Review report, state of Georgia, Griffin Regional Educational Service Agency, Griffin, Georgia, year ended June 30, 1997

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REVIEW REPORT STATE OF GEORGIA GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY GRIFFIN, GEORGIA YEAR ENDED JUNE 30, 1997
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASH I NGTON STREET
ATLANTA, GEORGIA 30334-8400

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT ACCOUNTANTS COMBINED REPORT ON REVIEW OF FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

EXlllBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUPS

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

5

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

6

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

7

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

16

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

17

G

FIDUCIARY FUND TYPE

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

18

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

19

2 SCHEDULE OF STATE REVENUE

20

3 SCHEDULE OF SALARIES AND TRAVEL

21

SECTIONll AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR 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
January 23, 1998

Honorable Zell Miller, Governor Members of the General Assembly of Georgia Members of the State Board of Education
and Director and Members of the Griffin 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 Griffin 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 Griffin 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, 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.
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 through G and Schedules

97ARL-RESA-1

I through 3) is presented only for supplementary analysis purposes. Such information has been subjected to the inquiries and analytical procedures applied in the review ofthe financial statements and we are not aware of any material modifications which should be made thereto.
Respectfully submitted,

CLV:jy 97ARL-RESA-I

Claude L. Vickers State Auditor

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30.1997

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Inventories for Resale
General Fixed Assets Equipment
Amount to be Provided in Future Years For Payment of Compensated Absences

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

FIDUCIARY FUND TYPE AGENCY FUND

$ 154,560.00

$

0.00

3,569.33 $ 289,142.23

573,324.77

Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Compensated Absences
Total Liabilities
FUND EQUITY
Investment in General Fixed Assets
Fund Balances Reserved For Continuation of Federal Programs For Sick and Personal Leave For Inventories for Resale Unreserved Undesignated
Total Fund Equity
Total Liabilities and Fund Equity

$ 158,129.33 $ 862,467.00 $========0=.00=

$

57,236.96

$

28,018.47

184,703.84

75,427.82

8,821.80

1,454.33

$ 103,446.29 $ 252,216.93

$

1,410.39 $

1,460.20

3,775.05

573,324.77

49,497.60

35,465.10 $

0.00

$

54,683.04 $ 610,250.07 $

0.00

$

158,129.33 $

862,467.00 $=======0;.;0;0,

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

EXHIBIT "A"

ACCOUNT GROUPS

GENERAL

GENERAL

FIXED

LONG-TERM

ASSETS

DEBT

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

$

154,560.00 $

136,576.85

292,711.56

409,890.64

573,324.77

579,234.68

$

680,226.68

680,226.68

705,577.46

$

111,160.85

111,160.85

87,661.62

$

680,226.68 $

111,160.85 $ 1,811,983.86 $ 1,918,941.25

$

57,236.96 $

14,168.24

212,722.31

285,287.35

84,249.62

68,043.56

1,454.33

$

111,160.85

111,160.85

87,661.62

$

111,160.85 $ 466,824.07 $ 455,160.77

$

680,226.68

$ 680,226.68 $ 705,577.46

$

680,226.68

2,870.59 3,775.05 573,324.77

21,303.33 3,775.05
579,234.68

84,962.70

153,889.96

$ 1,345,159.79 $ 1,463,780.48

$

680,226.68 $

111,160.85 $ 1,811,983.86 $ 1,918,941.25

-3-

THIS PAGE LEFT BLANK

GRIFFIN 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

$

54,683.04 $ 610,250.07 $ 664,933.11 $ 758,203.02

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

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

EXHIBIT "C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Other Funds

$ 744,192,00 $ 880,299,59 24,758,67
940,037,58 1,083,304,30

Total Revenues

$ 1,684,229.58 $ 1,988,362.56

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 Enterprise Operations

$ 403,930.69 $
123,985,67 377,324,97
249,099.25 107.403.34 77,285.73 365,190.44

461,554,62
136,808.16 590,201,31
252,287.77 102,706.82 66,116,67 384,961.37
1,848.00

Total Expenditures

$ 1,704,220.09 $ 1,996.484.72

Excess of Revenues over (under) Expenditures $ -19,990.51 $

-8,122.16

FUND BALANCE JULY 1,1996

60,890.83

62,805.20

Inventory - Net Change in Period

FUND BALANCE JUNE 30.1997

$ 40,900.32 $ 54,683.04

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 527,067.00 $ 153,930,00 329,881,36
$ 1,010,878,36 $

68,722,00 514,987,27 195,686,55
779,395.82

$ 89,513,00 $ 54,104,75

134,005.00 515,382,92
3,000.00 49,925.00

217,291.90 278,894,53
3.420,21 49,306.86

11,200.00 222,852.44 $ 1,025,878.36 $ $ -15,000.00 $ 706,647,95

18,836.86 236,778.55 858,633.66 -79,237.84 695,397,82
-5,909.91

$ 691,647.95 $ 610,250.07

The notes to the general purpose financial statements are an integral part of this statement. -6-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Griffm Regional Educational Service Agency (Agency) was established pursuant to the Official Code of Georgia Annotated Sections 20-2-270 through 20-2-274 for the purposes of providing shared services designed to improve the effectiveness of educational programs and services of local school systems and for providing instructional programs directly to selected public school students in the state.
Each regional educational service agency is governed by a board. The number ofmembers and terms of office are prescribed by 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 of the 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 executive officer 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 therefore a part ofthe primary government ofthe State of Georgia. Inclusion in the State's fmancial reporting entity is based on application of criteria defined in Section 2100 of the Governmental Accounting Standards Board Codification of Governmental and Financial Reporting Standards which indicates that the Agency does not have legal separate standing.
FUND ACCOUNTING
The Agency uses funds and account groups to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a fmancial 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.
The general purpose financial statements account for all State, Federal and Other funds under control of the Agency, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and account groups presented in this report are as follows:
-7-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997
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 fmancial 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 ofEducation and from the Federal government to accomplish specific objectives and are required to be accounted for separately.
FIDUCIARY FUND TYPE - the agency fund used to account for assets held as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:
AGENCY FUND - the fund used to account for assets in the Special Activities Account.
ACCOUNT GROUPS
GENERAL FIXED ASSETS ACCOUNT GROUP - A fmancial reporting device used to account for all general fixed assets acquired or constructed for use by the Agency. The Agency is prohibited by Georgia Law from holding title to real property.
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for material accrued compensated absences.
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.
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
-8-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" 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 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.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
BUDGET
The Griffin Regional Educational Service Agency's budget is a complete fmancial 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 fmal 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 fmancial 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. Receivablesare 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.
-9-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
GOODS FOR RESALE Inventories are reported on the Combined Balance Sheet at cost (weighted average). The Agency uses the purchases method to account for inventories whereby purchases for resale are recorded at the time of purchase. 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.
GENERAL FIXED ASSETS
General fixed assets purchased, including capital outlay costs, are recorded as expenditures in the various funds at the time of purchase. All purchased general fixed assets are valued at cost where historical records are available and at estimated historical cost where no historical records exist. Donated general fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded cost. No depreciation has been provided on General Fixed Assets. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Agency relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose fmancial statements.
RESERVED FUND BALANCES
Reserves represent those portions of fund equity that are legally segregated for a specific future use.
Reserved fund balances include $3,775.05 in unexpended funds received in prior years from the Georgia Department of Education for sick and personal leave to be paid to substitute personnel. These funds will be used for the original purpose until exhausted.
INTERFUND TRANSACTIONS
The Agency has the following type 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.
- 10-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general purpose fmancial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERAL;IZATION 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,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or ofthe State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws 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
- 11 -

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

Note 2: DEPOSITS

(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 $287,453.38. 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 fmancial 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
1 2 3

Bank Balance
$ 146,825.41 140,627.97 0.00

Total

$ 287.453.38

Note 3: GENERAL FIXED ASSETS

The following is a summary of changes in the General Fixed Assets Account Group during the fiscal year:

Equipment

Balance July 1, 1996 Additions

$ 705,577.46 20,514.73

Deductions Balance June 30, 1997

- 12-

45,865.51 $ 680,226.68

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

Note 4: RISK MANAGEMENT

The Agency 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 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 Agencyhas not experienced any losses related to these risks in the past three years.

The Agency is self-insured with regard to unemployment compensation claims. The Agency 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

Claims Paid

End of Year Liability

$

0.00 $

1.567.00 $

1.567.00 $

0.00

$

0.00 $ 4.730.00 $

4,730.00 $

0.00

Note 5: GENERAL LONG-TERM DEBT

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

Compensated Absences

Balance July 1, 1996

$ 87,661.62

Additions Annual Leave Earned and Utilized (Net)

23,499.23

Balance June 30, 1997

$ 111.160.85

- 13 -

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997
Note 6: ON-BEHALF PAYMENTS
The Agency has recognized revenues and expenditures in the amount of$20,255.59 for health insurance paid on the Agency's behalf by the following State Agency.
Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $20,255.59
Note 7: 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 fmancial position.
Note 8: ACCUMULATED EMPLOYEES' LEAVE
The Agency's administrative staff and certain other full-time employees earn one and one-quarter days per month of vacation. A maximum of fifteen days of unused vacation may be accumulated and carried over at the end ofthe fiscal year. Upon termination, employees will be paid at the rate of 11230 of their annual salary for each day ofunused vacation up to a maximum often days. Persons employed by the Agency prior to July 1, 1994, who have accrued vacation in excess of fifteen days as of June 30, 1995, should use that excess vacation by June 30, 1999. Persons who terminate employment with the Agency prior to June 30, 1999, and have unused vacation in excess often days will be paid 11230 of their annual salary for each day of unused vacation. See Note 1 - Compensated Absences
Note 9: RETIREMENT PLANS
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 pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.
- 14-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

Note 9: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Agency who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Agency 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

Contribution

1997 1996 1995

100% 100% 100%

$ 189,136.68 $ 175,976.78 $ 174,339.99

- 15 -

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 1997

EXHIBIT II E"

ASSETS Cash and Cash Equivalents Accounts Receivable Inventories for Resale
Total Assets

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS JUNE 30,1997 JUNE 30, 1996

$

24,679.56

$

24,679.56 $

48,475.62

58,208.82 $ 230,933.41

289,142.23

393,563.87

573,324.77

573,324.77

579,234.68

$

82,888.38 $ 804,258.18 $ 887,146.56 $ 1,021,274.17

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

Programs

$

For Inventories for Resale

Unreserved

Undesignated

Total Fund Equity

$

$ 71,152.05
8,821.80 1,454.33
81,428.18 $

81,916.52 $ 113,551.79
195,468.31 $

81,916.52 $ 184,703.84
8,821.80 1,454.33
276,896.49 $

62,643.86 253,879.65
9,352.84
325,876.35

1,460.20 $
0.00
1,460.20 $

$ 573,324.77
35,465.10
608,789.87 $

1,460.20 $ 573,324.77
35,465.10
610,250.07 $

21,303.33 579,234.68
94,859.81
695,397.82

Total Liabilities and Fund

Equity

$

82,888.38 $ 804,258.18 $ 887,146.56 $ 1,021,274.17

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

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY

EXHIBIT "F"

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

SPECIAL REVENUE FUND

YEAR ENDED JUNE 30,1997

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Maintenance and Operation of Plant Enterprise Operations
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
Inventory - Net Change in Period Inventory for Resale

FEDERAL PROGRAMS

OTHER PROGRAMS

TOTALS YEAR ENDED JUNE 30,1997 JUNE 30, 1996

$

68,722,00 $

68,722,00 $ 141,768.00

$ 514,987,27

514,987.27

581,751.56

1,092,53

194,594,02

195,686.55

264,543.13

$ 516,079,80 $ 263,316.02 $ 779,395.82 $ 988,062.69

$

54,104.75

$

54,104.75 $ 112,639.29

152,892.90 $ 278,894,53
3,420.21 44,224.86
2,385.68

64,399,00
5,082.00 16,451.18 236,778.55

217,291.90 278,894.53
3,420.21 49,306,86
18,836.86 236,778.55

8,154.03 453,809.37
18,612,12 131,727.81
2,094.00 39,057.26 202,947.38

$ 535,922.93 $ 322,710.73 $ 858,633.66 $ 969,041.26

$ -19,843.13 $ -59,394.71 $ -79,237.84 $

19,021.43

$

12,969.07

-0.06

$

12,969.01

$ -19,843.13 $ -59,394.71 $ -79,237.84 $

31,990.44

21,303.33

674,094.49

695,397.82

675,139.04

-5,909.91

-5,909.91

-11,731.66

FUND BALANCE JUNE 30

$

1,460.20 $ 608,789.87 $ 610,250.07 $ 695,397.82

See notes to the general purpose financial statements.

- 17-

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUND
YEAR ENDED JUNE 30,1997

EXHIBIT"G"

SPECIAL ACTIVITIES ACCOUNT ASSETS
Cash and Cash Equivalents
LIABILITIES Sales Tax

BALANCE
JULY 1,1996

ADDITIONS

DEDUCTIONS

BALANCE
JUNE 3D, 1997

$

0.00 $

395.68 $

395.68 $=======0.=00=

$

0.00 $

395.68 $

395.68 $==="';;';;;0;.000=

See notes to the general purpose financial statements.

- 18-

GRIFFIN 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 Vocational Education - Basic Grants to States High School Program Basic Grant 1997 Grant Individuals with Disabilities Education Act Part B - Special Education Special Projects Georgia Learning Resources System 1997 Grant Part D - Special Education Personnel Development and Parent Training Georgia Learning Resources System 1997 Grant Through Georgia Department of Human Resources DAR.E. Program 427-93-610005 Safe and Drug-Free Schools High Risk Youth Program 1997 Grant
Total U. S. Department of Education
Health and Human Services, U. S. Department of Through Georgia Department of Education AIDS School Health Education Implementation of a Program In Comprehensive Health Education 1997 Contract Through Georgia Department of Medical Assistance State Survey and Certification of Health Care Providers and Suppliers Children's Intervention Services Program
Total U. S. Department of Health and Human Services
OTHER FEDERAL ASSISTANCE
National Science Foundation Through the University of Georgia Research Foundation National Science Foundation Grant RR229-120n565543
Defense, U. S. Department of Direct Teachers and Teacher's Aide Placement Program 1997 Grant

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.186 $ 114,804.51 $

114,804.51

* 84.048

1,000.00

2,000.00

* 84.027

110,517.67

110,517.67

84.029

7,587.00

84.186

81,157.33

84.186 $

12,338.39 327,404.90 $

10,916.80 81,157.33 10,928.00 330,324.31

93.938 $

3,907.07 $

93.777 $

421.10 4,328.17 $

3,907.07
421.10
-4=,-3=2=8=.1,-7,-

$ 199,920.76 $

216,526.62 (1)

$,--=~8.,0.92:..11.

(2)

Total Federal Financial Assistance

$=========== $ 539,745.94

551,179.10

* 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) Expenditures for this program include State and/or Other Funds. Expenditures are not maintained by fund source.
(2) Expenditures on this program were not maintained by fund source.

The Agency did not provide Federal Assistance to any subrecipient.

See notes to the general purpose financial statements.

- 19 -

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30,1997

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Other State Programs Alternative Programs Georgia Learning Resources System Health Insurance Mentoring Program Regional Educational Service Agencies Special Education Low Incidence Grant Supervision and Assessment of Student and 'Beginning Teachers and Performance-Based Certification
CONTRACT Education, Georgia Department of Operation of an Instruction Training Technology Center

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

246,350.00

$

20,255.59

3,500.00

497,842.00

21,214.00

85,208.00

$ 68,722.00

5,930.00

TOTAL
246,350.00 68,722.00 20,255.59 3,500.00
497,842.00 21,214.00
85,208.00
5,930.00

$

880,299.59 $ =====68;;.:.,7~2=2=.0=0 $ =====94=9~,0=2=1.=5=9

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

PE!RSONNEL
ANDREWS, ROBIN A BEVIL,L1NDA F BEVIL,L1NDA F BEVIL,L1NDA F BLUBAUGH,M JAMIE BROOKS, CAROL BROWN,TEESIA BROWN,TEESIA BUNN,RONALD BUNN,RONALD BURGREEN,LAUREN W BURGREEN,LAUREN W CALL,WARREN F JR CHAMPION,GWEN CHAMPION,GWEN COLLlNS,SUSAN COPELAND,JACQUELINE COPELAND,JACQUELINE CRUMBLEY,MARY CRUSE,CHARLES R DUNN,CLYDE 0 DYE,PATRICIA G DYE,PATRICIA G FINLEY,JOHN H FINLEY,JOHN H FLETCHER,JUANITA FLETCHER,JUANITA FREEMAN,JEFFREY J GARNER,TOYE H GARRISON,RONNIE 0 GARRISON,RONNIE 0 GEE,DENNIS R GOUKLER,SANDRA A GRAVES,ARTHUR B GREENE,LOUELLA A HALL,JAMES W HART,CARALIE R HART,CARALIE R HARVEY,DIANE B HARVEY,DIANE B HEAD, RONALD W HILDERBRAND,CHERYL M HILDERBRAND,CHERYL M HINDS,STANMORE J HOBSON,CHARLES DAVID HOBSON,CHARLES DAVID HOGAN,DENISE P HOGAN,DENISE P HUGHLEY,ANTONETTE HUGHLEY,PATRICIA JACKSON, GARY P JONES,REBECCA W KENDALL, BRENDA J MATTHEWS,ANDREA L MATTHEWS,ANDREA L MATTHEWS,ANDREA L MCGAVIN,JOHN T MCGAVIN,JOHN T MCGAVIN,JOHN T MCLUCAS,JOHN L MCLUCAS,JOHN L MCNEAL,VICKEY MOORE,ALTON A

GRIFFIN REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30,1997

SCHEDULE "3"

PROGRAM
INSTRUCTION SUPP SRVS - IMPROV INSTR & ED MED SRVS SUPPORT SERVICES - BUSINESS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION SUPP SRVS - IMPROV INSTR & ED MED SRVS INSTRUCTION SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION SPECIAL REVENUE FUND - OTHER PROGRAMS SPECIAL REVENUE FUND - OTHER PROGRAMS FEDERAL PROGRAMS MAINTENANCE &OPER. OF PLANT SERVICES INSTRUCTION SPECIAL REVENUE FUND - OTHER PROGRAMS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION INTERNAL SERVICES FUND INTERNAL SERVICES FUND GENERAL ADMINISTRATION SUPPORT SERVICES - BUSINESS SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION SPECIAL REVENUE FUND - OTHER PROGRAMS INTERNAL SERVICES FUND SUPP SRVS - IMPROV INSTR & ED MED SRVS INSTRUCTION SCHOOL ADMINISTRATION INSTRUCTION INSTRUCTION INTERNAL SERVICES FUND SPECIAL REVENUE FUND - OTHER PROGRAMS MAINTENANCE &OPER. OF PLANT SERVICES SUPP SRVS - IMPROV INSTR &ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS MAINTENANCE & OPER. OF PLANT SERVICES SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION INSTRUCTION MAINTENANCE & OPER. OF PLANT SERVICES INTERNAL SERVICES FUND SCHOOL ADMINISTRATION SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS FEDERAL PROGRAMS SUPP SRVS - IMPROV INSTR & ED MED SRVS GENERAL ADMINISTRATION SPECIAL REVENUE FUND - OTHER PROGRAMS SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS INSTRUCTION MAINTENANCE & OPER. OF PLANT SERVICES
- 21 -

SALARIES

$

25,039.30 $

10,456.50

14,639.10

32,723.16 1,991.25 1,096.50 172.00 215.00 86.00
43,142.08 318.00
17,919.32 540.00 45.00
32,371.10 2,494.00 2,193.00 129.00
27,528.24 59,152.32

29,797.92 23,185.28 38,472.56
1,483.50 1,247.00
534.00 9,831.50

63,671.04 4,750.00
24,229.12 2,762,00 4,671.40
45,901,54 33,440,32 19,227.58 39,140.71
7,128,94 42,351.16 37,949.20
250.00 27,006.00
7,150.18 1,787,54 11,797,80 11,797.80
43.00 282.00 34,269.84 30,799.80 19,803.45 4,268.75 250.00 48,656.68

54,893.99 13,756.17 58,382,90
769.42 47,116.20 28,045.08

TRAVEL 690.55 24.66 265.25
976.58
2,282,00
290.00 773.25 2,924.39
7.75 189.50 661.06
1,833.34 309.00
1,697.48 1,855,96
68.00
2,576,98 37.25
726.25 622.75 2,935.69

PERSONNEL
PACE,BOWMAN S PARKS,DENNIS MICHAEL PARKS,GARY L PHILLlPS,EDDIE JANE POLLARD,R 0 REID,GREGORY D RIVERS,DOUGLAS L RIVERS,SUSAN S RIVERS,SUSAN S SANDERS,KENARD SHELLEY,L1SA LYLE SHELLEY,L1SA LYLE SIZEMORE,RODNEY C SPURGEON,JOYCE E SPURGEON,JOYCE E SPURGEON,JOYCE E STINCHCOMB,HUGH G STINCHCOMB,HUGH G TUGGLE,JUNE K TURNER,WILLIAM R TURNER,wILLlAM R TURNIPSEED,WKEITH WHITFIELD,RICHARD B WHITNER,TRELL WILLIAMS,KEITH R WILSON,DONNAP WILSON,JANE S WILSON,JANE S WIMBUSH,MONTINA WIMBUSH,MONTINA WRENSEN,GEORGE M WRENSEN,GEORGE M
Accruals June 30,1996 June 30, 1997

GRIFFIN REGIONAL EDUCATIONAL SERVICEAGENCY SCHEDULE OF SALARIES AND TRAVEL YEAR ENDEDJUNE 30. 1997

SCHEDULE "3"

PROGRAM
MAINTENANCE & OPER. OF PLANTSERVICES MAINTENANCE & OPER.OF PLANT SERVICES INTERNAL SERVICES FUND INSTRUCTION INSTRUCTION INSTRUCTION INTERNAL SERVICES FUND GENERALADMINISTRATION FEDERAL PROGRAMS INSTRUCTION SUPP SRVS- IMPROVINSTR& ED MED SRVS SPECIALREVENUE FUND- OTHERPROGRAMS INSTRUCTION SPECIALREVENUE FUND- OTHERPROGRAMS GEORGIALEARNING RESOURCES SYSTEM FUND FEDERAL PROGRAMS DIRECTOR GENERALADMINISTRATION GENERALADMINISTRATION SUPP SRVS- IMPROVINSTR& ED MED SRVS SPECIALREVENUE FUND- OTHERPROGRAMS INTERNAL SERVICES FUND MAINTENANCE & OPER. OF PLANT SERVICES INSTRUCTION INSTRUCTION GENERALADMINISTRATION INSTRUCTION SPECIALREVENUE FUND- OTHER PROGRAMS INSTRUCTION SPECIALREVENUE FUND- OTHERPROGRAMS SUPPORT SERVICES PUPIL SERVICES SUPPSRVS - IMPROVINSTR& ED MED SRVS

SALARIES

$

34,091.16

32,022.60

2,568.00

25,673.50

135.00

19,497.50 $

11,836.95

1,873.04

20,599.00

3,893.50

52,504.56

500.00

29,524.20

1,250.00

51,764.00

4,967.32

73,782.84

22,472.04 50,166.60
5,650.00 19,242.56
9,779.74 172.00
20,530.00 18,855.41
150.50 86.00 666.50 172.00 47,489.26

$ 1,665,068.02 $

TRAVEL
73.50 17.25 1,806.20 88.50 1,000.00 2,511.49 2,243.81 1,009.50
1,660.62 78.25
32,236.81

-68,043.56 84,249.62

$ 1,681,274.08 $====3=2=,2=36=.=81=

See notes to the general purpose financialstatements.

- 22-

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

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

PRIOR YEAR FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

8624-95-02 8624-96-01

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

CORRECTIVE ACTIONIRESPONSES

CASH MANAGEMENT Excessive Cash Balances Finding Control Number 8624-96-01

Griffin RESA will analyze this account to forecast expenditures more closely. Drawdown requests will match only those expenditures for which there are purchase orders or outstanding invoices. Griffm RESA will request reimbursement for expenditures rather than request drawdowns in anticipation of program expenditures.