GA A800 .RI E3~ 1qq3--Cf+ STATE OF GEORGIA DEPARTMENT OF AUDITS 254 WASHINGTON STREET ATLANTA. GEORGIA 30334 AUDIT REPORT STATE OF GEORGIA DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30, 1994 DEPARTMENT OF EDUCATION - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION EXHIBITS FINANCIAL STATEMENTS A COMBINED BALANCE SHEET (STATUTORY BASIS) ALL FUND TYPES AND ACCOUNT GROUPS 2 B STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS) GOVERNMENTAL FUND TYPE 7 C STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND 8 STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BUDGET FUND D "A" DEPARTMENT OF EDUCATION 12 E "B" LOTTERY FOR EDUCATION 14 F STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND 15 G NOTES TO THE FINANCIAL STATEMENTS 16 SUPPLEMENTARY INFORMATION H COMBINING BALANCE SHEET (STATUTORY BASIS) BUDGET FUND 30 I COMBINING STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS) BUDGET FUND 31 J COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND 32 K COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUND TYPE - AGENCY FUNDS 36 DEPARTMENT OF EDUCATION -TABLE OF CONTENTS- SECTION I FINANCIAL SUPPLEMENTARY INFORMATION SCHEDULES SCHEDULES OF APPROVED BUDGET 1 "A" DEPARTMENT OF EDUCATION 38 2 "B" LOTTERY FOR EDUCATION 40 3 CASH AND CASH EQUIVALENTS 41 4 INVESTMENTS 42 5 SCHEDULE OF GOVERNOR'S EMERGENCY FUND 43 6 SCHEDULE OF FEDERAL REVENUES 44 7 SCHEDULE OF OTHER OPERA TING EXPENSES 46 8 RECONCILIATION OF TRAVEL 47 9 SUMMARY OF SALARIES, TRAVEL, AND PER DIEM AND FEES 48 SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTION I FINANCIAL ' CLAUDE L. VICKERS STATE AUDIIDR (404) 656-2174 TAX RATIO (404) 656-0494 ~epartmeut nf ~uh-its 254 WASHINGIDN STREET, S.W. ROOM 214 J\tlanbt, eorgia 30334-8400 December 22, 1994 FINANCIAL AUDl"TS (404) 656-2180 PROGRAM AUDl"TS (404) 656-2006 Honorable Zell Miller, Governor Members ofthe General Assembly of Georgia Members ofthe State Board ofEducation and Honorable Linda C. Schrenko State Superintendent of Schools INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION Ladies and Gentlemen: We have audited the accompanying financial statements (Exhibits A through G) of the Department of Education as ofand for the year ended June 30, 1994. These financial statements are the responsibility of the Department'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. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial 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. As described in Note 1, these financial statements were prepared on a prescribed basis of accounting that demonstrates compliance with the budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position (statutory basis) ofthe Department ofEducation as of June 30, 1994, and the results of its operations (statutory basis) for the year then ended, on the basis of accounting described in Note 1. 94ARL-l Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary infonnation (Exhibits H through K and Schedules I through 9) is presented for purposes of additional analysis and is not a required part of the financial statements of the Department of Education. Such infonnation has been subjected to the auditing procedures applied in the audit of the financial statements and, in our opinion, is fairly presented in all material respects in relation to the financial statements taken as a whole. Respectfully submitted, d~' /~ Claude L. Vickers State Auditor CLV:gp 94ARL-l FINANCIAL STATEMENTS - 1- DEPARTMENT OF EDUCATION COMBINED BALANCE SHEET (STATUTORY BASIS) ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30. 1994 ASSETS Cash and Cash Equivalents (See Schedule) Investments (See Schedule) Accounts Receivable State Appropriation Federal Financial Assistance Other Prepaid Items Inventories Supply Donated Food Fixed Assets Equipment Amount to be Provided for Payment of Accrued Compensated Absences Installment Purchase Commitments GOVERNMENTAL FIDUCIARY FUND TYPES FUND TYPE ---------------------------- -------------- NONEXPENDABLE BUDGET TRUST AGENCY $ 13,500.00$ 1,001,881.41 $ 119,111.83 $ 89,006,627.92 90,304,396.28 8,748,077.83 $188,059,102.03 $ 0.00 $ 75,169.94 1,375,823.93 $ 1,450,993.87 Total Assets $189,510,095.90 $ 13,500.00$ 1,120,993.24 ============== ============= ============= The notes to the financial statements are an integral part of this statement. - 2- EXHIBIT "A" Page 1 ACCOUNT GROUPS GENERAL FIXED ASSETS GENERAL LONG-TERM DEBT TOTALS (Memorandum Only) JUNE 30, 1994 JUNE 30, 1993 $ 1,015,381.41 $ 1,156,764.59 $ 119,111.83 $ 115,412.31 $ 89,006,627.92 $14,131,473.66 90,304,396.28 94,354,960.47 8,748,077.83 4,138,302.57 $188,059,102.03 $112,624,736.70 $ 0.00 $ 10,684.40 $ 75,169.94 $ 71,224.13 1,375,823.93 1,330,848.71 $ 1,450,993.87 $ 1,402,072.84 $23,563,489.23 $ 23,563,489.23 $18,440,832.43 $2,912,306.95$ 2,912,306.95 $ 2,592,329.70 172,556.20 172,556.20 24,720.81 $3,084,863.15$ 3,084,863.15$ 2,617,050.51 $23,563,489.23 $ 3,084,863.15 $217,292,941.52 $136,367,553.78 ============= ============= ============== ============== - 3- DEPARTMENT OF EDUCATION COMBINED BALANCE SHEET (STATUTORY BASIS) ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30 1 1994 LIABILITIES AND FUND EQUITY Liabilities Cash Overdraft Accounts Payable Contracts Payable Grants Payable Payroll Withholdings Funds Held for Others Compensated Absences Installment Purchases Total Liabilities Fund Equity Investment in General Fixed Assets Fund Balances Reserved Federal Financial Assistance Inventories Supply Donated Food Food Distribution Program Temporary Emergency Food Assistance Program France-Mediaction and Vocational Mission Programs Georgia Academy for the Blind Pupils' Trust Fund - Endowment Corpus Georgia-Lorraine Exchange Program Georgia School for the Deaf School Improvements Legislative Video Program Mellon School/College Collaboration Grant QBE Formula Grants School Nurse Program State Teacher of the Year Program United States Senate Youth Program Vocational Education General Obligation Funds Unreserved Designated Surplus Regular Lottery for Education Total Fund Equity GOVERNMENTAL FIDUCIARY FUND TYPES FUND TYPE ---------------------------- -------------- NONEXPENDABLE BUDGET TRUST AGENCY $ 1,930,405.02 8,283,831.15 5,063,122.20 167,865,597.50 356,343.93 $183,499,299.80 $1,120,993.24 $1,120,993.24 $ 1,104,179.48 85,000.00 252,055.47 1,123,768.46 13,227.45 $ 1,228.45 38,719.23 500.00 20.83 0.00 571.93 1,855.54 2,392.32 3,116.90 13,500.00 2,629,643.20 754,516.84 -------------- ------------- $ 6,010,796.10 $ 13,500.00 -------------- ------------- Total Liabilities and Fund Equity $189,510,095.90 $ 13,500.00$ 1,120,993.24 ============== ============= ============= The notes to the financial statements are an, integral part of this statement. - 4- EXHIBIT "A" Page 2 ACCOUNT GROUPS GENERAL FIXED ASSETS GENERAL LONG-TERM DEBT TOTALS (Memorandum Only) JUNE 30, 1994 JUNE 30, 1993 $ 1,930,405.02 $ 1,886,913.11 8,283,831.15 2,885,140.06 5,063,122.20 4,402,663.23 167,865,597.50 98,133,739.18 356,343.93 235,830.66 1,120,993.24 1,258,676.90 $ 2,912,306.95 2,912,306.95 2,592,329.70 172,556.20 172,556.20 24,720.81 $ 3,084,863.15 $187,705,156.19 $111,420,013.65 $23,563,489.23 $ 23,563,489.23 $ 18,440,832.43 1,104,179.48 85,000.00 252,055.47 1,123,768.46 13,227.45 13,500.00 1,228.45 38,719.23 500.00 20.83 0.00 571.93 1,855.54 2,392.32 3,116.90 991,187.04 85,000.00 518,111.82 812,736.89 0.00 13,500.00 1,228.45 238,920.00 500.00 11. 79 1,908,260.00 0.00 5,080.77 1,938.83 0.00 $23,563,489.23 2,629,643.20 1,930,232.11 754,516.84 0.00 $ 29,587,785.33 $ 24,947,540.13 $23,563,489.23 $ 3,084,863.15 $217,292,941.52 $136,367,553.78 - 5- DEPARTMENT OF EDUCATION STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS) GOVERNMENTAL FUND TYPE YEAR ENDED JUNE 30, 1994 EXHIBIT "B" FUND BALANCES - JULY 1 ---------------------- Reserved Unreserved Designated Surplus ADDITIONS Adjustments to Prior Year's Accounts Payable Grants Payable Change in Reserve for Inventory Donated Food Program Food Distribution Program Temporary Emergency Food Assistance Program Excess of Funds Available over Expenditures Exhibit "C" Reimbursement of Prior Year's Expenditures Grants Other DEDUCTIONS Unreserved Fund Balance (Surplus) Returned to Office of Treasury and Fiscal Services Year Ended June 30, 1992 Year Ended June 30, 1993 Adjustment to Prior Year's Accounts Receivable Refund of Private Grant Reserved Fund Balance Carried Over from Prior Year as Funds Available FUND BALANCES - JUNE 30 (To Exhibit "A") BUDGET FUND YEAR ENDED JUNE 30, 1994 JUNE 30, 1993 $ 4,562,975.59 $ 2,580,510.90 1,930,232.11 4,933,643.29 -------------- -------------- $ 6,493,207.70 $ 7,514,154.19 -------------- -------------- $ 427,457.23$ 364,502.20 24,B65,747.92 26,813,509.14 -266,056.35 221,505.08 311,031.57 -1,264,162.39 -24,487,383.84 -26,693,108.29 3,731,476.01 4,643,750.33 125,692.48 34,660.61 $ 4,707,965.02 $ 4,120,656.6B $ 0.00 $ 4,933,643.29 1,930,232.11 0.00 27,891.63 126.00 0.00 955.00 3,232,126.B8 207,004.88 -------------- -------------- $ 5,190,376.62 $ 5,141,603.17 -------------- -------------- $ 6,010,796.10 $ 6,493,207.70 ============== ============== The notes to the financial statements are an integral part of this statement. - 7- DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30. 1994 EXHIBIT "C" Page 1 FUNDS AVAILABLE REVENUES STATE APPROPRIATION General Appropriation Amended Appropriation Governor's Emergency Fund (See Schedule) Budget Adjustments Less: Lapsed Funds Total State Appropriation FEDERAL REVENUES (See Schedule) OTHER REVENUES RETAINED Audit Contracts Cafeteria Sales Court Settlement Equipment Funding for Vocational Education High School Program Georgia State Financing and Investment Commission Funding for Student Information System Project Georgia State Financing and Investment Commission Grants France-Mediaction and Vocational Mission Programs Indi~ent Care Trust Fund Program Lettie Pate Evans Foundation Next Generation School Grants State Teacher of the Year ~rogram United States Senate Youth-Program Indirect Services Funding Department of Administrative Services Lottery Proceeds Atlanta School for the Deaf General Instruction/State Georgia Academy for the Blind Georgia Regional Library for the Blind Georgia School for the Deaf Reimbursements For Honorariums For Job Training Partnership Act For School Lunch and Milk Program For Telephone Expenses For Workshop Expenses Rents Received Sales Photocopies and Publications Recycled Materials Timber Video Fees Total Other Revenues Retained Total Revenues CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance Federal Financial Assistance Inventories Carnegie Corporation Grant Education Commission of the States Grant Georgia-Lorraine Exchange Program Georgia School for the Deaf School Improvements Leg~slative Video Program Mellon School/College Collaboration Grant QBE Formula Grants State Teacher of the Year Program United States Senate Youth Program Total Carry-Over from Prior Year TOTALS YEAR ENDED JUNE 30. 1994 JUNE 30. 1993 $3,216,277,608.00 $3,031,122,006.00 180,667,171.00 42,787,685.00 405,487.00 203,400.00 -10.030.931.00 0.00 $3,387,319,335.00 $3,074,113,091.00 5.618,469.00 1,500.000.00 $3.381.700.866.00 $3.072.613.091.00 $ 508.786.886.29 $ 492,353.733.46 $ 664,571.29 $ 597,823.48 0.00 2,658.96 1,196.36 0.00 11,297,168.05 3,853,337.50 5,915,652.18 3,200,000.00 15,003.38 344,305.00 50,000.00 1,943,699.50 0.00 1,000.00 0.00 0.00 50,000.00 0.00 5,200.00 1,000.00 340,000.00 340,000.00 66,696.72 0.00 4,447.00 0.00 99,083.32 0.00 12,275.11 0.00 232,699.54 0.00 532,955.80 0.00 176,266.53 47.65 7,338.92 1,620.00 503,500.00 3,232.00 166,319.67 0.00 1,736.69 10,240.38 77,448.21 0.00 0.00 283.444.70 81,905.51 20.82 238,920.00 273.293.21 $,_.2..2l:..0!6;~6.=9.1:9=.~2~6 $ 9.329.188.22 $3.912.554.671.55 $3.574.296.012.68 $ 991,187.04 $ 85,000.00 0.00 0.00 1,228.45 238,920.00 500.00 11. 79 1,908,260.00 5,080.77 1,938.83 3,232,126.88 $ 77,846.51 94,000.00 20,610.16 2,484.45 1,228.45 0.00 500.00 5,093.79 0.00 3,665.77 1 575.75 207,004.88 Total Funds Available $3.915.786.798.43 $3.574.503.017.56 The notes to the financial statements are an integral part of this statement. - 8- DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30. 1994 EXHIBIT "C" Page 2 EXPENDITURES PERSONAL SERVICES Salaries and Wages EmRloyer's Contributions for: F. I .C.A. Retirement Health Insurance Personal Liability Insurance Unemplo,rnent Compensation Insurance Workers Compensation Insurance Assessments by Merit System REGULAR OPERATING EXPENSES Motor Vehicle Expenses Supplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Insurance and Bonding Tuition and Scholarships Other Operating Expenses (See Schedule) Duplicating and Rapid Copy Publications and Printing TRAVEL MOTOR VEHICLE PURCHASES EQUIPMENT Equipment Purchases Lease/Purchase of Equipment Rental of Equipment COMPUTER CHARGES Other Costs Supplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Other Operating Expenses (See Schedule) Software Equipment Equipment Purchases Per Diem, Fees and Contracts Per Diem and Fees Contracts Computer Billings, DOAS REAL ESTATE RENTALS TELECOMMUNICATIONS PER DIEM, FEES AND CONTRACTS Per Diem and Fees Contracts CAPITAL OUTLAY Per Diem, Fees and Contracts Per Diem and Fees Contracts TOTALS YEAR ENDED JUNE 30. 1994 JUNE 30. 1993 $ 26,758,888.05 $ 1,631,831.64 4,009,141.07 3,568,829.80 477,264.00 29,616.00 377,651.00 134,330.66 $_...3...6....,..9.._8..7....,,552.22 $ 26,395,797.47 1,616,535.96 3,932,287.90 3,245,426.49 402,865.00 19,042.00 244,191.00 139,478.71 35,995,624.53 $ 55,242.37 $ 1,408,067.78 1,416,021.38 303,145.17 53,220.24 6,850.00 1,035,530.79 289,861.98 286,371.33 $_ __.4....,8_5._4_...3...1..,1. 04 $ $____96...8_,..5...2..1.00 $ $ _ _ _ _ _ _..__, 113,896.72 $ 48,150.73 1,282,678.66 575,924.47 350,770.43 62,854.00 12,189.50 852,282.66 201,526.25 275,709.01 3,662,085.71 903 .051.69 0.00 $ 158,244.82$ 210,378.85 33,614.77 11,009.95 30,344.30 21,357.82 222,203.89 $ 242,746.62 $ 770,455.50$ 3,625,361.81 30.00 120,720.48 109,377.29 9,781,565.48 215,950.00 2,463,483.87 691,616.90 $___1_7..,..7._7___8__,._561.33 $ $_ __.1...,..4.,a8:=3,;,..4.. 79.24 $ $_ _ ____ 1,077,230.59 $ 309,406.88 1,816,918.69 40.83 2,230.15 106,925.21 3,736,793.70 71,214.00 1,288,212.71 591,891.50 7,923,633.67 2,153,450.22 967 .551.65 $ 1,424,977.72 $ 1,109,959.43 12,777,429.17 11,582,947.20 $ 14,202,406.89 $ 12,692,906.63 $ 0.00 $ 5,000.00 38,658.00 48,600.00 $ 38,658.00 $ 53,600.00 The notes to the financial statements are an integral part of this statement. - 9- DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30, 1994 EXHIBIT "C" Page 3 TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993 EXPENDITURES OTHER UTILITIES $ s_____ 861,s21.os 76__9__.,..1.._s_6._...o....1... QBE FORMULA GRANTS: Kindergarten\Grades 1 - 3 Grades 4 - 8 Grades 9 - 12 High School Laboratories Vocational Education Laboratories Special Education Gifted Remedial Education Staff Development and Professional Development Media Indirect Cost Pupil Transportation Local Fair Share Mid-Term Adjustment Reserve Textbook - 7 Year Cycle Textbook - Increased FTE Counts $ 759,921,314.00$ 751,461,519.00 721,385,180.00 700,793,074.00 297,422,530.00 299,625,646.00 124,988,870.00 107,088,791.00 102,574,758.00 99,674,648.00 278,830,860.00 259,710,473.00 40,026,562.00 35,763,301.00 59,244,823.00 57,541,020.00 28,987,901.00 20,748,780.00 87,721,767.00 85,311,350.00 600,119,184.00 583,201,228.00 126,831,106.00 125,212,107.00 -614,197,789.00 -594,509,675.00 68,563,220.00 62,734,041.00 0.00 -36,919,947.00 0.00 3,526,005.00 $2,682,420,286.00 $2,560,962,361.00 OTHER CATEGORICAL GRANTS: Equalization Formula Sparsity Grants In School Suspension Special Instructional Assistance Middle School Incentive Special Education Low-Incidence Grants $ 144,854,014.00 $ 153,097,318.00 2,966,091.00 3,452,877.00 20,901,157.00 20,515,623.00 51,051,591.00 42,162,178.00 56,908,600.00 49,852,255.00 411,712.00 415,326.00 $ 277,093,165.00 $ NON-QBE GRANTS: Education of Children of low-Income Families Retirement (H.B. 272 and H.B. 1321) Instructional Services for the Handicapped Tuition for the Multi-Handicapped Severely Emotionally Disturbed School Lunch (Federal) School Lunch (State) Supervision and Assessment of Students and Beginning Teachers and Performance-Based Certification Regional Education Service Agencies Georgia learning Resources System High School Program Special Education in State Institutions Governor's Scholarships Job Training Partnership Act Vocational Research and Curriculum Even Start Salaries and Travel of Public librarians Public Library Materials Talking Book Centers Public library M& 0 Child Care Lunch Program {Federal) Chapter II - Block Grant Flow Through Payment of Federal Funds to Board of Technical and Adult Education Education of Homeless Children/Youth Innovative Programs Technology Grants Next Generation School Grants Limited English - Speaking Students Program Drug-Free School (Federal J Emergency Immigrant Education Program Title II Math/Science Grant (Federal) Robert C. Byrd Scholarship (Federal) Health Insurance - Non-Cert. Personnel and Retired Teachers Pre-School Handicapped Program Mentor Teachers Pre-Kindergarten Program Public Library Construction Nutrition Education Advanced Placement Exams $ 186,023,794.03 $ 4,950,000.00 54,732,103.21 1,065,437.85 38,965,519.00 187,111,477.77 24,213,192.00 2,032,955.00 7,072,130.00 3,397,225.90 28,379,567.59 3,673,574.00 2,702,000.00 0.00 293,213.00 2,720,906.00 11,183,401.47 5,718,136.33 911,019.00 4,039,390.00 24,579,610.97 9,663,513.00 14,633,712.73 601,772.27 1,524,035.00 0.00 2,945,000.00 7,452,253.00 11,625,942.51 164,514.00 5,162,004.51 273,723.00 90,047,892.00 14,112,004.00 999,940.00 0.00 0.00 0.00 1,056,649.00 The notes to the financial statements are an integral part of this statement. 269,495,577.00 198,714,080.90 4,600,914.00 51,519,022.71 1,529,876.88 37,034,242.39 165,074,766.24 23,265,716.00 2,001,750.00 6,944,268.00 3,190,796.66 25,063,945.08 3,818,413.00 2,378,647.00 2,598,867.47 258,213.00 1,375,167.00 10,762,697.23 4,568,218.54 871,713.00 3,764,427.98 22,464,115.19 10,019,305.67 13,341,906.64 186,752.00 2,348,634.44 375,000.00 0.00 6,009,348.00 12,505,816.87 228,503.17 4,570,112.00 253,000.00 67,167,892.00 11,525,052.00 703,740.00 2,593,489.00 411,994.00 57,032.00 920,000.00 - 10 - DEPARTMENT DF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30, 1994 EXHIBIT "C" Page 4 EXPENDITURES Qifil.B. NON-QBE GRANTS: Family Connection Grants Youth Apprenticeship Grants Serve America LOTTERY FOR EDUCATION: Pre-Kindergarten for 4-year-olds Personal Services Salaries and Wages Employer's Contributions for: F. I .C.A. Retirement Hea 1th Insurance Personal Liability Insurance Assessments by Merit System Other Costs Supplies and Materials Insurance and Bonding Grants to Counties, Cities and Civil Divisions Other Operating Expenses (See Schedules) Duplicating and Rapid Copy Publications and Printing Travel Equipment Equipment Purchases Computer Charges Software Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Lottery Grants Computer Hardware/Software in Classrooms Next Generation Schools Distant Learning - Hardware and Cabling Postsecondary Options Educational Technology Centers Safe Schools Grant Media Center and Library Equipment Learning Logic Sites Algebra Classrooms Drug and Anti-Violence Education Total Other Total Expenditures Excess of Funds Available over Expenditures TOTALS YEAR ENDED JUNE 30 1 1994 JUNE 30 1 1993 $ 1,982,199.00 $ 280,272.00 382,597.00 0.00 0.00 356,345.00 $ 756,672.676.14 $ 705,373,781.06 $ 170,163.83 $ 0.00 2,845.30 0.00 20,414.05 0.00 21,270.60 0.00 2,928.00 0.00 851.64 0.00 19,964.15 0.00 36.00 0.00 35,188,544.98 0.00 1,238.26 0.00 3,136.52 0.00 741.87 0.00 24,822.75 0.00 85,150.13 0.00 4,253.00 0.00 144.04 0.00 18,978.78 0.00 $ 35,565,483.90 $ 0.00 32,889,196.00 0.00 1,000,000.00 0.00 14,111,078.00 0.00 545,855.26 0.00 1,236,400.00 0.00 20,000,000.00 0.00 37,450,000.00 0.00 924,000.00 0.00 752,700.00 0.00 1,025,000.00 0.00 $ 145.499.713.16 $ 0.00 $3.862.547.361.35 $3.536.601,475.13 $3,940,274,182.27 $3,601,196,125.85 -24,487.383.84 -26,693,108.29 $3,915.786,798.43 $3.574.503.017.56 The notes to the financial statements are an integral part of this statement. - 11 - DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BUDGET FUND "A" DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30, 1994 EXHIBIT "D" Page 1 FUNDS AVAILABLE REVENUES State Appropriation Federal Revenues Other Revenues Retained CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance BUDGET ACTUAL VARIANCE FAVORABLE (UNFAVORABLE) $3,239,196,636.00 $3,235,446,636.00 $ -3,750,000.00 693,665,934.00 508,786,886.29 -184,879,047.71 24,171,865.00 22,066,919.26 -2,104.945.74 $3,957,034,435.00 $3,766,300,441.55$ -190,733,993.45 0.00 3,232,126.88 3,232,126.88 $3,957,034,435.00 $3,769.532,568.43 $ -187.501.866.57 EXPENDITURES Personal Services Regular Operating Expenses Travel Motor Vehicle Purchases Equipment Computer Charges Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Capital Outlay Utilities QBE Formula Grants: Kindergarten\Grades 1 - 3 Grades 4 - 8 Grades 9 - 12 High School laboratories Vocational Education Laboratories Special Education Gifted Remedial Education Staff Development and Professional Development Media Indirect Cost Pupil Transportation Local Fair Share Mid-Term Adjustment Reserve Other Categorical Grants: Equalization Formula Sparsity Grants In School Suspension Special Instructional Assistance Middle School Incentive Special Education Low - Incidence Grants Non-QBE Grants: Education of Children of Low-Income Families Retirement (H.B. 272 and H.B. 1321) Instructional Services for the Handicapped Tuition for the Multi-Handicapped Severely Emotionally Disturbed School Lunch (Federal) School lunch (State) $ 37,493,212.00$ 36,987,552.22 $ 5,728,749.00 4,854,311.04 1,282,649.00 968,521.00 117,900.00 113,896.72 532,453.00 222,203.89 18,626,419.00 17,778,561.33 1,476,911.00 1,483,479.24 1,278,638.00 1,077,230.59 15,762,792.00 14,202,406.89 50,000.00 38,658.00 881,922.00 861,521.05 505,659.78 874,437.96 314,128.00 4,003.28 310,249.11 847,857.67 -6,568.24 201,407.41 1,560,385.11 11,342.00 20,400.95 759,921,314.00 721,385,180.00 297,422,530.00 124,988,870.00 102,574,758.00 278,830,860.00 40,026,562.00 59,244,823.00 28,992,874.00 87,721,767.00 600,119,184.00 128,798,307.00 -614,197,789.00 68,646,330.00 759,921,314.00 721,385,180.00 297,422,530.00 124,988,870.00 102,574,758.00 278,830,860.00 40,026,562.00 59,244,823.00 28,987,901.00 87,721,767.00 600,119,184.00 126,831,106.00 -614,197,789.00 68,563,220.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4,973.00 0.00 0.00 1,967,201.00 0.00 83,110.00 144,854,014.00 3,609,604.00 20,901,157.00 51,051,591.00 56,822,863.00 416,000.00 144,854,014.00 2,966,091.00 20,901,157.00 51,051,591.00 56,908,600.00 411,712.00 0.00 643,513.00 0.00 0.00 -85,737.00 4,288.00 192,531,488.00 4,950,000.00 55,060,784.00 2,047,671.00 38,966,173.00 314,456,650.00 24,332,066.00 186,023,794.03 4,950,000.00 54,732,103.21 1,065,437.85 38,965,519.00 187,111,477.77 24,213,192.00 6,507,693.97 0.00 328,680.79 982,233.15 654.00 127,345,172.23 118,874.00 The notes to the financial statements are an integral part of this statement. - 12 - DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BUDGET FUND "A" DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30 1 1994 EXHIBIT "D" Page 2 EXPENDITURES Non-QBE Grants: Supervision and Assessment of Students and Beginning Teachers and Performance-Based Certification Regional Education Service Agencies Georgia Learning Resources System High School Program Special Education in State Institutions Governor's Scholarships Vocational Research and Curriculum Even Start Salaries and Travel of Public Librarians Public Library Materials Talking Book Centers Public Library M& 0 Child Care Lunch Program (Federal) Chapter II - Block Grant Flow Through Payment of Federal Funds to Board of Technical and Adult Education Education of Homeless Children/Youth Innovative Programs Next Generation School Grants Limited English - Speaking Students Program Drug-Free School (Federal) Transition Program for Refugees Emergency Immigrant Education Program Title II Math/Science Grant (Federal) Robert C. Byrd Scholarship (Federal) Health Insurance - Non-Cert. Personnel and Retired Teachers Pre-School Handicapped Program Mentor Teachers Nutrition Education Advanced Placement Exams Family Connection Grants Youth Apprenticeship Grants Serve America 1lliQfilI ACTUAL VARIANCE FAVORABLE (UNFAVORABLE) $ 2,062,000.00 $ 2,032,955.00 $ 7,072,186.00 7,072,130.00 3,417,151.00 3,397,225.90 33,159,328.00 28,379,567.59 3,991,103.00 3,673,574.00 2,702,000.00 2,702,000.00 298,270.00 293,213.00 2,780,622.00 2,720,906.00 11,198,623.00 11,183,401.47 7,701,969.00 5,718,136.33 911,019.00 911,019.00 4,039,390.00 4,039,390.00 31,496,955.00 24,579,610.97 10,783,825.00 9,663,513.00 17,198,206.00 631,607.00 2,450,000.00 3,000,000.00 7,452,253.00 12,213,181.00 119,012.00 223,824.00 5,203,464.00 273,723.00 14,633,712.73 601,772.27 1,524,035.00 2,945,000.00 7,452,253.00 11,625,942.51 0.00 164,514.00 5,162,004.51 273,723.00 90,047,892.00 14,112,300.00 1,000,000.00 68,500.00 1,048,000.00 1,988,102. 00 280,272.00 402,382.00 90,047,892.00 14,112,004.00 999,940.00 0.00 1,056,649.00 1,982,199.00 280,272.00 382,597.00 29,045.00 56.00 19,925.10 4,779,760.41 317,529.00 0.00 5,057.00 59,716.00 15,221.53 1,983,832.67 0.00 0.00 6,917,344.03 1,120,312.00 2,564,493.27 29,834.73 925,965.00 55,000.00 0.00 587,238.49 119,012.00 59,310.00 41,459.49 0.00 0.00 296.00 60.00 68,500.00 -8,649.00 5,903.00 0.00 19,785.00 $3,957.034,435.00 $3.794.774,469.11 $ 162.259,965.89 Excess of Funds Available over Expenditures $ -25.241.900.68 $ -25.241.900.68 The notes to the financial statements are an integral part of this statement. - 13 - DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES COMPARED TO BUDGET BUDGET FUND "B" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 1994 EXHIBIT "E" FUNDS AVAILABLE REVENUES State Appropriation EXPENDITURES Pre-Kindergarten for 4-year-olds Computer Hardware/Software in Classrooms Next Generation Schools Distant Learning - Hardware and Cabling Postsecondary Options Educational Technology Centers Safe Schools Grant Media Center and Library Equipment Learning Logic Sites Algebra Classrooms Drug and Anti-Violence Education Excess of Funds Available over Expenditures BUDGET ACTUAL VARIANCE FAVORABLE (UNFAVORABLE) $148,122,699.00 $146,254,230.00$ -1,868,469.00 ============== -------------- -------------- $ 36,346,000.00 $ 35,565,483.90 $ 33,087,500.00 32,889,196.00 1,000,000.00 1,000,000.00 14,138,078.00 14,111,078.00 1,585,221.00 545,855.26 1,236,400.00 1,236,400.00 20,000,000.00 20,000,000.00 38,027,500.00 37,450,000.00 924,000.00 924,000.00 753,000.00 752,700.00 1,025,000.00 1,025,000.00 780,516.10 198,304.00 0.00 27,000.00 1,039,365.74 0.00 0.00 577,500.00 0.00 300.00 0.00 $148,122,699.00 $145,499,713.16$ 2,622,985.84 ============== -------------- -------------- $ 754,516.84$ 754,516.84 The notes to the financial statements are an integral part of this statement. - 14 - DEPARTMENT OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 1994 EXHIBIT "F" REVENUES Interest Earned EXPENDITURES None Recorded Excess of Revenues over Expenditures OTHER FINANCING USES Operating Transfers Out Excess of Revenues over Expenditures and Other Financing Uses FUND BALANCE JULY 1, 1993 FUND BALANCE JUNE 30, 1994 ENDOWMENT CORPUS PUPILS' TRUST FUND - GEORGIA ACADEMY FOR THE BLIND $ 823.50 0.00 $ 823.50 -823.50 $ 0.00 13,500.00 $ 13,500.00 ================ The notes to the financial statements are an integral part of this statement. - 15 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATE:MENTS JUNE 30, 1994 EXHIBIT "G" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Department ofEducation, an organizational unit of the State of Georgia, is part ofthe executive branch ofthe government ofthe State of Georgia. The State Board ofEducation is composed of one member from each Congressional District in the State, appointed by the Governor and confirmed by the Senate. The Board adopts and prescribes rules, regulations and policies as may be necessary for operating of public education in Georgia. The State School Superintendent is elected by qualified voters of the State. The Superintendent is the Executive Officer of the State Board of Education and the Administrative Officer of the Department of Education. The Superintendent is responsible for the operation and the enforcement ofthe rules, regulations, policies and standards adopted by the State Board ofEducation. The Department ofEducation does not have authority to determine the amount of funding it will receive from the State of Georgia for any given fiscal year. Such authority is vested in the General Assembly of Georgia. The Department also does not have authority to retain unexpended State appropriations (surplus) for any given fiscal year. Accordingly, the Department ofEducation is included within the State of Georgia reporting entity for financial reporting purposes because ofthe significance of its legal, operational and financial relationships with the State ofGeorgia. These reporting entity relationships are defined in Section 2100 ofthe Governmental Accounting Standards Board Codification of Governmental Accounting and Financial Reporting Standards. FUND ACCOUNTING The Department ofEducation uses funds and account groups to report on its financial position and the results ofits operations determined in conformity with accounting practices prescribed or permitted by statutes and regulations ofthe State ofGeorgia. 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, on the other hand, 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 net expendable available financial resources. Funds and account groups presented in the accompanying financial statements are as follows: GOVERNMENTAL FUND TYPE BUDGET FUND - The fund used to account for activities and functions as set forth in the Amended Appropriations Act of 1993-1994. The Budget Fund is similar in nature to a General Fund as identified in generally accepted accounting principles in that the Budget Fund is used to account for all activities except those required to be accounted for in some other fund. FIDUCIARY FUND TYPES NONEXPENDABLE TRUST FUND - The fund used to account for assets, revenues and expenditures utilized in accordance with the provisions of a trust established by individual agreement. Nonexpendable - 16 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXlilBIT "G" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FUND ACCOUNTING FIDUCIARY FUND TYPES NONEXPENDABLETRUSTFUND trust funds are used when only the revenues earned on the principal (corpus) ofthe trust may be expended for the purposes designated in the trust agreement and the principal of the trust agreement must remain intact. AGENCY FUNDS - The funds used to account for assets held for use by other funds, governments, or individuals. ACCOUNT GROUPS GENERAL FIXED ASSETS - The account group used to account for fixed assets used in governmental fund type operations. Fixed assets purchased are recorded at historical cost. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. No depreciation has been provided on general fixed assets. GENERAL LONG-TERM DEBT - The account group used to report the noncurrent portions of certain governmental long-term liabilities, such as claims, judgments and compensated absences, which will be paid from future resources. BASIS OF ACCOUNTING MEASUREMENT FOCUS The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. Governmental funds should be accounted for using the 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 decreases (i.e., expenditures) in net current assets. Nonexpendable trust funds, on the other hand, should be accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities are included on the balance sheet. Operating statements of these funds present increases, (i.e., revenues) and decreases (i.e., expenses) in net total assets. In accordance with accounting practices prescribed or permitted by the State of Georgia, the Nonexpendable Trust Fund utilizes the current financial resources measurement focus. GOVERNMENTAL FUND TYPE BUDGET FUND Except as disclosed in the following paragraphs, units of government of the State of Georgia record their Budget Fund revenues and expenditures in accordance with the modified accrual basis of accounting. Under the modified accrual basis ofaccounting, revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the 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. Revenues that are accrued include primarily State appropriations, Federal - 17 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXIilBIT "G" NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING GOVERNMENTAL FUND TYPE BUDGET FUND grants and entitlements, and certain amounts earned under operating agreements with other parties. Further, the modified accrual basis ofaccounting calls for expenditures, other than accrued interest of general long-term debt, to be recorded when the related fund liability is incurred. Contractual obligations for services which have not been performed and for goods which have not been delivered at the end of the fiscal year are recognized as expenditures and liabilities in the accompanying ( financial statements. This accounting practice causes expenditure-driven grant revenues to be accrued based in part on the unexecuted portion of contracts for goods and services. The recognition of encumbrances as expenditures and liabilities is in conformity with accounting practices prescribed or permitted by statutes and regulations ofthe State ofGeorgia, but is not consistent with generally accepted accounting principles, which provide for the recording of encumbrances as a reservation offund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles. Prior period adjustments and certain other items are reported as additions to and deductions from fund balances ofthe Budget Fund in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations ofthe State of Georgia, but differs from generally accepted accounting principles in that immaterial adjustments should be reported as current period revenues and expenditures. FIDUCIARY FUND TYPES NONEXPENDABLE TRUST FUND The Nonexpendable Trust Fund is maintained in accordance with the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable means the amount of the 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. Revenues that are accrued include primarily interest income. Expenditures are recorded when the related fund liability is incurred. This basis of accounting differs from generally accepted accounting principles in that nonexpendable trust funds should be maintained on the accrual basis of accounting. A statement ofCash Flows is not presented for the Nonexpendable Trust Fund in the accompanying financial statements as required by generally accepted accounting principles. AGENCY FUNDS The Agency Funds are custodial in nature in that assets are equally offset by liabilities to other funds, governmental units, or individuals. The modified accrual basis of accounting is utilized for recognizing assets and liabilities. - 18 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXlilBIT "G" NOTE 1: SUM!vfARY OF SIGNIFICANT ACCOUNTING POLICIES BUDGET Appropriation allotments to the Department of Education are on the basis of budgets submitted by the Department and approved by the Legislature and the Governor. The budgets are compiled in the same manner as all State departments and expenditures are classified by budget unit object classes as provided in Act No. 608 ofGeorgia Laws 1993 (as approved April 28, 1993) and amended by Act No. 622 of Georgia Laws 1994 (as approved February 8, 1994), which is an appropriated budget and is referred to in these notes as the Amended Appropriations Act of 1993-1994. CASH AND CASH EQUIVALENTS Cash and Cash Equivalents include currency on hand, demand deposits with banks and other financial institutions, and cash management pools that have the general characteristics of demand deposit accounts in that the Department may deposit additional cash at any time and also may withdraw cash at any time without prior notice or penalty. INVESTMENTS Investments are defined as those financial instruments with terms of three months or more from the date of purchase and certain other securities held for the production of revenue. Investments are stated at cost. INVENTORIES SUPPLY Inventories of supplies are valued at first-in, first-out (FIFO) on the Combined Balance Sheet (Statutory Basis). The consumption method is used to account for the use of inventories. Under the consumption method, the costs of inventories are recorded as expenditures when consumed rather than when purchased. DONATED FOOD Inventories are shown on the Combined Balance Sheet (Statutory Basis) at a value established by the U. S. Department ofAgriculture. RESERVED FUND BALANCE Reserves represent those portions of fund equity not appropriable for expenditure or legally segregated for a specific future use. The following is a brief description of the reserves reflected in the accompanying financial statements: FEDERAL FINANCIAL ASSISTANCE The residual portion ofFederal financial assistance revenues not yet expended or encumbered. This amount is restricted for expenditure in future years. This accounting treatment differs from generally accepted accounting principles in that the unearned portion of Federal financial assistance should be reflected as deferred revenue. - 19 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATE1\1ENTS JUNE 30, 1994 EXHIBIT "G" NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RESERVED FUND BALANCE INVENTORIES SUPPLY Reported inventories, under the consumption method, are offset by a portion of State funds to provide working capital for managing a reasonable level of inventories. DONATED FOOD Donated food inventories are equally offset by an amount to indicate that they do not constitute "available expendable resources" even though they are a component of net current assets. The fund balance reserve is based on values established by the U.S. Department of Agriculture. FRANCE-MEDIACTION AND VOCATIONAL MISSION PROGRAMS The residual portion ofa grant awarded by the French Government not yet expended or encumbered. This amount is restricted for expenditures in future years. GEORGIA ACADEMY FOR THE BLIND - PUPILS' TRUST FUND The fund used to account for the principal of an endowment to be preserved intact and invested with the resultant income to be transferred to the Fiduciary Fund Type - Agency Funds (Student Activities Account Georgia Academy for the Blind). GEORGIA-LORRAINE EXCHANGE PROGRAM The residual portion ofa grant awarded by the French Government not yet expended or encumbered. This amount is restricted for expenditure in future years. GEORGIA SCHOOL FOR THE DEAF - SCHOOL IMPROVEMENTS The proceeds from timber sales not yet expended or encumbered. This amount is restricted for expenditure in future years. LEGISLATIVE VIDEO PROGRAM The residual portion of a grant awarded by various associations not yet expended or encumbered. This amount is restricted for expenditure in future years. MELLON SCHOOUCOLLEGE COLLABORATION GRANT The residual portion ofa grant awarded by the Council of Chief State School Officers not yet expended or encumbered. This amount is restricted for expenditure in future years. SCHOOL NURSE PROGRAM The residual portion of a grant awarded by the Department of Human Resources not yet expended or encumbered. This amount is restricted for expenditure in future years. -20- DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXHIBIT "G" NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RESERVED FUND BALANCE STATE TEACHER OF THE YEAR PROGRAM The residual portion ofa grant awarded by the Council of Chief State School Officers not yet expended or encumbered. This amount is restricted for expenditure in future years. UNITED STATES SENATE YOUTH PROGRAM The residual portion of a grant awarded by the William Randolph Hearst Foundation not yet expended or encumbered. This amount is restricted for expenditure in future years. VOCATIONAL EDUCATION GENERAL OBLIGATION FUNDS The residual portion of refunds from local school systems due to the Georgia State Financing and Investment Commission at fiscal year end. This amount is restricted for payment to the Georgia State Financing and Investment Commission. COMPENSATED ABSENCES Compensated absences represent obligations of the Department relating to employee's rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulating annual leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion ofthis obligation as this amount will not be liquidated with expendable available financial resources. Funds are provided in the appropriation of funds each year to the Department to cover the cost of annual leave paid to terminated employees. The liability for compensated absences at year end is reported in the General Long-Term Debt Account Group for governmental funds. MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the Combined Balance Sheet (Statutory Basis) are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position 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. COMPARATIVE DATA Comparative total data for the prior year have been presented in the accompanying financial statements in order to provide an understanding ofchanges in the Department's financial position and operations. However, comparative data have not been presented in all statements because their inclusion would make certain statements unduly complex and difficult to understand. NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds of the State of Georgia cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as - 21 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXIIlBIT "G" NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES collateral any one or more ofthe following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59: (1) Bonds, bills, notes, certificates ofindebtedness or other direct obligations ofthe United States or of the State of Georgia. (2) Bonds, bills, notes, certificates ofindebtedness or other obligations ofthe counties or municipalities ofthe State of Georgia. (3) Bonds ofany public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose. (4) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia. (5) Bonds, bills, certificates of indebtedness, notes, 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 Banlc, the Federal Intermediate Credit Banlc, the Central Banlc for Cooperatives, the Fann Credit Banlcs, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. (6) Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation. As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies ofthe State of Georgia the option of exempting demand deposits from the collateral requirements. CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all banlc balances which include demand deposits and/or interest bearing accounts. These banlc balances are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk. Category 1 - Amounts covered by depository insurance or collateralized with securities (at market value) held by the Department or by its agent in the Department's name. Category 2 - Amounts collateralized with securities (at market value) held by the financial institution's trust department or agent in the Department's name. - 22- DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXIIlBIT "G" NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS CATEGORIZATION OF DEPOSITS Category 3 - Amounts collateralized with securities (at market value) held by the financial institution or by its trust department or agent, but not in the Department's name, and amounts uncollateralized. Canying ~ Bank Balance Risk Categories 2 3 Cash Deposits S -967 949 23 S 2 964 970 86 S 972.776 00 S 87 969,91 S I 904.224,95 CATEGORIZATION OF INVESTMENTS Investments are stated at cost. The carrying amount shown below is maintained in an investment pool by the Office of Treasury and Fiscal Services. Type ofInvestment Carrying Amount Market Value State Investment Pool $ 170,689.00 $ 170,689.00 NOTE 3: OPERATING LEASES The Department ofEducation has entered into certain agreements to lease real property and equipment which are classified as operating leases. These leases generally contain provisions that, at the expiration date ofthe original term ofthe lease, the Department has the option ofrenewing the lease on a year-to-year basis. Future minimum commitments for operating leases as ofJune 30, 1994, are listed below. Amounts are included only for multi-year leases and for cancellable leases for which an option to renew for the subsequent fiscal year has been exercised. Fiscal Year Ending June 30 1995 $ 136 827.75 Expenditures for rental of real property and equipment under operating leases for the year ended June 30, 1994, totaled $512,054.75. NOTE 4: INSTALLMENT PURCHASE COMMITMENTS The Department of Education acquires certain property and equipment through multi-year installment purchases with varying terms and options. The majority ofthese agreements contain fiscal funding clauses in accordance with O.C.G.A. 50-5-64 which prohibits the creation of a debt to the State of Georgia for the payment ofany sums under such agreements beyond the fiscal year of execution if appropriated funds are not available. If renewal of such agreements is reasonably assured, however, installment purchases requiring - 23 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXIIlBIT "G" NOTE 4: INSTALLMENT PURCHASE COMMITMENTS appropriation by the General Assembly of Georgia are considered noncancellable for financial reporting purposes. At June 30, 1994, future minimum commitments under installment purchases are as follows: Fiscal Year Ending June 30 1995 1996 1997 1998 1999 $ 57,167.88 48,767.62 44,917.52 35,698.32 12,291.24 Total Future Minimum Commitments $ 198,842.58 Less: Amounts Representing Interest 26,286.38 Present Value ofFuture Minimum Commitments $ 172,556.20 NOTE 5: CHANGES IN GENERAL FIXED ASSETS In accordance with the statutory definition of moveable personal property as defined in Official Code of Georgia Annotated Section 50-16-161, only those items with an acquisition cost of$1,000.00 or greater are reflected in the General Fixed Assets Account Group. The following is a summary of changes of equipment in the General Fixed Assets Account Group during the fiscal year: Balance July 1, 1993 $18,440,832.43 Additions Deductions 5,529,641.28 406,984.48 Balance June 30, 1994 $23,563,489.23 NOTE 6: GENERAL LONG-TERM DEBT CHANGES IN GENERAL LONG-TERM DEBT A summary of changes in General Long-Term Debt for the year ended June 30, 1994, follows: - 24- DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXHIBIT "G" NOTE 6: GENERAL LONG-TERM DEBT Compensated Absences Installment Purchase Commitments Total Balance July 1, 1993 $2,592,329.70 $ 24,720.81 $ 2,617,050.51 Additions Annual Leave Earned and Utilized (Net) Salaries Salary Related Fringe Benefits (*) Current Year Purchases Deductions 113,018.14 206,959.11 178,512.00 30,676.61 113,018.14 206,959.11 178,512.00 30,676.61 Balance June 30, 1994 $ 2.912,306.25 $ 172,SS~.20 $ 3,Q84,863.1S (*) Includes related fringe benefits applicable to compensated absences at July 1, 1993. NOTE 7: DEFERRED COMPENSATION PLAN The State ofGeorgia offers its employees a deferred compensation plan in accordance with Internal Revenue Code Section 457. The plan, available to employees of the State of Georgia and county health departments, permits such employees to defer a portion of their salary until future years. Participants choose the option or options in which they wish to participate. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property or rights ofthe State ofGeorgia subject only to the claims of the State's general creditors. Participant's rights under the plan are equal to those of a general creditor of the State of Georgia in an amount equal to the fair market value ofthe deferred account ofeach participant. Financial information relative to the plan is presented in the financial report ofthe State Personnel Board - Merit System ofPersonnel Administration for the year ended June 30, 1994. NOTE 8: RETIREMENT PLANS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA The Department ofEducation participates in the Employees' Retirement System of Georgia, a single-employer, defined benefit pension plan. The Employees' Retirement System of Georgia was established by the General Assembly of Georgia for the purpose of providing retirement allowances for employees of the State of Georgia. The Retirement System is funded through a combination of employee and employer contributions. -25 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXHIBIT "G" NOTE 8: RETIREMENT PLANS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA Employees are required to contribute a graduated percentage ofannual compensation. Employer contributions are for a specified percentage ofactive member payroll determined annually by an actuarial valuation. During the year ended June 30, 1994, the Department contributed $3,476,246.06 to the Employees' Retirement System ofGeorgia. Participation in the Retirement System is not segregated by employee groups ofindividual governmental units and the Department has no further liability under the retirement system other than future employer contributions as established for each fiscal year. Information relative to the plan description, funding status and historical trends is presented in the financial report ofthe Employees' Retirement System of Georgia for the year ended June 30, 1994. TEACHERS RETIREMENT SYSTEM OF GEORGIA The Department ofEducation participates in the Teachers Retirement System ofGeorgia, a single-employer, defined benefit pension plan. The Teachers Retirement System of Georgia was established by the General Assembly of Georgia for the purpose of providing retirement allowances for employees of the State of Georgia. The Retirement System is funded through a combination of employee and employer contributions. Employees are required to contribute a graduated percentage ofannual compensation. Employer contributions are for a specified percentage ofactive member payroll determined annually by an actuarial valuation. During the year ended June 30, 1994, the Department contributed $553,309.06 to the Teachers Retirement System of Georgia. Participation in the Retirement System is not segregated by employee groups of individual governmental units and the Department has no further liability under the retirement system other than future employer contributions as established for each fiscal year. Information relative to the plan description, funding status and historical trends is presented in the financial report ofthe Teachers Retirement System of Georgia for the year ended June 30, 1994. GEORGIA DEFINED CONTRIBUTION PLAN The State ofGeorgia also provides retirement coverage for temporary, seasonal, and part-time employees who are not eligible for membership in the Employees' Retirement System of Georgia referred to above through a single-employer defined contribution plan. The Georgia Defined Contribution Plan was established by the General Assembly of Georgia and is administered by the Board of Trustees of the Employees' Retirement System of Georgia. Covered employees are required to contribute 7.5% of their gross salary, with no matching contribution by the employer. A member who terminates employment may apply for a refund of contributions and interest. Benefits are based solely on the amount contributed by the employee plus investment earnings. Upon discretion ofthe Board ofTrustees, members who leave employment with less than $3,500.00 credited to their account may be required to make a lump-sum withdrawal. Members are eligible to retire at the age of65 with the option ofreceiving a periodic payment based on mortality tables and interest accumulation as adopted by the Board of Trustees of the Employees' Retirement System of Georgia. Information relative to the plan description and funding status is presented in the financial report of the Employees' Retirement System ofGeorgia for the year ended June 30, 1994. - 26- DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994 EXIIlBIT "G" NOTE 9: LEAVE POLICIES Employees earn ten hours of sick leave each month with a maximum accumulation of ninety days. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment. Employees earn annual leave ranging from ten to fourteen hours each month depending upon the employees' length ofcontinuous State service with a maximum accumulation offorty five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment. See Note 1 - Compensated Absences Certain employees who retire with one hundred and twenty days or more of forfeited annual and sick leave are entitled to additional service credit in the Employees' Retirement System of Georgia. NOTE 10: NONMONETARY TRANSACTIONS The Georgia State Financing and Investment Commission (GSFIC), a unit of State government, is responsible for the issuance of state debt and for the investment and accounting for proceeds derived from the issuance of state debt. In addition, GSFIC-is authorized to acquire and construct projects for the benefit of units of State government or to contract with units of State government for the construction or acquisition of capital outlay projects. During the fiscal year ended June 30, 1994, the Georgia State Financing and Investment Commission paid $188,931,303.63 to various vendors for approved projects related to the Department of Education. Certain programs administered by the Federal government provide donated commodities to the Department ofEducation in lieu of monetary assistance. An analysis of nonmonetary assistance received and the values assigned by the Federal government during the year under review is reflected below: Agriculture, U. S. Department of Food Distribution Temporary Emergency Food Assistance $ 28,985,373.00 $ 5,161,804.00 In accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, the revenues and expenditures associated with the nonmonetary assistance are not reflected on Exhibit "C", Statement ofFunds Available and Expenditures. NOTE 11: CONTINGENCIES Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. This could result in refunds to the grantor agency for any expenditures which are disallowed under grant terms. The amount of expenditures which may be disallowed by the grantor cannot be determined at this time although the Department expects such amounts, if any, to be immaterial to its overall financial position. - 27 - DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATE:MENTS JUNE 30, 1994 EXlflBIT "G" NOTE 11: CONTINGENCIES Litigation, claims and assessments filed against the Department ofEducation, if any, are generally considered to be actions against the State of Georgia. Pursuant to the Official Code of Georgia Annotated, the Department ofAdministrative Services maintains a program of purchased insurance and self- insurance which provides coverage for such litigation, claims and assessments. Accordingly, significant litigation, claims and assessments pending against the State ofGeorgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1994. NOTE 12: BONDING INFORMATION The State Superintendent of Schools and all employees ofthe Department ofEducation are bonded under a Public Employees Blanket Bond written by Employers Insurance ofWausau, their Bond No. 1450-00-110723, on which the premium was paid to October 1, 1994. Under this agreement the Public Employee Dishonesty Coverage insures the Department to a maximum of$1,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees. The Faithful Performance ofDuty Coverage insures the Department to a maximum of $100,000.00 against loss sustained from failure of its employees to perform faithfully their duties or to account properly for all monies and property received by virtue of their position or employment. All employees ofthe Department ofEducation are also bonded under a Commercial Crime Policy written by the United States Fire Insurance Company, their Policy No. 626011675 2, on which the premium was paid to October 1, 1994. Under this additional public employee dishonesty coverage, the policy insures the Department to a maximum of $4,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees. - 28 - SUPPLEMENTARY INFORMATION -29- DEPARTMENT OF EDUCATION COMBINING BALANCE SHEET (STATUTORY BASIS) BUDGET FUND JUNE 30, 1994 EXHIBIT "H" ASSETS Cash and Cash Equivalents Accounts Receivable State Appropriation Federal Financial Assistance Other Inventories Supply Donated Food "A" DEPARTMENT OF EDUCATION "B" LOTTERY FOR EDUCATION TOTAL $ 506,485.32 $ 506,485.32 $16,094,251.92 $72,912,376.00$ 89,006,627.92 90,304,396.28 90,304,396.28 8,748,077.83 8,748,077.83 $115,146,726.03$ 72,912,376.00 $188,059,102.03 $ 75,169.94 1,375,823.93 -------------$---1-,4-5--0-,9-9--3-.8--7 $ 75,169.94 1,375,823.93 -------------$---1-,4--5-0-,9--9-3-.8--7 Total Assets $116,597,719.90 $ 73,418,861.32 $190,016,581.22 ============== ============== ============== LIABILITIES AND FUND EQUITY Liabilities Cash Overdraft Accounts Payable Contracts Payable Grants Payable Payroll Withholdings Total Liabilities $ 2,436,890.34 8,206,137.02 $ $ 77,694.13 2,436,890.34 8,283,831.15 5,063,122.20 5,063,122.20 95,282,190.16 72,583,407.34 167,865,597.50 -----3-5-3-,1--0-0-.9--2 -------3-,2-4--3-.0-1- -----3-5-6-,3--4-3-.9--3 $111,341,440.64$ 72,664,344.48 $184,005,785.12 Fund Equity Fund Balances Reserved Federal Financial Assistance Inventories Supply Donated Food Food Distribution Program Temporary Emergency Food Assistance Program France-Mediaction and Vocational Mission Programs Georgia-Lorraine Exchange Program Georgia School for the Oeaf School Improvements Legislative Video Program Mellon School/College Collaboration Grant School Nurse Program State Teacher of the Year Program United States Senate Youth Program Vocational Education General Obligation Funds Unreserved Designated Surplus Regular Lottery for Education Total Fund Equity $ 1,104,179.48 85,000.00 252,055.47 1,123,768.46 13,227.45 1,228.45 38,719.23 500.00 20.83 571.93 1,855.54 2,392.32 3,116.90 $ 1,104,179.48 85,000.00 252,055.47 1,123,768.46 13,227.45 1,228.45 38,719.23 500.00 20.83 571.93 1,855.54 2,392.32 3,116.90 2,629,643.20 2,629,643.20 -------------- $-----7-5-4-,5--1-6-.8--4 -----7-5-4-,-5-1-6-.8--4 $---5-,2-5--6-,2--7-9-.2--6 $-----7-5-4-,-5-1-6-.8--4 $---6-,0--1-0-,7--9-6-.1--0 Total Liabilities and Fund Equity $=1=1=6=,=5=9=7=,7==1=9=.9==0 $==7=3=,4==1=8=,8==6=1=.3=2= $190,016,581.22 ============== See notes to the financial statements. - 30 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS) BUDGET FUND YEAR ENDED JUNE 30, 1994 EXHIBIT "I" "A" DEPARTMENT OF EDUCATION "B" LOTTERY FOR EDUCATION TOTAL FUND BALANCES - JULY 1 Reserved Unreserved Designated Surplus $ 4,562,975.59 1,930,232.11 $ $ 4,562,975.59 0.00 1,930,232.11 $ 6,493,207.70$ 0.00 $ 6,493,207.70 ADDITIONS Adjustments to Prior Year's Accounts Payable Grants Payable Change in Reserve for Inventory Donated Food Program Food Distribution Program Temporary Emergency Food Assistance Program Excess of Funds Available over Expenditures Exhibit "J" Reimbursement of Prior Year's Expenditures Grants Other $ 427,457.23 24,865,747.92 $ 427,457.23 24,865,747.92 -266,056.35 311,031.57 -25,241,900.68 $ 3,731,476.01 125,692.48 -266,056.35 311,031.57 754,516.84 -24,487,383.84 3,731,476.01 125,692.48 $ 3,953,448.18$ 754,516.84$' 4,707,965.02 DEDUCTIONS Unreserved Fund Balance (Surplus) Returned to Office of Treasury and Fiscal Services Year Ended June 30, 1993 Adjustment to Prior Year's Accounts Receivable Refund of Private Grant Reserved Fund Balance Carried Over from Prior Year as Funds Available FUND BALANCES - JUNE 30 $ 1,930,232.11 27,891.63 126.00 3,232,126.88 -------------- $ 5,190,376.62 -------------- $ 1,930,232.11 27,891.63 126.00 3,232,126.88 -------------- $ 5,190,376.62 -------------- (To Exhibit "H") See notes to the financial statements. $ 5,256,279.26$ 754,516.84$ 6,010,796.10 ============== ============== ============== - 31 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30. 1994 EXHIBIT "J" Page 1 "A" DEPARTMENT OF EDUCATION "B" LOTTERY FOR EDUCATION TOTAL FUNDS AVAILABLE REVENUES STATE APPROPRIATION General Appropriation Amended Appropriation Governor's Emergency Fund Budget Adjustments $3,153,523,530.00 $ 85,434,351.00 405,487.00 -166.732.00 62,754,078.00 $3,216,277,608.00 95,232,820.00 180,667,171.00 405,487.00 -9.864.199.00 -10.030.931.00 Less: Lapsed Funds $3,239,196,636.00 $ 148,122,699.00 $3,387,319,335.00 3,750,000.00 1,868.469.00 5,618,469.00 Total State Appropriation $3.235.446.636.00 $ 146.254.230.00 $3.381.700.866.00 FEDERAL REVENUES $ 508.786.886.29 $ 508.786.886.29 OTHER REVENUES RETAINED Audit Contracts $ Court Settlement Equipment Funding for Vocational Education High School Program Georgia State Financing and Investment Commission Funding for Student Information System Project Georgia State Financing and Investment Commission Grants France-Mediaction and Vocational Mission Programs lndi9ent Care Trust Fund Program Lettie Pate Evans Foundation Next Generation School Grants United States Senate Youth Program Indirect Services Funding Department of Administrative Services Lottery Proceeds (State Schools) Atlanta School for the Deaf General Instruction/State Georgia Academy for the Blind Georgia Regional Library for the Blind Georgia School for the Deaf Reimbursements For Honorariums For School Lunch and Milk Program For Telephone Expenses For Workshop Expenses Rents Received Sales of Photocopies and Publications Video Fees 664,571.29 1,196.36 11,297,168.05 5,915,652.18 15 003.38 344:305.00 50,000.00 1,943,699.50 1,000.00 340,000.00 66,696.72 4,447.00 99,083.32 12,275.11 232,699.54 532,955.80 176,266.53 47.65 7,338.92 1,620.00 77,448.21 283,444.70 $ 664,571.29 1,196.36 11,297,168.05 5,915,652.18 15,003.38 344,305.00 50,000.00 1,943,699.50 1,000.00 340,000.00 66,696.72 4,447.00 99,083.32 12,275.11 232,699.54 532,955.80 176,266.53 47.65 7,338.92 1,620.00 77,448.21 283,444.70 Total Other Revenues Retained $ 22,066,919.26 $ 22,066,919.26 Total Revenues CARRY-OVER FROM PRIOR YEAR $3.766.300.441.55 $ 146.254.230.00 $3.912.554.671.55 Transfer from Reserved Fund Balance Federal Financial Assistance Inventories Georgia-Lorraine Exchange Program Georgia School for the Deaf School Improvements Legislative Video Program Mellon School/College Collaboration Grant QBE Formula Grants State Teacher of the Year Program United Stated Senate Youth Program Total Carry-Over from Prior Year $ 991,187.04 85,000.00 1,228.45 238,920.00 500.00 11. 79 1,908,260.00 5,080.77 1,938.83 $ 3,232,126.88 $ 991,187.04 85,000.00 1,228.45 238,920.00 500.00 11. 79 1,908,260.00 51.,098308..7873 $_ __..3......2..3.~2..,.,_1__2__6__.__8__8_ Total Funds Available $3,769.532.568.43 $ 146.254.230.00 $3.915.786.798.43 See notes to the financial statements. - 32 - DEPARTMENT DF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30, 1994 EXHIBIT "J" Page 2 EXPENDITURES PERSONAL SERVICES Salaries and Wages Employer's Contributions for: F.I.C.A. Retirement Health Insurance Personal Liability Insurance Unemplo.yment Compensation Insurance Workers Compensation Insurance Assessments by Merit System REGULAR OPERATING EXPENSES Motor Vehicle Expenses Supplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Insurance and Bonding Tuition and Scholarships Other Operating Expenses (See Schedule) Duplicating and Rapid Copy Publications and Printing TRAVEL MOTOR VEHICLE PURCHASES EQUIPMENT Equipment Purchases Lease/Purchase of Equipment Rental of Equipment COMPUTER CHARGES Other Cqsts Supplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Other Operating Expenses (See Schedule) Software Equipment Equipment Purchases Per Diem, Fees and Contracts Per Diem and Fees Contracts Computer Billings, DOAS REAL ESTATE RENTALS TELECOMMUNICATIONS PER DIEM, FEES AND CONTRACTS Per Diem and Fees Contracts CAPITAL OUTLAY Per Diem, Fees and Contracts Contracts QI!:!IB UTILITIES See notes to the financial statements. "A" DEPARTMENT OF EDUCATION "8" LOTTERY FOR EDUCATION TOTAL $ 26,758,88.05 1 , 631 , 831. 64 4,009,141.07 3,568,829.80 477,264.00 29,616.00 377,651.00 134,330.66 $ 36,987,552.22 $ 55,242.37 1,408,067.78 1,416,021.38 303,145.17 53,220.24 6,850.00 1,035,530.79 289,861.98 286,371.33 $ 4,854,311.04 $_ _ _9__6"""8_.,_.,5""21._.""'o_o_ $_ _ _11..3...,..8...9....6_._7__2__ $ 158,244.82 33,614.77 30,344.30 $_ _ _2. ,.2"""2.......2.._.03.._._.8_9_ $ 770,455.50 3,625,361.81 30.00 120,720.48 109,377.29 9,781,565.48 215,950.00 2,463,483.87 691,616.90 $ 17,778,561.33 $ 1,483,479.24 $ 1,077 .230.59 $ 1,424,977.72 12,777,429.17 $ 14,202,406.89 $_ _......::,3.::..8._6.,'""'5.::.8.'""o~o $_ _ _8__6__1_..,..5..,...21_._o_..5.. $ 26,758,888.05 1,631,831.64 4,009,141.07 3,568,829.80 477,264.00 29,616.00 377,651.00 134,330.66 $ 36,987,552.22 $ 55,242.37 1,408,067.78 1,416,021.38 303,145.17 53,220.24 6,850.00 1,035,530.79 289,861.98 286,371.33 $ 4,854,311.04 $_____96_.8...._5.2..1.=-._o_o 1 $_ _...,1...:1..._3..,8,..,.9.6...._.7. -2 $ 158,244.82 33,614.77 30,344.30 $_ __....22-:2...,...2.._0_3--._8__9_ $ 770,455.50 3,625,361.81 30.00 120,720.48 109,377.29 9,781,565.48 215,950.00 2,463,483.87 691,616.90 $ 17,778,561.33 $ 1,483,479.24 $ 1,077,230.59 $ 1,424,977.72 12,777,429.17 $ 14,202,406.89 $_ _......::,3,...8..,6,""'5..._8_,0.:.:,.0 $_ _ _86...1..,..5...2...1.......0._5__ - 33 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE ANO EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30, 1994 EXHIBIT "J" Page 3 "A" DEPARTMENT OF EDUCATION EXPENDITURES OTHER QBE FORMULA GRANTS: Kindergarten/Grades 1 - 3 Grades 4 - 8 Grades 9 - 12 High School Laboratories Vocational Education Laboratories Special Education Gifted . Remedial Education Staff Development and Professional Development Media Indirect Cost Pupil Transportation Local Fair Share Mid-Term Adjustment Reserve $ 759,921,314.00 721,385,180.00 297,422,530.00 124,988,870.00 102,574,758.00 278,830,860.00 40,026,562.00 59,244,823.00 28,987,901.00 87,721,767.00 600,119,184.00 126,831,106.00 -614,197,789.00 68,563,220.00 $2,682,420.286.00 OTHER CATEGORICAL GRANTS: Equalization Formula Sparsity Grants In School Suspension Special Instructional Assistance Middle School Incentive Special Education Low-Incidence Grants $ 144,854,014.00 2,966,091.00 20,901,157.00 51,051,591.00 56,908,600.00 411,712.00 $ 277.093.165.00 NON-QBE GRANTS: Education of Children of Low-Income Families Retirement (H.B. 272 and H.B. 1321) Instructional Services for the Handicapped Tuition for the Multi-Handicapped Severely Emotionally Disturbed School Lunch (Fed~ral) School Lunch (State) Supervision and Assessment of Students and Beginning Teachers and Performance-Based Certification Regional Education Service Agencies Georgia Learning Resources System High School Program Special Education in State Institutions Governor's Scholarships Vocational Research and Curriculum Even Start Salaries and Travel of Public Librarians Public Library Materials Talking Book Centers Public Library M&0 Child Care Lunch Program (Federal) Chapter II - Block Grant Flow Through Payment of Federal Funds to Board of Technical and Adult Education Education of Homeless Children/Youth Innovative Programs Next Generation School Grants Limited English - Speaking Students Program Drug-Free School (Federal) Emergency Immigrant Education Program Title II Math/Science Grant (Federal) Robert C. Byrd Scholarship (Federal) Health Insurance - Non Cert. Personnel and Retired Teachers Pre-School Handicapped Program Mentor Teachers Advanced Placement Exams Family Connection Grants Youth Apprenticeship Grants Serve America $ 186,023,794.03 4,950,000.00 54,732,103.21 1,065,437.85 38,965,519.00 187,111,477.77 24,213,192.00 2,032,955.00 7,072,130.00 3,397,225.90 28,379,567.59 3,673,574.00 2,702,000.00 293,213.00 2,720,906.00 11,183,401.47 5,718,136.33 911,019.00 4,039,390.00 24,579,610.97 9,663,513.00 14,633,712.73 601,772.27 1,524,035.00 2,945,000.00 7,452,253.00 11,625,942.51 164,514.00 5,162,004.51 273,723.00 90,047,892.00 14,112,004.00 999,940.00 1,056,649.00 1,982,199.00 280,272.00 382,597.00 $ 756.672,676.14 "B" LOTTERY FOR EDUCATION TOTAL $ 759,921,314.00 721,385,180.00 297,422,530.00 124,988,870.00 102,574,758.00 278,830,860.00 40,026,562.00 59,244,823.00 28,987,901.00 87,721,767.00 600,119,184.00 126,831,106.00 -614,197,789.00 68,563,220.00 $2,682.420,286.00 $ 144,854,014.00 2,966,091.00 20,901,157.00 51,051,591.00 56,908,600.00 411,712.00 $ 277.093.165.00 $ 186,023,794.03 4,950,000.00 54,732,103.21 1,065,437.85 38,965,519.00 187,111,477.77 24,213,192.00 2,032,955.00 7,072,130.00 3,397,225.90 28,379,567.59 3,673,574.00 2,702,000.00 293,213.00 2,720,906.00 11,183,401.47 5,718,136.33 911,019.00 4,039,390.00 24,579,610.97 9,663,513.00 14,633,712.73 601,772.27 1,524,035.00 2,945,000.00 7,452,253.00 11,625,942.51 164,514.00 5,162,004.51 273,723.00 90,047,892.00 14 , 112,004. 00 999,940.00 1,056,649.00 1,982,199.00 280,272.00 382,597.00 $ 756,672,676.14 See notes to the financial statements. - 34 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES BUDGET FUND YEAR ENDED JUNE 30. 1994 EXHIBIT "J" Page 4 EXPENDITURES OTHER LOTTERY FOR EDUCATION: Pre-Kindergarten for 4-year-olds Personal Services Salaries and Wages Employer's Contributions for: F.I.C.A. Retirement Health Insurance Personal Liability Insurance Assessments by Merit System Other Costs Supplies and Materials Insurance and Bonding Grants to Counties, Cities ~nd Civil Divisions Other Operating Expenses (See Schedule) Duplicating and Rapid Copy Publications and Printing Travel Equipment Equipment Purchases Computer Charges Software Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Lottery Grants Computer Hardware/Software in Classrooms Next Generation Schools Distant Learning - Hardware and Cabling Postsecondary Options Educational Technology Centers Safe Schools Grant Media Center and Library Equipment Learning Logic Sites Algebra Classrooms Drug and Anti-Violence Education Total Other Total Expenditures Excess of Funds Available over Expenditures "A" DEPARTMENT OF EDUCATION "8" LOTTERY FOR EDUCATION IQll!.. $ 170,163.83 $ 170,163.83 2,845.30 20,414.05 21,270.60 2,928.00 851. 64 2,845.30 20,414.05 21,270.60 2,928.00 851.64 19,964.15 36.00 19,964.15 36.00 35,188,544.98 l,23B.26 3,136.52 741.87 24,822.75 35,188,544.98 1,238.26 3,136.52 741.87 24,822.75 85,150.13 85,150.13 4,253.00 144.04 4,253.00 144.04 18,978.78 18,978.78 $ 35,565,483.90 $ 35,565,483.90 32,889,196.00 1,000,000.00 14,111,078.00 545,855.26 1,236,400.00 20,000,000.00 37,450,000.00 924,000.00 752,700.00 1,025,000.00 32,889,196.00 1,000,000.00 14,111,078.00 545,855.26 1,236,400.00 20,000,000.00 37,450,000.00 924,000.00 752,700.00 1,025,000.00 $_......1...4._5.....4..a9...9...713.16 $ 145.499.713.16 $3,717,047,648.19 $_....1...4.,.5...,..4...9...9....713.16 $3,862,547.361.35 $3,794,774,469.11 $ 145,499,713.16 $3,940,274,182.27 -25,241,900.68 754,516.84 -24,487,383.84 $3.769,532,568.43 $ 146,254,230.00 $3.915.786,798.43 See notes to the financial statements. - 35 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30 1 1994 EXHIBIT "K" Page 1 Atlanta Area School for the Deaf Student Activities Account Vending Machine Account Barber, Janette, Fund Charitable Contributions Civil Rights Act of 1964, Title IV Equity Workshop Edenfield, Myrtice, Fund Educational Technology Training Education's Leadership Academy Financial Assistance Fees Fine Arts Education Advisory Council Georgia Academy for the Blind Student Activities Account Georgia Curriculum Director's Account Georgia School for the Deaf Athletic Account Clemmons, Polly, Fund Jones, Jesse Forbes, Memorial Fund Kroger Account Miscellaneous Account Needy Children's Fund Registration Account Student Activities Account Student Bank Vocational Projects Fund Work Incentive Account Hazardous Materials and School Maintenance Section Instructional Technology Fund International Education Fund International Exchange Program Fund Leadership Skills Development Workshop Library for the Blind Marketing and Distributive Education Georgia Association of Distributive Education Clubs of America In-Service Conference Account Media Services Workshop Fund Middle Georgia School Service Center Nutrition Seminar Programs of Education and Career Exploration Conference Account Professional Practices Commission Public School Recruitment Services Public School Standards (Parental Involvement) Quality Basic Education Collaboration Conference Fund Related Vocational Instruction Enrichment Camp Sachsen-Anhalt Exchange School Improvement Workshop Schools of Excellence See notes to the financial statements. ASSETS/ LIABILITIES JULY 1. 1993 ADDITIONS DELETIONS ASSETS/ LIABILITIES JUNE 30 1 1994 $ 5,311.28 $ 1,123.97 9,537.57 725.65 9,253.44 320.52 7,500.38 4,120.40 1,710.82 195,625.47 351.88 456.98 533.36 1,323.92 1,848.87 31,150.29 3,002.07 2,848.50 2,118.35 651.23 2,028.86 1,595.28 2,971.65 359,733.34 24.89 3,756.91 13,165.47 $ 5,929.56 266.37 1,722.76 14,662.91 $ 5,951.05 1,200.00 1,685.00 3,813.84 1,102.48 8,603.94 37.76 625.00 269.26 1,523.98 44,830.00 25.00 1,330.95 600.00 1,493.97 39,825.05 110.18 1,661.93 19.70 8,922.70 350.53 12,505.33 4,035.22 48.89 57,866.03 36,222.35 65,471.98 25,787.88 188,019.52 10,786.35 19,472.33 27.21 35.94 1,080.77 2,813.02 57,747.21 10,707.22 3,485.21 89,101.32 81.50 16,926.10 15,468.35 100.00 101.00 106.96 2,687.74 30,314.17 10,135.51 6,187.62 88,710.19 15,371.60 4,460.96 460.57 1,258.86 973.81 1,974.15 58,583.33 3,573.78 146.09 2,509.48 732.73 3,583.36 7,360.00 44,208.79 390.00 3,367.95 207,014.53 88.55 1,595.28 3,992.05 2,971.65 196,927.60 24.89 4,058.36 22,552.90 30.54 10,143.84 14,566.97 354.35 1,902.39 1,766.32 262.85 625.46 42,876.86 3,441.66 3,718.84 119,216.00 2,442.00 1,725.00 165.00 360.00 2,120.43 4,169.75 567.50 75,382.86 147.70 11,960.00 30,780.00 110,524.67 30.54 10,260.74 1,657.76 1,160.91 439.25 2,908.75 3,359.48 649.50 70,158.22 3,051.42 514.00 32,165.36 31,244.23 2,325.10 67.24 13,571.06 275.10 1,114.07 2,576.59 180.85 625.46 48,101.50 537.94 11,446.00 2,333.48 - 36 - DEPARTMENT OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30. 1994 EXHIBIT "K" Page 2 ASSETS/ ASSETS/ LIABILITIES LIABILITIES FUND JULY 1, 1993 ADDITIONS DELETIONS JUNE 30. 1994 Software Consortium $ Special Needs Program Conference Fund Special Services Conference Account Special Student Services Account Staff Conference Fund State Board Awards Summer Conference Superintendents' Orientation Support Staff Development Fund Teacher Assessment and Agent Account (Leadership Development Seminars) Tech Prep Conference Account Vocational Administrators' Account Vocational Education Accounts Business Education Fund Future Business Leaders of America Georgia Association of American Industrial Arts Student Association, Incorporated Georgia Association of Future Farmers of America District I Pig Chain Fund Vocational Agriculture Teachers' Fund District II Vocational Agriculture Teachers' Fund District III Vocational Agriculture Teachers' Fund Dunn, J.E., Scholarship Fund Northwest District (District IV) Regular Agent Account Georgia Association of Future Homemakers of America Georgia Association of Vocational Industrial Clubs of America Homemaking Teachers' Conference Miscellaneous Vocational Agriculture Fund Regional Meeting Society of Georgia Vocational Agriculture Teachers' Benefits Association, The Vocational Industrial Clubs of America Metro Atlanta Automobile Dealer Association Vocational Occupation Clubs of America Worksite Wellness 11,289.76 4,851.53 364.50 38,253.24$ 6,178.44 . 943.10 7,571.48 715.58 2,536.02 9,935.88 7,597.20 525.48 61,164.55 $ 19,115.11 1,095.00 1,955.89 35,626.47 3,111.54 4,760.00 138,651.96 11,289.76 4,936.22$ 32,261.54 814.11 1,083.00 5,833.79 609.00 87.37 34,942.83 6,620.05 4,196.01 135,876.03 38,064.66 71,723.12 64,225.68 5,406.69 7,122.14 15,154.14 17,244.33 9,007.42 3,895.95 4,361.51 4,788.81 4,055.69 3,077.08 63,394.54 54,364.60 22,188.97 12,328.96 4,997.71 168.88 40,798.19 59,078.17 122.98 796.01 257,415.22 76,216.31 81,230.00 21,064.85 7,532.00 12,130.54 57,135.50 2,496.22 260,750.40 77,156.45 63,743.09 24,809.99 2,940.21 5,063.20 8,619.64 430.13 83,619.81 1. 067. 00 51.73 115,038.48 137.07 481.86 123,424.32 1,187.06 -84.69 364.50 25,106.81 6,178.44 128.99 12.00 3,693.58 106.58 2,448.65 10,619.52 4,088.69 1,089.47 63,940.48 45,562.10 5,406.69 5,031.95 8,541.86 6,731.48 4,178.67 1,376.87 60,059.36 53,424.46 39,675.88 8,583.82 2,057.50 2,637.68 44,309.09 75,233.97 17.01 $1,258,676.90$ 1,590.821.18 $ 1.728.504.84 $ 1.120.993.24 See notes to the financial statements. - 37 - FUNDS AVAILABLE REVENUES State Appropriation Federal Revenues Other Revenues Retained DEPARTMENT OF EDUCATION SCHEDULE OF APPROVED BUDGET "A" DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30. 1994 ORIGINAL AMENDED GOVERNOR'S BUDGET APPROPRIATION APPROPRIATION EMERGENCY FUND ADJUSTMENTS SCHEDULE "1" Page 1 TOTAL $3,153,523,530.00$ 85,434,351.00$ 460,621,324.00 -3,590,809.00 1,722,561.00 405,487.00$ -166,732.00 $3,239,196,636.00 236,635,419.00 693,665,934.00 22,449,304.00 24,171,865.00 $3,615,867,415.00$ 81,843,542.00$ 405,487.00 $258,917,991.00 $3,957,034,435.00 =============== ============ ============== ============== ================ EXPENDITURES ------------ Personal Services $ 37,840,329.00$ -699,304.00 Regular Operating Expenses 4,126,626.00 86,594.00 Travel 1,087,967.00 31,200.00 Motor Vehicle Purchases 109,500.00 -42,360.00 Equipment 421,823.00 80,260.00 Canputer Charges 7,010,846.00 425,556.00 Real Estate Rentals 1,471,304.00 3,425.00 Telecamllnications 1,180,382.00 23,000.00 Per Diem, Fees and Contracts 15,781,097.00 -1,619,772.00 $ Capital Outlay 50,000.00 Utilities 742,880.00 QBE Fortll.lla Grants: Kindergarten\Grades 1 - 3 753,531,667.00 Grades 4 - 8 715,965,525.00 Grades 9 - 12 294,622,175.00 High School Laboratories 124,613,856.00 Vocational Education Laboratories 100,756,134.00 Special Education 275,159,949.00 Gifted 38,022,413.00 Renedial Education 58,760,866.00 Staff Development and Professional Development 28,891,019.00 Media 87,006,632.00 Indirect Cost 596,369,241.00 Pupil Transportation 129,798,307.00 -1,000,000.00 Local Fair Share -615,762,984.00 1,563,000.00 Mid-Term Adjustment Reserve 0.00 78,705,327.00 Teacher Salary Schedule Adjustment 20,576,794.00 Other Categorical Grants: Equalization Formula 142,801,545.00 231,929.00 Sparsity Grants 3,609,604.00 In School Suspension 21,059,624.00 Special Instructional Assistance 51,005,135.00 Middle School Incentive 51,755,114.00 4,922,095.00 Special Education Low - Incidence Grants 416,000.00 Non-QBE Grants: Education of Children of Low- Income Famil i es 186,500,970.00 Retirement (H.B. 272 and H.B. 1321) 4,950,000.00 Instructional Services for the Handicapped 39,176,572.00 Tuition for the Multi-Handicapped 2,960,451.00 -912,780.00 Severely Emotionally Disturbed 36,105,108.00 233,000.00 $ 352,187.00$ 1,515,529.00 163,482.00 50,760.00 30,370.00 11,190,017.00 2,182.00 75,256.00 41,000.00 1,560,467.00 139,042.00 37,493,212.00 5,728,749.00 1,282,649.00 117,900.00 532,453.00 18,626,419.00 1,476,911.00 1,278,638.00 15,762,792.00 50,000.00 881,922.00 6,389,647.00 5,419,655.00 2,800,355.00 375,014.00 1,818,624.00 3,670,911.00 2,004,149.00 483,957.00 759,921,314.00 721,385,180.00 297,422,530.00 124,988,870.00 102,574,758.00 278,830,860.00 40,026,562.00 59,244,823.00 364,487.00 101,855.00 715,135.00 3,385,456.00 2,195.00 -10,058,997.00 -20,576,794.00 28,992,874.00 87,721,767.00 600,119,184.00 128,798,307.00 -614,197,789.00 68,646,330.00 0.00 1,820,540.00 -158,467.00 46,456.00 145,654.00 144,854,014.00 3,609,604.00 20,901,157.00 51,051,591.00 56,822,863.00 416,000.00 6,030,518.00 15,884,212.00 2,628,065.00 192,531,488.00 4,950,000.00 55,060,784.00 2,047,671.00 38,966,173.00 See notes to the financial statements. - 38 - DEPARTMENT OF EDUCATION SCHEDULE OF APPROVED BUDGET "A" DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30. 1994 SCHEDULE "l" Page 2 ORIGINAL AMENDED GOVERNOR'S BUDGET APPROPRIATION APPROPRIATION EMERGENCY FUND ADJUSTMENTS TOTAL ------------- ------------- -------------- ----------- EXPENDITURES ------------ Non-QBE Grants: School Lunch (Federal) $ 136,568,755.00 $177,BB7,B95.00 $ 314,456,650.00 School Lunch (State) 24,332,066.00 24,332,066.00 Supervision and Assessment of Students and Beginning Teachers and Perfonnance-Based Certification 1,500,000.00 562,000.00 2,062,000.00 Regional Education Service Agencies 6,746,192.00$ 249,986.00 76,008.00 7,072,186.00 Georgia Learning Resources System 2,766,212.00 650,939.00 3,417,151.00 High School Program 18,041,235.00 -299,986.00 15,418,079.00 33,159,328.00 Special Education in State Institutions 3,991,103.00 3,991,103.00 Governor's Scholarships 2,702,000.00 2,702,000.00 Job Training Partnership Act 3,084,680.00 -3,084,680.00 0.00 Vocational Research and Curriculum 248,270.00 50,000.00 298,270.00 Even Start 0.00 2,780,622.00 2,780,622.00 Salaries and Travel of Public Librarians 10,645,182.00 553,441.00 11,198,623.00 Public Library Materials 5,007,912.00 2,694,057.00 7,701,969.00 Talking Book Centers 911,019.00 911,019.00 Public Library M& 0 4,025,581.00 13,809.00 4,039,390.00 Child Care Lunch Program (Federal) 22,934,480.00 8,562,475.00 31,496,955.00 Chapter II - Block Grant Flow Through 10,783,825.00 10,783,825.00 Payment of Federal Funds to Board of Technical and Adult Education 11,701,897.00 5,496,309.00 17,198,206.00 Education of Homeless Children/ Youth 0.00 631,607.00 631,607.00 Innovative Programs 2,450,000.00 2,450,000.00 Next Generation School Grants 1,000,000.00 2,000,000.00 3,000,000.00 Limited English-Speaking Students Program 6,924,763.00 527,490.00 7,452,253.00 Drug-Free School (Federal) 11,841,909.00 371,272.00 12,213,181.00 Transition Program for Refugees 119,012.00 119,012.00 Emergency Inmigrant Education Program 223,824.00 223,824.00 Title II Math/Science Grant (Federal) 3,715,615.00 l,487,B49.00 5,203,464.00 Robert C. Byrd Scholarship (Federal) 232,000.00 41,723.00 273,723.00 Health Insurance - Non-Cert. Personnel and Retired Teachers 90,047,892.00 90,047,892.00 Pre-School Handicapped Program 13,782,520.00 329,780.00 14,112,300.00 Mentor Teachers 1,000,000.00 1,000,000.00 Nutrition Education 65,000.00 3,500.00 68,500.00 Advanced Placenent Exams 0.00 1,012,000.00 36,000.00 1,048,000.00 Family Connection Grants 0.00 1,325,000.00 663,102.00 1,988,102.00 Youth Apprenticeship Grants 0.00 280,272.00 280,272.00 Serve America 0.00 402,382.00 402,382.00 ---------------- -------------- -------------- -------------- ---------------- $3,615,867,415.00$ 81,843,542.00$ 405,487.00 $258,917,991.00 $3,957,034,435.00 ============= ========== ========== ============= =============== See notes to the financial statenents. - 39 - DEPARTMENT OF EDUCATION SCHEDULE OF APPROVED BUDGET "B" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30, 1994 SCHEDULE "2" FUNDS AVAILABLE REVENUES State Appropriation ORIGINAL AMENDED BUDGET APPROPRIATION APPROPRIATION ADJUSTMENTS TOTAL $62,754,07B.OO $95,232,B20.00 $-9,864,199.00 $148,122,699.00 ============= ============= ============= ============== EXPENDITURES Pre-Kindergarten for 4-year-olds Computer Hardware/Software in Classrooms Next Generation Schools Distant Learning - Hardware and Cabling Postsecondary Options Educational Technology Centers Safe Schools Grant Media Center and Library Equipment Model Technology Schools Learning Logic Sites Algebra Classrooms Drug and Anti-Violence Education $37,100,000.00 $ -754,000.00 $ 36,346,000.00 10,310,000.00 $21,777,500.00 1,000,000.00 33,087,500.00 1,000,000.00 1,000,000.00 12,304,078.00 1,800,000.00 34,000.00 14,138,078.00 603,600.00 981,621.00 1,585,221.00 1,436,400.00 -200,000.00 1,236,400.00 0.00 20,000,000.00 20,000,000.00 0.00 38,307,500.00 -280,000.00 38,027,500.00 9,864,199.00 -9,864,199.00 0.00 0.00 924,000.00 924,000.00 0.00 753,000.00 753,000.00 0.00 1,025,000.00 1,025,000.00 ------------- ------------- ------------- -------------- $62,754,078.00 $95,232,820.00 $-9,864,199.00 $148,122,699.00 ============= ============= ============= ============== See notes to the financial statements. - 40 - DEPARTMENT OF EDUCATION CASH AND CASH EQUIVALENTS JUNE 30, 1994 SCHEDULE "3" NONINTEREST BEARING ACCOUNTS Bank South, N.A., Atlanta, Georgia First Floyd Bank, Cave Spring, Georgia First Union National Bank of Georgia, Atlanta, Georgia Middle Georgia Bank, Fort Valley, Georgia NationsBank of Georgia, N.A., Atlanta, Georgia NationsBank of Georgia, N.A., Valdosta, Georgia Southtrust Bank of Atlanta, N.A., Atlanta, Georgia Trust Company Bank, Atlanta, Georgia Trust Company Bank of Middle Georgia, Macon, Georgia United Bank and Trust, Rockmart, Georgia Wachovia Bank of Georgia, Atlanta, Georgia Wachovia Bank of Georgia, Macon, Georgia INTEREST BEARING ACCOUNTS Bank South, N.A., Atlanta, Georgia Central Bank, Swainsboro, Georgia First Floyd Bank, Cave Spring, Georgia First Commerce Bank, Lexington, Georgia First Union National Bank of Georgia, Atlanta, Georgia Georgia State Department of Education Credit Union, Atlanta, Georgia NationsBank of Georgia, N.A., Cedartown, Georgia NationsBank of Georgia, N.A., Douglasville, Georgia NationsBank of Georgia, N.A., Tifton, Georgia Trust Company Bank, Atlanta, Georgia Trust Company Bank of Middle Georgia, Macon, Georgia United Bank and Trust, Rockmart, Georgia Funds on Deposit with Office of Treasury and Fiscal Services State Investment Pool OTHER Cash on Hand Petty Cash $ -362,700.90 28,468.49 144,721.67 350.53 734,051.55 2,388.63 60,000.00 -2,595,093.32 200.00 2,057.50 388,522.89 2,508.05 $-1,594,524.91 $ 20,534.43 2,917.13 1,258.86 6,731.48 25,699.87 139,299.16 50,074.86 24,247.54 5,031.95 31,244.23 199,011.47 1,376.87 170,689.00 ------------- 678,116.85 1,348.45 36.00 See notes to the financial statements. - 41 - $ -915,023.61 ============= DEPARTMENT OF EDUCATION INVESTMENTS JUNE 30. 1994 SCHEDULE "4" INVESTMENT TYPE Certificates of Deposit Bank of Banks County, Homer, Georgia No. 51445039 Central Bank, Swainsboro, Georgia No. 26410 First Community Bank of Tifton, Tifton, Georgia No. 0150203362 First Union National Bank of Georgia, Atlanta, Georgia No. 205-8208081 No. 205-8548189 NationsBank of Georgia, N.A., Atlanta, Georgia No. 1340868-0002 NationsBank of Georgia, N.A., Douglasville, Georgia No. 9100-0001 No. 9100-0002 PURCHASE DATE January 27, 1994 December 1, 1993 March 3, 1994 December 16, 1993 December 20, 1993 Apri 1 29, 1993 October 30, 1993 October 30, 1993 MATURITY DATE July 26, 1994 December 1, 1994 March 3, 1995 December 16, 1994 December 20, 1994 October 29, 1995 October 30, 1994 October 30, 1994 AMOUNT $ 22,395.81 5,624.73 5,406.69 31,685.36 17,848.74 12,296.54 11,845.56 12,008.40 $ 119 , 111. 83 ============= See notes to the financial statements. - 42 - DEPARTMENT OF EDUCATION SCHEDULE OF GOVERNOR'S EMERGENCY FUND YEAR ENDED JUNE 30, 1994 SCHEDULE "5" Uncle Remus Regional Library - City of Eatonton for the Eatonton/Putnam County Public Library Burke County Board of Education - Help with Burke County Communities in Schools Program Union County Board of Education - Establish a Regional, Evening School for Union, Fannin and Towns Counties Long County Board of Education - Building Improvements - Additional Classrooms Charlton County Board of Education - Physical Education Facilities DeKalb County Board of Education - Physical Education Facilities - Columbia High School Paulding County Board of Education - Physical Education Facilities - W. C. Abney Elementary School Paulding County Board of Education - Physical Education Facilities - East Paulding High School Pulaski County Board of Education - Building Improvements - Middle Georgia CAA, Incorporated Governor's 1993 Conference on Education - Operating Expenses for Conference Clayton County Board of Education - Complete Permanent Visual Arts Gallery in Clayton County Schools Performing Arts Center Hall County Board of Education - Provide Walkways and Canopies at Chestnut Mountain Elementary School Stewart County Board of Education - Renovate Old Lumpkin Elementary School Bulloch County Board of Education - Provide Classroom Space at Marvin Pittman Laboratory School, where the South Wing was Damaged by Fire on December 21, 1993 Randolph County Board of Education - Purchase Materials for the Randolph-Clay High School Music Department Haralson County Board of Education - Expenses in Connection with the West Georgia Life Writing Program at West Haralson Middle School Hall County Board of Education - Facility Improvements at Mount Vernon Elementary School Colquitt County Board of Education - Band Uniforms for the Colquitt County School's 50th Regiment Band DeKalb County Public Library - Purchase Equipment and Materials for the Scott Candler Library Macon County Board of Education - Install a New Roof and Ceiling Tiles at Macon County High School Stephens County Board of Education - Replace Books and Materials Destroyed in a Fire at Big A Elementary School Georgia Teacher of the Year Program Houston County Board of Education - Purchase a Video System for the Athletic/ Physical Education Department at Warner Robins High School North Fulton Education 2000, Incorporated - Program Expenses in Connection with Project Soar Piedmont Regional Library - Assist with Expenses in Connection with the Relocation of the Auburn Branch Schools of Excellence Banks County Board of Education - Assist with the Purchase of New Band Uniforms Berrien County Board of Education - Assist with the Purchase of New Band Uniforms for the High School Dublin City Schools - Assist with the Completion of the Physical Education Facilities at Dublin High School 1994 Georgia Teacher of the Year Candler County Board of Education - To Replace Boiler used in Food Preparation at the Canning Plant $ 5,200.00 2,500.00 30,000.00 40,000.00 12,500.00 5,000.00 2,500.00 2,500.00 7,000.00 26,000.00 6,025.00 20,000.00 10,000.00 35,000.00 7,500.00 4,000.00 20,000.00 15,000.00 5,000.00 19,762.00 25,000.00 5,000.00 10,000.00 5,000.00 2,000.00 62,000.00 4,000.00 1,000.00 6,000.00 5,000.00 5,000.00 ------------- $ 405,487.00 ============= See notes to the financial statements. - 43 - DEPARTMENT OF EDUCATION SCHEDULE OF FEDERAL REVENUES YEAR ENDED JUNE 30. 1994 PROGRAM Agriculture, U. S. Department of Food Distribution Direct School Breakfast Program Direct National School Lunch Program Direct Special Milk Program for Children Direct Child and Adult Care Food Program Direct State Administrative Expenses for Child Nutrition Direct Nutrition Education and Training Program Direct Temporary Emergency Food Assistance (Administrative Costs) Direct Commission on National and Community Service Serve America Program Direct Education, U. S. Department of Bilingual Education Direct Desegregation Assistance, Civil Rights Training, and Advisory Services Direct Education of Handicapped Children in State Operated or Supported Schools Direct Chapter 1 Programs - Local Educational Agencies , Direct Migrant Education - Basic State Formula Grant Programs Direct Educationally Deprived Children - State Administration Direct Chapter 1 Program for Neglected and Delinquent Children Direct Services for Children with Deaf-Blindness Direct Special Education - State Grants Direct Special Education - Special Education Personnel Development and Parent Training Direct Public Library Services (LSCA - Title I) Direct Interlibrary Cooperation and Resource Sharing Direct Vocational Education - Basic Grants to States Direct Vocational Education - Consumer and Homemaking Education Direct Educational Research and Development Direct , Federal, State, and Local Partnerships for Educational Improvement Direct Public Library Construction and Technology Enhancement (LSCA - Title II) Direct Emergency Immigrant Education Direct Eisenhower Mathematics and Science Education - State Grants Direct Special Education - Preschool Grants Direct See notes to the financial statements. - 44 - CFDA NUMBER 10.550 10.553. 10.555 10.556 10.558 10.560 10.564 10.568 N/A 84.003 84.004 84.009 84.010 84. 011 84.012 84.013 84.025 84.027 84.029 84.034 84.035 84.048 84.049 84.117 84.151 84.154 84 .162 84 .164 84.173 SCHEDULE "6" Page 1 AMOUNT $ 11,141.26 37,661,867.54 149,427,948.46 21,960.00 24,890,955.31 2,025,688.35 96,215.27 871,848.25 341,916.90 -7.69 184,287.65 848,099.63 166,167,873.49 3,889,860.20 1,134,460.30 565,101.57 146,267.49 48,180,873.40 129,896.33 2,231,336.82 375,680.83 26,537,117.48 745,750.24 11,850.00 11,324,124.75 19,378.26 154,723.65 5,330,104.26 7,300,279.36 DEPARTMENT OF EDUCATION SCHEDULE OF FEDERAL REVENUES YEAR ENDED JUNE 30. 1994 PROGRAM Education, U. S. Department of Vocational Education - Community Based Organizations Direct Robert C. Byrd Honors Scholarships Direct Drug-Free Schools and Communities - State Grants Direct Christa McAuliffe Fellowships Direct Bilingual Education Support Services Direct Education for Homeless Children and Youth - Grants for State and Local Activities Direct Even Start - State Educational Agencies Direct Capital Expenses Direct State Program Improvement Grants Direct Tech-Prep Education Direct Foreign Languages Assistance Direct Supplementary State Grants for Facilities, Equipment, and Other Program Improvement Activities Direct White House Conference on Library and Administrative Services Direct Envi ronm.enta 1 Protection Agency, U. S. Toxic Substances Compliance Monitoring Program Direct Enhancement Grants for State Asbestos Programs Direct Health and Human Services, U. S. Department of Acquired Immunodeficiency Syndrome (AIDS) Activity Direct Head Start Direct Medical Assistance Program Direct Cooperative Agreements to Support School Health Education to Prevent the Spread of Acquired Immunodeficiency Syndrome Direct Labor, U. S. Department of Job Training Partnership Act Contracts with State Agency Through Georgia Department of Labor National Science Foundation Materials Development, Research, and Informal Science Education Direct CFDA NUMBER 84.174 84 .185 84.186 84.190 84.194 84.196 84.213 84.216 84.218 84.243 84.249 84.253 N/A 66.701 66.706 93 .118 93.600 93. 778 93.938 17.250 47.067 SCHEDULE "6" Page 2 AMOUNT $ 337,754.26 273,723.00 10,304,216.54 29,172.00 71,221.90 599,326.19 2,528,496.73 6,048.00 541,943.54 2,832,107.43 292,270.72 -45,410.98 -404.57 -1,476.00 13,794.11 -11,750.18 12,973.00 53,100.29 295,465.49 34,784.10 -7,068.64 -------------- $508,786,886.29 ============== See notes to the financial statements. - 45 - DEPARTMENT OF EDUCATION SCHEDULE OF OTHER OPERATING EXPENSES YEAR ENDED JUNE 30. 1994 "A" DEPARTMENT OF EDUCATION REGULAR OPERATING EXPENSES Accreditation Fees Appraisals Bus Fare - Bank Deposits Clipping Services Collection Fees Court Reporter Services and Transcripts Examinations and Testing Freight, Express and Storage Linen Service and Outside Laundry Nutrition Survey Other Student Expenses Production of Films, Tapes and Recordings Seminars and Training Student Meals Student Medical Expenses Subscriptions, Dues and Registration Fees Test Scoring Services COMPUTER CHARGES Freight, Express and Storage Subscriptions, Dues and Registration Fees "B" LOTTERY FOR EDUCATION OTHER Lottery for Education Pre-Kindergarten for 4-Year-olds Subscriptions, Dues and Registration Fees See notes to the financial statements. - 46 - SCHEDULE "7" $ 189.51 5,000.00 195.20 771.25 1,696.15 287.00 2,360.80 345,843.71 7,593.50 2,100.00 17,465.29 43,324.42 166,628.70 3,554.88 3,366.61 434,871.62 282.15 $1,035,530.79 $ 45,449.00 75,271.48 $ 120,720.48 $ 1,238.26 Total per Annual Supplement Accruals June 30, 1994 Total per Audit Report DEPARTMENT OF EDUCATION RECONCILIATION OF TRAVEL YEAR ENDED JUNE 30. 1994 SCHEDULE "8" $ 987,844.82 5,498.93 $ 993,343.75 ============= See notes to the financial statements. - 47 - DEPARTMENT OF EDUCATION SUMMARY OF SALARIES, TRAVEL, AND PER DIEM AND FEES YEAR ENDED JUNE 30. 1994 SCHEDULE "9" BUDGET FUND "A" DEPARTMENT OF EDUCATION Regular Computer Charges B 11 11 LOTTERY FOR EDUCATION Pre-Kindergarten for 4-Year-olds SALARIES TRAVEL PER DIEM AND FEES $26,758,888.05$ 968,521.00$ 1,424,977.72 215,950.00 170,163.83 24,822.75 18,978.78 $26,929,051.88$ 993,343.75$ 1,659,906.50 ============= ============= ============= See notes to the financial statements. - 48 - SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 STATUS OF PRIOR YEAR FINDINGS AND IMPROPER OR QUESTIONED COSTS The status of findings disclosed in the audit report for the year ended June 30, 1993, is summarized below: Audit Control Number Status ofFinding 414-93-01 414-93-02 414-93-03 414-93-04 414-93-05 414-93-06 See Audit Control Number 414-94-01 See Audit Control Number 414-94-02 See Audit Control Number 414-94-03 See Audit Control Number 414-94-04 Corrective Action Implemented Corrective Action Implemented PRIOR YEAR/CURRENT YEAR CASH AND CASH EQUIVALENTS - Financial Statements EXPENDITURES/LIABILITIES/DISBURSEMENTS - Financial Statements Agency Funds - Deficiencies in Accounting Procedures Audit Control Number 414-94-01 The audit report for the year ended June 30, 1993, noted several deficiencies concerning Agency Funds cash accounts. For the year under review, certain ofthese deficiencies were corrected. However, an examination of current year accounting procedures disclosed the following deficiencies in accounting procedures and internal controls which are in need of corrective action: (1) Certain disbursements were not supported by adequate documentation. All disbursements should be supported by adequate documentation to demonstrate proper disbursement and accounting of funds. (2) Certain disbursements did not appear to be in compliance with the intent ofthe fund. Steps should be taken to ensure that records ofa fund include documentation stating specific disbursements which are allowable for the fund. A listing of approved allowable disbursements would reduce the likelihood of questionable disbursements. (3) Checks were issued to a certain individual for services rendered; however, there were no corresponding W-2's or 1099's issued. Procedures should be implemented to issue W-2's or 1099's to an individual performing services. (4) Certain deposits for the Vocational Education Account, Georgia Association ofFuture Farmers of America, District III, Vocational Agriculture Teacher's Fund account were not made on a timely basis. Procedures should be implemented to ensure that all funds received are deposited promptly. DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 PRIOR YEAR/CURRENT YEAR CASH AND CASH EQUIVALENTS - Financial Statements EXPENDITURES/LIABil.,ITIES/DISBURSEMENTS - Financial Statements Agency Funds - Deficiencies in Accounting Procedures Audit Control Number 414-94-0 I (5) Checks issued from the Professional Practices Commission account included one check made payable to, signed, and endorsed by the custodian of the account. In addition, the custodian reconciles the bank statement. Although documentation was available for the disbursement; compensating controls should be established to mitigate the lack of separation of duties in administering this account. (6) Checks issued from the Vocational Education Account, Georgia Association ofFuture Farmers of America, Regular Agent Account included one check payable to cash. Although documentation was available for the disbursement; measures should be taken to prevent this practice. (7) Certain funds are invested in certificates of deposit. Interest earned on these deposits at maturity become part ofthe principal when the certificates of deposits are renewed; however, the accounting records do not reflect these increases in principal. Audit adjustments have been made to the accounting records to reflect these increases in principal on the certificates of deposits. Procedures should be implemented to report certificates of deposit at the correct amounts on the accounting records. GENERAL FIXED ASSETS/PROPERTY MANAGEMENT - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequacies in Operation ofProperty Management System Major/Nonmajor Programs Audit Control Number 414-94-02 The audit report for the year ended June 30, 1993, noted deficiencies in the controls over general fixed assets. For the year under review, our examination included a review of the internal accounting controls utilized by the Department ofEducation in maintaining their State Property System. This review consisted oftesting the system for compliance with Federal and State equipment laws and regulations. In addition, procedures were completed to verify the accuracy ofthe total equipment inventory valuation contained in the inventory records, which comprises the General Fixed Assets Account Group. A sample of equipment items was selected to test the accuracy of the inventory system's control attributes. Ofthe 293 equipment items selected for physical inspection, the following deficiencies were noted: (I) Two (2) items could not be located. (2) Nine (9) items did not have decal numbers attached. Items were identified by serial numbers or descriptions. DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 PRIOR YEAR/CURRENT YEAR GENERAL FIXED ASSETS/PROPERTY MANAGEMENT - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequacies in Operation ofProperty Management System Major/Nonmajor Programs Audit Control Number 414-94-02 (3) Two (2) items were returned to vendors but were not removed from the inventory listing. In addition, the following conditions relating to inappropriate accounting practices were found to exist: (1) Equipment deletions were not properly updated on the inventory system. (2) Three (3) capital lease equipment items were not properly recorded. (3) The Department was unable to produce documentation ofcompliance with the requirement that a physical inventory be taken every two years. The Department of Education should establish the necessary internal controls to ensure that equipment inventories are maintained in accordance with provisions of 0MB Circular A-102 and the State Property System Manual. Federal Grantor Agencies Affected: U. S. Department of Agriculture U.S. Department ofEducation U. S. Environmental Protection Agency U.S. Department ofHealth and Human Services MONITORING SUBRECIPIENTS Subrecipient Audit Reports Not Received Within Required Time Period Federal Financial Assistance Major/Nonmajor Programs Audit Control Number 414-94-03 The audit report for the year ended June 30, 1993, noted that a substantial number of subrecipient audit reports had not been submitted within the time period required by 0MB Circular A-128 and A-133. The Circulars state that subrecipients subject to the reporting requirements should submit audit reports no later than thirteen months after the end ofthe audited period. As part of our examination for the year under review, we examined tracking documents used by the Department of Education to determine the status of subrecipient audit reports for the year ended June 30, 1993. Ofthe 379 subrecipients identified on the tracking documents, 141 had not submitted their audits within the thirteen month period as required by 0MB Circulars A-128 and A-133. DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 PRIOR YEAR/CURRENT YEAR MONITORING SUBRECIPIENTS Subrecipient Audit Reports Not Received Within Required Time Period Federal Financial Assistance Major/Nonmajor Programs Audit Control Number 414-94-03 A subsequent review of associated tracking documents indicated that 102 additional audit reports applicable to the period had been submitted by December 8, 1994. A review of the audit reports and the actions taken by the Department ofEducation to resolve the findings included in such reports indicated that the findings were properly resolved and audits were closed within the six month resolution period set forth in 0MB Circulars A-128 and A-133. It was noted during our examination that the Department ofEducation utilized a program review staff for interim compliance reviews of all subrecipients in accordance with the foregoing provisions ofOMB Circulars A-128 and A-133. Federal Grantor AgenciesAffected: U. S; Department of Agriculture U.S. Department ofEducation U. S. Environmental Protection Agency U. S. Department ofHealth and Human Services U. S. Department ofLabor MONITORING SUBRECIPIENTS Subrecipient Reviews Not Performed Within the Required Time Period Federal Financial Assistance Temporary Emergency Food Assistance (Food Commodities - CFDA 10.569) Nonmajor Program Audit Control Number 414-94-04 The audit report for the year ended June 30, 1993, noted that three subrecipient reviews had not been performed within the allotted time period as required by Federal regulation 7 CFR, Chapter 11, Section 251.10 (e) (2) which states, in part, as follows: "(2) Unless specific exceptions are approved in writing by the FNS Regional Office, the State monitoring system shall include (i) an annual review of all emergency feeding organizations within the State;..." As part ofour examination for the fiscal year ended June 30, 1994, we reviewed tracking documents used by the Department ofEducation to determine the status of subrecipient reviews for the Federal fiscal year ended September 30, 1993. Ofthe 29 subrecipients identified on the tracking documents, 4 had not been reviewed within the allotted time period. The Department should establish appropriate internal control structure policies and procedures to ensure that all subrecipients are reviewed in accordance with Federal regulations. DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 CURRENT YEAR BUDGET PREPARATION/EXECUTION Overexpenditure ofBudget Unit Object Class Financial Statements Audit Control Number 414-94-05 The total approved budget for the Department of Education - "A" Budget Unit provided for expenditures totaling $3,957,034,435.00. A comparison ofanticipated funds available and budgeted expenditures to actual funds available and expenditures by object class indicates that the following object classes were overspent by the amounts identified below: Other Categorical Grants Middle School Incentive Non-QBE Grants Advanced Placement Exams $ 85,737.00 $ 8,649.00 These overexpenditures are in violation ofSection 78 ofthe Amended Appropriations Act of 1993-1994. The Department should review its internal control procedures over budget operations, design procedures which would prohibit the expenditure of funds in excess of budget approval, and implement those procedures to strengthen the internal controls over the budget function. GENERAL LEDGER Lottery Grants to "A" Department ofEducation Budget Not Maintained by Program Financial Statements Amount: $18,047.72 Audit Control Number 414-94-06 For the year under review, our examination included a review of the lottery proceeds granted to the State operated schools which are maintained in "A" budget unit of the Department ofEducation. The review was conducted to ensure that accounting records were maintained for lottery funds on a grant by grant basis for each State operated school. In addition, tests were also performed to ensure that expenditures did not exceed amounts awarded for each grant. The following conditions were noted: ( 1) Lottery grants were not maintained on a grant by grant basis in the accounting records, but were maintained for each ofthe State operated schools as a whole. Instructions from the Department of Education issued March 30, 1994, requires each lottery grant to be accounted for separately. (2) Lottery fund revenues of$18,047.72 were drawn down by the Department ofEducation for State operated schools in excess of grant availability. DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 CURRENT YEAR GENERAL LEDGER Lottery Grants to "A" Department ofEducation Budget Not Maintained by Program Financial Statements Amount: $18,047.72 Audit Control Number 414-94-06 The Department ofEducation should establish procedures to account for each lottery grant separately and to limit the amount of revenue and expenditures recognized to grant award amounts. The questioned cost of $18,047.72 should be returned to "B" budget unit of the Department ofEducation for refund to the Lottery for Education account maintained by the Office of Treasury and Fiscal Services. COMPLIANCE WITH LAWS AND REGULATIONS Instructions to Boards ofEducation Not Consistent With the Official Code of Georgia Financial Statements Audit Control Number 414-94-07 Audits of various subrecipients disclosed that Georgia Department ofEducation issued written instructions to boards ofeducation regarding expenditure requirements relative to StaffDevelopment - Cost of Instruction (CIS) and Professional Development Stipend (PDS) funds that were not consistent with the Official Code of Georgia (OCGA). In a memorandum to system superintendents dated April 9, 1992 (for the 1993 fiscal year) the Georgia Department ofEducation stated: "The General Assembly also approved the transfer ofPDS funds to the Cost ofInstruction budget above the 15 percent cap... " In addition, in another memorandum date April 15, 1993 (for the 1994 fiscal year) the Georgia Department ofEducation stated: "The Appropriations Bill addresses staffdevelopment as a single line item, thereby allowing commingling of cost of instruction and professional development stipend funds..." The OCGA 20-2-182 states, in part, as follows: "A local school system shall be authorized to expend up to 15 percent of its initial allotment of funds for providing professional development stipends for staff development programs as specified under this subsection..." Furthermore, an appropriations act cannot restrict or alter the powers or duties conferred on an agency by general law (Attorney Generals Opinions, 75-88 and 79-46). DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1994 CURRENT YEAR COMPLIANCE WITH LAWS AND REGULATIONS Instructions to Boards ofEducation Not Consistent With the Official Code of Georgia Financial Statements Audit Control Number 414-94-07 The guidance provided in the above referenced memorandums has resulted in the various boards of education inappropriately expending PDS funds ofapproximately of $2,114,000.00 for fiscal year ended June 30, 1993. An inappropriate expenditure of a similar amount is anticipated for the fiscal year ended June 30, 1994. The Georgia Department ofEducation should develop procedures whereby instructions given to subrecipients are consistent with laws and regulations. The Georgia Department ofEducation should request appropriate refunds from affected boards of education. CASH MANAGEMENT Failure to Amend Agreement for Change in Funding Technique Federal Financial Assistance Major Programs Audit Control Number 414-94-08 As a part of our examination for the year under review, we examined the Department's funding techniques used in implementing the Cash Management Improvement Act of 1990. The Agreement effective for the period July 1, 1993 through June 30, 1994, applied the estimated clearance funding technique for the following Federal financial assistance programs: National School Lunch Program (CFDA I0.555) Chapter 1 Programs - Local Educational Agencies (CFDA 84.010) Special Education - State Grants (CFDA 84.027) During the year under review, the Department ceased using the estimated clearance method and began using the zero balance accounting funding technique which is acceptable under Federal regulation 31 CFR Part 205. However, the Department failed to obtain approval from the Financial Management Service for the change in funding technique during fiscal year 1994 prior to implementation. Federal regulation 31 CFR Part 205 .9(d) states, as follows: "A treaswy-state agreement may be amended by the mutual written consent of the state and the Financial Management Service." It should be noted that the Agreement for the subsequent fiscal year provided that the zero balance accounting funding technique was the agreed-upon technique for fiscal year 1995 but was not approved for use during fiscal year 1994. The Department should ensure any changes to the agreement made with the Financial Management Service are approved in writing for the applicable fiscal year before it is implemented.