Review report, state of Georgia, Chattahoochee-Flint Regional Educational Service Agency, Ellaville, Georgia, year ended June 30, 1997

REVIEW REPORT STATE OF GEORGIA CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY ELLAVILLE, GEORGIA YEARENDED JUNE 30, 1997
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

EXHIBITS

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

ALL GOVERNMENTAL FUND TYPES

3

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

4

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

12

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

13

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

14

2 SCHEDULE OF STATE REVENUE

15

3 SCHEDULE OF SALARIES AND TRAVEL

16

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

CHA ITAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY - TABLE OF CONTENTS -
SECTIONID CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS


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
December 19, 1997

Honorable Zell Miller, Governor Members of the General Assembly of Georgia Members of the State Board of Education
and Director and Members of the Chattahoochee-Flint Regional Educational Service Agency Board of Control
INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have reviewed the accompanying financial statements (Exhibits A through D) of Chattahoochee-Flint Regional Educational Service Agency as of and for the year ended June 30, 1997, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. All information included in these financial statements is the representation of the management of Chattahoochee-Flint Regional Educational Service Agency.
A review consists principally of inquiries of Agency personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, with the exception of the matters described in the following paragraphs, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles.
* The financial statements of the Agency did not contain a General Fixed Assets Account Group to
account for equipment owned by the Agency which should be included to conform to generally accepted accounting principles.

97ARL-RESA-1

* The Agency did not recognize as expenditures, in the year ended June 30, 1997, a portion of salaries
. and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1997. Also funds received, subsequent to June 30, 1997, from the Georgia Department of Education for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1996, were improperly recorded in the year ended June 30,1997. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the financial statements of these variances or omissions have not been determined, but are believed to be material.
Our review was made for the purpose of expressing limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with generally accepted accounting principles. The accompanying supplementary information (Exhibits E and F and Schedules 1 through 3) is presented only for supplementary analysis purposes. Such information has been subjected to the inquiries and analytical procedures applied in the review of the financial statements, and except for the effects ofthe matters discussed in the paragraph above, we are not aware of any material modifications which should be made thereto.
Respectfully submitted,

CLV:gp 97ARL-RESA-1

Claude L. Vickers State Auditor

CHAITAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY

CHATIAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30,1997

EXHIBIT "A"

ASSETS Cash and Cash Equivalents Accounts Receivable Inventories for Resale

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

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

$

281,018,64

$

281,018.64 $

168,601.92

17,979.57 $

171,305.65

189,285.22

104,368.87

26,074.98

26,074.98

26,464.73

Total Assets

$

325,073.19 $

171,305.65 $

496,378.84 $

299,435.52

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Program For Expired Grant Balances/Questioned Costs For Inventories for Resale Unreserved Undesignated
Total Fund Equity

$

150,539.47 $

150,539.47 $

3,560.46

3,560.46

17,205.72

17,205.72

$

171,305.65 $

171,305.65 $

36,945.42 5,355.53
25,256.60 913.96
68,471.51

$

26,074.98

298,998.21 $

$ 325.073.19 $

$
0.00
0.00 $

$
26,074.98 298,998.21
325,073.19 $

1,542.19 19,834.33 26,464.73
183,122.76
230,964.01

Total Liabilities and Fund Equity

$

325,073.19 $

171,305.65 $

496,378.84 $

299,435.52

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

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30,1997

EXHIBIT "B"

FUND BALANCE JUNE 30

$ 325,073,19 $

0,00 $

325.Q73.19 $

230,964.01

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

CHAlTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAPP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30. 1997

EXHIBIT "c"

FUND BALANCE JUNE 30.1997

$ 290,276.75 $ 325,073.19

======== $

58,889.34 $

0.00

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

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1997

EXHffiIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Chattahoochee-Flint Regional Educational Service Agency (Agency) was established pursuant to the OfficialCode ofGeorgiaAnnotatedSections20-2-270 through20-2-274 for the purposesof providingshared servicesdesignedto improve the effectiveness of educational programs and services of local school systems and for providing instructional programs directly to selectedpublic school students in the state.
Each regional educational serviceagencyis governed by a board. The numberof membersand terms of office are prescribedby the State Board of Education; provided, however, that at least one-third of the membership of each Board shall be individuals who hold no other public office, who are not employees of any local unit of administration, and who are not employees of the Georgia Department of Education.
The members ofthe Board are elected by an annual caucus of an equal number of members of local boards of education from the respective member local school systems. Each Board appoints and contracts with a director who is the executiveofficer of the regional educational service agency. The director is responsible for the administration of the programs and services approved by the Board.
For financial reporting purposes, the Agency is considered to be an organizational unit of the State, and thereforea part ofthe primarygovernment of the Stateof Georgia. Inclusion in the State'sfinancial reporting entity is based on applicationof criteriadefinedin Section2100 of the Governmental Accounting Standards Board Codificationof Governmental and Financial Reporting Standards which indicates that the Agencydoes not have legal separate standing.
FUND ACCOUNTING
The Agencyuses 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 Agency. To conform to generally accepted accounting principles, a General Fixed Assets AccountGroup shouldbe maintainedfor reporting the cost of assets acquired by governmental fund types.
The generalpurpose fmancial statements account for all State, Federal and Other funds under control of the Agency, in compliancewith generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds presented in this report are as follows:

-5-

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GOVERNMENTAL FUND TYPES - are used to account for all or most of a regional educational service agency's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Agency except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a regional educational service agency.
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 received primarily from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately.
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 ofthe current period. Those revenues considered susceptible to accrual are intergovernmental grants, sales and services and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on certain employees' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1997, a substantial number of personnel of the Agency were employed for a one hundred and ninety day period beginning in late August 1996 and ending in early June 1997. Personnel contracts for this employment period 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 ofthese contracts were disbursed from the Georgia Department of Education to the Agency in the same twelve months. As of June 30, 1997, compensation under these employment contracts had been earned, but
-6-

CHAITAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
two 'ofthe twelve monthly payments, due for July and August 1997, had not been made. Payments for these two months were made and recorded as expenditures by the Agency subsequent to June 30, 1997. Also, the State's portion of the compensation paid in July and August 1997 was received and recorded as revenue in the fiscal year subsequent to June 30, 1997, Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1996, were recorded in the year ended June 30, 1997, Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
BUDGET
The Chattahoochee-Flint Regional Educational Service Agency's budget is a complete financial plan for the Agency'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 Agency at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Agency'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 budget. This final budget is then submitted, in accordance with provisions ofthe 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,
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Agency to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations.
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.

-7-

CRAITAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30.1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
GOODS FOR RESALE Inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). The Agency records inventories on its financial statements as goods for resale are purchased and costs of goods sold are recorded as inventories are sold. The inventory reported on the balance sheet is equally offset by a reservation of fund balance which indicates that it does not constitute "available spendable resources" even though it is a component of net current assets.
INTERFUND TRANSACTIONS
The Agency 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.
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 fmancial 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 of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum 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 the 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. 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 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,
-8-

CRATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1997

EXHIBIT"D"

Note 2: DEPOSITS

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

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

(5) Bonds 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 of the State of Georgia, and

(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation ofthe 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 $306,757,83, 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 Agency or by the Agency's agent in the Agency's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Agency'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 Agency's name.)

The Agency's deposits are classified by risk category at June 30, 1997, as follows:

Risk Category

Bank Balance

1

$ 100,000.00

2

206,757.83

3

0.00

Total

$ 306,757.83

-9-

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30,1997

EXHIBIT "D"

Note 3: RISK MANAGEMENT

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

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

The Agency has elected to self-insure for all losses related to natural disaster and errors or omissions, which includes, among other risks, risks for sexual harassment and discrimination, The Agency has not experienced any losses related to these risks in the past three years.

Note 4: OPERATING LEASES

The Chattahoochee-Flint Regional Educational Service Agency has entered into various leases as lessee for office space and copy machine rentals. These leases are considered for accounting purposes to be operating leases, Lease expenditures for the year ended June 30, 1997, amounted to $35,904.00, Future minimum lease payments for these leases are as follows:

Year Ending
1998 1999 2000 2001
Total
Note 5: ON-BEHALF PAYMENTS

Amount
$ 34,002,00 3,252,00 2,052,00 171.00
$ 39.477.00

The Agency has recognized revenues and expenditures in the amount of$1O,127,79 for health insurance paid on the Agency's behalf by the following State Agency,

Georgia Department ofEducation Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of$10,127,79

Note 6: 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 Agency believes that such disallowances, if any, will be immaterial to its overall financial position.

- 10-

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1997

EXHIBIT"D"

Note 7: RETIREMENTPLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by Agency's are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pensionplan. TRS provides service retirement, disability retirementand survivorsbenefits for its members in accordance with State statute, The Teachers Retirement Systemof Georgiaissues a separate stand alone financial audit report and a copy can be obtainedfrom the GeorgiaDepartment of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Agency who are covered by TRS are required by State statute to contribute 5% of their grossearnings to TRS. The Agencymakes monthlyemployer 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 precedingtwo fiscal years are as follows:

Fiscal Year

Percentage Contributed

Contribution

1997 1996 1995

100% 100% 100%

$ 132,549,21 $ 138,346.66 $ 142,773.69

- 11 -

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30,1997

EXHIBIT"E"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets

FEDERAL PROGRAMS

OTHER PROGRAM

TOTALS JUNE 30, 1997 JUNE 30, 1996

$

12,781.48

$ 158,347.62 $

12,958.03 $ 171,305.65

70,013.70

$ 158,347.62 $

12,958.03 $ 171,305.65 $ ........-8..2..,.7...9...5....1..8....

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable

$ 150,207.58 $ 1,405,14 6,734.90

Total Liabilities

$ 158,347.62 $

FUND EQUITY

Fund Balances

Reserved

For Continuation of Federal Program

Unreserved

Undesignated

$

0.00 $

Total Fund Equity

$

0.00 $

331.89 $ 2,155,32 10,470,82

150,539.47 $ 3,560.46 17,205,72

12,958.03 $ 171,305.65 $

0.00 $ 0.00 $

$ 0.00 0.00 $

49,726.90 5,355.53
25,256,60 913.96
81,252.99
1,542,19 0.00
1,542.19

Total Liabilities and Fund Equity

$ 158,347.62 $

12,958.03 $ 171,305.65 $

82,795.18 .

See notes to the general purpose financial statements.

- 12-

CHATIAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30.1997

EXHIBIT "F"

REVENUES
State Funds Federal Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Other Support Services
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
FUND BALANCE JUNE 30

FEDERAL PROGRAMS

OTHER PROGRAM

TOTALS YEAR ENDED JUNE 30, 1997 JUNE 30, 1996

$ $ 965,722.10
$ 965,722.10 $

85,030.03 $

85,030.03 $ 965,722.10

174,800.04 895,542.85

85,030.03 $ 1,050,752.13 $ 1,070,342.89

$ 113,361.00
165,734.35 99,434.76 $ 136,349.84 19,298.27 433,086.07
$ 967,264.29 $

$ 113,361.00 $ 111,531.14

83,196.03 1,834.00

165,734.35 182,630.79 136,349.84 21,132.27 433,086.07

195,479.13 232,496.99 118,422.07
28,008.72 384,469.99

85,030.03 $ 1,052,294.32 $ 1,070,408.04

$

-1,542.19 $

0.00 $

-1,542.19 $

-65.15

$

-1,542.19 $

1,542.19

$

0.00 $

0.00 $ 0.00

-1,542.19 $ 1,542.19

1,607.34
1,542.19 0.00

0.00 $

0.00 $=====1=,5=4=2.=19=

See notes to the general purpose financial statements.

-13-

CHATIAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30,1997

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Education, U, S, Department of Through Georgia Department of Education Safe and Drug-Free Schools 1997 Grant Elementary and Secondary Education Act Title I Migrant Education 1996 Grant 1997 Grant Individuals with Disabilities Education Act Part B - Special Education Special Projects Effective Procedures for Student Support Teams and Eligibility Teams 1997 Grant Reducing Attrition of Special Education Teachers 1997 Grant Goals 2000 State and Local Education Systemic Improvement Grant 1997 Grant
Total U. S, Department of Education
National Science Foundation Through University of Georgia Georgia Initiative in Mathematics and Science 1997 Grant

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84,186 $

77,901.53 $

77,901.53

84,011 84,011

294,749,60 546,916.08

296,291,79 (1) 546,916,08 (1)

* 84.027

950.00

950,00

* 84,027

746,91

746.91

84.276 $

35,459.84 956,723.96 $

35,459.84 958,266.15

47.076 $

8,998.14 $

8,998.14

Total Federal Financial Assistance

$ 965,722.10 $====,;9;;6,;7",;2;=6=4=.2=9=

* This program has been defined as a major program on a statewide basis in accordance with OMB Circular A-133. Internal control and compliance testing for this program has been conducted at other organizational units of the State of Georgia.
(1) Includes Federal Assistance in the amount of $433,086.07 provided to subrecipients.

See notes to the general purpose financial statements.

- 14 -

CHAITAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1997

SCHEDULE "2"

AGENCY/FUNDING

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

GRANTS

Education, Georgia Department of

Other State Programs

Health Insurance

$

Regional Educational Service Agencies

Supervision and Assessment of Student and

Beginning Teachers and Performance-

Based Certification

10,127.79 777,699.00
s

$ 85,030.03

CONTRACT Education, Georgia Department of Conducting Technology Training Sessions for School System Employees

160,115.00

TOTAL
10,127.79 777,699.00
85,030.03
160,115.00

$

947,941.79 $ ==============

1,032,971.82

See notes to the general purpose financial statements. - 15 -

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF SALARIES AND TRAVEL YEARENDED JUNE 30,1997

SCHEDULE "3"

PERSONNEL
AFFOLTER,DIANE W ANDERSON,JAY M ARGO,ANNEA BAILEY,GLORIA N BARNES,DAVID B BYRD,ARLENE W CARTER,NORMAN K CARTER,NORMAN K CARTER,NORMAN K COLLlNS,EMILY C CURTIS,PHILIP J JR DAVIS,WILLIAM E EXUM,EGAIL FISHER,MARSHA M GONZALEZ,JAVIER HALL,CHARLOTTE R HOLMES,ELlZABETH D HUNT,LENA MAE KENNEDY,NICK KENNEDY,WAYNE R KENNON,CAROL W KILBRIDGE,BISCHOFF M KOCHAN,WILLIAM R MCCORKLE,BARBARA A MOATES,BARBARA L MOORE,ROBERT M MORGAN,GWEN D PEREZ,SAN JUANITA PICKETT,V GAY PLESS, GRACE P PLESS, GRACE P SMITH,BETTY I SMITH,BILLIE SUE SMITH,BILLIE SUE SMITH,LENORA E STREETMAN,REBECCA A STREETMAN,REBECCA A TORBERT,MARYR TORBERT,MARY R TURNER,MARTHA H USREY,J CHRISTOPHER USREY,J CHRISTOPHER VALVERDE-JENSEN,AMY VALVERDE-JENSEN,MIGUEL WALKER,F MEREDITH WALKER,F MEREDITH WEBB,BETTY WYLENE WHITTEN,THOMAS M WHITTEN,THOMAS M WILLlAMS,PATRICIA L WRIGHT,LEE
Accruals June 30, 1996 June 30, 1997

PROGRAM
SUPPORT SERVICES - PUPILSERVICES MAINTENANCE & OPER. OF PLANTSERVICES MIGRANT EDUCATION AGENCIES FUND SPECIALREVENUE FUND- OTHERPROGRAMS SUPPORT SERVICES - PUPILSERVICES SUPPORT SERVICES - PUPILSERVICES INSTRUCTION SUPPORT SERVICES - PUPILSERVICES SPECIALREVENUE FUND- OTHERPROGRAMS INSTRUCTION INSTRUCTION MAINTENANCE & OPER.OF PLANTSERVICES SUPPORT SERVICES - PUPILSERVICES INSTRUCTION MIGRANTEDUCATION AGENCIES FUND SPECIALREVENUE FUND- OTHERPROGRAMS SPECIALREVENUE FUND OTHERPROGRAMS MAINTENANCE & OPER.OF PLANTSERVICES MAINTENANCE & OPER.OF PLANTSERVICES MAINTENANCE & OPER.OF PLANTSERVICES SUPPORT SERVICES - PUPILSERVICES MIGRANTEDUCATION AGENCIES FUND SUPPORT SERVICES - PUPILSERVICES INSTRUCTION SPECIALREVENUE FUND- OTHERPROGRAMS SUPPORT SERVICES - PUPILSERVICES SPECIALREVENUE FUND- OTHERPROGRAMS MIGRANT EDUCATION AGENCIES FUND MIGRANTEDUCATION AGENCIES FUND SUPPORT SERVICES - BUSINESS MIGRANT EDUCATION AGENCIES FUND SPECIAL REVENUE FUND- OTHER PROGRAMS INSTRUCTION SPECIAL REVENUE FUND- OTHER PROGRAMS INSTRUCTION SUPPORT SERVICES - BUSINESS MIGRANT EDUCATION AGENCIES FUND INSTRUCTION SPECIAL REVENUE FUND- OTHERPROGRAMS INSTRUCTION SPECIALREVENUE FUND- OTHERPROGRAMS MIGRANT EDUCATION AGENCIES FUND MIGRANT EDUCATION AGENCIES FUND MIGRANT EDUCATION AGENCIES FUND DIRECTOR GENERAL ADMINISTRATION SPECIAL REVENUE FUND- OTHERPROGRAMS INSTRUCTION SPECIAL REVENUE FUND- OTHER PROGRAMS SUPPORT SERVICES - PUPIL SERVICES SUPPORT SERVICES - PUPILSERVICES

See notes to the general purposefinancial statements.

- 16 -

SALARIES

$

42,009,96 $

1,107.13

7,084.00

49,885.74

51,637.10

9,815,00

38,064.15

7,654.70 62,213.55 51,285.36 29,562.00 36,130.70
7,417.72 30,955.20 16,900.00 60,500.04 3,738.00
537.63 29,889.60 35,757.90
4,855.26 7,401.06 16,992.00 39,879.54 25,725.60 7,131.00 12,087.97 65,517.60 20,250.00 6,750.00 10,250.01 37,103.38 12,367.86 30,796.68 2,325.00 13,175.04 47,908.80

3,334.72 33,000.00
575.00 30,179.00 16,461.29 72,096.00

7,501.06 50,849.42
354.00 13,268.08 43,709.92

$ 1,203,990.77 $

TRAVEL
2,473.56
24.50 1,656.79 2,266,44
2,438.84 220,00 860.25
2,788.06 2,329.00
2,437.88
6,048.66 61.50
2,565.10
83.38 915.52 386.25
7.50 4,317.21 1,582.48
2,213.00 3,939.82
34.50
413.75 1,226.41
1,309.06
307.00
2,052.32
2,074.65
971.90 3,619.75
3,785.38
4,096.78
2,434.34
61,941.58

-25,256.60 17,205.72

$ 1,195,939.89 $ =====6=1=,=9=4=1=.5=8=

SECTION II AUDlTEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1997

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

8724-93-01 8724-93-02

Unresolved-See Corrective ActionlResponse Unresolved-See Corrective ActionlResponse

CORRECTIVE ACTIONIRESPONSES

ACCOUNTING CONTROLS (OVERALL) Administrative Requirements Inadequate Separation of Duties Finding Control Number 8724-93-01

The management at Chattahoochee-Flint RESA will continue to periodically review staff to determine if employee duties can be reassigned to achieve a higher degree of internal controls.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number 8724-93-02

At the present time no efforts are being made to establish a General Fixed Assets Account Group. It is our belief that it is not cost beneficial to do so.

PRIOR YEAR FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

8724-94-01

Previously Reported Corrective Action Implemented

SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS

CHATTAHOOCHEE-FLINT REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1997
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number FS-8724-97-01
For the year under review, the management ofthe Chattahoochee-Flint Regional Educational Service Agency did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Agency being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Agency 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 equipment owned by the Agency and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.