Audit report, Middle Georgia Regional Educational Service Agency, Fort Valley, Georgia, year ended June 30, 1994

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STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET ATLANTA. GEORGIA 30334

AUDIT REPORT MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY
FORT VALLEY, GEORGIA YEAR ENDED JUNE 30, 1994

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXIDBITS

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

GOVERNMENTAL FUND TYPES

3

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES -ACTUAL AND BUDGET

GOVERNMENTAL FUND TYPES

4

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

13

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

14

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

15

2 ANALYSIS OF CASH AND CASH EQUNALENTS

16

3 ACCOUNTS RECEIVABLE

17

SCHEDULE OF REVENUE

4

STATE FUNDS

18

5

LOCAL AND OTHER FUNDS

19

SCHEDULE OF EXPENDITURES BY OBJECT

6

GOVERNMENTAL FUND TYPES

20

7

LOTTERY PROGRAM

21

8 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS

22

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY - TABLE OF CONTENTS -
SECTION IT SUMMARY AND SCHEDULE OF SALARIES AND TRAVEL
SECTION Ill COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS
SECTIONN INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SECTIONV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
SECTION VI PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Middle Georgia Regional Educational Service Agency Board ofControl
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
Ladies and Gentlemen:
We have audited the general purpose financial statements (Exhibits A through D) of the Middle Georgia Regional Educational Service Agency, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Agency's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the general purpose financial statements present fairly, in all material respects, the financial position ofthe Middle Georgia Regional Educational Service Agency as ofJune 30, 1994, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles.

94ARL-31

Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the Middle Georgia Regional Educational Service Agency taken as a whole. The combining statements (Exhibits E and F), the financial schedules (Schedules I through 8 which includes the Schedule of Federal Financial Assistance) and the Schedule of Salaries and Travel, as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Middle Georgia Regional Educational Service Agency. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office of the State Auditor and made available to the press ofthe State, as provided for by Official Code of Georgia Annotated Section 50-6-24.

Respec~ submitted,

/

C?'~~~

Claude L. Vickers State Auditor

CLV:jy 94ARL-31

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY - 1-

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP
JUNE 30 1 1994

EXHIBIT "A"

ASSETS
Cash and Cash Equivalents Accounts Receivable General Fixed Assets

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

ACCOUNT GROUP -------------
GENERAL FIXED ASSETS

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

$ 550,324.73 88,068.24 $

$ 550,324.73 $ 542,993.76

45,853.66

133,921.90 116,737.17

$ 191,404.49 191,404.49 229,745.79

Total Assets
LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities
FUND EQUITY
Investment in General Fixed Assets
Fund Balances Reserved For Sick and Personal Leave Unreserved Undesignated
Total Fund Balances
Total Fund Equity

$ 638,392.97 $ 45,853.66 $ 191,404.49 $ 875,651.12 $ 889,476.72
============ =========== ============ ============= ============

$ 23,188.80

$ 34,712.06

16,673.72

138,851.55

5,991.14

601.20

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

$ 174,164.81 $ 45,853.66
------------- -------------

$ 23,188.80

51,385.78$ 77,014.71

144,842.69 134,387.40

601.20

100.00

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

$ 220,018.47 $ 211,502.11
------------- -------------

$ 191,404.49 $ 191,404.49 $ 229,745.79

$ 16,653.60

$ 16,653.60$ 16,942.30

447,574.56$

0.00

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

$ 464,228.16 $

0.00

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

$ 464,228.16 $

0.00 $

447,574.56 431,286.52
------------- -------------
$ 464,228.16$ 448,228.82
------------- -------------
191,404.49$ 655,632.65$ 677,974.61

Total Liabilities and Fund Equity $ 638,392.97 $ 45,853.66$ 191,404.49 $ 875,651.12$ 889,476.72
========= ========== ======= ========-=-..- ==========

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

EXHIBIT "B"

GENERAL FUND

SPECIAL REVENUE
FUND

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

REVENUES

State Funds Federal Funds Local and Other Funds

$ 524,052.80$ 140,016.54
1,072,439.41

17,466.76$ 541,519.56 $

174,399.98

314,416.52

1,072,439.41

632,972.93 380,947.54 961,112.22

Total Revenues

$1,736,508.75 $ 191,866.74 $1,928,375.49 $1,975,032.69

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Business Administration Maintenance and Operation of Plant
Capital Outlay
Total Expenditures

$ 517,787.30 $ 14,872.84 $ 532,660.14 $ 602,221.94

519,364.10 437,757.59
126,576.13 33,326.29
77,678.16 8,019.84
-------------

88,000.00 88,694.87
299.03
-------------

607,364.10 526,452.46 126,875.16 33,326.29
77,678.16 8,019.84
-------------

468,299.11 567,297.60 119,543.12 37,250.76 57,834.44
-------------

$1,720,509.41 $ 191,866.74 $1,912,376.15$ 1,852,446.97

Excess of Revenues over (under) Expenditures $ 15,999.34 $

FUND BALANCE JULY 1

448,228.82

0.00 $ 15,999.34$ 122,585.72

0.00

448,228.82

325,643.10

FUND BALANCE JUNE 30

$ 464,228.16 $

0.00 $ 464,228.16$ 448,228.82

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

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ACTUAL AND BUDGET - GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1994

EXHIBIT "C"

REVENUES
State Funds Federal Funds Local and Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Business Administration Maintenance and Operation of Plant
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures FUND BALANCE JULY 1, 1993
ADJUSTMENTS
Prior Year (Net)
FUND BALANCE JUNE 30, 1994

ACTUAL PER
EXHIBIT "B"

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

$ 541,519.56 $ 617,046.00$ 314,416.52 243,031.72
1,072,439.41 1,074,076.88

-75,526.44 71,384.80 -1,637.47

$1,928,375.49 $1,934,154.60$ -5,779.11

$ 532,660.14 $ 549,058.85$ 16,398.71

607,364.10 526,452.46
126,875.16 33,326.29 77,678.16
8,019.84
-------------

658,569.36
568,341.03
188,084.56 47,417.46 125,463.13 10,000.00
-------------

51,205.26
41,888.57 61,209.40 14,091.17 47,784.97
1,980.16
-------------

$ 1,912,376.15$ 2,146,934.39$ 234,558.24
------------- ------------- -------------

$ 15,999.34 $ -212,779.79 $ 228,779.13

448,228.82

610,771.20 -162,542.38

0.00 -27,137.31

27,137.31

$ 464,228.16$ 370,854.10$ 93,374.06
============= ============= =============

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Middle Georgia 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 of providing shared services designed to improve the effectiveness of educational programs and services offocal 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 of members and terms of office are prescribed by the State Board ofEducation; 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 ofEducation.
The :financial statements ofthe Agency have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.
The more significant of the Agency's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". Based upon the application of the above criteria, the Middle Georgia Regional Educational Service Agency is determined to be a jointly governed organization.
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.
Member boards ofeducation in the Middle Georgia Regional Educational Service Agency are as follows: Bibb County, Crawford County, Houston County, Jones County, Monroe County, Peach County and Twiggs County.
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.
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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The general purpose financial statements account for all State, Federal, Local and Other Funds under control ofthe 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:
GOVERN1\1ENTAL FUND TYPES - are used to account for all or most ofa 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 traditionally 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 primarily received from the Georgia Department ofEducation and from the Federal government to accomplish specific objectives and are required to be accounted for separately.
ACCOUNT GROUP
GENERAL FIXED ASSETS ACCOUNT GROUP - used to account for all equipment acquired for use by the Agency. See Note 1- General Fixed Assets.
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 ofaccounting under which:

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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are intergovernmental grants, sales and services and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
BUDGET
The Middle Georgia Regional Educational Service Agency has a legally authorized nonappropriated budget which is fonnally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure ofthe aggregate budget. The budget process begins when the Agency's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, the budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting of the 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 to the Georgia Department ofEducation.
The Agency prepares its budget on the modified accrual basis, which is the same basis on which it presents
its financial statements. The budget comparison on Exhibit "C" presents actual and budget data for all governmental funds on a combined basis.
CASH
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits (including certificates of deposit, and N.O.W. accounts) in authorized financial institutions. Georgia Laws authorize the 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 ofgrant reimbursements due from Federal, State or other grantors for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.

- 7-

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL FIXED ASSETS
General fixed assets purchased, 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 Agency is prohibited by Georgia Law from holding title to real property. The Peach County Board of Education owns the land and buildings utilized by the Agency.
RESERVED FUND BALANCES
Reserved fund balances include 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 ofexpenditures 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 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
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral in an amount of not less than 110 percent of the public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.

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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT "D"

Note 2: DEPOSITS
Acceptable security for deposits consists of any one of or any combination of the following:
(I) 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 ofthe United States or ofthe State of Georgia,
(4) Bonds, bills, notes, certificates ofindebtedness or other obligations ofthe counties or municipalities ofthe 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 of the United States gov:ernment, 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 Banlcs, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZATION OF DEPOSITS At June 30, 1994, the bank balances were $667,924.09. The amounts ofthe total bank balances are classified into three categories of credit risk:
Category I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the 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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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 2: DEPOSITS

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

Risk Category

Bank Balance

1

$ 150,000.00

2

400,000.00

3

117,924.09

Total

$ 667 924.09

Note 3: CHANGES IN GENERAL FIXED ASSETS

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

Balance July 1, 1993 Additions Deletions Balance June 30, 1994

Eguigment $ 229,745.79
17,603.42 55,944.72 $ 191,404.49

Note 4: 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 grantor agencys 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 5: 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 public employee retirement system (PERS).

TRS provides service retirement, disability retirement and survivors benefits for its members. A member is
eligible for service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the

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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT "D"

Note 5: RETIREMENT PLANS
average of the member's two consecutive highest paid years of service multiplied by the number ofyears of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest.
The Agency's payroll for employees covered by TRS for the year ended June 30, 1994, was $1,142,808.78~ total payroll was $1,189,882.23.
TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Agency who are covered by TRS are required to contribute 6% of their gross earnings to TRS. The Agency makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1994 that rate for employer contributions was I 1.81%. The interest rate assumption (rate of return on investments) was 7.500/o.
Total contributions made during fiscal year 1994 amounted to $203,534.37, of which $134,965.69 was made by the Agency and $68,568.68 was made by employees. These contributions represented 11.81% (Agency) and 6% (employees) of covered payroll.
TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure ofthe pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers.

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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1994

EXHIBIT"D"

Note 5: RETIREMENT PLANS

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

Total pension benefit obligation

$13,912,014,000.00

Net assets available for benefits, at cost

12,821,722,000.00

Unfunded pension benefit obligation

$ 1,090,292,000.00

The measurement ofthe total pension benefit obligation is based on an actuarial valuation as ofJune 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers.

Total contributions from all employers to TRS for fiscal year ended June 30, 1994 were $521,550,000.00. The Agency's contribution for the year ended June 30, 1994 of$134,965.69 was actuarially determined and represented .0259%, oftotal contributions made by all participating employers.

Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due.

Note 6: SURETY BONDS

The Director, Dr. Jackie L. Green, is bonded in the amount of$20,000.00 with the Western Surety Company, Sioux Falls, South Dakota, their Bond No. 18274994, on which premium was paid through July 1, 1994.

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MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 1994

EXHIBIT "E"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable
Total Liabilities-
FUND EQUITY Unreserved Undesignated

DRUG-FREE

SCHOOLS AND

TOTALS

LOTTERY COMMUNITIES ----------------------------

PROGRAM

ACT

JUNE 30, 1994 JUNE 30, 1993

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

$ 2,961.29

$ 17,466.76 $ 28,386.90 $ 45,853.66

7,435.11

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

$ 17,466.76$ 28,386.90$ 45,853.66 $ 10,396.40
============= ============= ============= =============

$ 17,466.76 $ 5,722.04 $ 23,188.80

16,673.72

16,673.72 $ 1,930.14

5,991.14

5,991.14

8,366.26

100.00

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

$ 17,466.76 $ 28,386.90 $ 45,853.66 $ 10,396.40
------------- ------------- ------------- -------------

$

0.00 $

0.00 $

0.00 $

0.00

Total Liabilities and Fund Equity $ 17,466.76 $ 28,386.90 $ 45,853.66$ 10,396.40
--=---------- -=----==--=-- ============= =============

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 1994

EXHIBIT "F"

LOTTERY PROGRAMS

DRUG-FREE SCHOOLS ANO
COMMUNITIES ACT

TOTALS
---------------------------YEAR ENDED
---------------------------JUNE 30, 1994 JUNE 30, 1993

REVENUES

State Funds Federal Funds

$ 17,466.76

$ 17,466.76

$ 174,399.98 174,399.98$ 152,778.00

Total Revenues

$ 17,466.76$ 174,399.98$ 191,866.74$ 152,778.00

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services $ General Administration

$ 17,466.76

14,872.84$
88,000.00 71,228.11
299.03

14,872.84 $ 41,686.71

88,000.00 88,694.87
299.03

110,735.99 355.30

Total Expenditures

$ 17,466.76$ 174,399.98$ 191,866.74$ 152,778.00

Excess of Revenues over (under) Expenditures $

0.00 $

0.00 $

0.00 $

0.00

FUND BALANCE JULY 1

0.00

0.00

0.00

0.00

FUND BALANCE JUNE 30

$

0.00 $

0.00 $

0.00 $

0.00

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

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30, 1994

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NIMBER

AWARDS
IN PERIOD

FEDERAL FUNDS RECEIVED IN PERIOD (NET OF REFUNDS)

FEDERAL REVENUE IN PERIOD

EXPENDITlRES IN PERIOD

Education, U. S. Department of Through Georgia Department of Education Drug-Free Schools and CCJ1111Jnities Act 1992 Grant 1993 Grant 1993 Carry-Over 1994 Grant Elementary and Secondary Education Act Chapter 2 Innovative Programs 1992 Regular 1993 Regular Vocational Education - Basic Grants to States High School Program Basic Grant 1992 Grant 1993 Grant 1994 Grant Tech-Prep Education 1993 Grant 1994 Grant

84.186 84.186 84.186 $ 84.186

$
40,100.00 166,919.00

-486.88 7,335.11 40,100.00 $ 105,913.08

40,100.00 $ 134,299.98

40,100.00 134,299.98

84.151 84.151

-77 .91 6,650.86

1,346.72

1,070.83

84.048 84.048 84.048

83,306.52

-520.00 42,323.21 49,134.87

83,306.52

83,306.52

84.243

39,993.00

84.243

54,000.00

25,246.88

48,441.96

48,441.96

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

Total U. S. Department of Education

$ 344,325.52 $ 315,612.22 $ 307,495.18 $ 307,219.29
------------- ------------- ------------- -------------

Health and Human Services, U. S. Department of Through Georgia Department of Education Cooperative Agreements to Support School Health Education to Prevent the Spread of AIDS 1993 Grant 1994 Grant

93.938 93.938 $

$
6,500.00

1,997.54 $

1,997.54 $ 4,923.80

1,997.54 4,923.80

Total U. S. Department of Health and HL111an Services

$ 6,500.00$ 1,997.54 $ 6,921.34 $ 6,921.34

Total Federal Financial Assistance

$ 350,825.52$ 317,609.76$ 314,416.52$ 314,140.63
============ ============= ============= ===:""'T'======

The Agency had no major programs as defined by the Single Audit Act of 1984.

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY ANALYSIS OF CASH AND CASH EQUIVALENTS JUNE 30, 1994

SCHEDULE "2"

INTEREST BEARING ACCOUNTS
Citizens Bank, Fort Valley, Georgia
Certificates of Deposit No. 16478 (3.50%) No. 17077 (3.33%) No. 18012 (3.70%) No. 18026 (3.70%) No. 18027 (3.70%) No. 18784 (5.00%)
Super N.0.W. Account (2.67%)
Middle Georgia Bank, Fort Valley, Georgia
Certificates of Deposit No. 62581 (5.05%) No. 62582 (5.05%)

$ 10,000.00 29,620.81 25,000.00 30,000.00 25,000.00 30,000.00
327,515.12 $ 477,135.93

$ 25,000.00 25,000.00

50,000.00

$ 527,135.93

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY ACCOUNTS RECEIVABLE JUNE 30 1 1994

SCHEDULE "3"

Education, Georgia Department of Vocational Education Federal Funds Federal Programs Cooperative Agreements to Support School Health Education to Prevent the Spread of AIDS Drug-Free Schools and Communities Act Lottery Program Education Technology Centers
Bibb County Board of Education Contracted Services
Crawford County Board of Education Contracted Services
Jones County Board of Education Sales and Services
McDonnell-Douglas Corporation Apprenticeship Program
Monroe County Board of Education Contracted Services
Peach County Board of Education Sales and Services

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE FUND

TOTAL

$ 57,366.73

$ 57,366.73

4,923.80 $

28,386.90 17,466.76

4,923.80 28,386.90
17,466.76

300.00

300.00

159.90

159.90

8.00

8.00

1,800.00

1,800.00

23,399.11

23,399.11

110.70

110.70

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

$ 88,068.24 $ 45,853.66$ 133,921.90
============= ============= =============

See notes to the general purpose financial statements. - 17 -

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1994

SCHEDULE "4"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Other State Programs Regional Educational Service Agencies Staff Development Sex Education Grant Supervision and Assessment of Student and Beginning Teachers and Performance-Based Certification Lottery Program Education Technology Centers

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 416,788.00 31,000.00

$ 416,788.00 31,000.00

76,264.80

76,264.80

$ 17,466.76

17,466.76

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

$ 524,052.80$ 17,466.76$ 541,519.56
============= ============= =============

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF LOCAL AND OTHER REVENUE YEAR ENDED JUNE 30, 1994
Boards of Education Membership Contributions and Contracted Services Bibb County Crawford County Houston County Jones County Monroe County Peach County Twiggs County Non-Contracted Services
Other Compensation for Loss of Assets Donations McDonnell-Douglas Corporation Other Interest Earned Jury Duty Fees Registration Fees Sales and Services Less: Purchases for Resale Teacher's Certification Training Fees Other

SCHEDULE "5"
GOVERNMENTAL FUND TYPE GENERAL FUND
$ 12,345.00 168,895.44 37,422.64 176,693.16 280,717.32 106,268.04 239,733.24 7,105.20
2,834.00 1,800.00
250.00 19,275.95
215.00 13,260.00 8,256.17 -3,575.07
699.11 244.21
$1,072,439.41

See notes to the general purpose financial statements. - 19 -

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF EXPENDITURES BY OBJECT GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

SCHEDULE 611 11

EXPENDITURES
------------
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Repair and Maintenance Services Rents Insurance Communications Shared Services Supplies Energy Books, Textbooks and Periodicals Dues and Fees Other Expenditures
Nonoperating Costs Building and Building Improvements Equipment
Total Expenditures

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

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

$ 1,153,935.39 $ 246,488.75 70,474.89 43,927.66 2,441.94 7,075.45 7,687.33 9,618.07 15,563.21
103,385.60 11,132.50 9,193.50 11,024.48 6,394.40

35,946.84 $ 1,189,882.23

7,661.47

254,150.22

2,726.48

73,201.37

7,010.93

50,938.59

2,441.94

7,075.45

7,687.33

9,618.07

1,575.39

17,138.60

88,000.00

88,000.00

31,860.45

135,246.05

11,132.50

9,193.50

3,348.11

14,372.59

6,394.40

8,019.84

8,019.84

14,146.40

13,737.07

27,883.47

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

$1,720,509.41 $ 191,866.74 $1,912,376.15
============= ============= =============

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF EXPENDITURES BY OBJECT LOTTERY PROGRAM YEAR ENDED JUNE 30, 1994
EXPENDITURES Operating Costs Supplies Nonoperating Costs Equipment
Total Expenditures

SCHEDULE "7"
EDUCATION TECHNOLOGY
CENTERS
$ 3,729.69 13,737.07
$ 17,466.76
=============

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

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD.MEMBERS
YEAR ENDED JUNE 30. 1994

SCHEDULE "B"

BOARD MEMBER ADDRESS
Mr. Gene Trammell, Chairman(*) Crawford County Board of Education P.O. Box B Roberta, Georgia 31078 Mr. Charles Keily, Vice Chairman(*) Twiggs County Board of Education P. 0. Box 232 Jefferson, Georgia 31044 Mr. Charles Dumas (*) Monroe County Board of Education P. 0. Box 1308 Forsyth, Georgia 31029 Mr. Tony Hinnant(*) Houston County Board of Education P. 0. Drawer N Perry, Georgia 31069 Mr. Linton Jordan(*) P. 0. Box 517 Gray, Georgia 31032 Dr. Thomas Madison(*) Bibb County Board of Education P. 0. Box 6157 Macon, Georgia 31213 Mr. Bill Mathews(*) Jones County Board of Education P. 0. Box 519 Gray, Georgia 31032 Ms. Myrtle Rawlins(*) Route 19, Box 869 Macon, Georgia 31201 Mr. Eugene Sheets (*) Peach County Board of Education P. 0. Box 1018 Fort Valley, Georgia 31030 Mr. Lewis Waldrop(*) 336 Sunset Terrace Forsyth, Georgia 31029 Ms. Jacalyn Wilson(*) P. 0. Box 508 Roberta, Georgia 31078
(*) Denotes Board Members Serving as of June 30, 1994

COMPENSATION

TRAVEL

$

650.00 $

155.59

550.00

550.00 350.00

186.35

$

2,100.00$

341.94

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

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

SECTION II SUMMARYANDSCHEDULEOFSALARIESANDTRAVEL

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SUMMARY OF SALARIES AND TRAVEL YEAR ENDED JUNE 30, 1994

SALARIES

TOTAL PER FINANCIAL
STATEMENTS (ACCRUAL BASIS)

ADJUSTMENTS FOR ACCRUALS

TOTAL PER

---------------------------- SCHEDULE JUNE 30, 1993 JUNE 30, 1994 (CASH BASIS)

GENERAL FUND

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

General Administration

Business Administration

Maintenance and Operation of Plant

363,360.08 $
406,130.53 252,713.24 65,861.02 24,378.00 41,492.52

62,888.70$ -57,808.17 $ 368,440.61

55,063.98 8,068.46

-63,796.70 -17,246.68

397,397.81 243,535.02 65,861.02 24,378.00 41,492.52

Total General Fund SPECIAL REVENUE FUND

$ 1,153,935.39$ 126,021.14 $ -138,851.55 $1,141,104.98

35,946.84

8,366.26

-5,991.14

38,321.96

Total Salaries

$ 1,189,882.23 $ 134,387.40$ -144,842.69 $1,179,426.94
================ ============= ============= =============

TRAVEL

GENERAL FUND

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

General Administration

Business Administration

Maintenance and Operation of Plant

Total General Fund

$

SPECIAL REVENUE FUND

28,385.73 $
19,675.23 15,293.92 3,415.40
44.73 3,659.88
70,474.89 $
2,726.48

64.05 $
47.67
111.72 $

$ -251.16

28,449.78
19,424.07 15,341.59 3,415.40
44.73 3,659.88

-251.16 $

70,335.45 2,726.48

Total Travel

$

73,201.37 $

111.72 $

-251.16 $ 73,061.93

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

MIDDLE GEORGIA R.E.S.A. SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30, 1994

NAME

TITLE CATEGORY

SALARIES i AMOUNT

ARNOLD.KAREN C

SUPPORT SERVICES - PUPIL SERVICES

$

BARTA.LYNNE C

INSTRUCTION

BERRANG,DEBORAH A

INSTRUCTION

BISSELL.HILLARY A

SUPPORT SERVICES - PUPIL SERVICES

BLANN.BRIAN M

SUPPORT SERVICES - PUPIL SERVICES

BORDERS, DENNIS

MAINTENANCE & OPER. OF PLANT SERVICES

BORUM,CECIL J

SUPP SRVS - IMPROV INSTR & ED MED SRVS

BORUM.GERALDINE E

SUPPORT SERVICES - PUPIL SERVICES

BOYT, JANET D

GENERAL ADMINISTRATION

BUSH, LI NOA L

INSTRUCT ION

CAPISTA,STEPHEN R

SUPPORT SERVICES - PUPIL SERVICES

CARTER-WYCHE.TARYN

SUPPORT SERVICES - PUPIL SERVICES

COLLINS, ANGELA P

INSTRUCTION

DAVIDSON.ROBERT E

INSTRUCTION

DAVIS.ANGELIA B

SUPP SRVS - IMPROV INSTR & ED MED SRVS

DELONEY.LUNA F

SUPPORT SERVICES - PUPIL SERVICES

DYKES.CAROLYN C

SUPP SRVS - IMPROV INSTR & ED MED SRVS

F ITCHBEN, SUSAN P

INSTRUCTION

GOODMAN.LETICIA D

SUPPORT SERVICES - PUPIL SERVICES

GREEN.JACKIE L

DIRECTOR

GREEN.JACKIE L

GENERAL ADMINISTRATION

GUNNELS.ROLF 0

INSTRUCTION

HALL.SHERRYL C

INSTRUCT ION

HARSHMAN.ROBERT G

SUPPORT SERVICES - PUPIL SERVICES

HATIN,DARCY A

SUPPORT SERVICES - PUPIL SERVICES

HAYWARD.CORDELIA J

INSTRUCTION

HAYWARD.CORDELIA J

SUPPORT SERVICES - PUPIL SERVICES

JONES.SHARON S

SUPPORT SERVICES - BUSINESS

LONG.SANDRA W

INSTRUCTION

LUNSFORD.RAMONA M

SUPP SRVS - IMPROV INSTR & ED MED SRVS

MARKS.ANGELA H

INSTRUCTION

MCCANN.JACQUELINE J

SUPP SRVS - IMPROV INSTR & ED MED SRVS

MCKENZIE,QUOVADIS

GENERAL ADMINISTRATION

MEADERS.KATHLEEN W

INSTRUCTION

MOORE.JAMES E

INSTRUCTION

PATYI,SUZAN

INSTRUCT ION

POSEY.JOSEPH A

SUPP SRVS - IMPROV INSTR & ED MED SRVS

POSEY.JOSEPH A

SPECIAL REVENUE FUND - FEDERAL

RANDOLPH.FREDE

INSTRUCTION

REDDING-MCKINNIE.MARILYN SUPP SRVS - IMPROV INSTR & ED MED SRVS

REID.JANET S

SUPPORT SERVICES - PUPIL SERVICES

ROZIER.MICHAEL B

INSTRUCT ION

RUMPH.LAKESHA N

GENERAL ADMINISTRATION

SCOTT,DONNA W

INSTRUCTION

SHEAFFER.LEANN R

SUPPORT SERVICES - PUPIL SERVICES

SMITH, JEAN K

SUPPORT SERVICES - PUPIL SERVICES

STAPLETON.CONRADE

SUPP SRVS - IMPROV INSTR & ED MED SRVS

THARP.TWYLA

INSTRUCTION

TOMPKINS.PAULETTE

SUPPORT SERVICES - INSTRUCTIONAL STAFF

TOMPKINS,PAULETTE

SPECIAL REVENUE FUND - FEDERAL

TWIGGS.JAMES L

MAINTENANCE & OPER. OF PLANT SERVICES

VANDERBEEK.VALERIE L

SUPPORT SERVICES - PUPIL SERVICES

WALTON.CONNIE H

INSTRUCTION

WILLIAMS.BRENDAL

INSTRUCTION

WILSON.ANGELA K

SUPP SRVS - IMPROV INSTR & ED MED SRVS

WOOD.LARAINE E

SUPPORT SERVICES - PUPIL SERVICES

3,497.66 34,058.80 $ 22,784.13 17,747.50 38,283.08 25,992.48 19,317.44 19,267.80
4,753.64 18,716.70 40,260.51 22,265.37 10,520.84 24,220.90 36,822.30 25,584.20 33,148.02 31,494.22 21,722.66 56,314.44
6,164.34 22,913.66 39,204.40
4,918.32 325.00
36,095.42 24,378.00 22,309.32 13, 791 . 72
7,534.18 26,213.22
1,054.00 31,352.52 10,520.84
3,592.62 182.34
35,726.02 34,058.80 16,868.40 35,611.70
5,493.80 3,738.94 26,204.40 28,850.49 4,918.32 52,268.88 28,306.30 2,595.94 2,595.94 15,500.04 31,502.48 17,348.40 10,520.84 42,326.76 27,667.90

TOTALS

$ 1,179,426.94 $

TRAVEL EXPENSE
3,813.81 493.71
1,640.47 1,808.75
395.64
1,960.98 1,643.11 2,886.50
3,393.39 2,022.06
412.57 2,509.93 4,127.80 1,853.04
3,415.40
2,307.90 2,517.22
44.73 1,204.35
139.34 142.50 2,908.36
3,589.19 67.20
2,726.48 3,692.22
325.71 1,429.68
2,165.73 1,479.24
2,379.43 1,080.24
3,659.88 1,474.62
410.76 4,661.12 2,278.87
73,061.93

:o

SECTION III COMPLIANCE

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Middle Georgia Regional Educational Service Agency
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements ofthe Middle Georgia Regional Educational Service Agency as ofand for the year ended June 30, 1994, and have issued our report thereon dated April 14, 1995.
We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to Middle Georgia Regional Educational Service Agency is the responsibility ofthe Agency's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests ofthe Agency's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.
The results of our tests indicate that, with respect to the items tested, the Middle Georgia Regional Educational Service Agency complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Agency had not complied, in all material respects, with those provisions.

94CRL-10

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

CLV:jy 94CRL-I0

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14, 1995

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Middle Georgia Regional Educational Service Agency

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

Ladies and Gentlemen:

We have audited the general purpose financial statements ofthe Middle Georgia Regional Educational Service Agency as ofand for the year ended June 30, 1994, and have issued our report thereon dated April 14, 1995.

We have applied procedures to test the Middle Georgia Regional Educational Service Agency's compliance with the following requirements applicable to each ofits Federal financial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1994:

(1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Audit Follow-Up/Resolution

(3) Cash Management

(7) Administrative Requirements

(4) Federal Financial Reports

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

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph ofthis report. With respect to items not

94CRL-40

tested, nothing came to our attention that caused us to believe that Middle Georgia Regional Educational Service Agency had not complied, in all material respects, with those requirements.

This report is intended for the information of management, the Federal cognizant audit agency and other

Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a

matter of public record.

Rex~

CLV:jy 94CRL-40

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14,1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members of the Middle Georgia Regional Educational Service Agency
SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS
Ladies and Gentlemen:
We have audited the general purpose financial statements ofthe Middle Georgia Regional Educational Service Agency as ofand for the year ended June 30, 1994, and have issued our report thereon dated April 14, 1995.
In connection with our audit ofthe fiscal year 1994 general purpose financial statements ofthe Middle Georgia Regional Educational Servise Agency and with our consideration of the Agency's internal control structure used to administer Federal financial assistance programs, as required by Office ofManagement and Budget (0MB) Circular A-128, "Audits ofState and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing:
Types of Services Allowed or Unallowed
Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Middle Georgia Regional Educational Service Agency's compliance with these requirements. Accordingly, we do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Middle Georgia Regional Educational Service Agency had not complied, in all material respects, with those requirements.

94CRL-120

This report is intended for the information of management, the Federal cognizant audit agency and other Federal granter agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
t r ~ ~ Respectfully submitted,
Claude L. Vickers State Auditor
CLV:jy 94CRL-120

SECTION IV INTERNAL CONTROL

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14, 1995

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members of the Middle Georgia Regional Educational Service Agency
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements ofthe Middle Georgia Regional Educational Service Agency as ofand for the year ended June 30, 1994, and have issued our report thereon dated April 14, 1995.
We conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
In planning and performing our audit of the general purpose financial statements of the Middle Georgia Regional Educational Service Agency for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure.
The management ofthe Middle Georgia Regional Educational Service Agency is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs ofinternal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may
94ICL-3

nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.

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

(1) Cash and Cash Equivalents

(5) Employee Compensation

(2) Revenue/Receivables/Receipts

(6) General Ledger

(3) Procurement

(7) General Fixed Assets

(4) Expenditures/Liabilities/ Disbursements

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

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

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

Cash and Cash Equivalents

Accounting Controls (Overall)

A material weakness is a reportable condition in which the design or operation of one or more ofthe specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.

Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all of the reportable conditions disclosed above are also considered to be material weaknesses.

94ICL-3

These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Middle Georgia Regional Educational Service Agency's financial statements and this report does not affect our report thereon dated April 14, 1995.

This report is intended for the information of management, the Federal cognizant audit agency and other

Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a

matter of public record.

Rextted,

CLV:jy 94ICL-3

Claude L. Vickers State Auditor

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
April 14, 1995

Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board ofEducation
and Director and Members of the Middle Georgia Regional Educational Service Agency
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Middle Georgia Regional Educational Service Agency as ofand for the year ended June 30, 1994, and have issued our report thereon dated April 14, 1995.
We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Middle {3-eorgia Regional Educational Service Agency complied with laws and regulations, noncompliance with which would be material to a Federal financial assistance program.
In planning and performing our audit for the year ended June 30, 1994, we considered the Agency's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Agency's general purpose financial statements and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit ofthe general purpose financial statements in a separate report dated April 14, 1995.

94ICL-15

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

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

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

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

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

(5) Allowable Costs/Cost Principles

(4) Reporting

(6) Audit Follow-Up/Resolution (7) Administrative Requirements
-

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

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

During the year ended June 30, 1994, the :Middle Georgia Regional Educational Service Agency had no major Federal financial assistance programs and expended 56% of its total Federal financial assistance under the following nonmajor Federal financial assistance program:

Drug-Free Schools and Communities Act

94ICL-15

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

CLV:jy 94ICL-15

Claude L. Vickers State Auditor

SECTIONV FINDINGS AND IMPROPER OR QUESTIONED COSTS

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR/CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS -Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 8644-93-01
The audit report for the year ended June 30, 1993, stated that the Agency did not provide for adequate separation ofemployee duties in the performance ofaccounting functions and related procedures. For the year under review, the Agency made some improvements regarding separation of employee duties, but still did not achieve an adequate degree ofinternal control. This deficiency was a result of management's decision to limit the number ofadministrative staffmade responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff.
Note: All Federal financial assistance programs listed in the Schedule of Federal Financial Assistance, Schedule "1" of this report are affected by this finding.
CURRENT YEAR
CASH AND CASH EQUIVALENTS Uncollateralized Deposits Financial Statements Reportable Condition - Material Weakness Nonmaterial Noncompliance Audit Control Number 8644-94-01
As of June 30, 1994, the Agency failed to have its bank balances fully collateralized as provided for by the Official Code of Georgia Annotated Section 45-8-12 which states, in part, as follows:
"The collecting officer or officer holding public funds may not have on deposit at any one time in any depository for a time longer than ten days a sum of money belonging to the public body when such depository has not given bond to the public body as set forth in this code section... The aggregate of the face value of such surety bond, the face or par value of securities pledged, and the amount of deposit insurance shall be equal to not less than 110 percent ofthe public funds being secured... after the deduction ofthe amount of deposit insurance"
This noncompliance occurred because ofmanagement's failure to adequately monitor the collateralization of balances at individual banks. The Agency should implement adequate procedures to monitor the collateralization of bank balances to ensure compliance at all times with State Laws governing deposits and investments.

SECTION VI PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

MIDDLE GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEAR ENDED JUNE 30, 1994
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 8644-93-01
We concur with this finding. Because of staff limitations (one bookkeeper), this finding cannot be totally resolved. The administration feels it has provided for the most appropriate assignment of duties with the number ofpersonnel available to perform the accounting functions. Procedures are in place to safeguard funds and maintain the integrity of the bookkeeping department.
CASH AND CASH EQUIVALENTS Uncollateralized Deposits Financial Statements Reportable Condition - Material Weakness Nonmaterial Noncompliance Audit Control Number - 8644-94-0 I
We concur with this finding. We have received a letter from Synovus Trust to the Citizens Bank acknowledging the mistake. It is hoped that this error will not occur in the future.