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AUDIT REPORT STATE OF GEORGIA DEPARTMENT OF EDUCATION YEAR ENDED JUNE 30, 1996 
 
 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 
 
4 
 
C STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
 
BUDGET FUND 
 
5 
 
STATEMENTS OF FUNDS AVAILABLE AND EXPENDITURES 
 
COMPARED TO BUDGET 
 
BUDGET FUND 
 
D 
 
"A" DEPARTMENT OF EDUCATION 
 
10 
 
E 
 
"B" LOTTERY FOR EDUCATION 
 
12 
 
F STATEMENT OF REVENUES, EXPENDITURES AND 
 
CHANGES IN FUND BALANCE 
 
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND 
 
13 
 
G NOTES TO THE FINANCIAL STATEMENTS 
 
14 
 
SUPPLEMENTARY INFORMATION 
 
H COMBINING BALANCE SHEET (STATUTORY BASIS) 
 
BUDGET FUND 
 
32 
 
I COMBINING STATEMENT OF CHANGES IN FUND BALANCES 
 
(STATUTORY BASIS) 
 
BUDGET FUND 
 
33 
 
J COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
 
BUDGET FUND 
 
35 
 
K COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES 
 
FIDUCIARY FUND TYPE - AGENCY FUNDS 
 
40 
 
SCHEDULES 
 
SCHEDULES OF APPROVED BUDGET 
 
1 
 
"A" DEPARTMENT OF EDUCATION 
 
42 
 
2 
 
"B" LOTTERY FOR EDUCATION 
 
44 
 
3 CASH AND CASH EQUIVALENTS 
 
45 
 
 DEPARTMENT OF EDUCATION - TABLE OF CONTENTS - 
 
SECTION I 
 
FINANCIAL 
 
SUPPLEMENTARY INFORMATION 
 
SCHEDULES 
 
4 ~STMENTS 
 
46 
 
5 SCHEDULE OF GOVERNOR'S EMERGENCY FUND 
 
47 
 
6 SCHEDULE OF FEDERAL REVENUES 
 
48 
 
7 SCHEDULE OF OTHER OPERATING EXPENSES 
 
50 
 
8 RECONCILIATION OF TRAVEL 
 
51 
 
9 SUMMARY OF SALARIES, TRAVEL, AND PER DIEM AND FEES 
 
52 
 
SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS 
 
 SECTION I FINANCIAL 
 
 CLAUDE L. VICKERS 
STATE AUDITOR 
(404) 656-2174 
 
DEPARTMENT OF AUDITS 
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 
January 22, 1997 
 
Honorable Zell Miller, Governor Members ofthe General Assembly of Georgia Members of the 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, 1996. 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. 
As more fully discussed in Sectipn II, Findings and Improper or Questioned Costs, material discrepancies were noted in the equipment inventory records of the Department. Equipment inventory comprises the General Fixed Assets Account Group. We were unable to determine the effects these discrepancies may have on the financial statements. 
 
96ARL-2 
 
 In our opinion, except for the effects on the financial statements ofthe adjustments to the equipment inventory records that may be necessary as described in the preceding paragraph, the financial statements referred to above present fairly, in all material respects, the financial position (statutory basis) of the Department of Education as ofJune 30, 1996, and the results ofits operations (statutory basis) for the year then ended, on the basis ofaccounting described in Note 1. 
Our audit was made for the purpose offorming an opinion on the financial statements taken as a whole. The accompanying supplementary infonnation (Exhibits H through K and Schedules 1 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 ofthe 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, 
tt~~ 
Claude L. Vickers State Auditor 
CLV:cm 96ARL-2 
 
 FUNANCLALSTATE~S 
- 1- 
 
 ~ Caah lIIId Caah EquMllenls 
(See Schedule) 
InYesImenla (See Schedule) 
AccounIa~ 
State Appropri8llon FederlII FinIInci8I AaiIIance Other 
Inv8nIorIes  SUpply 
Donated Food 
FlxedAuela Equipmenl 
Amount to be ProvIded for Payment 01 Accrued ComlJllMated Ab8ences Installment Purchau Cornmilmenls 
 
 
 
DEPABTMENIOf EDUCATION 
 
COMBINED BALANCE SHEET {STATUIOBY BASIS> 
 
ALL FUND TYPES ANDACCOVNI GROUPS 
 
JUNE 30. 1996 
 
GOVERNMENTAl. FUND TYPE BUDGET 
 
FIDUCIARY FUND TYPES 
 
NONEXPENDABLE 
 
TRUST 
 
AGENCY 
 
$ 
 
$ 
 
81,414,170.31 
 
81,214,330.86 
 
8,610,220.78 
 
$ 
 
171,238,721.95 
 
$ 
 
82,201.28 
 
911,709.11 
 
.$ 
 
993,910.39 
 
13,500.00 $_---'830=,320='-'.47~ $ _ _':..:',:,8'1:;81:.,:6::.2..:.,' 
 
TotalAuela 
 
$ 
 
172,232,632.34 $ 
 
L!ABlLlDES AND FUND EQUITY 
Liabilities Caah Overdraft Accounts Payable Conlracls P8yabIe Grants Payable Payroll Withholdinga Funds Held for Others Compensated Absences Installment Purchases 
Total Liabilities 
Fund Equity Investment in General Filled Assets Fund Balances Reserved Federal Financial A&sistance Inventories Supply Donated Food Food Distribution Program Emergency Food Assistance Program Georgia Academy for the Blind Pupira Trust Fund EI1dcMImenl Cofpua Georgia Femily Connection Initiative Georgia School for the D88f School Improvements Indigent Cere Trust Fund LoItery for EdUC8lion Teecher Honorarium Payment Technology General Obligation Bond Funds OlherFunds Unreserved Designated Surpius Regular LoItery for Education 
Total Fund Equity 
 
$ 
 
1,476,864.92 
 
5,839,180.55 
 
5,681,571.46 
 
149,6&4,552.69 
 
263,036.31 
 
$ 
 
162,925,205.93 
 
$ 
 
183,028.75 
 
85,000.00 
 
51,737.69 859,971.42 
 
$ 70,6&4.87 
 
38,922.60 
381.60 0.00 0.00 
5,464.78 32,729.31 
 
2,678,094.78 5,301,430.61 
 
$ 
 
9,307,426.41 $ 
 
Total Liabilities end Fund Equity The notes to the flll8ncial statements ere en integral pert 01 this statement. 
2  
 
$ 
 
172,232,632.34 $ 
 
13,500.00 $ 
 
749,196.68 
 
$ 
 
749,196.68 
 
$ 
 
749,196.68 
 
13,500.00 
 
13,500.00 
 
13,500.00 $ 
 
749,196.68 
 
 EXHIBIT "A" 
 
ACCOUNT GROUPS 
 
GENERAl. 
 
GENERAl. 
 
FIXED 
 
LONG-TERM 
 
ASSETS 
 
DEBT 
 
TOTALS 
 
(Memorandum Only) 
 
JUNE 30, 1lMl6 
 
JUNE 30,1995 
 
$ 
 
843,820.47 $ 
 
866,985.33 
 
$ 
 
118,87621 $ 
 
105,378.61 
 
$ 81,414,170.31 $ 81,214,330.66 8,610,220.78 
$ 171.238,721.95 $ 
 
166,193,On.29 81,878,641.87 5,027,889.14 
253,099,608.30 
 
$ 
 
82,20128 $ 
 
71,940.74 
 
911,709.11 
 
1,307,370.07 
 
$ 
 
993,910.39 $ 
 
1,379,310.81 
 
$ 31 ,818,242.64 
 
$ 31,818,242.64 $ 28,760,012.94 
 
$ 2,667,112.01 $ 123,892.42 
$ 2,791,004.43 $ 
 
2,667,112.01 $ 123,892.42 
2,791,004.43 $ 
 
2,964,361.32 169,718.42 
3,134,079.74 
 
$ 31.818.342.64 $ 2,791,004.43 $ 207,604,576JS $ 287,345.375.73 
 
$ 1,476,864.92 $ 
 
5,839,180.55 
 
5,661,571.46 
 
149,664,552.69 
 
263,036.31 
 
749,196.66 
 
$ 2,667,112.01 
 
2,667,112.01 
 
123,892.42 
 
123,892.42 
 
2,364,616.40 67,021,33225 
5,355,699.50 171,044,656.49 
336,57028 958,863.94 2,964,361.32 169,718.42 
 
$ 2,791,004.43 $ 166,465,407.04 $ 250,215,818.60 
 
$ 31,818,242.64 
 
$ 31.818,242.64 $ 28,760,012.94 
 
183,028.75 
85,000.00 
51,737.69 859.971.42 
13.500.00 70.664.87 
38.922.60 381.60 0.00 0.00 
5,464.78 32,729.31 
 
267,161.57 
85.000.00 
116.1n.61 1.191.192.46 
13.500.00 0.00 
38.922.60 0.00 
3,758.56 300.00 
5,464.78 28.346.23 
 
$ 31,818,242.64 
 
2,678,094.78 5,301,430.61 
$ 41,139,169.05 $ 
 
3,046,203.81 3,573,516.57 
37,129,557.13 
 
$ 31,818,242.64 $ 2,791,004.43 $ 207,604,576.09 $ 287,345,375.73 
 
3 
 
 DEPARTMENT OF EDUCATION STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS> 
GOVERNMENTAL FUND TYPE 
yEAR ENDED JUNE 30, 1996 
 
EXHIBIT Er 
 
FUND BALANCES JULY 1 
Reserved Unreserved 
Designated Surplus RegUlar Lottery for Education 
ADD'TIONS 
AdjUstments to Prior Year's Accounts Payable Grants Payable 
Agency Funds Lapsed to Surplus Change In Reserve for Inventory 
Donated Food Program Food Distribution Program 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 30,1994 Year Ended June 30,1995 
Adjustments to Prior Year's Accounts Receivable 
Refund of Local Grant Indigent Care Refund of Private Grant Reserved Fund Balance Transferred to Agency Funds 
French Exchange Program Reserved Fund Balance Carried Over from 
Prior Year as Funds Available 
FUND BALANCES - JUNE 30 
(To Exhibit "A) 
The notes to the financial statements are an integral part of this statement. -4- 
 
BUDGET FUND YEAR ENDED JUNE 30, 1996 JUNE 30, 1995 
 
$ 1,736,323,81 $ 2,626,636.06 
 
3,046,203.81 3,573,516.57 
 
2,629,643.20 754,516.84 
 
$ 8,356,044.19 $ 6,010,796.10 
 
$ 
 
560,354.57 $ 
 
768,287.35 
 
24,917,090.86 
 
28,172,248.27 
 
2,984.60 
 
0.00 
 
-64,439.92 
~1,221.04 
 
-135,8n.86 67,424.00 
 
-24,167,400.29 -27,946,267.88 
 
6,878,755.69 207.451.85 
 
6,085,182.95 93,554.52 
 
$ 8,003,576.32 $ 7,104,551.35 
 
$ 
 
0.00 $ 3,384,160.04 
 
6,619,720.38 
 
0.00 
 
0.00 0.00 2,291.53 
 
9,116.00 115,215.09 
0.00 
 
1,228.45 
 
0.00 
 
428,953.74 
 
1,250,812.13 
 
$ 7,052,194.10 $ 4,759,303.26 
 
$ 9,307,426.41 $ 8,356,044.19 
 
 PEPARTMENT OF EDUCATION STATEMENT OF FUNpS AVAILABLE AND EXPENPITURES 
BUDGET FUND 
YEAR ENpED JUNE 30, 1996 
 
EXHIBIT"C" 
 
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 Contract - Honorariums Professional Standards Commission Court Settlement Donation Macon Uons Club McGraw-HOI Companies Equipment Funding for Vocational Education High School Program Georgia State Financing and Investment Commission Grants Environmental Science Program (State School) Georgia Academy for the BHnd French Cultural Services Georgia Family Connection Initiative Lettie Pate Evans Foundation Next Generation School Grants State Teacher of the Year Program United States Senate Youth Program Indirect Services Funding Department of Administrative Services Lottery Proceeds Service Centers Calhoun Gainesville Moultrie Swainsboro State Schools AUanta Area School for the Deaf Georgia Academy for the Blind Georgia School for the Deaf Reimbursements For Lost Slides For Overpayment For Postage Expense For School Lunch and Milk Program For School Nurses Training For Telephone Expenses For Workshop Expenses Rents Received Sales Photocopies and Publications Video Fees 
Total Other Revenues Retained 
Total Revenues 
The notes to the financial statements are an integral part of this statement. 
-5- 
 
TOTALS 
 
VEARENDED 
 
JUNE 30, 1996 
 
JUNE 30, 1995 
 
$ 3,882,759,793.00 $ 3,531,338,321.00 
 
99,130,641.00 
 
209,944,556.00 
 
90,500.00 
 
187,000.00 
 
88,187,00 
 
-1,110,160.00 
 
$ 3,982,069,121.00 $ 3,740,359,717,00 
 
3,500,000,00 
 
6,281,899.00 
 
$ 3::,.L97:.:8:.,.5::6:.a9.,:1=2.:.1:.,:0=0:..$ 3,734,On,818.00 
 
$--=53=3,0=53=,2=47:,9.0. $ 515,476,319,70 
 
$ 
 
691,549.07 $ 
 
665,206.60 
 
521,323,00 282.50 
 
522,663,57 0.00 
 
0.00 10,00 
 
1,245.00 0,00 
 
7,159,893.87 
 
6,7n,672,00 
 
0,00 9,183.67 
0.00 0.00 0.00 0.00 1,000.00 
340,000.00 
 
500.00 15,740,74 625,000.00 50,000,00 879,336.53 6,000.00 1,000.00 
340,000.00 
 
0.00 
 
825.00 
 
0.00 
 
842.50 
 
0.00 
 
325.00 
 
0.00 
 
1,667.00 
 
14,485.63 30,017.17 81,321.66 
 
34,550.00 44,786.00 15,961.39 
 
0.00 4,127.89 
687.10 197,660,15 
30,750.00 
0.00 436.36 578.98 
 
52.22 1,208.38 1,963.18 180,392.67 26,083,32 
5.16 2,012.36 2,188.70 
 
150,379.27 264,780.05 
 
73,499.20 274,626.50 
 
$ 
 
9,498,466.37 $ 
 
10,545,353.02 
 
$ 4,521,120,835.27 $ 4,260,099,490.72 
 
 DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUDGET FUND YEAR ENDED JUNE 30, 1996 
 
EXHIBIT"C" 
 
FUNDS AVAILABLE 
CARRY-OVER FROM PRIOR YEAR 
Transfer from Reserved Fund Balance Federal Financial Assistance Inventories Georgia SChool for the Deaf SChool Improvements Lottery for Education Teacher Honorarium Payment Technology General Obligation Bond Funds Vocational Education General Obfigation FLI'lds Other Funds 
Total Carry-Over from Prior Year 
Total FLI'lds Available 
 
TOTALS 
 
YEAR ENDED 
 
JUNE 30,1996 
 
JUNE 30,1995 
 
$ 
 
267,161,57 $ 
 
1,104,179,48 
 
85,000.00 
 
85,000.00 
 
38,922.60 3,758.56 300.00 5,464.78 0.00 
28,346.23 
 
38,719.23 0.00 0.00 0.00 
3,116,90 19,796.52 
 
$ _ _---'4=28""-,9.:;.;5=3=.7~4$ _ _-"1"",2=50,,,,-,8;;:;..1=2;;.;.1,;;:;.,3 
 
$ 4,521,549,789,01 $ 4,261,350,302,85 
 
EXPENDITURES 
PERSONAL SERVICES 
Salaries and Wages Employer's Contributions for: 
F.I,CA Retirement Health Insurance Personal Uability Insurance Unemployment 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 Equipment Purchases 
TRAVEL 
MOTOR VEHICLE PURCHASES 
EQUIPMENT 
Equipment Purchases LeaselPurchase of Equipment Rental of Equipment 
The notes to the financial statements are an integral part of this statement 
-6- 
 
$ 
 
25,354,654.63 $ 
 
27,218,244.02 
 
1,510,680.89 3,751,585.28 3,115,738.02 
238,632.00 58,992.00 
396,973,00 151,680.88 
 
1,640,878.51 3,929,m.73 3,068,598.10 
278,730.00 
41,858.00 
449,512.00 136,901,47 
 
34,578,936.70 $ 
 
36,764,499.83 
 
$ 
 
52,755,62 $ 
 
1,431,788.94 
 
1,128,004,30 
 
56,392.64 
 
60,014,04 
 
12,519.50 
 
1,171,917,43 
 
204,397,16 
 
345,336.26 
 
326,129,68 
 
$--~4=,7=89=,2.55:,57 $ 
$ ----.;:;9=55-,=16=6.=09. $ 
$--.......;1=30=,7-0=0.=92- $ 
 
$ 
 
81,036.60 $ 
 
55,616,46 
 
42,798,58 
 
179,451,64 $ 
 
44,514,40 1,633,649.91 4,357,637,84 
281,780.88 51,503.15 2,139.00 
1,726,524.88 222,748.73 302,844,35 297,508,49 
8,920,851.63 
1,076,731.48 
131,662,00 
37,166.40 70,439.58 28,831,46 
136,437.44 
 
 DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUDGET FUND YEAR ENDED JUNE 30. 1996 
 
EXHIBIT"C" 
 
EXPENDITURES 
COMPUTER CHARGES 
Software Equipment 
Equipment Purchases Rental of Equipment Per Diem, Fees and Contracts Per Diem and Fees Contracts Computer BUlings, DOAS 
REAL ESTATE RENTALS 
TELECOMMUNICATIONS 
PER DIEM. FEES AND CONTRACTS 
Per Diem and Fees ContractS 
CAPITAL OUTLAY 
Per Diem, Fees and Contracts Contracts 
OTHER 
UTILITIES 
aBE FORMULA GRANTS: Kmdergarten\Grades1-3 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 For:mula Sparsity Grants In School Suspension Special Instructional Assistance Middle SChool Incentive Special Education Low-Incidence Grants 
 
TOTALS 
 
VEARENDED 
 
JUNE 30, 1996 
 
JUNE 30, 1995 
 
$ 
 
380,438.00 $ 
 
2,872,986.19 0.00 
 
281,240.00 3,201,350.88 1,017,642.29 
$ _ _.7..,.7:.5..3.L,6:5.=7.=36=$ 
$--...,:1.,4,3.0;,4;1:1=.~7~8 $ $ _ _.1..,.2:1.z3:,:6:.8.7:..:1.7L=~$ 
 
125,608.17 
3,191,832.11 7,066.19 
400,546.00 3,462,319.23 1,207,033.89 
8,394,405.59 
1,494,104.22 
1,166,417.20 
 
$ 
 
1,290,782.99 $ 
 
1,559,167.98 
 
16,547,469.66 
 
24,125,513.55 
 
$ 
 
17,838,252.65 $_~2~5~,6~84::!.1,~68::...!1.:.::.5~3 
 
$ - - - - - - = 0=.00- $ 
 
25,000.00 
 
$-_-..7:5.4=,43=9.6=0 $ 
 
775,349.80 
 
$ 861,279,137.00 $ 800,183,642.00 
 
818,340,850.00 
 
764,882,110.00 
 
311,639,548.00 
 
297,405,987.00 
 
189,439,018.00 
 
157,120,167.00 
 
116,242,554.00 
 
108,414,205.00 
 
346,213,274.00 
 
309,288,077.00 
 
51,241,172.00 
 
45,180,921.00 
 
76,335,052.00 
 
67,899,853.00 
 
32,446,142.00. 
 
30,126,581.00 
 
99,492,691.00 
 
92,728,016.00 
 
633,258,428.00 
 
625,247,059.00 
 
138,159,104.00 
 
133,357,336.00 
 
-658,766,066.00 
 
-635,201,965.00 
 
77,462,514.00 
 
70,767,219.00 
 
3,092,783,418.00 $ 2,867,399,208.00 
 
$ 160,777,462.00 $ 149,779,502.00 
 
3,301,936.00 
 
3,257,609.00 
 
23,317,032.00 
 
21,906,464.00 
 
72,552,948.00 
 
59,211,783.00 
 
72,512,817.00 
 
66,129,306.00 
 
551,277.00 
 
483,628.00 
 
333,013,472.00 $ 300,768,292.00 
 
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 30,1996 
 
EXHIBIT .C" 
 
EXPENDITURES 
OTHER 
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 Educational Service Agencies Georgia Learning Resources System High SChool Program Special Education in State Institutions Governor's Scholarships Counselors Vocational Research and Curriculum Even Start Salaries and Travel of Public Ubrarians Public Ubrary Materials Talking Book Centers Public Ubrary 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 ChiidrenIYouth Innovative Programs Next Generation School Grants Umited English - Speaking Students Program Drug-Free School (Federal) 
At Risk Summer School Program 
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 Serve America Program Family Connection Grants Youth Apprenticeship Grants Remedial Summer School Alternative Programs Superintendenfs Base Salary Environmental Science Grants Pay for Performance Mentoring Program Charter Schools Technology Specialist State and Local Education Systemic Migrant Education 
LOTTERY FOR EDUCATiON Pre-Kindergarten for 4-year-olds Personal Services Salaries and Wages 
The notes to the financial statements are an integral part of this statement 
-8- 
 
TOTALS 
 
VEARENDED 
 
JUNE 30,1996 
 
JUNE 30,1995 
 
$ 
 
178,097,558.00 $ 
 
170,268,470.97 
 
5,308,976.18 
 
5,185,712.00 
 
61,644,962.00 
 
59,252,742.21 
 
1,538,516.14 
 
1,047,293.70 
 
42,844,819.00 
 
40,369,243.00 
 
202,881,821.88 
 
202,115,138.43 
 
27,567,268.00 
 
25,571,964.00 
 
2,028,464.00 9,012,044,00 3,833,130.00 31,932,850.47 4,564,128.00 2,818,424.00 6,995,220.00 
146,338.00 2,874,8n.00 12,558,024.26 5,927,770.98 
992,239,00 4,039,391.00 31,139,947.62 7,948,435.50 
 
2,022,308.57 7,264,296.00 3,603,974.49 31,574,463.78 4,097,533.00 2,972,200.00 6,717,000.00 
0.00 2,448,485.00 11,838,868.38 5,505,248.94 
934,520.00 4,039,391.00 30,126,533,78 8,100,763.00 
 
14,237,799.13 662,599.63 
1,609,663,00 499,996.00 
11,417,099.00 9,263,719.33 5,999,999.93 416,362.60 5,173,471,12 772,500.00 
 
14,862,910,72 655,330,47 
1,208,875.00 1,447,000.00 9,027,195.00 8,513,874.22 4,691,269.86 
312,864.00 5,238,971.73 
513,000.00 
 
99,047,892.00 14,953,763.00 
1,248,292.50 63,913,00 0,00 
543,862.78 0.00 
4,307,343.00 1,875,663,09 12,394,075,00 
0,00 100,000.00 2,018,000.00 495,060.00 260,000.00 13,655,450.00 1,569,113.00 266,394.00 
 
99,047,892.00 15,226,209.00 
1,236,710.00 131,943.00 
1,n1,560.00 351,427.00 
3,195,000.00 2,000,000.00 1,874,991.25 7,240,788.00 1,228,175.00 
100,000.00 1,048,000.00 
0.00 0.00 0.00 56,000.00 0.00 
 
$ 849,547,236.14 $ 806.036.136,50 
 
$ 
 
464,900.20 $ 
 
354,556.60 
 
 DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUDGET FUND YEAR ENDED JUNE 30, 1996 
 
EXHIBIT .C" 
 
EXPENDITURES 
OTHER 
LOTIERY FOR EDUCATION Pre-Kindergarten for 4-year-olds 
Personal Services 
Employer's Contributions for: 
F.I.CA 
Retirement Health Insurance Personal Uability Insurance Assessments by Merit System Other Costs SUpplies and Materials Repairs and Maintenance Rents (Other than Real Estate) Insurance and Bonding 
Grants to Counties, Cities and Civil 
Divisions Other Operating Expenses (See Schedule) Duplicating and Rapid Copy Publications and Printing Equipment Purchases Travel Equipment Equipment Purchases Rental of Equipment Computer Charges Software Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Contracts 
Lottery Grants Applied Technology Labs Next Generation Schools Drug and Anti-Violence Education Alternative Programs Educational Technology Centers Distant Learning - Satellite Dishes Model Technology Schools Instructional Technology Capital Outlay Technology Installation Postsecondary Options Safe Schools Grant Learning Logic Sites Media Center/Ubrary Equipment 
Total Other 
Total Expenditures 
Excess of Funds Available over Expenditures 
The notes to the financial statements are an integral part of this statement 
-9- 
 
TOTALS 
 
yEAR ENDED 
 
JUNE 30, 1996 
 
JUNE 30, 1995 
 
$ 
 
20,903.46 $ 
 
61,730.55 
 
58,112.74 
 
2,928.00 
 
2,244,05 
 
209,886.10 0.00 
9,556.73 72.00 
 
176,596,532.63 2,393.45 
35,941.13 2,734.02 
18,422.35 26,173.89 
 
218,878.55 5,149.67 
 
19,324.22 43,803.04 
712.98 
 
66,608.45 9,080.00 
 
$ 177,876,088.21 $ 
 
10,871,44 44,410.07 44,319.49 
3,420.00 1,599.80 
24,905.47 1,213.85 60.00 72,00 
75,291,336.00 3,426.08 
25,668.73 448.54 
20,599.79 19,874.47 
27,912.61 0.00 
3,657.44 0.00 
1,489.62 
45,667.84 0.00 
75,925,509.84 
 
0.00 500,000.00 
0.00 5,000,000;00 
900,000.00 0.00 
250,000.00 0.00 
10,650,000.00 0.00 
1,313,015.47 0.00 
2,100,000.00 2,160,000.00 
 
12,280,040.00 500,000.00 
1,000,000.00 8,471,564.00 
877,582.00 4,206,507.00 10,499,998.00 31,237,453.00 61,405,934.00 18,989,992.00 1,128,213.67 4,000,000.00 
0.00 0.00 
 
$ 200,749,103.68 $ 230,522,793.51 
 
$ 4,476,847,669.42 $ 4,205,501,779.81 
 
$ 4,545,717,189.30 $ 4,289,296,570.73 
 
-24,167,400.29 
 
-27,946,267.88 
 
$ 4,521,549,789.01 $ 4,261,350,302.85 
 
 DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
COMPARED TO BUDGET BUDGET FUND 
-A- DEPARTMENT OF EDUCATION 
YEAR ENDED JUNE 30.1996 
 
EXHIBIT-P- 
 
The notes to the financial statements are an integral part of this statement -10- 
 
 DEPARTMENT OF EDUCATION STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
COMPARED TO BUDGET BUDGET FUND 
-A- DEPARTMENT OF EDUCATION 
YEAR ENDED JUNE 30,1996 
 
EXHIBIT-o- 
 
EXPENDITURES 
. Non-QBE Grants Supervision and Assessment of Students and Beginning Teachers and Performance-Based Certification Regional Educational Service Agencies Georgia Learning Resources System High School Program Special Education in State Institutions Governor's Scholarships .Counselors 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 ofTechnical and Adult Education Education of Homeless ChildrenIYouth Innovative Programs Next Generation School Grants Limited English-Speaking Students Program Drug-Free School (Federal) At Risk Summer School Program 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 Serve America Program Youth Apprenticeship Grants Remedial Summer School Alternative Programs Environmental Science Grants Pay for Performance Mentoring Program . 
Charter Schools Technology Specialist State and Local Education Systemic Migrant Education 
 
BUDGET 
 
ACTUAL 
 
VARIANCEFAVORABLE (UNFAVORABLE) 
 
$ 
 
2,028,464.00 $ 
 
2,028,464.00 $ 
 
9,012,044.00 
 
9,012,044.00 
 
3,895,096.00 
 
3,833,130.00 
 
39,674,784.00 
 
31 ,932,850.47 
 
4,782,130.00 
 
4,564,128.00 
 
2,818,424.00 
 
2,818,424.00 
 
6,995,656.00 
 
6,995,220.00 
 
294,520.00 
 
146,338.00 
 
2,963,956.00 
 
2,874,8n.00 
 
12,571,011.00 
 
12,558,024.26 
 
6,302,325.00 
 
5,927,nO.98 
 
992,239.00 
 
992,239.00 
 
4,039,395.00 
 
4,039,391.00 
 
33,702,706.00 
 
31,139,947.62 
 
9,663,513.00 
 
7,948,435.50 
 
16,892,002.00 1,203,522.00 1,n3,761.00 2,443,700.00 
11,417,099.00 11,625,943.00 6,000,000.00 
459,113.00 5,580,597.00 
n2,5OO.00 
 
14,237,799~ 13 662,599.63 
1,609,663.00 499,996.00 
11,417,099.00 9,263,719.33 5,999,999.93 
416,362.60 5,173,471.12 
n2,5OO.00 
 
99,047,892.00 14,953,763.00 
1,250,000.00 63,913.00 
632,685.00 4,340,000.00 1,875,664.00 12,394,075.00 
100,000.00 2,018,000.00 
500,000.00 620,000.00 13,655,450.00 1,674,891.00 266,403.00 
 
99,047,892.00 14,953,763.00 
1,248,292.50 63,913.00 
543,862.78 4,307,343.00 1,875,663.09 12,394,075.00 
100,000.00 2,018,000.00 
495,060,00 260,000.00 13,655,450.00 1,569,113.00 266,394.00 
 
0.00 0.00 61,966.00 7,741,933.53 218,002.00 0.00 436.00 148,182.00 89,079.00 12,986.74 374,554.02 0.00 4.00 2,562,758.38 1,715,On.50 
2,654,202.87 540,922.37 164,098.00 
1,943,704.00 0.00 
2,362,223.67 0.07 
42,750.40 407,125.88 
0.00 
0.00 0.00 1,707.50 0.00 88,822.22 32,657.00 0.91 0.00 0.00 0.00 4,940.00 360,000.00 0.00 105,n8.00 9.00 
 
$ 4,392,310,200.00 $ 4,344,968,085.62 $ 
 
47,342,114.38 
 
Excess of Funds Available over Expenditures 
 
$ 
 
-25,554,541.61 $ 
 
-25,554,541.61 
 
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 
"B" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30, 1996 
 
EXHIBIT"E" 
 
FUNDS AVAILABLE 
REVENUES 
State Appropriation 
EXPENDITURES 
Pre-Kindergarten for 4-year aids Next Gerieration Schools A1temative Programs Educational Technology Centers Model Technology Schools Capital Outlay Post Secondary Options Learning Logic Sites Media CenterJUbrary Equipment 
 
BUDGET 
 
ACTUAL 
 
VARIANCEFAVORABLE (UNFAVORABLE) 
 
---_..:...-_- $ 202,636,245.00 $ 202,136,245.00 $ 
 
-500,000.00 
 
$ 178,456,245.00 $ 177,876,088.21 $ 
 
500,000.00 
 
500,000.00 
 
5,000,000.00 
 
5,000,000.00 
 
900,000.00 
 
900,000.00 
 
250,000.00 
 
250,000.00 
 
11,950,000.00 
 
10,650,000.00 
 
1,320,000.00 
 
1,313,015.47 
 
2,100,000.00 
 
2,100,000.00 
 
2,160,000.00 
 
2,160,000,00 
 
580,156.79 0.00 0.00 0.00 0.00 
1,300,000.00 6,984.53 
0.00 0.00 
 
$ 202,636,245.00 $ 200,749,103.68 $ _ _----'1,'-88_7...:..,1_4_1_.3_2 
 
Excess of Funds Available over Expenditures 
 
$ 
 
1,387,141.32 $ ====::i::i1,=38=:7:::!::.1=4=::1=.3=2 
 
The notes to the financial statements are an integral part of this statement. -12 - 
 
 DEPARTMENT OF EDUCATiON STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE 
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND 
YEAR ENPED JUNE 30,1996 
 
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. 1995 
 
ENDOWMENT CORPUS PUPILS' TRUST FUND- 
GEORGIA ACADEMY FOR THE BLIND 
 
$ 
 
822,03 
 
0,00 
 
$ 
 
822,03 
 
-822.03 
 
$ 
 
0,00 
 
13,500,00 
 
FUND BALANCE JUNE 30. 1996 
 
$========13=,5:=0:::::0.::::00= 
 
The notes to the financial statements are an integral part of this statement. 
-13- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE 1: SUMMARy OF SIGNIFICANT ACCOUNTING POLICIES 
REPORTING ENTITY The Department ofEducation, an organizational unit ofthe State of Georgia, is part ofthe executive branch ofthe government ofthe State ofGeorgia. 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 of the rules, regulations, policies and standards adopted by the State Board ofEducation. 
The Department ofEducation does not have authority to determine the amount offunding it will receive from the State of Georgia for any given fiscal year. Such authority is vested in the General Assembly ofGeorgia. 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 ofits 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. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds are maintained consistent with legal and managerial requirements. Account groups are a reporting device used to account for certain assets and liabilities of the governmental funds not recorded directly in those funds. 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 1995-1996. The Budget Fund is similar in nature to a General Fund as defined 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. 
 
- 14- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXlDBIT "G" 
 
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
FUND ACCOUNTING 
FIDUCIARY FUND TYPES 
NONEXPENDABLE TRUST FUND .; The fund used to account for assets, revenues and expenses utilized in accordance with the provisions ofa trust established by individual agreement. Nonexpendable trust funds are used when only the revenues earned on the principal (corpus) of the trust may be expended for the purposes designated by the trust and the principal ofthe trust 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 cost or at estimated historical cost ifhistorical cost is not practically determinable. 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. 
The cost ofnormal maintenance and repairs that do not add to the value ofthe asset or materially extend assets' lives are not included in the General Fixed Assets Account Group. Material improvements adding to the value or useful life ofthe assets are included in the General Fixed Assets Account Group. 
GENERAL LONG-TERM DEBT - The account group used to report the noncurrent portions of certain govemmentallong-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 a~unted for using the flow of current financial resources measurement focus. With this measurement focus, operating statements present increases and decreases in net current assets and unreserved fund balance is a measure ofavailable spendable resources. In accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, the Budget Fund remits its unreserved fund balance (surplus) to the Office ofTreasury and Fiscal Services in the subsequent fiscal year. 
Nonexpendable trust funds, on the other hand, should be accounted for on a flow of economic resources measurement focus. With this measurement focus, aU assets and aU liabilities are included on the balance sheet. Operating statements of these funds present increases, (i.e., revenues) and decreases, (Le., expenses) in net total assets. This measurement focus emphasizes the determination of net income. In accordance with 
- 15 - 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 3D. 1996 
 
EXHIBIT "0" 
 
NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
BASIS OF ACCOUNTING MEASUREMENT FOCUS 
accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, the Nonexpendable Trust Fund utilizes the current financial resources measurement focus. 
GOVERNMENTAL FUND TYPE BUDOETFUND 
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 (Le., when they are "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 pay liabilities ofthe. current period. Revenues that are accrued include primarily State appropriations, Federal grants and entitlements, and certain amounts earned under operating agreements with other parties. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest on general long-term debt which is recognized when due, and certain compensated absences, claims and judgements which are recognized when the obligations are expected to be liquidated with expendable available financial resources. 
Contractual obligations for goods and services which have not been received at the end ofthe 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 ofcontracts 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 of the State of Georgia, 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 ofaccounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (Le., 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. 
 
- 16- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 3D. 1996 
 
EXHIBIT "Gil 
 
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
BASIS OF ACCOUNTING FIDUCIARY FUND TYPES NONEXPENDABLE TRUST FUND 
Expenditures are recorded when the related fund liability is incurred. The basis of accounting differs from generally accepted accounting principles in that nonexpendable trust funds should be maintained on the accrual basis ofaccounting. 
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 Agency Funds are custodial in nature and do not measure results of operations or have a measurement focus. The modified accrual basis of accounting is utilized for recognizing assets and liabilities. 
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 adopted on a basis consistent . with accounting practices prescribed or permitted by statutes and regulations of the State ofGeorgia and are compiled in the same manner as all State departments. Expenditures are classified by budget unit object classes as provided in Act No. 476 ofGeorgia Laws 1995 (as approved April 21, 1995) and amended by Act No. 513 of Georgia Laws 1996 (as approved February 16, 1996). These budgets are considered to be appropriated budgets and are referred to in these notes as the Amended Appropriations Act of 1995-1996. 
. Overexpenditure of a budget unit object class, except for the "common object classes", included in the Department's final amended budget is in violation of Section 54 of the 1995-1996 Amended Appropriations Act. Expenditures ofno more than 102% of the stated amount for each common object class are authorized by Section 54. However, the total expenditure for the group of common object classes may not exceed the sum of the stated amounts for the separate object classes of the group. The common object classes include Personal Services, Regular Operating Expenses, Travel, Motor Vehicle Purchases, Equipment, Computer Charges, Real Estate Rentals, Telecommunications and Postage. 
A comparison of anticipated funds available and budgeted expenditures by budget unit object class indicates that the object class Non-QBE Grants - Retirement (H. B. 272 and H. B. 1321) was overspent by the amount of$135,226.18. 
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. 
 
- 17 - 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
INVESTMENTS Investments are defined as those financial instruments with terms in excess ofthree months from the date of purchase and certain other securities held for the production of revenue. Investments are stated'at cost. 
The Department ofEducation participates in an investment pool managed by the State of Georgia's Office of Treaswy and Fiscal Services (OTFS) referred to as the "Georgia Fund 1". The Department does not have any risk exposure related to investments in derivatives or similar investments in Georgia Fund 1 as the investment policy of OTFS does not provide for investments in derivatives or similar investments through the Georgia Fund 1. 
INVENTORIES SUPPLY 
Inventories ofsupplies are valued at cost using the first-in, first-out (FIFO) method on the Combined Balance Sheet (Statutory Basis). The consumption method is used to account for the use ofinventories. Under the consumption method, the costs ofinventories 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 of Agriculture. 
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. 
INVENTORIES SUPPLY 
Reported inventories, under the consumption method, are offset by a portion of State funds reserved to provide working capital for managing a reasonable level ofinventories. 
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. 
- 18- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXIDBIT "G" 
 
NOTE 1: SUMMARYOF SIGNIFICANT ACCOUNTING POLICIES 
 
RESERVED FUND BALANCE 
 
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 FAMILY CONNECTION INITIATIVE The residual portion of refunds from local school systems due to the Georgia Department of Human Resources at fiscal year end. This amount is restricted for payment to the Georgia Department ofHuman Resources. 
 
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. 
 
INDIGENT CARE TRUST FUND The residual portion of refunds from local school systems due to the Georgia Department of Medical Assistance at fiscal year end. This amount is restricted for payment to the Georgia Department ofMedical Assistance. 
 
TECHNOLOGY GENERAL OBLIGATION BOND 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. 
 
OTHER RESERVES The residual portion of various special purpose grants from sources which are restricted for expenditures in subsequent fiscal years. 
 
France - Mediaction and Vocational Mission Programs French Cultural Services Program Next Generation School State Teacher ofthe Year Program United State Senate Youth Program 
 
$ 6,022.92 21,038.98 622.17 1,776.32 3,268.92 
 
$ 32,729.31 
 
UNRESERVED FUND BALANCE In accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, the Budget Fund's unreserved fund balance is remitted to the Office ofTreasury and Fiscal Services 
in the subsequent fiscal year as surplus as follows. 
 
- 19- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
UNRESERVED FUND BALANCE 
REGULAR - An amount ofunexpended regular appropriations designated for reappropriation by the State in subsequent years. 
LOTTERY FOR EDUCATION - An amount ofunexpended lottery appropriations designated for future reappropriation by the State for Lottery for Education. 
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 offunds 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" because they do not represent consolidated financial information and are presented only to facilitate financial analysis. The columns do not present information that reflects 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 ofthis data. 
COMPARATIVE DATA Comparative total data for the prior year have been presented in selected sections of the accompanying financial statements in order to provide an understanding ofthe changes in the Department's financial position and operations. Comparative totals have not been included on statements where their inclusion would not provide enhanced understanding of the Department's financial position and operations or would cause the statements to be unduly complex and difficult to understand. Also, certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year's presentation. 
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS 
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds ofthe 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 collateral anyone or more ofthe following securities as enumerated in the Official Code of Georgia Annotated . Section 50-17-59: 
- 20- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS 
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES (1) Bonds, bills, certificates ofindebtedness, notes, or other direct obligations ofthe United States or ofthe State of Georgia. 
(2) Bonds, bills, certificates ofindebtedness, notes, or other obligations ofthe counties or municipalities ofthe State of Georgia. 
(3) Bonds ofany public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose. 
(4) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws ofthe State of Georgia. 
(5) Bonds, bills, certificates ofindebtedness, 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, or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. 
(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 bank balances which include demand deposits and/or interest bearing accounts. The bank balances as of June 30, 1996, 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 pledging financial institution's trust department or agent in the Department's name. 
Category 3 - Amounts collateralized with securities (at market value) held by the pledging financial institution or by its trust department or agent, but not in the Department's name, and amounts uncollateralized. 
- 21 - 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS. 
 
CATEGORIZATION OF DEPOSITS 
 
Cash Deposits 
 
Carrying Amount 
 
Bank Balances 
 
Risk Categories 
 
2 
 
3 
 
$ .77399553 $ 5,275,291 42 $ 805,217,54 $ JJ 1 61533 $ 4358 45855 
 
CATEGORIZATION OF INVESTMENTS Investments are stated at cost. The carrying amount ofthe investment balance as ofJune 30, 1996, shown below is maintained in an investment pool by the Office ofTreasury and Fiscal Services and is not subject to risk categorization. 
 
Type ofInvestment 
 
Carrying Amount 
 
Market Value 
 
State Investment Pool 
 
$ 48 677,99 $ 48,677,99 
 
NOTE 3: OPERATING LEASES 
 
The Department 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 of the lease, the Department has the option of renewing the lease on a year-to-year basis. Future minimum commitments for operating leases as ofJune 30, 1996, are listed below. Amounts are included only for multiyear leases and for cancellable leases for which an option to renew for the subsequent fiscal year has been exercised. 
 
Fiscal Year Ending June 30 
 
1997 
 
$ 116,926,05 
 
Expenditures for rental of.real property and equipment under operating leases for the year ended June 30, 1996, totaled $231,780.74. 
 
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 ifappropriated funds are not available. If renewal of such agreements is reasonably assured, however, installment purchases requiring appropriation by the General Assembly. of Georgia are considered noncancellable for financial reporting 
purposes. 
 
- 22- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT"G" 
 
NOTE 4: INSTALLMENT PURCHASE COMMITMENTS 
 
At June 30, 1996, future minimum commitments under installment purchases for equipment are as follows: 
 
Fisca1Year Ending June 30 
 
1997 1998 1999 2000 
 
$ 58,211.60 48,992.76 26,313.45 2,936.36 
 
Total Future Minimum Commitments 
 
$ 136,454.17 
 
Less: Amounts Representing Interest 
 
12.561.75 
 
Present Value ofFuture Minimum Commitments 
 
$ 123.892.42 
 
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, 1995 
 
$28,760,012.94 
 
Additions Deductions 
 
3,331,217.77 272.988.07 
 
Balance June 30, 1996 
 
$31.818.242.64 
 
- 23- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXHIBIT"G" 
 
NOTE 6: GENERAL LONG-TERM DEBT 
 
CHANGES IN GENERAL LONG-TERM DEBT A summary ofchanges in General Long-Term Debt for the year ended June 30, 1996, follows: 
 
Compensated Absences 
 
Installment Purchase Commitments 
 
Total 
 
Balance July 1, 1995 
 
$ 2,964,361.32 $ 169,718.42 $ 3,134,079.74 
 
Additions Annual Leave Earned and Utilized (Net) Salaries Salary Related Fringe Benefits 
Deductions 
 
-276,125.69 -21,123.62 
 
45,826.00 
 
-276,125.69 -21,123.62 45,826.00 
 
Balance June 30, 1996 
 
$ 2,667,112.01 $ 123,892.42 $ 2,791.004 43 
 
. NOTE 7: RISK MANAGEMENT 
 
Public Entity Risk Pool 
 
The State Personnel Board, Merit System ofPersonnel Administration administers for the State of Georgia a program ofhealth benefits for the employees ofunits ofgovernment ofthe State of Georgia, units of county . government and local education agencies located within the State of Georgia. This plan is funded by participants covered in the plan, by employers' contributions paid by the various units of government participating in the plan, and appropriations made by the General Assembly of Georgia. The State Personnel Board, Merit System ofPersonnel Administration has contracted with Blue Cross Blue Shield of Georgia to process claims in accordance with the State Employees' Health Benefit Plan as established by the State Personnel Board. 
 
Other Risk Management 
 
The Department ofAdministrative Services (DOAS) has the responsibility for the State of Georgia of making and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts ofcommercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The Department ofEducation is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment. 
 
- 24- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXHIBIT "Gil 
 
NOTE 8: 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 ofthe State of Georgia and county health departments, pennits such employees to defer a portion oftheir salary until future years. Participation in the plan is optional. 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 of the State of Georgia 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 of the deferred account of each participant. Financial information relative to the plan will be presented in the State of Georgia Comprehensive Annual Financial Report for the year ended June 30, 1996. 
NOTE 9: RETIREMENT PLANS 
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 
Plan Description The Department ofEducation participates in the Employees' Retirement System of Georgia ("ERS"), a singleemployer, defined benefit plan established by the General Assembly of Georgia for the purpose of providing retirement allowances for employees of the State of Georgia. The Department's payroll for the year ended June 30, 1996, for employees covered by ERS was $19,410,930.27. The Department's total payroll for all employees was $25,819,554.83. 
Benefits The benefit structure of ERS was significantly modified on July 1, 1982. Unless elected otherwise, an employee who currently maintains membership with ERS based upon State employment that started prior to July 1, 1982, is an "old plan" member subject to the plan provisions in effect prior to July I, 1982. All other members are "new plan" members subject to the modified plan provisions. 
Under both the old plan and new plan, members become vested after 10 years of creditable service. A member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 65. If 10 years of service is completed and age 60 is reached,,the member may retire with a reduced benefit. Additionally, there are certain provisions allowing for retirement after 30 years ofservice regardless of age. 
Retirement benefits paid to members are based upon a formula which considers the monthly average of the members highest eight consecutive calendar quarters of salary, the number of years of creditable service, and the members age at retirement. Postretirement cost-of-living adjustments are also made to member's benefits. The normal retirement pension is payable monthly for life~ however, options are available for distribution of the member's monthly pension at reduced rates to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS. 
- 25- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "Gil 
 
NOTE 9: RETIREMENT PLANS 
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 
Funding Status and Progress Funding status and progress information is presented in the ERS June 30, 1996, financial report which may be obtained through ERS. 
Contributions Required and Contributions Made As established by State statute, all full-time employees of the State of Georgia and its political subdivisions, who are not members ofother state retirement systems, are eligible to participate in the ERS. Both employer and employee contributions are established by State statute. 
Under the old plan, member contributions consist of employee contributions paid by the employee of 1.25% ofcompensation and 4.75% of compensation paid by the Department on behalf ofthe employee. Under the new plan, member contributions consist solely of 1.25% of compensation paid by employee. The Department also is required to contribute at a specified percentage of active member payroll determined annually by actuarial valuation. For the year ended June 30, 1996, the ERS employer contribution rate for the Department amounted to 15.68% ofcovered payroll and included the 4.75% contributed on behalf ofthe employee under the old plan referred to above. The employer contributions are projected to liquidate the unfunded actuarial liability within 20 years based upon the actuarial valuation ofJune 30, 1995. Employer contributions are also made on amounts paid for accumulated leave to retiring employees. 
Actuarial assumptions used by the ERS to compute actuarially determined contribution requirements are the same as those used to compute the pension benefit obligation. 
Total contributions to the plan made during fiscal year 1996 amounted to $3,284,063.43, of which $3,044,417.40 was made by the Department and $239,646.03 was made by employees. These contributions met the requirements ofthe plan. 
Trend Information Historical trend information is presented in the ERS June 30, 1996, financial report which may be obtained through ERS. This information gives an indication of the progress made in accumulating sufficient assets to pay benefits when due. 
TEACHERS RETIREMENT SYSTEM OF GEORGIA 
Plan Description The Department ofEducation participates in the Teachers Retirement System ofGeorgia (TRS), a cost-sharing multiple-employer public employee retirement system (PERS) established by the General Assembly of Georgia for the purpose of providing retirement allowances and other benefits for teachers of the State of Georgia. The Department's payroll for the year ended June 30, 1996, for employees covered by TRS was $5,206,484.05. The Department's total payroll for all employees was $25,819,554.83. 
- 26- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXHIBIT "G" 
 
NOTE 9: RETIREMENT PLANS 
TEACHERS RETIREMENT SYSTEM OF GEORGIA 
Benefits TR.S provides service retirement, disability retirement, and survivor's benefits for its members. A member is eligible for service retirement after the member (1) has attained the age of 60 years and has at least ten years ofcreditable service, (2) has at least 30 years of creditable service, regardless ofage, or (3) has attained the age of55 years and has at least 25 years of creditable service. For those members with 30 years of service or those age 60 with at least ten years of service, retirement benefits are equal to 2% of the average of the member's two consecutive highest paid years ofservice multiplied by the number ofyears of creditable service up to 40 years. Any member who has between 25 and 30 years of creditable service and is at least 55 years ofage shall receive a benefit which is reduced by the lessor of 1/12 of 7% for each month the member is below age 60, or by 7% for each year or fraction thereofby which the member has less than 30 years of service. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death. 
Retirement benefits also include death and disability benefits whereby the disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The benefit is based on member's creditable service (minimum of 10 years of service) and compensation up to the date of death or up to the time of disability. 
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. 
Contributions Required and Contributions Made Employees ofthe Department who are covered by TR.S are required to pay 5% of their gross earnings to TRS. The Department makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1996, the employer contribution rate was 11.81% for covered employees. The interest rate assumption (rate ofretum on investments) was 7.50%. 
Total contributions to the plan made during fiscal year 1996 amounted to $874,673.67, ofwhich $614,506.66 was made by the Department and $260,167.01 was made by employees. These contributions represented 11.81% (Department) and 5% (employees) of covered payroll. 
Funding Status and Progress Funding status and progress information is presented in the TRS June 30, 1996, financial report which may be obtained through TRS. 
Trend Information Historical trend information is presented in the TRS June 30, 1996, financial report. This information gives an indication of the progress made in accumulating sufficient assets to pay benefits when due. 
 
- 27- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXHIBIT "G" 
 
NOTE 9: RETIREMENT PLANS 
GEORGMDE~DCONumrnUTIONPLAN 
Plan Description The Department of Education participates in the Georgia Defined Contribution Plan ("GDCP") which is a single-employer defined contribution plan established by the Georgia General Assembly for the purpose of providing retirement coverage for State employees who are temporary, seasonal, and part-time and are not members of a public retirement or pension system. GDCP is administered by the Employees' Retirement System Board ofTrustees. The Department's payroll for the year ended June 30, 1996, for employees covered by GDCP was $438,517.45. The Department's total payroll for all employees was $25,819,554.83. 
Benefits A member may retire and elect to receive periodic payments after attainment of age 65. The payment will be based upon mortality tables and interest assumptions to be adopted by the Board. If a member has less than $ 3,500 credit to hislher account, the Board has the option ofrequiring a lump sum distribution to the member in lieu of making periodic payments. Upon the death of a member, a lump sum distribution equaling the amount credited to hislher account will be paid to the member's designated beneficiary. 
Contributions and Vesting Member contributions are seven and one-half percent (7.5%) of gross salary. There are no employer contributions. Earnings are credited to each member's account in a manner established by the Board. Upon termination of employment, the amount ofthe member's account is refundable upon request by the member. 
Total contributions made by employees during fiscal year 1996 amounted to $32,888,83 which represents 7.50% of covered payroll. These contributions met the requirements ofthe plan. 
NOTE 10: LEAVB 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 offorfeited annual and sick leave are entitled to additional service credit in the Employees' Retirement System of Georgia. 
 
- 28- 
 
 DEPARTMENT OF EDUCATION 
NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30. 1996 
 
EXlDBIT "G" 
 
NOTE 11: NONMONETARY TRANSACTIONS 
Certain programs administered by the Federal government provide donated commodities to the Department ofEducation in lieu ofmonetary assistance. An analysis ofnonmonetary assistance received based on values assigned by the Federal government during the year under review is reflected below: 
 
Agriculture, U. S. Department of Food Distribution Emergency Food Assistance Program 
 
$26,818,828.00 $ 1,464,303.00 
 
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 12: OTHER FINANCIAL NOTE 
 
PAYMENTS MADE ON-BEHALF OF LOCAL EDUCATION AGENCIES The Department ofEducation has been directed by statute to pay a portion of the employer's cost of State retirement benefits and health insurance benefits for certain employees of local education agencies (LEA's) from funds appropriated by the General Assembly. During the year ended June 30, 1996, the Department contributed $5,308,976.18 to the Teachers' Retirement System of Georgia for retirement benefits and $90,047,892.00 to the State Personnel Board, Merit System ofPersonnel Administration for health insurance benefits for the LEA's. 
 
NOTE 13: CONTINGENCffiS 
 
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. 
 
Litigation, claims and assessments filed against the Department ofEducation, if any, are generally considered to be actions against the State ofGeorgia. 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, 1996. 
 
NOTE 14: SUBSEQUENT EVENT 
 
Pursuant to Official Code of Georgia Annotated Section 20-5-2, effective July 1, 1996, the responsibility for providing library services to local education agencies was transferred from the Department of Education (DOE) to the Department of Technical and Adult Education (DTAB). Subsequent to June 30, 1996, DOE transferred the assets and liabilities of associated with the library services program to DTAB. 
 
- 29- 
 
 DEPARTMENT OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS 
JUNE 30, 1996 
 
EXfllBIT "0" 
 
NOTE 15: BONDINOINFORMATION 
The State Superintendent of Schools and all employees of the Department ofEducation are bonded under a Public Employees Blanket Bond written by Employers Insurance ofWausau, their Bond No. 1450-02-110723, on which the premium was paid to October I, 1996. Under this agreement the Public Employee Dishonesty Coverage insures the Department to a maximum ofSI,OOO,OOO.OO against loss sustained through fraudulent or dishonest acts by its employees. The Faithful Performance ofDuty Coverage insures the Department to a maximum ofSl,OOO,OOO.OO against loss sustained from failure ofits employees to perform faithfuIly 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 Commercial Crime Policies written by the United States Fire Insurance Company, their Policy Nos. 626012292 6 and 626 012294 4, on which premiums were paid to October 1, 1996. Under these additional public employee dishonesty coverages, the policies insure the Department to a maximum ofS9,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees and from failure ofits employees to perform faithfully. 
 
- 30- 
 
 SUPPLEMENTARY INFORMATION - 31 - 
 
 DEPARTMENT OF EDUCATION COMBINING BAlANCE SHEET (STATUTORY BASIS) 
BUDGET FUND JUNE 30,1996 
 
EXHIBIT "..,. 
 
ASSETS Cash and Cash Equivalents Accounts Receivable 
State Appropriation Federal Financial Assistance Other 
Inventories Supply Donated Food 
Total Assets 
 
HA" DEPARTMENT OF 
EDUCATION 
 
"B" LOTTERY FOR 
EDUCATION 
 
TOTAL 
 
$ 
 
$ 
 
22,856,499.86 $ 
 
81,214,330.86 
 
8,610,220.78 
 
$ 
 
112,681,051.50 $ 
 
$ 
 
82,201.28 
 
911,709.11 
 
$ 
 
993,910.39 
 
294,898.44 $ 
 
294,898.44 
 
58,557,670.45 $ 58,557,670.45 $ 
 
81,414,170.31 81,214,330.86 
8,610,220.78 
171,238.721 .95 
 
$ 
 
82,201.28 
 
911,709.11 
 
$ 
 
993,910.39 
 
$ 
 
113,674,961.89 $ 
 
58,852,568.89 $ 172,527,530.78 
 
LIABILITIES AND FUND EQUITY 
 
Liabilities 
 
Cash Overdraft 
 
$ 
 
Accounts Payable 
 
Contracts Payable 
 
Grants Payable 
 
Payroll Withholdings 
 
Total Liabilities 
 
$ 
 
Fund Equity 
 
Fund Balances 
 
Reserved 
 
Federal Financial Assistance 
 
$ 
 
Inventories 
 
Supply 
 
Donated Food 
 
Food Distribution Program 
 
Emergency Food Assistance Program 
 
Georgia Family Connection Initiative 
 
Georgia School for the Deaf 
 
School Improvements 
 
Indigent Care Trust Fund 
 
Technology General Obligation Bond Funds 
 
Other Funds 
 
Unreserved 
 
Designated 
 
Surplus 
 
Regular 
 
Lottery for Education 
 
Total Fund Equity 
 
$ 
 
1,771,763.36 5,545,073.76 $ 5,681,571.46 96,414,191.82 
256,365.69 
109,668,966.09 $ 
183,028.75 
85,000.00 
51,737.69 859,971.42 
70,664.87 
38,922.60 381.60 
5,464.78 32,729.31 
2,678,094.78 $ 
4,005,995.80 $ 
 
Total Liabilities and Fund Equity See notes to the financial statements. 
 
$ 
 
113,674,961.89 $ 
 
- 32- 
 
$ 294,106.79 
53,250,360.87 6,670.62 
53,551,138.28 $ 
 
1,771,763.36 5,839,180.55 5,681,571.46 149,664,552.69 
263,036.31 
163,220,104.37 
 
$ 
 
183,028.75 
 
85,000.00 
 
51,737.69 859,971.42 
70,664.87 
 
38,922.60 381.60 
5,464.78 32,729.31 
 
5,301,430.61 5,301 ,430.61 $ 
 
2,678,094.78 5,301,430.61 
9,307,426.41 
 
58,852,568.89 $ 172,527,530.78 
 
 DEPARTMENT OF EDUCATION COMBINING STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS) 
BUDGET FUND YEAR ENDED JUNE 30, 1996 
 
EXHIBITT 
 
  DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUOOETFUND YEAR ENDED JUNE 30 1996 
 
EXHIBIT"r 
 
FUNDS AVAILABLE 
REVENUES' 
STATE APPROPRIATION General Appropriation Amended Appropriation 
~sE~Fuoo 
Budget Adjustments 
Less: Lapsed FuOOs 
Total State Appropriation 
FEDERAL REVENUES 
OTHER REVENUES RETAINED Audit Contracts Contract  Honorariums Professional Standards Commission Court Settlement Donation McGraw-Hili Companies Equipment Funding for Vocational Education High School Program Georgia State Financing and Investment Commission Grants French Cultural Services United States Senate Youth Program Indirect Services Funding Department of Administrative Services Lottery Proceeds State Schools Atlanta Area School for the Deaf Georgia Acedemy for the Blind Georgia School for the Deaf Reimbursements For Overpayment For Postage Expense For School Lunch and Milk Program For School Nurses Training For Workshop Expenses Rents Received Sales Photocopies and Publications Video Fees 
Total Other Revenues Retained 
Total Revenues 
CARRy-oVER FROM PRIOR YEAR 
Transfer from Reserved Fund Balance Federal Financial Assistance Inventories Georgia School for the Deaf School Improvements Lottery for Education 
See notes to the financial statements. 
 
"A" DEPARTMENT OF 
EDUCATION 
 
"S" LOTTERY FOR 
EDUCATION 
 
TOTAL 
 
$ 
 
3,701,103,548.00 $ 
 
181,656,245.00 $ 3,882,759,793.00 
 
78,150,641.00 
 
20,980,000.00 
 
99,130,641.00 
 
90,500.00 
 
90,500.00 
 
88,187.00 
 
88,187.00 
 
$ 
 
3,n9,432,876.00 $ 
 
202,636,245.00 $ 3,982,069,121.00 
 
3,000,000.00 
 
500,000.00 
 
3,500,000.00 
 
$ 
 
3,n6,432,876.00 $ 
 
202,136,245.00 $ 3,978,569,121.00 
 
$ 
 
533,053,247.90 
 
$ 533,053,247.90 
 
$ 
 
691,549.07 
 
521,323.00 282.50 
 
10.00 
 
$ 
 
691,549.07 
 
521,323.00 282.50 
 
10.00 
 
7,159,893.87 
9,183.67 1,000.00 
340,000.00 
 
7,159,893.87 
9,183.67 1,000.00 
340,000.00 
 
14,485.63 30,017.17 81,321.66 
 
14,485.63 30,017.17 81,321.66 
 
4,127.89 687.10 
197,660.15 30,750.00 
436.36 578.98 
 
4,127.89 687.10 
197,660.15 30,750.00 
436.36 578.98 
 
150,379.27 264,780.05 
 
150,379.27 264,780.05 
 
$ 
 
9,498,466.37 
 
$ 
 
9,498,466.37 
 
$ 
 
4,318,984,590.27 $ 
 
202,136,245.00 $ 4,521 ,120,835.27 
 
$ 
 
267,161.57 
 
85,000.00 
 
38,922.60 3,758.56 
 
- 35 
 
$ 
 
267,161.57 
 
85,000.00 
 
38,922.60 3,758.56 
 
 DEPARTMENT OF eDUCATION COMBINING STATEMENT OF FUNDS A\lAILABLE AND EXPENDITURES 
BUDGET FUND yEAR ENDED JUNE 30, 1996 
 
EXHIBIT-.!' 
 
FUNDS AVAILABLE CARRY.QVER FROM PRIOR yEAR 
Transfer from Reserved Fund Balance Teacher Honorarium Payment Technology General Obligation Bond Funds Other Funds Total C8rry-Qver from Prior Year 
Total Funds Available 
 
-ADEPARTMENT OF 
EDUCATION 
 
-8" 
LOITERYFOR EDUCATION 
 
TOTAL 
 
$ 
 
300,00 
 
5.464.78 
 
28,346,23 
 
$ 
 
428,953,74 
 
$ 
 
300,00 
 
5,464.78 
 
28.346.23 
 
$ 
 
428,953.74 
 
$ 
 
4,319,413,544,01 $ 
 
202.136,245,00 $ 4,521,549,789,01 
 
EXpENDITURES 
PERSONAL SERVICES 
Salaries and Wages Employer's Contributions for: 
F.I.C.A. Retirement Health Insurance Personal Liability Insurance Unemployment 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 Equipment Purchases 
JMYEJ. 
MOTOR VEHICLE PURCHASES 
EQUIPMENT 
Equipment Purchases Lease/Purchase of Equipment Rental of Equipment 
See notes to the financial statements. 
 
$ 
 
25.354.654,63 
 
1,510.680,89 3,751,585.28 3,115,738,02 
238,632,00 58.992.00 
396,973.00 151.680,88 
 
$ 
 
34,578,936.70 
 
$ 
 
52,755,62 
 
1,431,788,94 
 
1,128,004.30 
 
56,392,64 
 
60,014.04 
 
12,519,50 
 
1,171,917.43 
 
204,397,16 
 
345,336.26 
 
326,129,68 
 
$ 
 
4,789,255,57 
 
$ 
 
955,166,09 
 
$ 
 
130,700.92 
 
$ 
 
81,036,60 
 
55,616.46 
 
42,798.58 
 
$ 
 
179,451.64 
 
 36 
 
$ 
 
25,354.654,63 
 
1,510,680.89 3,751,585.28 3,115.738,02 
238,632,00 58,992.00 396,973.00 151,680,88 
 
$ 
 
34,578,936,70 
 
$ 
 
52,755.62 
 
1,431,788,94 
 
1,128.004,30 
 
56,392.64 
 
60,014,04 
 
12,519,50 
 
1,171,917,43 
 
204,397.16 
 
345,336,26 
 
326.129.68 
 
$ 
 
4,789.255,57 
 
$ 
 
955.166,09 
 
$ 
 
130,700,92 
 
$ 
 
81,036.60 
 
55,616,46 
 
42,798,58 
 
$ 
 
179,451,64 
 
 DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUDGET FUND yEAR ENDED JUNE 30. 1996 
 
EXHIBIT-,r 
 
EXPEND'TURES 
COMPUTER CHARGES 
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 
~ 
UTILITIES 
aBE FORMULA GRANTS: Kindergarten\Grades 1- 3 Grades 4-8 Grades 912 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 
 
-A" DEPARTMENT OF 
EDUCATION 
 
"B" LOITERYFOR 
EDUCATION 
 
TOTAL 
 
$ 
 
380.438.00 
 
2.872.986.19 
 
281.240.00 3.201.350.88 1,017.642.29 
 
$ 
 
7.753.657.36 
 
$ 
 
1.430.411.78 
 
$ 
 
1,213.687.17 
 
$ 
 
1,290,782.99 
 
16,547,469.68 
 
$ 
 
17,838,252.65 
 
$ 
 
754,439.60 
 
$ 
 
861,279,137.00 
 
818,340,850.00 
 
311,639.548.00 
 
189,439,018.00 
 
116,242,554.00 
 
346,213,274.00 
 
51,241,172.00 
 
76,335,052.00 
 
32,446.142.00 
 
99.492,691.00 
 
633,258.428.00 
 
138.159.104.00 
 
-658.768.068.00 
 
n,462,514.00 
 
$ 
 
3,092,783,418.00 
 
$ 
 
160,777,462.00 
 
3,301,936.00 
 
23,317,032.00 
 
72,552,948.00 
 
72,512,817.00 
 
551,2n.00 
 
$ 
 
333,013,472.00 
 
$ 
 
380.438.00 
 
2.8n.986.19 
 
281.240.00 3.201.350.88 1,017,642.29 
 
$ 
 
7,753,657.36 
 
$ 
 
1,430,411.78 
 
$ 
 
1,213,687.17 
 
$ 
 
1.290.782.99 
 
16,547,469.68 
 
$ 
 
17,838,252.65 
 
$ 
 
754,439.60 
 
$ 861.279.137.00 818.340.850.00 311.639,548.00 189,439,018.00 116,242.554.00 346,213.274.00 51.241.1n.00 76,335.052.00 32,446.142.00 99.492.691.00 633.258.428.00 138.159,104.00 -658,768.068.00 n,462,514.00 
$ 3,092,783,418.00 
 
$ 160.777.462.00 3.301.936.00 
23.317.032.00 n,552,948.00 n,512,817.00 
551,2n.00 
$ 333.013.4n.00 
 
see notes to the financial statements. 
 
 37 
 
 DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABlE AND EXPENDITURES 
BUOOETFUND YEAR ENDED JUNE 30. 1996 
 
EXHIBIT"J" 
 
EXPENDITURES 
~ 
NON-QBE GRANTS: Education 01 Children 01 Low-Income Families 
Retirement (H.B. 2n and H.B. 1321) Instructional 8ervices 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 Educational Service Agencies Georgia Leaming Resources System High School Program Special Education in State Institutions Governors Scholarships Counselors Vocational Research and Curriculum Even Start Salaries and Travel of Public Ubrarians Public Ubrary Materials 
Talking Book Centers Public Ubrary M & 0 
Child Care lunch Program (Federal) Chapter" - Block Grant Flow Through Payment of Federal Funds to Board of 
Technical and Adult Education Education of Homeless ChildrenIYouth Innovative Programs Next Generation School Grants Umited English Speaking Students Program Drug-Free School (Federal) 
At Risk Summer School Program 
Emergency Immigrant Education Program Title" 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 Serve America Program Youth Apprenticeship Grants Remedial Summer School Alternative Programs Environmental Science Grants Pay for Performance Mentoring Program Charter Schools Technology Specialist State and Local Education Systemic Migrant Education 
 
"A" DEPARTMENT OF 
EDUCATION 
 
"S" 
LOITERYFOR EDUCATION 
 
TOTAL 
 
$ 
 
178,097,558.00 
 
5,308,976.18 
 
61,644,962.00 
 
1,538,516.14 
 
42,644,819.00 
 
202,881,821.88 
 
27.567,268.00 
 
2.028,464.00 9,012,044.00 3,833,130.00 31,932,850.47 4,564,128.00 2,818,424.00 6,995,220.00 
146,338.00 2,874,877.00 12,558,024.26 5,927,770.98 
992,239.00 4,039,391.00 31,139,947.62 7,948,435.50 
 
14,237,799.13 662.599.63 
1,609,663.00 499.996.00 
11,417,099.00 9,263,719.33 5,999,999.93 
416,362.60 5,173.471.12 
772.500.00 
 
99,047,892.00 14.953.763.00 
1,248,292.50 63,913.00 
543.862.78 4,307,343.00 1,875.663.09 12.394.075.00 
100,000.00 2,018,000.00 
495,060.00 260,000.00 13.655.450.00 1.569,113.00 266,394.00 
 
$ 
 
849,547,236.14 
 
$ 178,097,558.00 5,308,976.18 61,644,962.00 1,538.516.14 
42,644,819.00 202,881,821.88 
27,567,268.00 
2,028,464.00 9,012.044.00 3,833,130.00 31,932,850.47 4,564,128.00 2,818,424.00 6,995,220.00 
146,338.00 2,874,877.00 12,558,024.26 5,927,770.98 
992,239.00 4,039,391.00 31,139,947.62 7 ,948,435.50 
14.237,799.13 662,599.63 
1.609.663.00 499,996.00 
11,417.099.00 9,263,719.33 5,999,999.93 
416,362.60 5,173,471.12 
m,5OO.00 
99.047.892.00 14,953,763.00 1.248,292.50 
63.913.00 543,862.78 4,307,343.00 1,875,663.09 12,394.075.00 100.000.00 2,018.000.00 495.060.00 260.000.00 13,655,450.00 1,569.113.00 266,394.00 
$ 849,547,236.14 
 
See notes to the financial statements. 
 
- 38- 
 
 DEPARTMENT OF EDUCATION COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES 
BUDGET FUND yEAR ENDED JUNE 30 1996 
 
EXPEND'TURES 
 
A 
DEPARTMENT OF EDUCATION 
 
.S- 
LOTTERY FOR EDUCATION 
 
EXHIBITr 
TOTAL 
 
LOTTERY FOR EDUCATION Pre-Kindergarten for 4-year-olds Personal Services Salaries and Wages Employer's Contributions for: F.I.CA Retirement Health Insurance Personal Liability Insurance Assessments by Merit System Other Costs Supplies end Materials Rents (Other than Real Estate) 
Insurance and Bonding Grants to Counties, Cities and Civil 
Divisions Other Operating Expenses (See Schedule) Duplicating and Rapid Copy Publications and Printing Equipment Purchases Travel Equipment Equipment Purchases Rental of Equipment Computer Charges Software Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Contracts 
Lottery Grants Next Generation Schools Alternative Programs Educational Technology Centers Model Technology Schools Capital Outlay Postsecondary Options Leaming Logic Sites Media Center/Ubrary Equipment 
Total Other 
Total Expenditures 
Excess of Funds Available over Expenditures 
See notes to the financial statements. 
 
$ 
 
464,900.20 $ 
 
464,900.20 
 
20,903.46 61,730.55 58,112.74 
2,928.00 2,244.05 
 
20,903.46 61,730.55 58,112.74 
2,928.00 2,244.05 
 
209,886.10 9,556.73 72.00 
 
209,886.10 9,556.73 72.00 
 
176,596,532.63 2,393.45 
35,941.13 2,734.02 
18,422.35 26,173.89 
 
176,596,532.63 2,393.45 
35,941.13 2,734.02 
18,422.35 26,173.89 
 
218,878.55 5,149.67 
 
218,878.55 5,149.67 
 
19,324.22 43,803.04 
712.98 
 
19,324.22 43,803.04 
712.98 
 
66,608.45 9,080.00 
 
66,608.45 9,080.00 
 
$ 
 
177,876,088.21 $ 
 
177,876,088.21 
 
500,000.00 5,000,000.00 
900,000.00 250,000.00 10,650,000.00 1,313,015.47 2,100,000.00 2,160,000.00 
 
500,000.00 5,000,000.00 
900,000.00 250,000.00 10,650,000.00 1,313,015.47 2,100,000.00 2,160,000.00 
 
200,749,103.68 $ 
 
200,749,103.68 
 
$ 
 
--===....:.=::=. 4,276,098,565.74 $ _ _ 200,749,103.68 $ 4,476,847,669.42 
 
$ 
 
4,344,968,085.62 $ 
 
200,749,103.68 $ 4,545,717,189.30 
 
-25,554,541.61 
 
1,387,141.32 
 
-24,167,400.29 
 
$ 
 
4,319,413,544.01 $ 
 
2=;0:2",,:1,3;;6;,;2;4;:5:.,0;0~~ $ 4,521,549,789.01 
 
- 39- 
 
 DEPARTMENT Of EQUCATION COMBINING STATEMENT Of CHANGES IN ASSETS AND UABIUTIES 
flPUCIARY FUND TyPE. AGENCY FUNDS YEAR ENDED JUNE 30, 1996 
 
EXHIBIT "K" 
 
fWD 
Associlltlon for Supervision and Curriculum Development Afric8n-American Critical Issues Network 
At Risk Instruction Atlant8 Area School for the Deaf 
Student Activities Account Vending Machine Account B8rtMK,JaneUe,fund Compensatory Education Division Conference 
Ede~,~e,fund 
Educational Technology Training  Excellence Recognition 
Fine Arts Educ.tion Advisory Council French Exchange Program Georgia Academy for the Blind 
Student Activities Account Georgia Association of Distributive 
Education Clubs of America 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 B8nk T1gerama Vocational Projects Fund Work Incentive Account Hazardous Materials and School Maintenance Section Instructional Technology Account Instructional Technology Division Meeting Account Intemational Education fund International Exchange Program Fund Leadership Skills Development Programs Library for the Blind Middle Georgia School Service Center Nutrition Seminar Programs of Education and Career Exploration Conference Account Professional Practices Commission Public School Standards (parental Involvement) Recruitment Services Related Vocational Instruction Enrichment Camp Sachsen-Anhalt Exchange School Improvement Conference fund School Improvement Workshop School Renewal fund Single Parent Conference fund Special Needs Program Conference fund Special Services Conference Account Special Student Services Account Staff Conference fund State Board Awards 
See notes to the financial statements. 
 
ASSETSI UABIUTIES JULY " 1995 
 
ADDITIONS 
 
DELETIONS 
 
ASSETS! UABIUTIES JUNE 30, 1996 
 
$ 
 
3,245.38 $ 
 
499,22 $ 
 
$ 
 
426.24 
 
426.24 
 
8,393,27 807.73 
7,962.58 12,395,45 9,285.02 
131.90 1,365.90 
48,89 
 
9,400.12 4.788.50 
198.69 49,428.49 
241.10 220.00 37,174.00 
1,228,45 
 
12,175.78 5,082.79 
350.00 34,825.74 
324.99 37,848.18 
119,16 
 
173,946,03 
 
65,924.70 
 
70,257.82 
 
38,136,87 
 
134,526,40 
 
142,544.83 
 
3,759.36 411.17 
1,193.67 543.81 433.08 
59,243.57 2,744,17 
172,47 913.61 
786.73 3,583,36 
 
19,473.80 18.03 32,93 . 
16,307.61 
3,600.83 2,437.50 59,426,97 1,480,30 
 
20,358,43 0.08 
100.00 543.81 11,509,45 350,81 6,345.00 2,609.97 58,623.96 
786.73 
 
1,595.28 4,699,89 
 
45,629.06 
 
232.00 48,662,59 
 
3,409.02 2,971.65 122,238.55 12,397.69 4,193.41 
105.99 9,124,33 
 
76,316,86 60,351.54 
636.27 
 
3,409.02 360.00 
134,700,70 45,845.21 4,829.68 
105,99 4,540,00 
 
2,172,27 1,638.99 
 
100.00 3,345.38 
 
550.89 3,076.65 
 
90,85 3,176.49 
 
5,725.00 
 
90.85 7,595.97 
 
31,617.26 537,94 
860.06 2,346,84 
143.49 3,205.27 10,064,48 
364,50 23,805,70 6,178.44 4,500.00 
 
75,475,06 16,550,00 
220,65 7,710,00 25,888,00 
36,302,00 
 
80,770,60 13,292.69 
596.36 1,700,76 7,843.49 25,228,34 6,613.92 
364.50 42,078.77 
2,515.11 4,500,00 
 
2,748.16 
5,617.81 513.44 
7.811.27 28,998.20 9,528.12 
28.91 693.72 
48.89 1,109.29 
169,612,91 
30,118.44 
2,874.73 429,12 
1,128,60 
5,231,24 58,892,76 
1,716.62 1,480.30 
3,583,36 
1,363.28 1,666.36 
2,611.65 63,854.71 26,904,02 
4,584.33 
1,721.38 1,907.72 
1,305.52 
26,321.72 3,795.25 263.70 866.73 10.00 3,864.93 3,450.56 
18,028.93 3,663.33 
 
40 - 
 
 DEPARTMENT OF EDUCADON COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES 
FIDUCIARY FUND TYPE AGENCY FUNDS yEAR ENDED JUNE 30 1996 
 
EXHIBIT "K" 
 
Blt:I2 
State Board 01 Education's Fund Statistical Services Advisory Committee 
and Conference Fund Superintendent's Fund Teacher Assessment and Agent Account 
(l.eedership Development Seminars) Tech Prep Conference Account 
TItJe IV Equity Workshop 
Vocational Administrators' Account Vocational Education Accounts 
Business Education F.und Future Business Leaders of America Georgia Association 01 American 
Industrial Arts Student Association, Incorporated 
Georgia Association 01 Future Farmers 01 America District I Pig Chain Fund Vocational Agriculture Teachers' Fund 
District" 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 Society of Georgia Vocational Agriculture Teacher's Benefits Association, The Vocational Industrial Clubs of America Vocational Occupation Clubs of America Workshop Registration Financial Review Worksite Wellness 
 
ASSETSI LIABILITIES JULY 1,1995 
 
ADDITIONS 
 
DELETIONS 
 
ASSETSI LIABILITIES JUNE 30,1996 
 
$ 
 
1,073.54 $ 
 
1.509.53 $ 
 
2,583.07 
 
12.00 750.00 
 
12.00 750.00 
 
2,076.14 4,330.56 
495.57 2,709.39 
 
56,893.50 18,858.84 27,136.26 
 
$ 45,927.13 16,164.88 25,694.94 
 
2,076.14 15,296.93 
3,189.53 4,150.71 
 
530.52 64,533.75 
 
3,920.00 110,039.48 
 
4,027.37 130,450.17 
 
423.15 44,123.06 
 
30,452.37 
 
63,978.63 
 
59,811.02 
 
34,619.98 
 
5,406.69 10,316.31 
 
5,406.69 10,316.31 
 
9,980.27 
 
9,980.27 
 
4,427.86 4,348.31 2,690.13 45,799.76 
61,524.62 
22,257.82 5,888.30 1,418.00 
51,211.10 
44,062.71 4,035.22 409.73 
 
46,962.99 149.06 
292,On.51 86,935.95 112,330.29 20,690.00 
112,097.42 
 
51,285.01 
2,690.13 261,778.87 
110,235.25 
120,153.88 24,269.80 1,418.00 
51,211.10 
143,259.15 4,035.22 
 
105.84 4,497.37 76,093.40 38,225.32 14,434.23 2,308.50 
12,900.98 409.73 
 
$ 958,863.94 $ 1,716,978.08 $ 1,926,645.34 $ 
 
7.4.9.,.1_9.6..6..8... 
 
See notes to the financial statements. 
 
41 - 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF APPROVED BUOOET "A" DEPARTMENT OF EDUCATION 
yEAR ENDED JUNE 30,1996 
 
ORIGINAL 
 
AMENDED 
 
APPROPRIATION APPROPRIATION 
 
GOVERNOR'S EMERGENCY FUND 
 
BUOOET ADJUSTMENTS 
 
TOTAL 
 
FUNDS AVAILABLE 
 
REVENUES 
 
State Appropriation Fedenli Revenues Other Revenues Retained 
 
$ 3,701,103,548.00 $ <497,238,342.00 4,221,086.00 
 
78,150,641.00 $ 42,698,522.00 
79,602,00 
 
90,500.00 $ 
 
88,187.00 $ 3,n9,432,876.00 
 
54,142,370.00 
 
594,079,234.00 
 
14,497,402.00 
 
18,798,090.00 
 
$ 4,202,562,976.00 $ 120,928,765.00 $ 
 
90,500.00 $ 68,n7,959.00 $ 4,392,310,200.00 
 
EXPENPITURES 
 
Penonal SelVices 
 
$ 
 
Regular Operating Expenses 
 
TrlIveI 
 
Motor Vehicle Purchases 
 
Equipment 
 
Computer Charges 
 
Real Estate Rentals 
 
Telecommunications 
 
Per Diem, Fees and Contracts 
 
Utilities 
 
aBE Formula Grants: 
 
Kinclergarten\Grades 1- 3 
 
Grades4-8 
 
Grades 912 
 
High School Laboratories 
 
Vocational Education Laboratories 
 
Special Education 
 
Gifted 
 
Remedial Education 
 
Staff Development and 
 
Pr~~MIDeve~pmern 
 
Media 
 
Indirect Cost 
 
Pupil Transportation 
 
Local Fair Share 
 
Mid-Term Adjustment Reserve 
 
Teacher Salary Schedule 
 
Adjustment 
 
Other Categorical Grants: 
 
Equalization Formula 
 
Sparsity Grants 
 
In School Suspension 
 
SpeciallnstructioMI Assistance 
 
Middle Schoollncernive 
 
Special Education Low-lncidence 
 
Grants 
 
Non-QBE Grants: 
 
Education ~ Children ~ Low- 
 
Income Families 
 
Retiremern (H.B. 272 and 
 
H.B.1321) 
 
Instructional Services for the 
 
Handicapped 
 
Tuition for the Multi-Handicapped 
 
Severely EmotioMlly Disturbed 
 
School Lunch (EederaQ 
 
School Lunch (State) 
 
Supervision and Assessment ~ 
 
Students and Beginning 
 
Teachers and Performance- 
 
Based Certification 
 
36,6<49,409.00 $ 5,568,020.00 1,145,152.00 
139,665.00 341,214.00 7,792,978.00 1,514,966.00 1,280,329.00 18,218,402.00 962,485.00 
827,651,524.00 n9,316,673.00 296,732,910.00 180,409,249.00 111,169,887.00 329,549,291.00 48,746,103.00 
73,351,312.00 
32,199,664.00 95,532,367.00 627,250,894.00 136,815,917.00 -658,824,689.00 
150,155,595.00 
160,m,464.00 3,609,604.00 
22,166,686.00 69,091,100.00 68,702,696.00 
483,628.00 
143,999,894.00 
5,173,750.00 
54,732,103.00 1,896,312.00 
39,621,548.00 188,375,n2.00 26,798,985.00 
2,005,097.00 
 
See notes to the financial statements. 
 
-295,934.00 751,426.00 $ 3n,966.00 
-1,983.00 571,264.00 
6,400.00 43,332.00 3,040,986.00 
-450,000.00 123,702.00 n,462,514.oo -936,950.00 -267,633.00 2,284,191.00 80,131.00 35,775,949.00 
-350,105.00 -300,000.00 
- 42- 
 
$ 14,500.00 
10,000.00 
 
197,451.00 $ 344,401.00 82,540.00 
24,521.00 558,778.00 
5,000.00 31,380.00 1,171,233.00 
 
36,550,926.00 6,678,347.00 1,600,658.00 
139,665.00 363,752.00 8,923,020.00 1,526,366.00 1,355,041.00 22,440,621.00 962,485.00 
 
33,627,613.00 39,024,1n.00 14,906,638.00 
9,029,769.00 5,On,667.00 16,663,983.00 2,495,069.00 2,983,740.00 
 
861,279,137.00 818,340,850.00 311,639,548.00 189,439,018.00 116,242,554.00 346,213,274.00 51,241,1n.00 
76,335,052.00 
 
66,000.00 
 
246,478.00 3,960,324.00 5,941,534.00 2,167,685.00 
-65,079.00 
 
32,446,142.00 99,492,691.00 633,258,428.00 138,533,602.00 -658,766,066.00 n,462,514.00 
 
-149,218,645.00 
 
0.00 
 
1.00 -40,035.00 1,150,346.00 3,642,708.00 1,525,930.00 
 
160,7n,485.00 3,301,936.00 
23,317,032.00 n,733,808.00 72,512,817.00 
 
563,759.00 
 
6,566,222.00 
9,351,OnOO 3,223,271.00 18,028,790.00 1,213,832.00 
 
186,342,065.00 
5,173,750.00 
64,083,180.00 1,546,207.00 
42,844,819.00 206,404,512.00 27,712,817.00 
 
23,367.00 
 
2,028,464.00 
 
 DEPARTMENT OF EPUCADON SCHEPULE OF APPROVED BUDGET "A" DEPARTMENT OF EDUCATION 
YEAR ENDEP JUNE 30 1996 
 
SCHEDUlE "1" 
 
ORIGINAL 
 
AMENDED 
 
APPROPRIAnON APPROPRIAnON 
 
EXpENDITURES 
 
Non-QBE Grants: 
 
Regionll Educational Service 
 
Agencies 
 
$ 
 
Georgia Leeming Resources 
 
System 
 
High School Program 
 
Special Education in State 
 
Institutions 
 
Governor's Scholarships 
 
Counselors 
 
Voc8tlonlli Research and 
 
Cuniculum 
 
Even Staut 
 
Salaries and Travel fA Public 
 
Ubrarians 
 
Public Ubrary Materials 
 
Talking Book Centers 
 
Public Ubrary M & 0 
 
Child care Lunch Program 
 
(Feder8/) 
 
Chapter II  Block Grant Flow 
 
Through 
 
Payment fA Federal Funds to 
 
Board of Technical and Adult 
 
Education 
 
Education fA Homeless Chlldrenf 
 
Youth 
 
Innovative Programs 
 
Next Generation School Grants 
 
Umited English Speaking 
 
Students Program 
 
Drug-Eree School (Federal) 
 
At Risk Summer School Program 
 
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 
 
Serve America Program 
 
youth Apprenticeship Grants 
 
Remedial Summer School 
 
Alternative Programs 
 
Environmental Science Grants 
 
Pay for Performance 
 
Mentoring Program 
 
Charter Schools 
 
Technology Specialist 
 
State and Local Education 
 
Systemic 
 
Migrant Education 
 
8.899.461.00 
3.528.045.00 21.827,731.00 $ 
4.782.130.00 2,818.424.00 6,661.809.00 
293,520.00 2.720,906.00 
11,453.167.00 5,719.142.00 992.239.00 4.039.395.00 
25,244,070.00 
9,663.513.00 
14.395,919;00 
601,772.00 1.690,215.00 2,443,700.00 
10,876.940.00 11,625,943.00 6,000,000.00 
164.514.00 
5.042,895.00 
273,723.00 
99,047,892.00 
14,199,935.00 1.250,000.00 
362,597.00 4.340,000.00 1,875,664.00 12,126,442.00 
100,000.00 3,000,000.00 
500,000.00 50,000.00 12,827,367.00 
 
-69,350.00 
350,105.00 
2,496,083.00 35,706.00 
233,152.00 498.n7.00 
267,633.00 .1,060,000.00 
266,403.00 
 
GOVERNOR'S EMERGENCY FUND 
 
BUDGET ADJUSTMENTS 
 
$ 
 
112,583.00 $ 
 
367,051.00 17,916,403.00 
 
333,847.00 
1.000.00 243,050.00 
767,739.00 583,183.00 
 
8,458,636.00 
 
566,044.00 83,546.00 
540,159.00 
61,447.00 537,702.00 
 
753,828.00 63,913.00 250,088.00 
78,000.00 570,000.00 828,083.00 1,674,891.00 
 
TOTAL 
9,012,044.00 
3,895,096.00 39,674,784.00 
4,782,130.00 2,818,424.00 6,995,656.00 
294.520.00 2.963.956.00 
12,571,011.00 6,302.325.00 
992.239.00 4.039,395.00 
33,702,706.00 
9,663.513.00 
16,892.002.00 
1,203.522.00 1,773,761.00 2,443.700.00 
11,417,099.00 11.625,943.00 6.000,000.00 
459,113.00 
5,580.597.00 
772.500.00 
99,047,892.00 
14.953.763.00 1,250,000.00 63.913.00 632.685.00 4.340.000.00 1.875,664.00 
12,394,075.00 100.000.00 
2,018,000.00 500,000.00 620,000.00 
13,655,450.00 
1,674,891.00 266.403.00 
 
$ 4,202.562,976.00 $ 120,928,765.00 $ 
 
90,500.00 $ 
 
680727,959.00 $ 4.392.310,200.00 
 
See notes to the financial statements. 
 
- 43- 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF APPROVED BUDGET 
-B- LOTTERY FOR EDUCATION YEAR ENDED JUNE 30. 1996 
 
SCHEDULE? 
 
FUNDS AVAILABLE REVENUES 
Lottery Proceeds 
 
ORIGINAL APPROPRIATION 
 
AMENDED APPROPRIATION 
 
BUDGET ADJUSTMENTS 
 
TOTAL 
 
$ 
 
181 ,656,245.00 $ 
 
20,980,000.00 $ 
 
0.00 $ 202,636,245.00 
 
EXPENDITURES 
Pre-Kindergarten for 4-year-olds Next Generation Schools Alternative Programs Educational Technology Centers Model Technology Schools Capital Outlay Postsecondary Options Learning Logic Sites Media Center/Ubrary Equipment 
 
$ 
 
157,646,245.00 $ 
 
500,000.00 
 
5,000,000.00 
 
900,000.00 
 
250,000.00 
 
13,000,000.00 
 
1,200,000.00 
 
1,OOO,OOCtOO 
 
2,160,000.00 
 
22,030,000.00 $ -1,050,000.00 
 
-1,220,000.00 $ 
120,000.00 1,100,000.00 
 
178,456,245.00 500,000.00 
5,000,000.00 900,000.00 250,000.00 
11,950,000.00 1,320,000.00 2,100,000.00 . 2,160,000.00 
 
$ 
 
181,656,245.00 $ 
 
20,980,000.00 $ 
 
0.00 $ 202,636,245.00 
 
See notes to the financial statements. 
 
-44 - 
 
 DEPARTMENT OF EDUCATION CASH AND CASH EQUIVALENTS 
JUNE 30,1996 
 
SCHEDULE "3- 
 
NONINTEREST BEARING ACCOUNTS . First Floyd Bank, Cave Spring, Georgia First Union National Bank of Georgia, Atlanta, Georgia Middle Georgia Bank, Fort Valley, Georgia NationsBank of Georgia, NA" Atlanta, Georgia NationsBank of Georgia, N.A., Valdosta, Georgia SunTrust Bank, NA, Atlanta, Georgia SunTrust Bank, Middle Georgia, NA, Macon, Georgia Wachovia Bank of Georgia, Atlanta, Georgia 
INTEREST BEARING ACCOUNTS First Commerce Bank, Lexington, Georgia First Floyd Bank, Cave Spring, Georgia First Union National Bank of Georgia, Atlanta, Georgia Georgia State Department of Education Credit Union, Atlanta, Georgia NationsBank of Georgia, N.A., Atlanta, Georgia NationsBank of Georgia, NA, Douglasville, Georgia SunTrust Bank, Middle Georgia, NA, Macon, Georgia Wachovia Bank of Georgia, Macon, Georgia Funds on Deposit with Office of Treasury and Fiscal Services State Investment Pool 
OTHER Cash on Hand 
 
$ 
 
16,386.25 
 
169,697.81 
 
26.91 
 
87,788,65 
 
3,000.00 
 
3,615,161.61 
 
200,00 
 
-4,871,158.21 $ 
 
-978,896.98 
 
$ 
 
105.84 
 
5,196.70 
 
1,511.65 
 
80,018.78 
 
-196,871,71 
 
12,951.07 
 
179,779.27 
 
3,333.64 
 
48,677.99 
 
134,703.23 
 
11,149.30 
 
See notes to the financial statements. 
 
- 45- 
 
$ -833.044.45 
 
 PEPARTMENT OF EDUCATION INVESTMENTS JUNE 30, 1996 
 
SCHEDULE "4" 
 
INVESTMENT TYPE 
Certificates of Deposit First Floyd Bank, Cave Springs, Georgia No. 2170AR 
First Union National Bank of Georgia, Atlanta, Georgia 
No. 123-8759958 
NationsBank of Georgia, NA, Atlanta, Georgia 
No. 10101340868002 
NationsBank Qf Georgia, NA, Douglasville, Georgia 
No. 9100-0001 
Regions Bank, Homer, Georgia 
No. 51445002 
 
PURCHASE DATE May 20, 1996 December 20, 1995 November 5, 1995 October 30, 1995 January 17, 1996 
 
MATURITY DATE 
 
AMOUNT 
 
May 20, 1997 
 
$ 55,251.78 
 
December 20, 1996 
 
11,389.33 
 
April 29, 1998 
 
14,064,35 
 
October 30, 1996 
 
13,370.65 
 
July 15, 1996 
 
24,800.10 
 
$ 118,876.21 
 
See notes to the financial statements. 
 
- 46- 
 
 PEPARTMENT OF EDUCATION SCHEDULE OF GOVERNOR'S EMERGENCY FUND 
YEAR ENDED JUNE 30. 1996 
 
SCHEDULE w5w 
 
Georgia Environmental Education Council: Operating Expenses Rockdale County Board of Education - School of Excellence Award For 
Margaret G. Barksdale Elementary School Expenses in Connection with the Georgia Law-Related Education Consortium Schools of Excellence 
 
$ 
 
10,000.00 
 
2,000.00 14,500.00 64,000.00 
 
$ 
 
90,500.00 
 
See notes to the financial statements. 
 
- 47- 
 
 PEPARTMENT OF EDUCATION SCHEDULE OF FEDERAL REVENUES 
YEAR ENDED JUNE 30, 1996 
 
PROGRAM 
 
Agriculture, U. S. Department of 
 
Food Distribution 
 
Direct 
 
School Breakfast Program 
 
Direct 
 
National School Lunch Program 
 
Direct 
 
Special Mnk Program for ChUdren 
 
Direct 
 
Child and Adult Care Food Program 
 
Direct 
 
State Administrative Expenses for Child Nutrition 
 
Direct 
 
Nutrition Education and Training Program 
 
Direct 
 
Emergency Food Assistance Program (Administrative Costs) 
 
Direct 
 
Corporation for National and Community Service 
 
Learn and Serve America 
 
School and Community Based Programs 
 
Direct 
 
Education, U, S. Department of 
 
, 
 
Desegregation Assistance, Civil Rights Training, and Advisory 
 
Services 
 
Direct 
 
Education of Children with Disabilities in State Operated or 
 
Supported Schools 
 
Direct 
 
Title I  Grants to Local Educational Agencies 
 
Direct 
 
Migrant Education - Basic State Grant Program 
 
Direct 
 
, 
 
Educationally Deprived Children - State Administration 
 
Direct 
 
Title I Program for Neglected and Delinquent Children 
 
Direct 
 
Services for Children with Deaf-Blindness 
 
Direct 
 
Special Education Grants to States 
 
Direct 
 
T" 
 
Special Education - Personnel Development and Parent raining 
 
Direct 
 
Public Ubrary Services 
 
Direct 
 
. 
 
Intertibrary Cooperation and Resource Shanng 
 
Direct 
 
. 
 
Vocational Education - Basic Grants to States 
 
Direct 
 
. Ed f 
 
Vocational Education Consumer and Homemaking uca Ion 
 
Direct 
 
Educational Research and Development 
 
Direct 
 
Public Ubrary Construction and Technology Enhancement 
 
Direct 
 
Immigrant Education 
 
Direct 
 
Special Education - Preschool Grants 
 
Direct 
 
CFDA NUMBER 
10.550 10.553 10.555 10.556 10.558 10.560 10.564 10.568 
94.004 
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 84.154 84.162 e4.173 
 
See notes to the financial statements, 
 
-48- 
 
SCHEDULE "6" 
 
AMOUNT 
 
$ 
 
1,426.01 
 
45,283,787.05 
 
157,534,042.06 
 
24,060.34 
 
31,341,484.84 
 
2,042,544.84 
 
255,599.36 
 
435,066.16 
 
517,810.27 
 
236,144.59 
17,729.41 161,626,159.38 
4,657,629,19 1,102,833.63 
990,467.48 232,915.34 53,1 n,862,78 173,987.24 1,712,459.32 455,n1.40 28,397,535,14 163,464.24 50,000.00 539,744.00 357,411.86 8,590,896.29 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF FEDERAL REVENUES 
YEAR ENDED JUNE 30.1996 
 
PROGRAM 
Education, U. S. Department of Vocational Education - Community Based Organizations Direct Byrd Honors Scholarships Direct Safe and Drug-Free Schools - State Grants Direct Christa McAuliffe Fellowships Direct Bilingual Education Support Services Direct Education for Homeless Children and Youth Direct Even Start - State Educational Agencies Direct Capital Expenses Direct State School Improvement Grants Direct Tech-Prep Education Direct Foreign Languages Assistance Direct Goals 2000 - State and Local Education Systemic Improvement Grants Direct Eisenhower Professional Development State Grants Direct Public Charter Schools Direct Innovative Education Program Strategies Direct National Center for Education Statistics Direct 
Health and Human Services, U. S. Department of Head Start Direct Medical Assistance Program Direct Cooperative Agreements to Support Comprehensive School Health Programs to Prevent the Spread of HIV and Other Important Health Problems Direct 
Labor, U. S. Department of Job Training Partnership Act Through Georgia Department of Labor Through Georgia Department of Technical and Adult Education 
 
CFDA NUMBER 
84.174 84.185 84.186 84.190 84.194 84.196 84.213 84.216 84.218 84.243 84.249 
84.276 84.281 84.282 84.298 
N/A 
93.600 93.IT8 
93.938 
17.250 17.250 
 
SCHEDULE "6" 
 
AMOUNT 
 
$ 
 
14,628.91 
 
m,500.oo 
 
8,491,437.51 
 
30,051.00 
 
29,573.47 
 
716,913.25 
 
2,366,572.62 
 
304,521.00 
 
661,386.24 
 
3,261,904.16 
 
68,231.01 
 
1,739,743.05 4,672,072.75 
220,000.00 9,396,156.36 
25,000.00 
 
148,780.50 52,953.12 
 
181,933.94 
-657.42 -14,235.79 
 
$ 533,053,247.90 
 
See notes to the financial statements. 
 
-49- 
 
 PEPARTMENT OF EDUCATION SCHEDULE OF OTHER OPERATING EXPENSES 
YEAR ENDED JUNE 30, 1996 
"A" DEPARTMENT OF EDUCATION 
REGULAR OPERATING EXPENSES 
Bus Fare Clipping Services. Court Reporter Services and Transcripts Examinations and Testing Freight, Express and Storage Unen Service and Outside Laundry Other Student Expenses Production of FUms, Tapes and Recordings Registration Fees Seminars and Training Student Meals Student Medical Expenses Subscriptions and Dues Substitute Teachers Pay Test Scoring Services 
"B" LOTTERY FOR EDUCATION 
OTHER 
Pre-Kindergarten for 4-year-olds Freight, Express and Storage Registration Fees Subscriptions and Dues 
 
SCHEDULE '7" 
 
$ 
 
36.00 
 
1,852.17 
 
662.47 
 
2,282.50 
 
229,438.70 
 
6,503.65 
 
9,301.97 
 
1,014.03 
 
28,940.41 
 
459,128.05 
 
778.99 
 
2,937.12 
 
427,900.19 
 
1,127.91 
 
13,27 
 
$ 1,171,917.43 
 
$ 
 
46.50 
 
485.00 
 
1,861,95 
 
$ 
 
2,393.45 
 
See notes to the financial statements. 
 
- 50- 
 
 DEPARTMENT OF EDUCATION RECONCILIATION OF TRAVEL YEAR ENDED JUNE 30, 1996 
Total per Annual Supplement Accruals June 30,1995 June 30,1996 Adjustment Prior Year's Accounts Payable 
Total per Report 
 
SCHEDULE "8" 
$ 978,104.77 
-1,104.52 4,314.73 
25.00 $ 981,339.98 
 
See notes to the financial statements. 
 
- 51 - 
 
 DEPARTMENT OF EDUCATION SUMMARY OF SALARIES, TRAVEL, AND PER DIEM AND FEES 
YEAR ENDED JUNE 30, 1996 
 
SCHEDULE "9" 
 
8UDGETFUNp 
"A" DEPARTMENT OF EDUCATION Regular Computer Charges 
"8" LOTTERY FOR EDUCATION Pre-Kindergarten for 4-year-olds 
 
SALARIES 
 
TRAVEL 
 
PER DIEM AND FEES 
 
$ 25,354.654,63 $ 
 
955.166,09 $ 
 
1,290,782.99 281,240.00 
 
464,900.20 
 
26,173.89 
 
66,608.45 
 
$ 25,819,554.83 $ 981,339.98 $ 1,638,631.44 
 
See notes to the financial statements. 
 
- 52- 
 
 SECTIONll FINDINGS AND IMPROPER OR QUESTIONED COSTS 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS 
YEAR ENDED JUNE 30, 1996 
 
STATUS OF PRIOR YEAR FINDINGS AND IMPROPER OR OUESTIONED COSTS 
 
The status offindings disclosed in the audit report for the year ended June 30, 1995, is summarized below: 
 
Audit Control Numbers 
 
Status ofFindings 
 
414-95-01 414-95-02 414-95-03 414-95-04 414-95-05 414-95-06 414-95-07 
 
See Audit Control Number 414-96-01 See Audit Control Number 414-96-02 See Audit Control Number 414-96-03 See Audit Control Number 414-96-04 Corrective Action Implemented Corrective Action Implemented Corrective Action Implemented 
 
PRIOR YEAR 
 
COMPLIANCE WITH LAWS AND REGULATIONS Instructions to Boards ofEducation Not Consistent With the Official Code of Georgia Financial Statements Audit Control Number 414-96-01 
 
The audit report for the year ended June 30, 1994, noted that the Department ofEducation issued written instructions for the 1993 and 1994 fiscal years to boards of education regarding expenditure requirements relative to StaffDevelopment - Cost ofInstruction (CIS) and Professional Development Stipend (PDS) funds that were not consistent with the Official Code of Georgia Annotated Section 20-2-182. 
 
The guidance provided in the above referenced memorandums has resulted in the various boards of education inappropriately expending PDS funds of approximately $2,114,000.00 and $4,315,000.00 for the fiscal years ending 1993 and 1994, respectively. 
 
As of June 30, 1996, the Department ofEducation has adjusted the affected boards of education local fair share for the fiscal year 1993 amount. Additionally, subsequent to June 30, 1996, the Department adjusted the affected boards of education local fair share for the fiscal year 1994 amount. 
 
- 1- 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS 
YEAR ENDED JUNE 30, 1996 
PRIOR YEAR/CURRENT YEAR 
CASH AND CASH EQUIVALENTS - Financial Statements EXPENDITURESILIABILITIESIDISBURSEMENTS - Financial Statements Agency Funds - Deficiencies in Accounting Procedures Audit Control Number 414-96-02 
The audit report for the year ended June 30, 1995, noted several deficiencies concerning agency fund 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 control 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 offunds. 
(2) Certain disbursements did not appear to be in compliance with the intent ofthe fund. Steps should be taken to ensure that records of a fund include documentation stating specific disbursements which are allowable for the fund. A listing of allowable disbursements would reduce the likelihood of questionable disbursements. 
(3) Checks were issued to a certain individual for services rendered~ however, there was no corresponding W-2's or 1099's issued. Procedures should be implemented to issue W-2's or 1099's to individuals as appropriate. 
(4) A check issued from the School Improvement Workshop included one check made payable to and endorsed by the custodian of the account. Measures should be taken to prevent this practice. 
(5) All checks issued for the Vocational Education Accounts, Georgia Association of American Industrial Arts Student Association, Incorporated and Georgia Association of Vocational Industrial Clubs of America were not signed by the custodian of the account. Two checks were not signed by anyone and the remainder of the checks were signed by an authorized signer who is not an employee ofthe Department of Education. Measures should be taken to ensure that a bonded employee ofthe Department signs all checks. 
(6) Certain, disbursements included payments for sales tax. According to the Department's policy and procedures for agency funds, sales tax should not be paid on an invoice total. Measures should be taken to prevent this practice. 
Although the accounting department has sent instructions to the custodians ofthe agency funds, deficiencies continued to exist. The Department should continue efforts to ensure that proper accounting procedures are utilized in maintaining agency funds. 
-2- 
 
 DEPARTMENT OF EDUCATION SCHEPULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS 
YEAR ENDED JUNE 30. 1996 
PRIOR YEAR/CURRENT YEAR 
GENERAL FIXED ASSETSIPROPERTY MANAGEMENT - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequacies in Operation ofProperty Management System Audit Control Number 414-96-03 
The audit report for the year ended June 30, 1995, noted deficiencies in the controls over general fixed assets. For the year under review, our examination included a review ofthe internal accounting controls utilized by the Department ofEducation in maintaining their State Property System. This review also consisted oftesting the system for compliance with Federal and State laws and regulations. The following conditions relating to inappropriate accounting practices were found to exist: 
(1) Equipment additions were not reconciled to the general ledger expenditure accounts. 
(2) Equipment inventory records for additions were updated incorrectly. Testing ofcurrent year additions revealed twenty-three (23) additions that had been updated onto the equipment inventory records incorrectly by the amount of $177,663.06 (net). 
(3) Four (4) equipment items acquired through installment purchases were included on the equipment inventory records at an incorrect amount. The difference in the acquisition cost and the amount recorded on the inventory records amounted to $6,997.16. 
In addition, three-hundred-thirty (330) equipment items were selected to test the accuracy of the Department's general fixed asset records. These items contained a value of $722,312.62 and were selected for the purpose oflocating the equipment as recorded in the inventory records. The following deficiencies were noted: 
(1) Twenty-six (26) items totaling $64,743.82 could not be located. 
(2) Twelve (12) items were located other than the location indicated in the equipment inventory records. 
Also, during the physical inspection testing, two (2) items of equipment were located which were not included in the equipment inventory records. 
The Department is required to maintain equipment inventories in accordance with provisions of paragraph 32 ofOMB's Unifonn Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments (Common Rule) and the State Property System Manual. The discrepancies identified above were caused by the Department's failure to follow guidelines for maintaining equipment inventories. 
As a result of the discrepancies identified above, we were unable to determine the validity of the total equipment inventory valuation contained in the inventory records, which comprises the General Fixed Assets Account Group. 
-3- 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS 
YEAR ENDED JUNE 30, 1996 
PRIOR YEAR/CURRENT YEAR 
GENERAL FIXED ASSETSIPROPERTY MANAGEMENT - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequacies in Operation ofProperty Management System Audit Control Number 414-96-03 
The Department should establish the necessary internal controls to ensure that equipment inventories are maintained in accordance with provisions ofOMB's Common Rule and the State Property System Manual. 
Federal Grantor Agencies Affected: U. S. Department of Agriculture U. S. Department ofEducation U. S. Department ofHealth and Human Services 
MONITORING OF SUBRECIPIENTS Subrecipient Audit Reports Not Received Within the Required Time Period Federal Financial Assistance Audit Control Number 414-96-04 
The audit report for the year ended June 30, 1995, noted that a substantial number of subrecipient audit reports had not been submitted within the time period required by OMB 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, 1995. Ofthe 468 subrecipients identified on the tracking documents, 150 had not submitted their audits within the thirteen month period as required by OMB Circulars A-128 and A-133. This noncompliance is due to subrecipient audits not being performed in a timely manner. 
A subsequent review ofthe status ofthe 150 audits not submitted by the due date, indicated that 142 ofthe reports had been submitted by January 15, 1997. It was noted during our examination that the Department ofEducation utilized a program review stafffor interim compliance reviews of all subrecipients in accordance with the foregoing provisions ofOMB Circulars A-128 and A-133. 
Federal Grantor Agencies Affected: U.S. Department of Agriculture Corporation for National and Community Service U.S. Department ofEducation .U.S. Department ofHealth and Human Services U.S. Department ofLabor 
-4- 
 
 DEPARTMENT OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS 
YEAR ENDED JUNE 30, 1996 
CURRENT YEAR 
BUDGET PREPARATIONIEXECUTION Overexpenditure ofBudget Unit Object Class Financial Statements Audit Control Number 414-96-05 
The total approved budget for the Department of Education - "A" Budget unit provided for cumulative expenditures of$4,392,31 0,200.00. A comparison of anticipated funds available and budgeted expenditures to actual funds available and expenditures by object class indicates that the object class Non-QBE Grants Retirement (H. B. 272 and H. B. 1321) was overspent in the amount of$135,226.18. This overexpenditure is in violation of Section 54 of the Amended Appropriations Act of 1995-1996. The overexpenditure was caused by the Department's failure to monitor the expenditure offunds against the budgeted expenditures by object class. 
The Department should review its internal control procedures over budget operations, design procedures which would prohibit the expenditure offunds in excess of budget approval, and implement those procedures to strengthen the controls over the budget function. 
CASH MANAGEMENT Failure to Amend Agreement for Change in Funding Technique Federal Financial Assistance Child and Adult Care Food Program (10.558) Audit Control Number 414-96-06 
As part ofour examination for the year under review, we examined the Department's funding technique used in implementing the Cash Management Improvement Act of 1990. The Agreement effective for the period July 1, 1995 through June 30, 1996 applied the zero balance accounting funding technique. 
During the year under review, the Department ceased using the zero balance accounting funding technique and began using the average clearance 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 1996 prior to implementation. Federal regulation 31 CFR Part 205.9(d) states, as follows: 
"A treasury-state agreement may be amended by the mutual written consent of the state and the Financial Management Service." 
This noncompliance occurred because the Department failed to gain approval from the Financial Management Service when they began using the average clearance technique in April 1996. The Department should ensure any changes to the agreement made with the Financial Management Service are approved in writing for the applicable fiscal year. 
- 5- 
 
 DEPARTMENT OF EDUCATION 
SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS 
YEAR ENDED JUNE 30. 1996 
 
CURRENT YEAR 
 
COMPLIANCE WITH DEPARTMENT OF EDUCATION INSTRUCTIONS Failure to File Completion Report Within Required Time Period Financial Statements Audit Control Number 414-96-07 
 
For the year under review, an examination ofthe Department's compliance with regulations for the Lottery Programs -Instructional Technology, Distant Learning-Satellite Dishes, and Technology Installation, revealed that the Department failed to file a final completion report by the required date for the Service Centers and State Schools in accordance with regulations established by the Department of Education. The final completion reports were due on July 31, 1996. The Department submitted the reports for the Service Centers and State Schools on the following dates: 
 
Service Centers Calhoun Gainesville Moultrie Swainsboro 
State Schools Atlanta Area School for the Deaf Georgia Academy for the Blind Georgia School for the Deaf 
 
November 22, 1996 November 22, 1996 November 22, 1996 November 22, 1996 
October 9, 1996 October 15, 1996 October 11, 1996 
 
This deficiency occurred because management failed to ensure timely submission of reports. Appropriate . procedures should be implemented by the Department to ensure that completion reports are submitted by the required date. 
 
-6-