Audit report, Worth County Board of Education, Sylvester, Georgia, year ended June 30, 1997

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AUDIT REPORT WORTH COUNTY BOARD OF EDUCATION
SYLVESTER, GEORGIA YEAR ENDED JUNE 30, 1997
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

WORTH COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

9

F NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

10

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

20

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

21

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

22

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

23

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

24

2 SCHEDULE OF STATE REVENUE

26

3 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

27

WORTH 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

4

OVERALL

29

5

BY PROGRAM

30

SECTIONll
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-I33

SECTION ill SUMMARY OF AUDITOR'S RESULTS SUMMARY SCHEDULE OF AUDITOR'S RESULTS

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

WORTH COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS -
SECTION V CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS
SECTION VI PERTINENT VIEWS OF RESPONSffiLE OFFICIALS PERTINENT VIEWS OF RESPONSffiLE OFFICIALS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17, 1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Worth 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 fmancial statements of the Worth County Board of Education, as of and for the year ended June 30, 1997, as listed in the table of contents. These generalpurpose financial statements are the responsibility of the Worth County Board of Education's management. Our responsibility is to express an opinion on these general-purpose fmancial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to fmancial 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.

97ARL-13

* School activity accounts maintained at the individual schools are not included in the general-purpose
fmancial 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 fmancial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Worth County Board of Education as of June 30, 1997, and the results of its operations and the cash flows of its nonexpendable trust fund 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 17, 1998, on our consideration ofthe Worth County Board of Education's internal control over fmancial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
Our audit was performed for the purpose of forming an opinion on the general-purpose fmancial statements of the Worth County Board of Education taken as a whole. The accompanying combining statements (Exhibits G through 1) and the fmancial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-B3,
AuditsofStates, LocalGovernments, andNon-Profit Organizations, are presented for purposes of additional
analysis and are not a required part of the general-purpose fmancial statements. Such information has been subjected to the auditing procedures applied in the audit of the 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 fmancial statements taken as a whole.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.

CLV:ds 97ARL-13

Claude L. Vickers State Auditor

* 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 fmancial statements referred to above present fairly, in all material respects, the financial position ofthe Worth County Board of Education as of June 30, 1997, and the results of its operations and the cash flows of its nonexpendable trust fund 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 17, 1998, on our consideration ofthe Worth 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.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements of the Worth County Board of Education taken as a whole. The accompanying combining statements (Exhibits G through 1) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-B3, Audits ofStates, 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 of the general-purpose financial statements and in our opinion, except for the effects ofthe 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 of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.

CLV:ds 97ARL-13

Claude L. Vickers State Auditor

* School activity accounts maintained at the individual schools are not included in the general-purpose
fmancial 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 fmancial statements of the matters referred to in the preceding paragraph, the general-purpose fmancial statements referred to above present fairly, in all material respects, the financial position ofthe Worth County Board of Education as of June 30, 1997, and the results of its operations and the cash flows of its nonexpendable trust fund 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 17, 1998, on our consideration of the Worth County Board of Education's internal control over fmancial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants.
Our audit was performed for the purpose of forming an opinion on the general-purpose fmancial statements of the Worth County Board of Education taken as a whole. The accompanying combining statements (Exhibits G through 1) and the fmancial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133,
AuditsofStates, 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 of the 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 fmancial statements taken as a whole.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.

CLV:ds 97ARL-13

Claude L. Vickers State Auditor

WORTH COUNTY BOARD OF EDUCATION

The notes to the general purpose financial statementsare an integralpart of this statement. -2-

EXHIBIT"A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST FUND

ACCOUNTGROUP
GENERAL LONG-TERM
DEBT

TOTALS (Memorandum Only) JUNE 30,1997 JUNE 30,1996

$

180,400.30 $

1,450.27

$ 3,186,016.91 $ 4,518,144.30

3,862.30

2,661,146.59

2,215,437.96

$

184,262.60

2,495,737.40

1,153.38 15,786.94 184,262.60
2,495,737.40

2,545.39 12,065.53 195,797.09
2,599,202.91

$

184,262.60 $

1,450.27 $

2,680.000.00 $ 8,544,103.82 $ 9.543,193.18

$

435,284.03 $

554,096.35

2,184,477.70

2,005,588.56

3,664.71

19,187.93

71,679.50

247,451.66

338,756.05

13,490.00

$

2,680,000.00

2,680,000.00

2.795,000.00

$

2,680,000.00 $ 5,388,595.94 $ 5,960,080.55

$

184,262.60

$

0.00

$

184,262.60 $

$

184,262.60 $

1,000.00
450.27 1,450.27

$

3,478.78

101.16

$

184,262.60

195,797.09

1,000.00

1,000.00

10,671.47

1,153.38 15,786.94 22,363.00

2,545.39 12,065.53 1,388,116.44

49,400.85 2,881,541.11

53,402.85 1,915,933.92

$ 3,155,507.88 $ 3,583,112.63

1,450.27 $

2,680,000.00 $ 8,544,103.82 $ 9,543,193.18

-3-

WORTH COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1997

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)
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
FUND BALANCE JUNE 30

GENERAL FUND

SPECIAL REVENUE
FUND

CAPITAL PROJECTS
FUND

$ 16,287,876.16 $ 65,020.51
3,356,541.44 317,907.21
$ 20,027,345.32 $

865,635.44 $ 2,904,268.13
366,986.58
4,136,890.15 $

36,962.47
3,510.94 40,473.41

$ 12,182,071.21 $
945,557.93 531,594.83 468,942.85 218,912.64 1,475,177.06 232,274.51 1,454,291.16 1,408,420.31 122,014.81 25,243.79

1,534,008.58
130,960.76 104,661.03
5,723.74 162,241.77
3,237.59 46,732.25
233,985.80 1,786,812.84
60,324.15 $

1,489,911.76

$ 19,064,501.10 $

$

962,844.22 $

4,068,688.51 $ 68,201.64 $

1,489,911.76 -1,449,438.35

$

$

-92,068.57

$

-92,068.57 $

4,872.72 $ 4,872.72 $

87,195.85 87,195.85

$

870,775.65 $

1,227,201.37

73,074.36 $ 606,878.87

-1,362,242.50 1,551,777.86

-1,392.01 3,721.41

$ 2,097,977.02 $

682,282.63 $

189,535.36

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

EXHIBIT"B"

DEBT SERVICE
FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30, 1997 JUNE 30, 1996

$ 17,190,474.07 $ 17,613,420.55

2,969,288.64

2,809,824.44

$

291,031.43

3,647,572.87

4,066,173.50

4,492.13

692,896.86

$

295,523.56 $ 24,500,232.44 $ 24,489,418.49

$ 13,716,079.79 $ 13,059,760.48

1,076,518.69 636,255.86 474,666.59
381,154.41 1,475,177.06
232,274.51 1,457,528.75 1,455,152.56
122,014.81 259,229.59 1,786,812.84
60,324.15 1,489,911.76

1,049,266.70 572,261.42 425,007.41
382,537.00 1,410,444.00
203,468.79 1,344,323.47 1,209,374.88
160,917.64 49,925.97 1,654,039.48 73,682.27 4,053,890.47

$

115,000.00

191,395.00

663.05

115,000.00 191,395.00
663.05

105,000.00 198,382.50
650.00

$

307,058.05 $ 24,930,159.42 $ 25,952,932.48

$

-11,534.49 $ -429,926.98 $ -1,463,513.99

$

92,068.57 $ 3,493,838.36

-92,068.57

-3,493,838.36

$

0.00 $

0.00

$

-11,534.49 $ -429,926.98 $ -1,463,513.99

195,797.09

3,581,655.19

5,043,116.00

-1,392.01 3,721.41

401.77 1,651.41

$

184,262.60 $ 3,154,057.61 $ 3,581,655.19

- 5-

THIS PAGE LEFT BLAHK

The notes to the general purposefinancial statementsare an integralpart of this statement. -7-

WORTH COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES. EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND
YEAR ENDED JUNE 30.1997

EXHIBIT"D"

OPERATING REVENUE None Recorded
OPERATING EXPENSES Current Instruction Operating Income (Loss)
NONOPERATING REVENUES Interest Earned Total Income (Loss)
FUND BALANCE JULY 1

ENDOWMENT FUND
CHASES. OSBORN
FUND

TOTALS (Memorandum Only)
YEAR ENDED
JUNE 30.1997 JUNE 30,1996

$

0.00 $

0.00 $

0.00

$

50.00 $

50.00 $

50.00

$

-50.00 $

-50.00 $

-50.00

42.83

42.83

43.20

$

-7.17 $

-7.17 $

-6.80

1.457.44

1.457.44

1,464.24

FUND BALANCE JUNE 30

$

1;,.:.,4,;,;;5;,;,0;,;;;.2~7 $

1;.:..4,;,;5~0.;;;,27,;..$_.........1..,..4..5..7...-4=4=

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

WORTH COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30,1997

EXHIBIT IIE"

Cash Flows from Operating Activities: Cash Paid for Scholarships
Cash Flows from Investing Activities: Interest Received on Investments
Net Increase (Decrease) in Cash Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

ENDOWMENT FUND
CHASES. OSBORN
FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30,1997 JUNE 30, 1996

$

-50,00 $

-50.00 $

-50.00

42,83

42,83

43.20

$

-7.17 $

-7.17 $

-6.80

1,457.44

1,457,44

1,464.24

1,450.27 $ ======1=,4=5=7=.4=4=

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

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Worth County Board of Education (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid fmancial 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 of a Board's educational activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds 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.
- 10-

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees.
FIDUCIARY FUND TYPE - the fund 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. This fund includes:
NONEXPENDABLETRUSTFUND Chase S. Osborn 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 an award to the Worth County School System spelling champion.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation bonds outstanding.
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. 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 of these funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
Governmental funds are accounted for using the modified accrual basis of accounting under which:

- 11 -

WORTH COUNTY BOARD OF EDUCAnON

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be 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. Property taxes are considered available ifthey 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 1996 and ending in early June 1997. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1996 and ending in August 1997. State grants to fund the State's share of these 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 of accounting, 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 Worth 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 of the 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 in accordance with generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general 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 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.

- 12-

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS

COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits 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 of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State.

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 Worth County Board of Commissioners fixed the property tax levy for the 1996 tax year (calendar year) on September 30, 1996 (levy date). Taxes were due on December 20, 1996. The lien date for property taxes was January 1, 1996. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1997 since their collection meets the criteria of GASB codification section P70.103. The Worth 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 1996 tax year (calendar year) for the Worth County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

11.85 mills 1.00 mills

l2..8.5. 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 of purchase. The inventories reported on the balance sheet for donated food

- 13-

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 the financial statements during the year bonds are issued. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds is recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The Board has the following types of interfund transactions:
Reimbursements of expenditures/expenses initially made from a fund that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as 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 of operations or cash flows in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Certain reclassifications have been made to the comparative data to conform to the current year classifications.
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 of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities shall be equal to not less than 110 percent ofthe public funds being secured after the deduction of the 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.
- 14-

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 2: DEPOSITS
Acceptable security for deposits consists of anyone of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations ofthe counties or municipalities of the State of Georgia,
(5) Bonds of any 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 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 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, 1997, the bank balances were $5,517,505.28. The amounts of the total bank balances are classified into three categories of credit risk:
Category I - 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 fmancial 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, 1997, as follows:

- 15 -

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 2: DEPOSITS

Risk Category

Bank Balance

1

$ 300,000.00

2

5,114,294.67

3

103,210.61

Total

$ 5,517,505.28

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 of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation.

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

The Board has elected to self-insure for all losses related to natural disaster. The Board has not experienced any losses related to these risks 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 of that loss can be reasonably estimated.

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

1996 1997

Beginning of Year Liability

Claims and Changes in Estimates

$

0.00 $

0.00 $

$

0.00 $

4,002.00 $

Claims Paid

End of Year Liability

0.00 $ 1,246.00 $

0.00 2,756.00

- 16-

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 4: RISK MANAGEMENT

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

Position Covered

Amount

Superintendent Each Principal

$10,000.00 $5,000.00 - $10,000.00

Note 5: GENERAL LONG-TERM DEBT

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

Purpose

Interest Rates

Amount

General Government - Series 1990

6.40% - 7.25% $ 2.680,000.00

The changes in General Long-Term Debt during the fiscal year ended June 30, 1997, were as follows:

Balance July 1, 1996
Deductions Payments
Balance June 30, 1997

General Obligation
Bonds $ 2,795,000.00
115,000.00 $ 2.680,000.00

At June 30, 1997, payments due, by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30
1998 1999 2000 2001 2002 2003 - 2007 2008 - 2011
Total Principal and Interest

General Obligation
Bonds
$ 213,857.50 309,975.00 306,335.00 307,290.00 307,430.00
1,544,940.00 1,227,692.50
$ 4,217,520.00

- 17 -

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $406,464.75 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of$330,841.23

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of$12,437.52

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$63,186.00

Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1997, together with funding available: .

Project

Unearned Executed Contracts

Funding Available From State

97-759-042

$ 36.000.00 $ 421.988.00

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

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.

- 18 -

WORTH COUNTY BOARD OF EDUCATION

EXHIBIT "F"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1997

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 defmed 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 fmancial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRSCONTRIBUTIONS 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 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1997 1996 1995

100% 100% 100%

$1,524,980.66 $1,420,805.69 $1,282,690.62

- 19-

WORTH COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30,1997

EXHIBIT"G"

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

OTHER

TOTALS

PROGRAMS JUNE 30,1997 JUNE 30,1996

$ 770,470.93 $ 60,559,62

$ 831,030.55 $

514,197,93

57,478.56

$ 337,634.01 $ 73,365.57

468,478.14

463,037.70

1,153.38 15,786.94

1,153.38 15,786.94

2,545.39 12,065.53

s 844,889.81 $ 60,559.62 $ 337,634,01 $ 73,365.57 $ 1,316,449.01 $

991,846.55

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue

$ 54,113.07 $ 95,004.11
13,490.00

Total Liabilities

$ 162,607.18 $

FUND EqUITY

Fund Balances

Reserved

For Continuation of Federal Programs

For Continuation of State Programs

For Inventories

Food

Donated Commodities

$

1,153.38

Purchased Food

15,786.94

Unreserved

Undesignated

665,342.31 $

Total Fund Equity

$ 682,282.63 $

$ 13,144.22 47,415.40

152,076.49 $ 45,131.80 136,761.01
3,664.71

60,559.62 $ 337,634.01 $

0.00 $ 0.00 $

0.00 $ 0,00 $

67,039,40 $ 6,326,17
73,365.57 $
$ 0.00 0.00 $

219,115.89 $ 118,715.26 279,180.52
3,664.71 13,490.00
s 634,166.38
$
1,153.38 15,786.94 665,342.31 682,282,63 $

31,102.62 111,310.28 230,015,44
12,539.34
384,967,68
3,478.78 101,16
2,545.39 12,065.53 588,688.01 606,878,87

s Total Liabilities and Fund Equity

844,889.81 $ 60,559.62 $ 337,634.01 $ 73,365.57 $ 1,316,449.01 $

991,846.55

See notes to the general purpose financial statements.

- 20-

WORTH COUNTYBOARDOF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDEDJUNE 30,1997

EXHIBIT"H"

SCHOOL FOOD
SERVICES FUND

LOTIERY PROGRAMS

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS YEAR ENDED JUNE 30,1997 JUNE 30,1996

REVENUES

State Funds Federal Funds Other Funds

$ 111,052,00 $ 1,388,535.44 363,879.70

587,202.46

$ 167,380.98 $ 865,635,44 $

$ 1,515,732.69

2,904,268,13

3,106.88

366,986.58

842,659,02 2,720,023,10
357,900.77

Total Revenues

$ 1,863,467.14 $ 587,202.46 $ 1,515,732,69 $ 170,487,86 $ 4,136,890.15 $ 3,920,582,89

EXPENDITURES

Current

Instruction

SupportServices

Pupil Services

Improvementof Instructional Services

Educational Media Services

General Administration

Maintenance and Operationof Plant

StudentTransportation Services

Central Support Services

Other SupportServices

Food Services Operation

$

CommunityServices Operations

$ 1,786,812.84

465,745.68 $ 1,068,262.90

$ 1,534,008,58 $

68,621.37 4,135.36
32,796.90
15,903,15

62,339,39 100,525.67
5,723,74 129,444.87
3,237.59 30,829,10

130,960,76 104,661,03
5,723,74 162,241.77
3,237.59 46,732.25

63,396.78 $ 170,589.02 60,324.15

233,985.80 1,786,812.84
60,324.15

1,633,203.19
160,555.85 66,305,10
182,114.77 35,466.59 39,862.88 21,352,57 37,584.32
1,654,039.48 73,682,27

Total Expenditures

$ 1,786,812.84 $ 587,202.46 $ 1,524,084.19 $ 170,589.02 $ 4,068,688.51 $ 3,904,167,02

Excess of Revenuesover (under) Expenditures

$ 76,654.30 $

0.00 $ -8,351,50 $

-101.16 $ 68,201.64 $

16,415.87

OTHER FINANCINGSOURCES

Operating Transfers In

4,872.72

4,872.72

46,664.04

Excessof Revenuesand Other FinancingSources over (under) Expenditures

$ 76,654.30 $

0.00 $ -3,478,78 $

-101,16 $ 73,074,36 $

63,079.91

FUND BALANCEJULY 1

603,298,93

0.00

3,478.78

101.16

606,878.87

541,745.78

Food Inventory- Net Change in Period Donated Commodities Purchased Food

-1,392.01 3,721.41

-1,392.01 3,721.41

401.77 1,651.41

FUND BALANCEJUNE 30

$ 682,282,63 $

0.00 $

0.00 $

0.00 $ 682,282,63 $

606,878.87

See notesto the general purposefinancial statements.

- 21 -

Cash and Cash Equivalents Accounts Receivable

WORTH COUNTYBOARDOF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 1997

EXHIBIT"I"

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$ 167,172.36 $

41,431.03 $

30,248.47

LOTTERY PROJECT

TOTALS JUNE 30,1997 JUNE 30, 1996

23,363.00 $

231.966.39 $ 2,151,151.36

30,248.47

Total Assets

$ 167.172,36 $

71,679.50 $

23.363,00 $

262,214.86 $ 2,151,151.36

LIABILITIES AND FUND EQUITY
LIABILITIES
AccountsPayable ContractsPayable Retainages Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For State Capital OutlayProjects Unreserved Undesignated
Total Fund Equity

$ $
$ 167,172.36 $ $ 167.172.36 $

$ 71,679.50 71,679.50 $
$ 0.00 0.00 $

1.000.00 $ 1,000.00 $

1.000.00 $ 71.679.50
72,679.50 $

13.165.79 247,451.66 338,756.05
599,373.50

22,363.00 $ 0.00
22.363.00 $

22.363.00 $ 167,172.36 189.535.36 $

1.388.116.44 163.661.42
1.551.777.86

Total Liabilitiesand Fund Equity

$ 167,172.36 $

71,679.50 $

23.363.00 $

262,214.86 $ 2,151.151.36

See notesto the general purposefinancial statements.

- 22-

WORTH COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30.1997

EXHIBIT"J"

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

LOTTERY PROJECT

TOTALS

YEAR ENDED

JUNE 30,1997

JUNE 30.1996

REVENUES

State Funds Other Funds

$

30,248.47 $

6,714.00 $

36,962.47 $ 1,698,882.00

$

3.510.94

3,510.94

9,641.80

Total Revenues

$

3,510.94 $

30,248.47 $

6,714.00 $

40,473.41 $ 1.708,523.80

EXPENDITURES

Current Support Services Business Administration
Capital Outlay Rents Other Purchased Services Supplies Land and Land Improvements BUilding and Building Improvements Equipment

$

0.00

$

0.00 $

61.65

$

500.00

17,907.00

1,907.45

$

1,426,263.31

3,839.00

3,495.00 36,000.00

500.00 17,907.00
1,907.45 3,495.00 1,462,263.31 3.839.00

12,000.00 186,106.81
341.15 3,693,589.39
161,853.12

Total Expenditures

$

0.00 $ 1.450.416.76 $

39.495.00 $ 1,489,911.76 $ 4,053,952.12

Excess of Revenues over (under) Expenditures

$

3.510.94 $ 1.420,168.29 $

-32,781.00 $ -1,449,438.35 $ -2,345,428.32

OTHER FINANCING SOURCES (USES)

Operating Transfers In Operating Transfers Out

$

87,195.85

$

87,195.85 $ 3,863,355.74

-416,181.42

Total Other Financing Sources (Uses)

$

87,195.85

$

87,195.85 $ 3,447,174.32

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

3,510.94 $ -1,332,972.44 $

-32,781.00 $ -1,362,242.50 $ 1,101,746.00

FUND BALANCE JULY 1

163,661.42

1,332.972.44

55,144.00

1,551,777.86

450,031.86

FUND BALANCE JUNE 30

$

167,172.36 $

0.00 $

22,363.00 $

189,535.36 $ 1,551,777.86

See notes to the general purpose financial statements.

-23 -

WORTH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,1997

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture. U. S. Department of Direct Food and Nutrition Program Summer School Food Service Program for Children 1996 Grant 1997 Grant Food Distribution Program Alternative to Commodity Donations 1997 Grant Through Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1997 Grant National School Lunch Program 1997 Grant 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 Title I Grants to Local Educational Agencies 1996 Summer 1997 Grant 1997 Summer State Program Improvement Grants 1997 Grant Title II Eisenhower Professional Development 1996 Grant 1997 Grant Title VI Innovative Education Program Strategies 1997 Grant Goals 2000 State and Local Education Systemic Improvement Grants 1997 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1997 Grant Preschool 1997 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1997 Grant
Total U. S. Department of Education

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

* 10,559 $ * 10,559
10,550

111,269.60 $ 85,778,05
90,970.00

111,269.60 85,778,05
(2)

* 10,553
* 10.555 10.550
$

309,334.20
787,511.59 3,672.00
1,388,535.44 $

(2)
1,586,093.19 (3) 3,672.00
1,786,812.84

* 84.010 $ * 84.010 * 84.010
84,218

24,435,28 $ 1,064,121.21
35,899.43
5,822.77

24,435.28 1,064,121.21
35,899.43
5,822.77

84.281 84.281

19,270.53

3,476.03 19,270.53

84.298

27,025.00

27,025.00

84.276

7,520.01

7,520.01

84.027 84.173

143,089.00 42,441.00

143,089.00 42,441.00

84.048 $

37,146.00 1,406,770.23 $

37,618.59 (3) 1,410,718.85

- 24-

WORTH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30,1997

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

Health and Human Services, U. S. Department of Through Georgia Department of Human Resources Child Care School Age Program Contract 427-93-61320 Contract 427-93-71537

93.037 $ 93.037

Total U. S. Department of Health and Human Services

$

Justice, U. S. Department of Through Office of the Govemor Georgia Children and Youth Council Juvenile Justice and Delinquency Prevention 1997 Grant

16.540 $

Labor, U. S. Department of Through Southwest Georgia Regional Development Center Job Training Partnership Act 96-B-96 96-B-98

17.250 $
17.250

Total U. S. Department of Labor

$

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

12,895.82 $
47,425.58

12,898.57 47.425.58

60,321.40 $ _ _-=60.,.3:2=4.~1=5-

20,972.61 $

25,372.74 (3)

8,583.83 $
19,084.62

8,583.83 19,084.62

27,668.45 $ _ _..2.7..,6::6.8:.~4~5=-

OTHER FEDERAL ASSISTANCE
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

$---6=5,=020=.5~1

(4)

Total Federal Financial Assistance

$

Major Programs are identified by an asterisk (*) in front of the CFDA number.

The Board did not provide Federal Assistance to any Subrecipient.

(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year.
(2) Expenditures for the Altematives to Commodity Donations and the School Breakfast Program were not maintained separately and are included in the 1997 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.

See notes to the general purpose financial statements.

- 25-

WORTH COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1997

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 Counselors Grades 4 and 5 Technology Training Local Fair 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 Environmental Science Program Health Insurance Innovative Programs Mentoring Program Mentor Teacher Program Preschool Handicapped Program Remedial Summer School Program Teachers'Retirement Lottery Programs Exceptional Growth-Capital Outlay Instructional Technology
Georgia State Financing and Investment Commission Reimbursement on Construction Projects
Human Resources, Georgia Department of Family Connection
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 8,802,840.00 1.340,708.00 361,284.00 373,405.00 119,536.00 2,536.967.00
694,486.00 219.472.00 344,622.00 375,979.00 75,774.00 25.590.00 54.313.00 -1,265,581.00 -1,569,167.00 1,853,604.00 1,212,782.00
$ 107,789.00
124,300.00 27,711.01
1,500.00 330,841.23
5,000.00 808.56
3,528.00 46,198.00
7,962.84 12,437.52

111,052.00
$ 92,160.00

$ 6,714.00

8,802,840,00 1.340,708.00
361,284.00 373,405.00 119,536.00 2,536,967.00
694,486.00 219.472.00 344.622.00 375,979.00
75,774.00 25,590.00 54,313.00 -1.265.581.00 -1,569,167.00 1,853,604.00 1,212,782.00 111,052.00 107,789.00
124,300.00 27,711.01
1,500.00 330,841.23
5,000.00 808.56
3,528.00 46,198.00
7,962.84 12,437.52
6,714.00 92,160.00

63,186.00

167,380.98 495,042.46

30.248.47

30,248.47 167,380.98 495,042.46 63,186.00

$ 16,287,876.16 $

865,635.44 $

36,962.47 $ 17.190.474.07

See notes to the general purpose financial statements.

- 26-

WORTH COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30. 1997

SCHEDULE "3"

EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Student Transportation Services
Total Expenditures

INSTRUCTIONAL PRE-KINDERGARTEN

TECHNOLOGY

PROGRAM

TOTAL

$

92,160.00 $

373,585.68 $
68,621.37 4,135.36
32,796.90 15,903.15

465,745.68
68,621.37 4,135.36
32,796.90 15,903.15

$

92,160.00 $

495,042.46 $

5.8-..7.r,,2;-0-.;2".,4;o6;"

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Instructional Technology Pre-Kindergarten Program

$

405,488.29

92,160.00 89,554.17

$

587,202.46

See notes to the general purpose financial statements.

- 27-

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WORTH COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30.1997

SCHEDULE "4"

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

$ 10,878,237.00 $

324,443.00

$ 10,473,808.18 748,463.90 $
$ 11,222,272.08

657,761.28

-62,280.02
$ 11,159,992.06

Amount of Underexpenditure for Total Allotment

$

0.00 $========0=.00=

Note: (1) Salary accruals (July and August 1997 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 1996 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. - 29 -

WORTHCOUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS BY PROGRAM
GENERAL FUND QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1997

SCHEDULE "5"

TOTAL

ACTUALEXPENDITURES

REQUIRED SALARIES (1)(2) OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$ 847,679.40 $

878,258.97 $

28,761.23 $ 907,020.20

2,166,354.90

2,246,372.64

126,882.42 2,373,255.06

$ 3,014,034.30 $ 3,124,631.61 $ 155,643.65 $ 3,280,275.26 $

0.00

955,081.80

1,183,357.30

95,316.04 1,278,673.34

0.00

1,848,168.00

1,792,744.06

116,455.71

1,909,199.n

0.00

1,405,048.50

1,444,092.62

141,656.44 1,585,749.06

0.00

274,011.30

489,365.07

28,109.94

517,475.01

0.00

426,212.10

474,760.09

73,466.34

548,226.43

0.00

$ 7,922,556.00 $ 8,508,950.75 $ 610,648.12 $ 9,119,598.87

$ 1,122,252.30 $

$ 452,365.26 552,533.94 123,197.04

294.54 $ 15,624.10 9,563.87
9,233.49

294.54 467,989.36 562,097.81 132,430.53

$ 1,122,252.30 $ 1,128,096.24 $

34,716.00 $ 1,162,812.24

0.00

84,384.90

111,370.51

6,545.23

117,915.74

0.00

$ 1,206,637.20 $ 1,239.466.75 $

41,261.23 $ 1,280,727.98

$ 325,155.60 $ 380,408.28 $

5,851.93 $ 386,260.21

0.00

$ 9,454,348.80 $ 10,128,825.78 $ 657,761.28 $ 10,786,587.06

$ 268,548.30 $ 344,982.40

$ 344,982.40

0.00

67,516.20

$

90,702.62

90,702.62

0.00

$ 336,064.50 $

344,982.40 $

90,702.62 $ 435,685.02

$ 9,790,413.30 $ 10,473,808.18 $ 748,463.90 $ 11,222,272.08 $

0.00

$

33,284.00

86,252.00

$ 119,536.00

$

44,148.84 $

44,148.84

75,549.05

75,549.05

$ 119,697.89 $ 119,697.89 $

.....0.;.,0;;;0;;,

- 31 -

SECTIONll COMPLIANCE AND INTERNAL CONTROL REPORTS

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17, 1998

Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board of Education
and Superintendent and Members of the Worth 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 of Worth County Board of Education as of and for the year ended June 30, 1997, and have issued our report thereon dated February 17, 1998. 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 of obtaining reasonable assurance about whether Worth County Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, 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 of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Worth County Board ofEducation's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation
97YB-40

that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Worth County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. Reportable conditions are described in the accompanying Schedule ofFindings and Questioned Costs as items FS-7591-97-01 and FS-7591-97-03.
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 fmancial 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, all ofthe reportable conditions described above are considered to be material weaknesses.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:ds 97YB-40

CLAUDE L. VICKERS
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 17,1998

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the Worth County Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of Worth County Board of Education with the types of compliance
requirements described in the Us. Office 0/Management and Budget (OMB) Circular A-i33 Compliance
Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1997. Worth County Board of Education's major Federal programs are identified in the accompanying Summary Schedule of Auditor's Results. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Worth County Board of Education's management. Our responsibility is to express an opinion on Worth County Board of Education's compliance based on our audit.
We conducted our audit of compliance 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 ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Worth County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Worth County Board of Education's compliance with those requirements.

97SA-10

In our opinion, the Worth 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, 1997.
Internal Control Over Compliance
The management of Worth 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 Worth 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 of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more ofthe internal 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 of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:ds 97SA-10

SECTION ill SUMMARY OF AUDITOR'S RESULTS

WORTH COUNTY BOARD OF EDUCATION SUMMARY SCHEDULE OF AUDITOR'S RESULTS
YEAR ENDED JUNE 30, 1997

1. Type of Report Issued on the Financial Statements The auditor's opinion on the Worth County Board of Education'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 Worth County Board of Education disclosed fmancial statement reportable conditions related to the following control categories.

Cash and Cash Equivalents

General Fixed Assets

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

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

4. Reportable Conditions in Internal Control Over Major Programs The audit report for the Worth 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 Worth County Board of Education's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Reported by Section .51O(a) ofOMB Circular A-133 The Worth County Board of Education's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-B3.

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 10.559 Food and Nutrition Program - Summer School Food Service Program for Children 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

9. Low Risk Auditee The Worth County Board of Education did not qualify as a low risk auditee.

97SAR-l

SECTION IV AUDlTEE'S RESPONSE TO PRIOR YEARFINDINGS AND QUESTIONED COSTS

WORTH COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

7591-93-01 7591-94-01 7591-93-02 7591-93-04

Unresolved-See Corrective Action/Response Previously Reported Corrective Action Implemented Unresolved-See Corrective Action/Response Unresolved-See Corrective Action/Response

CORRECTIVE ACTIONIRESPONSES

EXPENDlTURESILIABILITIESIDISBURSEMENTS Improper Expenditures Finding Control Number 7591-93-01

The Board does not plan to secure reimbursement of the $10,000.00 for the deposit to the Board's General Fund.

ACCOUNTING CONTROLS (OVERALL) ADMINISTRATIVE REQUIREMENTS Inadequate Separation of Duties Finding Control Number 7591-93-02

Procedures have been implemented during the 1998 fiscal year to provide for adequate separation of employee duties in the performance of accounting functions and related procedures. This corrective action establishes the required degree of internal control.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number 7591-93-04

The management of the Worth County Board of Education has not implemented a plan to maintain a system-wide General Fixed Assets Account Group within the formal accounting records. We feel that it is not cost beneficial to record these assets.

SECTION V CURRENT YEAR FINDINGS AND QUESTIONED COSTS

WORTH COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1997
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
CASH AND CASH EQUNALENTS Inadequate Separation of Duties Reportable Condition - Material Weakness Finding Control Number: FS-7591-97-01
Although the Board made some improvements regarding separation of employee's duties during the current year, the Board did not achieve an adequate degree of internal control in the performance of accounting functions and related procedures for all funds as enumerated below:
The bank reconciliation function was not separated from the check writing function. The check writing function was not separated from the record keeping function.
Separation of duties involving key accounting functions is the basis for achieving an adequate system of internal control. Inadequate separation of duties creates an environment which does not provide reasonable assurance that accounting data and financial statements are accurate and complete. 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.
CASH AND CASH EQUNALENTS Uncollateralized Deposits Nonmaterial Noncompliance Finding Control Number: FS-7591-97-02
As of June 30, 1997, the Board failed to have its bank balances fully collateralized as provided for by the Official Code of Georgia Annotated Section 45-8-12 which states, in part, as follows:
"The collecting officer or officer holding public funds may not have on deposit at any time in any depository for a time longer than ten days a sum ofmoney belonging to the public body when such depository has not given bond to the public body as set forth in this code section...The aggregate of the face value of such surety bond, and the market value of securities pledged, shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance" .
This noncompliance occurred because of management's failure to adequately monitor the collateralization of balances at individual banks. The Board should implement procedures to monitor the collateralization of bank balances to ensure compliance at all times with State laws governing deposits and investments.
- 1-

SECTION VI PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

WORTH COUNTY BOARD OF EDUCAnON PERTINENT VIEWS OF RESPONSffiLE OFFICIALS
YEAR ENDED JUNE 30, 1997
CASH AND CASH EQUIVALENTS Inadequate Separation of Duties Reportable Condition - Material Weakness Finding Control Number: FS-7591-97-01
We concur with this fmding. During fiscal year 1998, the Board implemented a corrective action plan to provide for adequate separation of employee duties in the performance of accounting functions and related procedures.
CASH AND CASH EQUIVALENTS Uncollateralized Deposits Nonmaterial Noncompliance Finding Control Number: FS-7591-97-02
We concur with this finding. We have contacted the financial institution involved and requested that they provide appropriate collateral for all Board deposits in the future.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Finding Control Number: FS-7591-97-03
We concur with this finding. Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff, the Board had decided not to pursue the recording of general fixed assets on the fmancial statements.