misstatement.
In planning and performing our audit ofthe general purpose financial statements of the Webster County Board of Education for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statementsand not to provide assurance on the internal control structure.
The management of the Webster County Board ofEducation is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not
94ICL-3

be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.

For the purposes of this report, we have classified the significant internal control structure policies and procedures in the following categories:

(1) Cash and Cash Equivalents

(6) Employee Compensation

(2) Inventories

(7) General Ledger

(3) Revenue/Receivables/Receipts

(8) General Fixed Assets

(4) Procurement

(5) Expenditures/Liabilities/ Disbursements

For all ofthe internal control categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk.

We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements.

As described in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories:

(1) Accounting Controls (Overall)

(2) General Fixed Assets

A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose 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 structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses.

94ICL-3

These conditions were considered in determining the nature, timing, and extent of the procedures to be perfonned in our audit ofthe Webster County Board of Education's financial statements and this report does not affect our report thereon dated February 3, 1995.
This report is intended for the infonnation of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Rz:~

CLV:gp 94ICL-3

Claude L. Vickers State Auditor

CLAUDE L. VICKERS STATE AUDIIDR (404) 656-2174
TAX RATIO (404) 656-0494

~:eparfttt:etd of J\units
254 WASHINGTON STREET. S. W. ROOM 214
~thmbt, ~eor_sia 30334-8400
February 3, 1995

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Superintendent and Members of the Webster County Board ofEducation
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Webster County Board ofEducation as of and for the year ended June 30, 1994, and have issued our report thereon dated February 3, 1995. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpo_se financial statements.
We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Webster County Board ofEducation complied with laws and regulations, noncompliance with which would be material to a Federal financial assistance program.
In planning and performing our audit for the year ended June 30, 1994, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Board's general purpose financial statements and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated February 3, 1995.

94ICL-15

The management of the Webster County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives ofan internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness ofthe design and operation of policies and procedures may deteriorate.

For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories:

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

(I) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports

(I) Types of Services Allowed or Unallowed
(2) Eligibility
(3) Matching, Level ofEffort, and/or Earmarking

(5) Allowable Costs/Cost Principles

(4) Reporting

(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution (8) Administrative Requirements

(5) Applicable Special Tests and Provisions
(6) Other Requirement Claims for Advances and Reimbursements

For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk.

During the year ended June 30, 1994, the Webster County Board ofEducation had no major Federal financial assistance programs and expended 51% of its total Federal financial assistance under the following nonmajor Federal financial assistance program:

Elementary and Secondary Education Act, Chapter 1 Education ofDeprived Children

94ICL-15

We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements, and specific requirements, as described above that are applicable to the aforementioned nonmajor program. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion.
We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the Board's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations.
As described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category:
Administrative Requirements
A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program 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 structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition described above is also considered to be a material weakness.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~
Claude L. Vickers State Auditor
CLV:gp 94ICL-15

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $113.00 Audit Control Number 7521-93-02
The audit report for the year ended June 30, 1993, disclosed that the Board had an underexpenditure of Quality Basic Education (QBE) funds of $113.00 for the operations portion of the Staff Development Professional Development Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditures of$113.00 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for QBE programs in a subsequent fiscal year.
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $33,612.80 Audit Control Number 7521-93-03
The audit report for the year ended June 30, 1993, disclosed that the Board had an underexpenditure of Quality Basic Education (QBE) funds of $33,612.80 for the Minimum Expenditure Requirements - Overall. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. The underexpenditures of$33,612.80 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for QBE programs in a subsequent fiscal year.
PRIOR YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets,Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7521-93-01
The audit report for the year ended June 30, 1993, noted that the management ofthe Webster County Board ofEducation had chosen not to 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. These subsidiary records should include an inventory of land, buildings and equipment owned by the Board and

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7521-93-01
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.
CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS -Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7521-94-01
Our audit disclosed that the Board had not provided for adequate separation of employee duties in the performance of accounting functions and related procedures. This deficiency was a result of management's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff.
Note: The Federal financial assistance program affected by this finding is as follows:
ESEA- Chapter 1 (CFDA 84.010)
EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $1,126.00 Audit Control Number 7521-94-02
For the year under review, the Board had an underexpenditure of Quality Basic Education (QBE) funds of $1, 126.00 for the operations portion of the Staff Development - Cost of Instruction Program. This underexpenditure occurred because ofmanagement's failure to adequately monitor QBE expenditures for this program. These funds should be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period.

WEBSTER COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
CURRENT YEAR
EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $14,988.74 Audit Control Number 7521-94-03
For the year under review, the Board had an underexpenditure of Quality Basic Education (QBE) funds of $14,988.74 for the Minimum Expenditure Requirements - Overall. This underexpenditure occurred because ofmanagement's failure to adequately monitor QBE expenditures overall. These funds should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period.
AUDIT FOLLOW-UP/RESOLUTION Audit Distribution Requirements Federal Financial Assistance Nonmaterial Noncompliance Audit Control Number 7521-94-04
The Board failed to submit a copy of the 1993 audit report to the USDA- Food and Nutrition Service from whom the Board received the Summer Food Service for Children program (CFDA 10.559) funds. Paragraph BfofOMB Circular A-128 requires that the recipients ofFederal financial assistance submit copies of single audit reports to those agencies providing Federal financial assistance. Even though formally notified in writing ofthese report distribution responsibilities by the Department of Audits, management claimed it was unaware ofthis audit distribution requirement. Procedures should be implemented to ensure that reports are submitted to grantor agencies in accordance with audit distribution requirements.

SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

WEBSTER COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30, 1994
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $113.00 Audit Control Number 7521-93-02
We agree with this finding.
AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $33,612.80 Audit Control Number 7521-93-03
We disagree with this finding. We believe the system should be given credit for some expenditures which were posted to the wrong account. We will present this information to Georgia Department of Education for their review.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7521-93-01
We agree with this finding. The Webster County Board ofEducation is currently working on this area so it will show a complete financial statement.
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7521-94-01
We agree with this finding. Webster County Board of Education will try to improve on separation of duties.
EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $1,126.00 Audit Control Number 7521-94-02
We agree with this finding.

WEBSTER COUNTY BOARD OF EDUCATION PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30, 1994
EXPENDITURES/LIABILITIES/DISBURSEMENTS Failure to Meet Expenditure Requirements Financial Statements Nonmaterial Noncompliance Amount: $14,988.74 Audit Control Number 7521-94-03
We agree with this finding. Our books indicate we met the 100% test. In reviewing the entries, we discovered the $175.80 midterm adjustment was subtracted in error rather than being added.
Note: The Webster County Board ofEducation has elected not to provide comments for inclusion in this report other than the above.