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

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REVIEWREPORT STATEOF GEORGIA METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY ATLANTA, GEORGIA YEAR ENDEDJUNE 30, 1997

STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

METROPOLITAN 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 AND ACCOUNT GROUP

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

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

13

2 SCHEDULE OF STATE REVENUE

14

3 SCHEDULE OF SALARIES AND TRAVEL

15

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

SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

CLAUDE L. VICKERS
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
February 5, 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 Metropolitan 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 Metropolitan 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 Metropolitan 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 fmancial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, with the exception ofthe matter described in the following paragraph, 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.
The aggregate effects on the financial statements of this variance or omission have not been determined, but are believed to be material.
97ARL-RESA-l

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 (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 we are not aware of any material modifications which should be made thereto.
Respectfully submitted,

CLV:dt 97ARL-RESA-l

Claude L. Vickers
State Auditor

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30, 1997

EXHIBIT "A"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable Amount to be Provided in Future Years
For Payment of Capital Lease Agreements

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

366,250.21 $

49,587.72

200,000.00

403,457.03

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

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

$

415,837.93 $

712,712.78

200,000.00

403,457.03

104,692.09

$

42,433.32

42,433.32

28,732.87

Total Assets

$

566,250.21 $ 453,044.75 $

42,433.32 $ 1,061,728.28 $

846,137.74

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable

$

Salaries Payable

Expired Grant Balances Payable

Capital Lease Agreements

Total Liabilities

$

FUND EQUITY

Fund Balances

Reserved for Continuation of

Federal Programs

Unreserved

Undesignated

$

Total Fund EqUity

$

12.61 $ 12.61 $

62,342.92 236,935.79 108,959.80
$
408,238.51 $

566,237.60 $ 566,237.60 $

44,806.24 44,806.24

$
42,433.32 42,433.32 $

62,355.53 $ 236,935.79 108,959.80
42,433.32
450,684.44 $

61,969.25 240,911.88
43,459.43 28,732.87
375,073.43

$

1,593.78

$ 611,043.84

469,470.53

$ 611,043.84 $ 471,064.31

Total Liabilities and Fund EqUity

$

566,250.21 $ 453,044.75 $

42,433.32 $ 1,061!728.28 $

846,137.74

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

$ 566,237.60 $

44,806.24 $ 611,043.84 $ 471,064.31

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

METROPOLITAN 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

$ 949,251.00 $ 966,865.97

142,000,00

300,036.94

Total Revenues

$ 1,091,251.00 $ 1,266,902.91

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration Business Administration Maintenance and Operation of Plant Central Support Services Other Support Services
Debt Service

$ 273,385.06 $ 275,345.29

7,025.44

566,361.13

505,400.51

59,863.00

50,705.71

110,149.00

130,633.10

51,904.00

65,230.27

100,500.00

105,887,22

14,559.40

Total Expenditures

$ 1,162,162.19 $ 1,154,786.94

Excess of Revenues over (under) Expenditures $ -70,911.19 $ 112,115,97

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$ 70,911.19 $ 23,525.00
-644.69

Total Other Financing Sources (Uses) $ 70,911.19 $ 22,880.31

Excess of Revenues and Other Financing

Sources over (under) Expenditures and

Other Financing Uses

$

0.00 $ 134,996,28

FUND BALANCE JULY 1,1996

468,409,75

431,241.32

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 2,495,102,00 $ 2,519,395.29

578,379.56

517,616.25

18,570.45

$ 3,073,481.56 $ 3,055,581.99

$ 1,661,715,00 $ 1,594,405.59

626,946,00 340,692.00
1,279,00 381,977.56
33,690.00 27,182,00

614,657.40 347,954.43
27,246.01 405,069,69
35,170,06 26,740.25

$ 3,073,481.56 $ 3,051,243.43

$

0.00 $

4,338.56

$

644,69

$

644.69

$

0.00 $

4,983.25

7,985.39

39,822.99

FUND BALANCE JUNE 30,1997

$ 468,409,75 $ 566,237.60

$

7,985.39 $ 44,806,24

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

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The Metropolitan Regional Educational Service Agency (Agency) was established pursuant to the Official Code ofGeorgia Annotated Sections 20-2-270 through 20-2-274 for the purposes ofproviding 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 tenus ofoffice 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 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 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 financial 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 an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Agency. 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.

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METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 the account group presented in this report are as follows:
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.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A fmancial reporting device used to account for material capital lease obligations.
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.
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.
- 6-

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUDGET
The Metropolitan 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.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Agency are stated at cost. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Agency to invest its funds. In selecting among the options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,

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METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia,
RECEIVABLES
Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
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.
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 fmancial 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 AND INVESTMENTS
COLLATERALIZAnON 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
-8-

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXlllBIT"D"

Note 2: DEPOSITS AND INVESTMENTS
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:
(l) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities 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 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 $562,859.89. 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.)

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METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXIllBIT "0"

Note 2: DEPOSITS AND INVESTMENTS

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

Risk Category

Bank Balance

1

$ 100,000,00

2

462,859.89

3

0.00

Total

$ 562,859.89

CATEGORIZATION OF INVESTMENTS At June 30, 1997, the carrying amount of the Agency's total investments was $200,000.00 and this entire amount was insured or registered, or securities held by the Agency or the Agency's agent in the Agency's name. The market value of these investments was $200,000.00.

Note 3: 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 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 errors or omissions, which includes, among other risks, risks for sexual harassment and discrimination. Additionally, the Agency has elected to selfinsure for all losses related to natural disasters. The Agency has not experienced any losses related to these risks in the past three years.

Note 4: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Metropolitan Regional Educational Service Agency has entered into various lease agreements as lessee for reproduction and communication equipment. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

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

- 10-

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30,1997

EXHIBIT"D"

Note 4: GENERAL LONG-TERM DEBT

Capital Leases

Balance July 1, 1996

$ 28,732.87

Additions

23,525.00

Deductions Payments

9,824.55

Balance June 30, 1997

$ 42.433.32

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

Capital Leases

1998 1999 2000

$ 21,226.08 20,719.08 9,233.30

Total Principal and Interest

$ 51,178.46

Deduct: Imputed Interest

8,745.14

Net Present Value of Future Minimum Lease Payments

$ 42.433.32

Note 5: ON-BEHALF PAYMENTS

The Agency has recognized revenues and expenditures in the amount of $54,014.89 for health insurance contributions 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$54,014.89

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METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"D"

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.

Note 7: 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.

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%

$ 313,327.63 $ 300,578.17 $ 277,098.81

- 12 -

METROPOLITAN 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 Individuals with Disabilities Education Act Part B - Special Education Special Projects Georgia Learning Resources System 1997 Grant Severely Emotionally Disturbed 1997 Grant Part D - Special Education Personnel Development and Parent Training Georgia Learning Resources System 1996 Grant 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 1996 Contract

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.186 $

29,382.00 $

30,026.69 (1)

* 84.027 * 84.027

160,994.79 286,196.12

160,994.79 286,196.12

84.029 84.029
$

-69.00 9,748.28
486,252.19 $

1,524.78 9,748.28
488,490.66

93.938 $

31,364.06 $

31,364.06

Total Federal Financial Assistance

$ 517,616.25 $====~51=9=,=85=4=.7=2=

* This program has been identified 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 Local Funds. Expenditures are not maintained by fund source.
The Agency did not provide Federal Assistance to any subrecipient.

See notes to the general purpose financial statements. - 13 -

METROPOLITAN 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 Georgia Learning Resources System Health Insurance Regional Educational Service Agencies Severely Emotionally Disturbed Supervision and Assessment of Student and Beginning Teachers and PerformanceBased Certification
OTHER Education, Georgia Department of Reimbursement for Manuals

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

59,566.08 $

$

54,014.89

738,685.00

2,459,829.21 .

174,147.92

18.16

TOTAL
59,566.08 54,014.89 738,685.00 2,459,829.21
174,147.92
18.16

$

966,865.97 $

2,519,395.29 $ 3,486,261.26

See notes to the general purpose financial statements. - 14 -

PERSONNEL
ALLEN,HELEN M AMMANN,MADELINE BAKER,JUDY A BARRON,ROSE M BATES,CHRISTINE BEECHER,SHARON L BERUSCH,JILL R BLACK,JILL BLACK,L1NDA B BROWN,ALFRED M BROWN,ALFRED M BROWN,PATRICIA BRUCE,LESLIE A BURDEn,GREGORY L CHEEKS,ROBERT CHERRY,MARCIE LEBLANC CLEMENTS,ELEANOR A COATES,MARJORIE CORBEn,ALVIN R CORBIN,FRANCINE COXTON,JEROME COXTON,L1NDA 0 CRAVEN,MARY L CROUTHAMEL,WILLARD CROUTHAMEL,wILLARD DAYKIN,L1NDA L DEAN,JANICE M DEATON,AMYL DELYRA,PAMELA F DORSEN,SUSAN R DUNNING,SUSAN S EARL,MICHAEL A EARLEY,WILLIE L EDWARDS,CYNTHIA FERDINAND,WILHELMENIA FERGUSON,PATRICK FRYMAN,KATHLEEN A FUSSELL,L1NDA GARRIS,JOHN R GARRIS,JOHN R GASAWAY,MARKE GIFFORD,SANDRA K GLENN,GARY GLOVER,JUDY C GOODSON,CONSTANCE F GOODSON,CONSTANCE F GRANT,ALLISON S HAMILTON,LESLIE ELLEN HATCH,A BERNARD HATCH,A BERNARD HEALEY,GAILG HENSCHEL,CLAUDEnE HICKS,PAULEnE S HOGAN,WENDI 0 HOPKINS,JEAN C HOPPER,MARIAN P HORNING,ANITA G

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

SCHEDULE "3"

PROGRAM
GENERALADMINISTRATION SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM GEORGIALEARNING RESOURCES SYSTEMFUND GENERALADMINISTRATION SUPPORTSERVICES - BUSINESS GEORGIALEARNING RESOURCES SYSTEM FUND SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM GENERALADMINISTRATION SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM GENERALADMINISTRATION SUPPORTSERVICES - CENTRAL SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SUPP SRVS - IMPROVINSTR & ED MED SRVS GENERALADMINISTRATION SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SUPP SRVS - IMPROVINSTR & ED MED SRVS SPECIAL REVENUE FUND- OTHERPROGRAMS SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM DIRECTOR GENERALADMINISTRATION SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM SEVERELYEMOTIONALLY DISTURBED PROGRAM
- 15-

SALARIES

TRAVEL

$

7,499,97

420.00

5,648.00 $

300.00

60.00

10,806.50

53,256.42

298.00

60,00

5,752.77

66,783.12

2,298,96

456.41

37,062.96

568.25

30,277.92

39,408.72

31,278.88

80.00

31,278,88

38,436.96

187.00

40,591.12

6,298.92

19,928.52

13,899,84

17,879.08

650.00

48,773.84

213.49

25,50

47,500,08

793.67

22,987,67

15,389,48

650.00

32,115,86

230.75

620,00

19,502.55

24,891.88

47,964.75

1,434.75

54,207.54

2,346.24

16,482.16

16,040.72

38,260.88

180.00

4,080.00

35,000.02

3,340.31

19,999,98

361.87

11,787.48

580.00

58,861.66

394,00

36,540.00

11,949.23

1,565.66

35,847.73

1,932.71

3,603.76

14,390.92

91,126.08

10,162.13

23,520.39

242,00

7,360.64

21,039.72

24,766.60

12,100.00

121.50

14,786,80

160.00

METROPOLITAN REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30. 1997

SCHEDULE "3"

PERSONNEL
HRISAK,TERRI L INGRAM,RITA M JONES,CARL E JONES, ELLEN K JONES,JENNIFER JONES,SHIRLEY JOVER,KATHLEEN G KAMOR,ANTOINETTE V KAUFMAN-NAVEH,PHILLIP A KAUWELL,EDWARD P KELLY,MICHELLE KEY,SHARON S LABORDE,REBECCA F LANGSTON, SUSAN LEGGETT,JOAN LEVY,MILTON G L1NDE,BARBARA LOEDDING,NANCY BETH LUCREE,JANET E LUGLAN,ANGELINE MADANI,KHATEREH MARION,SHARON K MATHEWS,JENNIFER MATOL,MICHELE F MAY,MARILYN A MCDONALD,JUDITH H MCGEE,AMANDA C MCGEE,JULIANNE F MCLAUGHLlN,TINA MEEK,ERICJ MEHNERT-JACOBY,KAREN L MURRAY,HEATHER L NEAL,HAROLD L PATRICE,LAURIE PATTERSON,DAWN PEEBLES,CINDY PETERS,JANICE E POWELL,ROBERTA QUIRK,CONSTANCE A QUITMAN,JACQUELINE C REXINGER,JANE E RHOADES,R MICHAEL RUANE,MARY P SCARBOROUGH,JACQUELINE SCHNUPP,JEANNETT SHURE,JANICE H SMITH,R WARREN SMITH,SUSAN K SPRIGGS,BARBARA L STRUSINER,ELLEN S STUBBS,L1NDA D STURGEON,CHRISTINE TAUCHES,MEGAN THELAN,DAVID THOMPSON,MARETA A TRUITT,PATSY B UNDERWOOD,LYNNE C

PROGRAM
GENERAL ADMINISTRATION SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM GENERAL ADMINISTRATION SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM GENERAL ADMINISTRATION SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM GEORGIA LEARNING RESOURCES SYSTEM FUND SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SUPP SRVS - IMPROV INSTR & ED MED SRVS SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM OTHER SUPPORT SERVICES SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM OTHER SUPPORT SERVICES SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM
- 16-

SALARIES

TRAVEL

$

5,500.02

28,381.89 $

5,573.73

26,981.54

14,786.64

8,216.10

22,824.44

31,487.17

580.00

36,250.62

420.00

5,306.80

771.26

40.00

16,676.55

55,000.00

780.00

7,633.44

38,777.94

1,100.00

144.00

39,408.72

16,935.48

4,872.00

54,874.88

56,226.96

24,891.88

21,618.20

24,418.60

12,508.52

38,260.88

2,575.09

27,262.08

6,948.45

60.00

14,326.88

8,748.16

34,235.04

54,850.64

11,689.21

54,728.26

4,352.16

19,459.60

16,482.16

192.00

50,559.52

38,566.00

41,468.92

30,448.60

45,275.74

36,647.32

39,018.76

180.00

40.00

6,494.52

2,939.32

60.00

72.25
22.00 2,114.86 1,873.17
2,064.81
396.92 110.25 317.79 586.75 301.50
24.75

PERSONNEL
WATSON,CHARLES E WEINER,LAWRENCE R WINEBARGER,LAURA H WOLKIN,SUSAN S WOODS,CATHERINE ZOECKLER,NATALIE R
Accruals June 30, 1996 June 30, 1997

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

SCHEDULE "3"

PROGRAM
SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM SEVERELY EMOTIONALLY DISTURBED PROGRAM

SALARIES

TRAVEL

$

17,879.08

78,714.00 $

51,096.66

59,406.64

16,482.16

25,638.92

4,382.69 601.75 985.00

$ 2,667,201.15 $

42,427.69

-240,911.88 236,935.79

-144.27

$ 2,663,225.06 $ =====42~,=28=3=.=42=

See notes to the general purpose financial statements.

-17 -

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

METROPOLITAN 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 QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

8564-93-02 8564-93-03

Unresolved - See Corrective ActionlResponses Unresolved - See Corrective ActionlResponses

CORRECTIVE ACTIONIRESPONSES

ACCOUNTING CONTROLS (OVERALL) ADMINISTRATIVE REQUIREMENTS Inadequate Separation of Duties Audit Control Number 8564-93-02

Due to budgetary constraints in fiscal year 1997, the Agency was unable to hire the additional staff required to clear this finding. In fiscal year 1998 an additional staff member was hired as we anticipate this finding to be resolved.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Audit Control Number 8564-93-03

Due to budget constraints we were not able to resolve this finding in fiscal year 1997. An additional staff member was hired and we anticipate this fmding to be resolved in the next reporting period.

PRIOR YEAR FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

8564-96-01

Resolved - See Corrective ActionlResponses

CORRECTIVE ACTIONIRESPONSES

TYPES OF SERVICES ALLOWEDIUNALLOWED Failure to Obtain Budget Approval Audit Control Number 8564-96-01

The equipment was purchased for instructional use by students with disabilities, therefore the $2,882.40 was an approvable expense. In fiscal year 1997 and 1998 training regarding prior approval of equipment was enhanced and we anticipate this fmding to resolve in fiscal year 1997.

SECTION ill CURRENT YEAR FINDINGS AND QUESTIONED COSTS

METROPOLITAN 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 Audit Control Number FS-8564-97-01
For the year under review, the Agency did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by 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.