GA A'&JO ,RI E2
    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 primarily received from the Georgia Department ofEducation and from the Federal government to accomplish specific objectives and are required to be accounted for separately. FIDUCIARY FUND TYPE - the trust fund used to account for assets held by a government unit in a trustee capacity for individuals, private organizations, other government units and/or other funds. This fund includes: EXPENDABLE TRUST FUND Self-Insured Employee Benefit Fund - the fund used to account for unemployment compensation contributions and expenditures. BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds and the expendable trust fund 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 ofthese 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 and the expendable trust fund are accounted for using the modified accrual basis of accounting under which: - 7- WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 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 West Georgia 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 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 ofgeneral 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 ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year end. The Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit "B" ofthis report: Excess ofRevenues and Other Sources of Financial Resources over (under) Expenditures and Other Financing Uses Fund Balance July 1, 1994 Inventory for Resale - Net Change in Period Adjustments: To Adjust Revenues for Purchases ofInventory for Resale To Adjust Expenditures for Purchases oflnventory for Resale Fund Balance June 30, 1995 (Budget Basis) - 8- General Fund $ -46,790.60 220,979.35 45,354.04 406,451.87 -406,451.87 $ 219,542.79 WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT"D" Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in an authorized financial institution. 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 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 ofthe United States government, (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 ofthe State of Georgia. 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. - 9- WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT"D" Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INVENTORIES GOODS FOR RESALE Inventories are reported on the Combined Balance Sheet at cost. The Agency uses the purchases method to account for inventories whereby purchases for resale are recorded at the time of purchase. The inventory reported on the balance sheet is equally offset by a reservation of fund balance which indicates that it does not constitute "available spendable resources" even though it is a component of net current assets. INTERFUND TRANSACTIONS The Agency has the following types ofinterfund 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. Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position 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 ofthis data. Note 2: DEPOSITS AND INVESTMENTS 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. The aggregate ofthe face value of such surety bond and the market value of the securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction of the amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts. Acceptable security for deposits consists of any one of or any combination of the following: (1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, (2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, - 10 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT "D" Note 2: DEPOSITS AND INVESTMENTS (3) Bonds, bills, notes, certificates ofindebtedness or other direct obligations of the United States or ofthe State of Georgia, (4) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities ofthe 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 ofthe bonds for this purpose, (6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and (7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 1995, the bank balances were $772,537.71. The amounts ofthe total bank balances are classified into three categories of credit risk: Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Agency or by the Agency's agent in the Agency's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Agency's name. Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Agency's name.) The Agency's deposits are classified by risk category at June 30, 1995, as follows: Risk Category Bank Balance 1 $ 100,000.00 2 0.00 3 672,537.71 Total $ 772.537,71 - 11 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT "D" Note 2: DEPOSITS AND INVESTMENTS CATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: Category I - Insured or registered, or securities held by the Agency or the Agency's agent in the Agency's name. Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Agency's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Agency's name. Funds invested in art investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. At June 30, 1995, the carrying amount of the Agency's total investments was $832,119.77 and consisted entirely of funds in the Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services which are not required to be categorized since the Agency did not own any specific identifiable securities in the pool. The investment policy ofthe State of Georgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool does not provide for investment in derivatives or similar investments. Note 3: RISK MANAGEMENT The Agency is exposed to various risks ofloss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illnesses or injuries to employees; natural disaster; and unemployment compensation. The Agency has obtained commercial insurance for risk of loss associated with torts, assets, job related illnesses or injuries to employees and natural disaster. 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 obtained commercial insurance for errors and omissions, however the policy excludes coverage for sexual harassment on claims relating to students. This exclusion does not apply to claims brought by or on the behalf of employees. The Agency has not experienced any losses related to sexual harassment claims in the past three years. The Agency is self-insured with regard to unemployment compensation claims. A premium is charged by the Expendable Trust Fund to each user fund on the basis ofthe percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Agency accounts for claims with expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. - 12 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT"D" Note 3: RISK MANAGEMENT The Agency has not incurred any unemployment compensation claims liability during the last two fiscal years. 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 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 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 in accordance with State statute. A member is eligible for service retirement after 30 years of creditable service, regardless ofage, 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 average of the member's two consecutive highest paid years of service multiplied by the number of years 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, 1995, was $1,114,949.72; total payroll was $1,111,086.00. - 13 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT"D" Note 5: RETIREMENT PLANS TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Agency who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The Agency makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1995 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.500/o. Total contributions made during fiscal year 1995 amounted to $187,423.21, ofwhich $131,675.64 was made by the Agency and $55,747.57 was made by employees. These contributions represented 11.81% (Agency) and 5% (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. Total unfunded pension benefit obligation ofTRS as of June 30, 1994, was as follows: Total pension benefit obligation $15,313,743,000.00 Net assets available for benefits, at cost 14,254,785,000.00 Unfunded pension benefit obligation $ 1.058,958,000,00 The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1994. 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, 1995 were $565,117,811.00. The Agency's contribution for the year ended June 30, 1995 of $131,675.64 was actuarially determined and represented .0233% oftotal contributions made by all participating employers. Ten year historical trend information is presented in the 1995 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. - 14 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1995 EXHIBIT "D" Note 6: SURETY BONDS The Director, Mr. J. Paul Abernathy, is bonded in the amount of $50,000.00 with the Selective Insurance Company ofAmerica, Branchville, New Jersey, their Bond No. B701 l 15, on which premium is paid through June 1, 1996. - 15 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 1995 ASSETS Cash and Cash Equivalents Accounts Receivable Total Assets LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Deferred Revenue Total Liabilities FUND EQUITY Fund Balances Reserved For Continuation of Federal Programs Unreserved Undesignated Total Fund Equity Total Liabilities and Fund Equity GEORGIA LEARNING RESOURCES SYSTEM ANNUAL EVALUATION COORDINATION AIDS HEALTH EDUCATION $ 4,839.60 $ 0.00 $ 0.00 2,152.00 $ 6,991.60 $ ----- 0.00 $ 0.00 $ 1,054.23 3,689.52 99.82 $ 4,843.57 $ 2,148.03 0.00 $ $ 2,148.03 $ $ 6,991.60 $ 0.00 $ 0.00 $ 0.00 0.00 ----- 0.00 $ 0.00 See notes to the general purpose financial statements. -16 - EXHIBIT"E" LOTTERY PROGRAMS DRUG-FREE SCHOOLS AND COMMUNITIES ACT INDMDUALS WITH DISABILITIES EDUCATION ACT TITLE VI, B PRESCHOOL PROGRAM TOTALS JUNE 30, 1995 JUNE 30, 1994 $ 1,023,077.08 $ 18,989.61 $ 1,046,906.29 $ 49,369.71 2,561.13 $ ----3-2,'7-1-1.-00- 37,424.13 18,074.63 $ 1,025,638.21 $ 32,711.00 $ 18,989.61 $ 1,084,330.42 $ 67,444.34 $ $ 764,725.26 260,912.95 $ 1,025,638.21 $ 7,318.53 906.92 3,305.32 21,180.23 32,711.00 $ 7,318.53 $ 766,686.41 6,994.84 21,280.05 260,912.95 $ 1,063,192.78 $ 5,884.87 3,670.53 12,917.72 22,473.12 $ 18,989.61 $ 21,137.64 $ 599.27 $ o.oo s____o_.o_o 0.00 0.00 44,371.95 $ 0.00 $ 0.00 $ 18,989.61 $ 21,137.64 $ 44,971.22 $ 1,025,638.21 $ 32,711.00 $ 18,989.61 $ 1,084,330.42 $ 67,444.34 - 17 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 1995 REVENUES State Funds Federal Funds Total Revenues EXPENDITURES Current Instruction Support SelVices Improvement of Instructional SelVices General Administration Maintenance and Operation of Plant Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES Operating Transfers In Excess of Revenues and Other Financing Sources over (under) Expenditures FUND BALANCE JULY 1 FUND BALANCE JUNE 30 GEORGIA LEARNING RESOURCES SYSTEM ANNUAL EVALUATION COORDINATION AIDS HEALTH EDUCATION $ 66,551.00 $ 139,013.18 $ 205,564.18 $ 91,265.00 $ 91,265.00 $ 26,200.00 26,200.00 $ 5,882.91 88,552.59 $ 106,179.92 3,400.00 $ 204,015.42 $ $ 1,548.76 $ $ 86,654.38 4,610.62 91,265.00 $ 0.00 $ 20,000.00 6,200.00 26,200.00 0.00 $ 1,548.76 $ 599.27 $ 2,148.03 $ 0.00 $ 0.00 0.00 0.00 ----- 0.00 $ 0.00 See notes to the general purpose financial statements. -18- EXHIBIT"F" LOTTERY PROGRAMS DRUG-FREE SCHOOLS AND COMMUNITIES ACT INDMDUALS WITH DISABILITIES EDUCATION ACT TITLEVI, B PRESCHOOL PROGRAM TOTALS YEAR ENDED JUNE 30, 1995 JUNE 30, 1994 $ 1,264,598.85 _____ $ $ 1,264,598.85 $ 245,039.77 $ 245,039.77 $ $ 1,422,414.85 $ 115,000.00 525,252.95 332,142.50 686,156.04 115,000.00 $ 1,947,667.80 $ 1,018,298.54 $ 1,263,507.04 $ 150.00 950.00 $ 1,264,607.04 $ $ -8.19 $ $ 97,524.96 144,176.11 3,338.70 245,039.77 $ 0.00 $ 44,086.93 $ 1,333,476.88 $ 126,122.18 36,767.07 59,528.34 315,699.00 310,034.37 12,299.32 374,008.27 498,860.90 9,957.55 140,382.34 $ 1,971,509.57 $ 1,008,948.90 -25,382.34 $ -23,841.77 $ 9,349.64 8.19 $ 0.00 $ 0.00 0.00 $ 0.00 8.19 190.00 -25,382.34 $ 44,371.95 -23,833.58 $ 44,971.22 9,539.64 35,431.58 $ 0.00 $ 0.00 $ 18,989.61 $ 21,137.64 $ 44,971.22 -19- WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30, 1995 FUNDING AGENCY PROGRAM/GRANT Education, U.S. Department of Through Georgia Department of Education Drug-Free Schools and Communities Act 1994Grant 1994 C8ny-0Yer 1995Grant Individuals with Disabilities Education Act Title VI, B Georgia Leaming Resources System 1994 C8ny-0Yer 1995 Regular Title VI, D Special Education Personnel Development and Parent Training 1994 Regular 1995 Regular Vocational Education - Basic Grants to States High School Program Basic Grant 1995Grant Through Georgia Department of Human Resources Drug-Free Schools and Communities Act 1994Gi'ant 1995 Grant Through Various Boards of Education (See Schedule a-) Individuals with Disabilities Education Act Title VI, B Preschool Program 1994 Regular 1995 Regular Total U. S. Department of Education Health and Human Services, U. S. Department of Through Georgia Department of Education Cooperative Agreements to Support Comprehensive School Health Programs to Prevent the Spread of HIV and Other Important Health Problems Coordinate the Production of Three Master Video Tapes Featuring an Expert on HIV/AIDS 1995 Regular Implementation of a Program in Comprehensive Health Education 1994 Regular 1995 Regular Total U.S. Department of Health and Human Services CFDA NUMBER AWARDS IN PERIOD FEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS) FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 84.186 84.186 $ 84.186 $ 7,909.00 242,711.00 12,496.00 7,909.00 $ 210,000.00 7,909.00 $ 221,530.77 7,909.00 221,530.77 84.027 84.027 16,000.00 118,809.00 16,000.00 118,809.00 16,000.00 118,709.18 16,000.00 118,709.18 84.029 84.029 4,304.00 2,152.00 4,304.00 599.27 2,155.97 84.048 37,428.18 26,012.21 37,428.18 37,428.18 84.186 84.186 24,960.00 1,137.00 15,600.00 15,600.00 15,600.00 84.173 84.173 1151000.00 $ 5671121.18 $ 1151000.00 1151000.00 5251115.21 $ 536Aa1.13 $ 44,371.95 961010.39 5601314.71 93.938 $ 20,000.00 $ 93.938 93.938 6,200.00 $ 261200.00 $ 20,000.00 $ 20,000.00 $ 20,000.00 621.27 61200.00 6,200.00 61200.00 261821.27 $ 261200.00 $ 26,200.00 - 20 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30 1995 SCHEDULE 1 FUNDING AGENCY PROGRAM/GRANT Labor, u. s. Department or Through Griffin Regional Educational Service Agency Job Training Partnership Act IIC-IEARC-93-001 CFDA NUMBER AWARDS IN PERIOD FEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS) FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 17.250 $ 31820.36 Total Federal Financial Assistance $ 593,321.18 $ sss:7ss.84 s 562 681.13 s _ _586_,s_1_4_.1_1 1 The Agency had no major programs as defined by the Single Audit Act of 1984. See notes to the general purpose financial statements. - 21 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY CASH AND CASH EQUIVALENTS JUNE 30, 1995 SCHEDULE "2" INTEREST BEARING ACCOUNTS NationsBank of Georgia, N.A., LaGrange, Georgia Commercial Bonus Checking (Variable) $ 348,068.83 See notes to the general purpose financial statements. - 22 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY INVESTMENTS JUNE 30, 1995 SCHEDULE "3" INVESTMENT POOL State of Georgia, Office of Treasury and Fiscal Services Local Government Investment Pool (6.032%) $ 832,119.77 See notes to the general purpose financial statements. - 23 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY ACCOUNTS RECEIVABLE JUNE 301 1995 SCHEDULE4 Education, Georgia Department of Vocational Education Federal Funds Lottery Programs Distant Leaming Education Technology Centers Federal Programs Drug-Free Schools and Communities Act Georgia Leaming Resources System Title VI, D Contracts Positive School Discipline Workshop Other Registration Fees Curriculum Director's Conference Fuller E. Calloway Foundation Audiology Grant Various Sources Equipment and Repair Services GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 11,415.97 $ 11,415.97 $ 1,100.00 1,461.13 1,100.00 1,461.13 32,711.00 32,711.00 2,152.00 2,152.00 6,100.00 6,100.00 125.00 125.00 13,823.72 13,823.72 2,355.30 2,355.30 $ 33,819.99 $ 37,424.13 $ 71,244.12 See notes to the general purpose financial statements. - 24 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1995 SCHEDULE 5 AGENCY/FUNDING GRANTS Education, Georgia Department of Other State Programs Georgia Leaming Resources System Regional Educational Service Agencies Staff Development Sex Education Grant Supervision and Assessment of Student and Beginning Teachers and PerformanceBased Certification Lottery Programs Distant Leaming Education Technology Centers Model Technology Schools CONTRACTS Education, Georgia Department of In-School Suspension Positive School Discipline Workshop OTHER Education, Georgia Department of Registration Fees Curriculum Director's Conference GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ $ 431,520.00 31,000.00 66,551.00 $ 66,551.00 431,520.00 31,000.00 91,265.00 1,100.00 50,000.00 1,213,498.85 91,265.00 1,100.00 50,000.00 1,213,498.85 4,979.19 6,100.00 4,979.19 6,100.00 2,199.44 2,199.44 $ 475,798.63 $ 1,422,414.85 $ 1,898,213.48 See notes to the general purpose financial statements. - 25 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FEDERAL REVENUE THROUGH BOARDS OF EDUCATION YEAR ENDED JUNE 30, 1995 SCHEDULE "6" AGENCY/FUNDING SUB-GRANTS Various Boards of Education Individuals with Disabilities Education Act Title VI, B - Preschool Program Coweta County Meriwether County Troup County GOVERNMENTAL FUND TYPE SPECIAL REVENUE FUND $ -40,000.00 -40,000.00 35,000.00 $=====1=1==s,=oo=o=.o=o See notes to the general purpose financial statements. -26- WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF LOCAL AND OTHER REVENUE YEAR ENDED JUNE 30, 1995 SCHEDULE '7" Donations Indirect Cost Special Revenue Fund Interest Earned Membership Contributions Boards of Education Carroll County Carrollton, City of Coweta County Heard County Meriwether County Troup County Rents Sales Assets Equipment and Repair Less: Purchases for Resale Resource Materials Shared Service Contributions Audiology Boards of Education Carroll County Carrollton, City of Heard County Meriwether County Head Start FuUer E. CaUoway Foundation Occupational Therapy Services Boards of Education Coweta County Heard County Meriwether County Troup County Teacher Assistant Contracts Boards of Education Carroll County Carrollton, City of Coweta County Heard County Meriwether County Troup County Tuition Workshop Registration Fees Other See notes to the general purpose financial statements. - 27 - GOVERNMENTAL FUND TYPE GENERAL FUND $ 26,000.00 16,878.19 22,805.81 93,519.00 30,294.00 83,167.00 16,236.00 37,116.00 98,208.00 8,010.62 1,240.00 396,786.04 -406,451.87 4,271.61 34,045.00 4,864.00 2,432.00 4,864.00 2,432.00 13,823.72 50,940.00 10,188.00 15,282.00 40,940.00 2,900.00 950.00 1,750.00 430.00 670.00 2,400.00 9,090.60 51,075.17 4,662.13 s _ _ _ _6s_1_.s_1_9._02_ WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF EXPENDITURES BY OBJECT GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1995 SCHEDULE "8" EXPENDITURES Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Insurance Communications Supplies Energy Dues and Fees Federal Indirect Costs Nonoperating Costs Equipment Total Expenditures GENERAL FUND SPECIAL REVENUE FUND TOTAL $ 759,690.22 $ 351,395.78 $ 1,111,086.00 202,442.75 98,232.65 300,675.40 28,075.37 18,460.56 46,535.93 58,779.57 125,859.79 184,639.36 850.00 850.00 2,359.07 2,359.07 3,919.18 950.00 4,869.18 6,000.00 8,010.62 14,010.62 18,487.77 18,487.77 13,596.52 13,596.19 27,192.71 83,419.13 73,106.68 156,525.81 22,348.70 22,348.70 6,146.50 6,169.68 12,316.18 16,878.19 16,878.19 35,713.46 1,258,849.43 1,294,562.89 $ 1,241,828.24 $ 1,971,509.57 $ 3,213,337.81 See notes to the general purpose financial statements. - 28 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF EXPENDITURES BY OBJECT LOTTERY PROGRAMS YEAR ENDED JUNE 30, 1995 SCHEDULE"9" EXPENDITURES Operating Costs Repairs and Maintenance Services Supplies Nonoperating Costs Equipment DISTANT LEARNING EDUCATION TECHNOLOGY CENTERS MODEL TECHNOLOGY SCHOOLS TOTAL $ 950.00 $ 950.00 150.00 $ 5,289.40 $ 4,708.21 10,147.61 44 718.79 112081790.64 112531509.43 Total Expenditures $ 1100.00 $ 50,008.19 $ 1,213,498.85 $ 1,264,607.04 See notes to the general purpose financial statements. - 29 - WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF COMPENSATION OF BOARD MEMBERS YEAR ENDED JUNE 30, 1995 SCHEDULE "1 O" BOARD MEMBER ADDRESS Dr. Terry Jenkins, Chairperson(*) Troup County Board of Education P. 0. Box 1228, 201 Main Street LaGrange, Georgia 30241 Mr. Leon Golden, Vice-Chairperson (*) Carroll County Board of Education 164 Independence Drive Carrollton, Georgia 30117 Mr. Richard Brooks(*) Coweta County Board of Education 237 Jackson Street Newnan, Georgia 30263 Mrs. Dana Diment (*) 402 Newnan Street Carrollton, Georgia 30117 Mr. Robert Hawk (*) Meriwether County Board of Education P. 0. Box 70, N. Court Square Greenville, Georgia 30222 Mr. Benjie Hyatt (*) Heard County Board of Education P. 0. Box 1330 Franklin, Georgia 30217 Mr. Lamar Moody (*) 42 Community Square V~la Rica, Georgia 30180 Mr. Alonzo Ransom (*) 208 Johnson Street LaGrange, Georgia 30240 Dr. Ronnie Williams (*) City of Carrollton Board of Education 106 Trojan Drive Carrollton, Georgia 30117 (*) Denotes Board Members Serving as of June 30, 1995 See notes to the general purpose financial statements. - 30 - $ 200.00 250.00 400.00 $===8=s=o=.o=o SECTION II SUMMARY AND SCHEDULE OF SALARIES AND TRAVEL WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SUMMARY OF SALARIES AND TRAVEL YEAR ENDED JUNE 30, 1995 SALARIES GENERAL FUND Instruction Support Services Improvement of Instructional Services General Administration Business Administration Maintenance and Operation of Plant Other Support Services Total General Fund SPECIAL REVENUE FUND TOTAL PER FINANCIAL STATEMENTS (ACCRUAL BASIS) ADJUSTMENTS FOR ACCRUALS JUNE 301 1994 JUNE 301 1995 TOTAL PER SCHEDULE (CASH BASIS) $ 337,949.14 $ 3,164.68 $ 31,390.44 138,452.58 75,398.09 15,456.00 161,043.97 $ 759,690.22 $ 3,164.68 $ 351,395.78 12,917.72 -3,305.34 $ -3,305.34 $ -6 994.84 337,808.48 31,390.44 138,452.58 75,398.09 15,456.00 161,043.97 759,549.56 357,318.66 Total Salaries $ 1,111,086.00 $ 16,082.40 $ -10,300.18 $ 1,116,868.22 TRAVEL GENERAL FUND Instruction $ Support Services Improvement of Instructional Services General Administration Business Administration Maintenance and Operation of Plant Total General Fund $ SPECIAL REVENUE FUND 18,836.36 $ 2,493.13 4,139.99 660.76 1 945.13 28,075.37 $ 18,460.56 Total Travel $ 46,535.93 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 18,836.36 2,493.13 4,139.99 660.76 1,945.13 28,075.37 18,460.56 o.oo s_____o_.oo_ s 46 535.93 1 WEST GEORGIA R.E.S.A. SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30, 1995 NAME TITLE CATEGORY SALARIES AMOUNT TRAVEL EXPENSE ABERNATHY,J PAUL ABERNATHY,J PAUL AUSTON.JUDY BASTON,MICHAEL D BECHAM,JAMES P CLARK,ANGELYNN S COTY.SELMA P COUCH,JAMES S CREWS,AMY DENNY,CYNTHIA DENNY,CYNTHIA DODDS.MARK D DORSETT-KELLY,DIANN DUTY.JEANINE T DUTY.JEANINE T ECHOLS.JACKIE ECHOLS.JACKIE FLETCHER.ANNE TIMMONS HAINES.TONITA HARRISON.ROBERT WAYNE HAWKINS, INEZ HAWKINS, INEZ HOWARD,EVEANN JAMES.PATRICIA L JOHNSON,MARY LANEY,EDDIE LANEY,JONATHAN LITTLEFIELD.BEATRICE LITTLEFIELD,BEATRICE LONGSHORE.TRACEY LONGSHORE.TRACEY LONGSHORE,TRACEY LONGSHORE,TRACEY LOVVORN.JOYCE H LOVVORN,JOYCE H MARLOW,PATSY D MARLOW,PATSY D MARLOW.PATSY D MCCALL,GARY S MOORE,DONNA LYNNE MOSELEY.LEWIS WAYNE NEWBORN,MARILEEN B NEWBORN,MARILEEN B NEWBORN,MARILEEN B NEWBORN,MARILEEN B OEHLER.SUSAN OWENSBY.LUANNE RHODES,MARK DAVIS SCHEIBEL-SCHMITT,CAROLE WARD,LEAH KENDRICK WELCH,JOHNNIE MAE WELCH.JOHNNIE MAE WHITE, STEVEN P WHITE.STEVEN P WHITTEN.JOYCE 0 WHITTEN.JOYCE 0 DIRECTOR $ GENERAL ADMINISTRATION INSTRUCTION OTHER SUPPORT SERVICES OTHER SUPPORT SERVICES GENERAL ADMINISTRATION GENERAL ADMINISTRATION OTHER SUPPORT SERVICES MISCELLANEOUS PROGRAMS GENERAL ADMINISTRATION SPECIAL REVENUE FUND - OTHER PROGRAMS OTHER SUPPORT SERVICES FEDERAL PROGRAMS SUPPORT SERVICES - BUSINESS INTERNAL SERVICES FUND GEORGIA LEARNING RESOURCES SYSTEM FUND FEDERAL PROGRAMS INSTRUCTION INSTRUCTION OTHER SUPPORT SERVICES SUPP SRVS - IMPROV INSTR & ED MED SRVS SPECIAL REVENUE FUND - OTHER PROGRAMS GENERAL ADMINISTRATION FEDERAL PROGRAMS FEDERAL PROGRAMS SUPPORT SERVICES - BUSINESS INTERNAL SERVICES FUND GEORGIA LEARNING RESOURCES SYSTEM FUND FEDERAL PROGRAMS SUPPORT SERVICES - BUSINESS OTHER SUPPORT SERVICES INTERNAL SERVICES FUND MISCELLANEOUS PROGRAMS SUPP SRVS - IMPROV INSTR & ED MED SRVS SUPPORT SERVICES - BUSINESS INSTRUCTION SUPP SRVS - IMPROV INSTR & ED MED SRVS FEDERAL PROGRAMS OTHER SUPPORT SERVICES FEDERAL PROGRAMS INSTRUCTION SUPPORT SERVICES - BUSINESS MAINTENANCE & OPER. OF PLANT SERVICES OTHER SUPPORT SERVICES FEDERAL PROGRAMS INSTRUCTION INSTRUCTION OTHER SUPPORT SERVICES INSTRUCTION MISCELLANEOUS PROGRAMS INSTRUCTION MISCELLANEOUS PROGRAMS GEORGIA LEARNING RESOURCES SYSTEM FUND FEDERAL PROGRAMS GENERAL ADMINISTRATION MISCELLANEOUS PROGRAMS 74,949.12 $ 19,235.63 13,824.01 27,540.96 25,833.96 1,918.50 27,540.96 31,686.54 11,916.96 11,917.08 25,959.96 39,382.64 2,141.61 2,141.62 44,008.42 50,912.76 48,267.84 27,540.96 52,727.52 23,834.04 23,834.04 51,384.36 29,541.00 850.50 23,834.04 15,889.36 7,944.68 24,834.00 16,170.84 31,390.44 11,096.16 6,329.34 47,428.32 15,456.00 1,200.00 33,682.87 38,415.80 27,540.96 32,734.13 2,343.30 31,268.93 15,401.10 38,563.56 11,518.92 14,934.48 2,675.95 659.33 668. 12 435. 10 46.22 2,676.40 847.98 803.67 3,510.56 413.31 3,152.08 2,036.61 4,927.68 224.80 1,824.12 163.32 909.61 2,658.76 249.93 70.35 345.01 200.25 303.96 109.41 136.24 205. 12 2,132.09 345.00 2,169.22 5.46 123. 16 326.63 3,155.89 1,948.53 1,706.84 1,143.36 742.43 2,455.50 17.64 10.29 TOTALS $ 1,116,868.22 $ 46,535.93 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 February 14, 1996 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Director and Members ofthe West Georgia Regional Educational Service Agency Board ofControl 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 West Georgia Regional Educational Service Agency as of and for the year ended June 30, 1995, and have issued our report thereon dated February 14, 1996. This report was qualified for a scope limitation and for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, 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. We did not observe the taking of inventories for resale at June 30, 1995, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories for resale through alternative procedures. Compliance with laws, regulations, contracts, and grants applicable to West 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. 95CRL-10 The results ofour tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards. 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. Respectfully submitted, CLV:gp 95CRL-10 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 February 14, 1996 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Director and Members ofthe West Georgia Regional Educational Service Agency Board of Control SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REOUIREl\ffiNTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements of the West Georgia Regional Educational Service Agency as of and for the year ended June 30, 1995, and have issued our report thereon dated February 14, 1996. This report was qualified for a scope limitation and for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have applied procedures to test the West Georgia Regional Educational Service Agency's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1995: (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 of State and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which 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. 95CRL-40 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 of this report. With respect to items not tested, nothing came to our attention that caused us to believe that West 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. Respectfully submitted, CLV:gp 95CRL-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 February 14, 1996 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Director and Members ofthe West Georgia Regional Educational Service Agency Board ofControl 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 of the West Georgia Regional Educational Service Agency as of and for the year ended June 30, 1995, and have issued our report thereon dated February 14, 1996. This report was qualified for a scope limitation and for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. In connection with our audit ofthe fiscal year 1995 general purpose financial statements of the West Georgia Regional Educational Service Agency and with our consideration of the Agency's control structure used to administer Federal financial assistance programs, as required by Office ofManagement and Budget (0MB) Circular A-128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal :financial assistance programs for the year ended June 30, 1995. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governing: ( 1) Types of Services Allowed or Unallowed (2) Eligibility Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the West Georgia Regional Educational Service Agency's compliance with these requirements. Accordingly, we do not express such an opinion. 95CRL-120 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 West 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. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:gp 95CRL-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 February 14, 1996 Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation and Director and Members ofthe West Georgia Regional Educational Service Agency Board ofControl REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe West Georgia Regional Educational Service Agency as of and for the year ended June 30, 1995, and have issued our report thereon dated February 14, 1996. This report was qualified for a scope limitation and for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, 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. We did not observe the taking of inventories for resale at June 30, 1995, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories for resale through alternative procedures. The management ofthe West 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 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, 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 95ICL-3 principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation ofthe 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. In planning and performing our audit ofthe general purpose financial statements of the West Georgia Regional Educational Service Agency for the year ended June 30, 1995, we obtained an understanding ofthe internal control structure. With respect to the internal control structure, 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 in order to determine our auditing procedure for the purpose of expressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. 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 of the 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, a reportable condition was noted in the following control category: General Fixed Assets 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 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 the reportable condition disclosed above is also considered to be a material weakness. This condition was considered in determining the nature, timing, and extent ofthe procedures to be performed in our audit of the West Georgia Regional Educational Service Agency's financial statements and this report does not affect our report thereon dated February 14, 1996. 95ICL-3 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. Respectfully submitted, CLV:gp 95ICL-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 February 14, 1996 Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation and Director and Members ofthe West Georgia Regional Educational Service Agency Board ofControl 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 West Georgia Regional Educational Service Agency as of and for the year ended June 30, 1995, and have issued our report thereon dated February 14, 1996. This report was qualified for a scope limitation and for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General ofthe United States; and the provisions of Office ofManagement 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. We did not observe the taking of inventories for resale at June 30, 1995, nor could we satisfy ourselves as to the accuracy ofthe amounts stated as inventories for resale through alternative procedures. In planning and performing our audit for the year ended June 30, 1995, 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 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 of the general purpose financial statements in a separate report dated February 14, 1996. 95ICL-13 The management ofthe West 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 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 purposes 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 (1) Types of Services Allowed or Unallowed (2) Eligibility (3) Matching, Level of Effort, 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 ofthe design ofrelevant policies and procedures and whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1995, the West Georgia Regional Educational Service Agency had no major Federal financial assistance programs and expended 66% of its total Federal financial assistance under the following nonmajor Federal financial assistance programs: Drug-Free Schools and Communities Act Individuals with Disabilities Education Act, Title VI, B - Preschool Program 95ICL-13 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 Federal financial assistance programs. 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. 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 constitute material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a 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. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. 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. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:gp 95ICL-13 SECTIONV FINDINGS AND IMPROPER OR QUESTIONED COSTS WEST GEORGIA REGIONAL EDUCATIONAL SERVICE AGENCY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1995 PRIOR YEAR/CURRENT YEAR GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 8604-93-01 The audit report for the year ended June 30, 1994, noted that the management of the West Georgia Regional Educational Service Agency had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Agency did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Agency being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Agency to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of equipment owned by the Agency and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. Note: The West Georgia Regional Educational Service Agency was provided an opportunity to include pertinent comments from the Agency's management concerning these audit findings, conclusions and recommendations. The Agency has elected not to provide comments for inclusion in this report.