City of Bremen Board of Education, Haralson County, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2001

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL RJND TYPES AND ACCOUNT GROUP

2

B

. COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLETRUST FUND

9

F NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

11

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

24

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

28

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

30

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

32

2 SCHEDULE OF STATE REVENUE

34

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

35

(

CITY OF BREMEN BOARD OF EDUCATION- HARALSON COUNTY -TABLEOFCONTENTS-

SECTION I

FINANCIAL

ADDIDONAL FINANCIAL INFORMATION

SCHEDULES

ALLOTMENTS AND EXPENDITURES

GENERAL FUND- QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

36

5

BY SITE

37

SECTION IT
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE~GOVERNMENTAUDITINGSTANDARDS
REPORT ON COMPLIANCE~ REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE~ OMB CIRCULAR A-133

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

SECTIONN FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

II

RUSSELL W. HINTON
STATEAUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
July 3, 2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City of Bremen Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general-purpose financial statements of the City of Bremen Board of Education, as of and for the year ended June 30, 2001, as listed in the table of contents. These general-purpose financial statements are the responsibility of the City of Bremen Board of Education's management. Our responsibility is to express an opinion on these general-purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the fmancial 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 opmion,
As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows:

2001ARL-13

* The general-purpose financial statements of the Board of Education did not contain a
General Fixed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting principles.
* School activity accounts maintained at the individual schools are not included in the
general-purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general-purpose financial statements.
* The Board of Education did not recognize as expenditures, in the year ended
June 30, 2001, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 200 I. Also funds received, subsequent to June 30, 2001, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were improperly recorded in the year ended June 30, 2001. To conform to generally accepted accounting principles, revenues 'should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general-purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general-purpose financial statements of the matters referred to in the preceding paragraph, the general-purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Bremen Board of Education as of June 30, 2001, and the results of its operations and the cash flows of its nonexpendable trust fund for the year then ended, in conformitywith accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated July 3, 2002, on our consideration ofthe City ofBremen Board ofEducation's internal control over financial reporting and our tests.ofits compliance with certain provisions oflaws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general-purpose financial statements' of the City of Bremen Board of Education taken as a whole. The accompanying combining statements (Exhibits G through J) and the financial schedules (Schedules 1 through 5),
which includes the Schedule of Expenditures of Federal Awards as required by u. S. Office of
Management and Budget Circular A-B3, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the
2001ARL-13

general-purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general-purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general-purpose financial statements taken as a whole.

A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 506-24.

\ . " Respectfully submitted,

.

-

U)~

R sell W. Hinton State Auditor

RWH:gp 2001ARL-13

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY

CITY OF BREMEN BOARDOF EDUCATION HARALSON COUNTY COMBINED BALANCE SHEET
ALL FUNDTYPESAND ACCOUNT GROUP JUNE 30, 2001

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPE
TRUST FUND

ACCOUNT GROUP
GENERAL LONG-TERM
DEBT

TOTALS

(Memorandum Only)

JUNE 30, 2001

JUNE 30, 2000

$

1,748.71 $

864.86

$ 1,677,827.65 $ 1,473,430.02

20,000.00

20,000.00

15,000.00

11.51

267,005.22

220,261.84

652.57

$

1,760.22

8,683.68 2,844.29
1,760.22

7,828.17 3,091.96
2,625.15

1,083,239.78 157,054.91

1,083,239.78 157,054.91

1,647,374.85 94,992.95

$

1,760.22 $

20,864.86 $ 1,242,054.91 $ 3,219,068.32 $ 3,464,604.94

$
$ 157,054.91 1,085,000.00
$ 1,242,054.91 $

143,860.19 $ 96,234.27 431.70 9,028.10 157,054.91
1,085,000.00
1,491,609.17 $

169,769.75 96,918.09 5,506.10
94,992.95 1,650,000.00
2,017,186.89

$

1,760.22

$

20,000.00

0.00

864.86

$

1,760.22 $

20,864.86

$

15,219.00 $

11,342.00

1,760.22

2,625.15

20,000.00

15,000.00

997.67

8,683.68 2,844.29 182,199.19 768,709.88

7,828.17 3,091.96 422,918.40 604,755.07

728,042.89

378,859.63

$ 1.727,459.15 $ 1,447,418.05

$

1,760.22 $

20,864.86 $ 1.242.054.91 $ 3.219,068.32 $ 3,464,604.94

-3-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 2001

REVENUES .",
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Enterprise Operations
Capital Outlay Debt Service
Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES IUSES)
Capital Leases Operating Transfers In Operating Transfers Out
Total Other Financing SourCes (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses "
FUND BALANCE JULY 1 (Restated - ~ee Note 1)
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 6,982,147.55 $
1,174,494,68 412,479.88

334,596.30 738,325.10
309,258.70

$ 8,569,122.11 $ 1,382,180.10

$ 6,067,012.78 $
198,441.08 124,900.76 181,365.48 186,937,10 643,574.72 90,261.91 566,482.03 53,532.56
3,819.65 31,978.20 4,559.40 71,586.51

487,269.82 40,259.82 336,979.97 22,208.99 41.76 5,262.00
502,188,76

13,265.88 2,746.97

$ 8,240,465,03 $ 1,394,211,12

~

328,657.08 $

-12,031.02

$

34,585.61

$

-11,799.54

.,."

$

22,786.07 $

11,785.60 11,785.60

$

351,443.15 $

-245.42

301,630.40

100,489.03

855.51 -247.67

FUND BALANCE JUNE 30

$

653,073.55 $ =====1"0~0=,8=5=1=.4=5=

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

EXHIBlrB"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

s

70,000.00

$ 7,386,743.85 $ 6,473,309.45

738,325.10

676,008.53

566,674.84 $

622,170.00

2,363,339.52

2,253,326.88

31,567.69

170.07

753,476.34

715,942.97

s

668.24 2.53 $

s 622,340.07 $ 11,241,884.81

10,118,587.83

$

779,026.31

65,467.55 s 6,736.79

$

851,230.65 $

s -182,988.12 $

$ 6,554,282.60 $ 5,729,502.39

238,700.90 461,880.73 181,365.48 209,146.09 643,616.48
90,261.91 571,744.03
53,532.56 3,819.65
31,978.20 506,748.16
71,586.51 779,026.31

342,314.89 537,992.38 188,412.27 204,326.70 569,443.84
98,509.21 481,101.66
54,618.41 3,522.50
28,175.89 453,278.18
73,934.16 962,182.09

565,000.00 58,205.00

643,733.43 67,688.76

526,721.09 127,367.44

623.205.00 $ 11,109,111.80 $ 10,381,403.10

-864.93 $

132,773.01 $ -262,815.27

s

106,209.78

13.94

s

106,223.72

$

-76,764.40 $

1,027,673.47

$

140,795.39 $

88,207.00

11,799.54

146,309.05

-11,799.54

-146,309.05

$

140,795.39 $

88,207.00

-864.93 $ 2,625.15

273,568.40 $ 1,432,418.05

-174,608.27 1,609,597.59

855.51 -247.67

-3,107.86 536.59

s

950,909.07 $

1.760.22 $ 1,706,594.29 $ 1,432,418.05

-5-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - INON-GAAp BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2001

EXHIBIT C

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES
State Funds Federal Funds. Taxes Other Funds

$ 6.842,533,00 $ 6.982,147,55

60,000,00

1,080,000.00 1,174.494.68

383.825,00

412,479.88

Total Revenues EXPENDITURES

$ 8.366.358.00 $ 8.569,122,11

Current

Instruction

Support Services

Pupil Services

. Improvement of Instructional Services

Educational Media Services

General Administration

School Administration

Business Administration

Maintenance and Operation of Plant

Student Transportatlon Services

Central Support Services

Other Support Services

Food Services Operation

Enterprise Operations

I

Debt Service .

I

Total Expenditures

~

Excess of Revenues over (under) Expenditures

]

OTHER FINANCING SOURCES IUSES)

Other Sources Other Uses

Total Other Financing Sources (Uses)

$ 6,192,132,00 $ 6.067,012.78

193,795.00 127,715.00 176.525,00 186.124,00 582.552.00 90,175.00 534,399.00 56.441.00
9,505.00 28.129,00 5,338.00 80,500,00

198.441,08 124,900,76 181,365,48 186,937.10 643.574.72 90,261,91 566.482,03 53,532.56
3,819.65 31.978.20
4.559,40 71,586,51 16.012.85

$ 8.263.330.00 $ 8,240.465.03

$ 103.028,00 $ 328,657,08

$ 34.585.61 -11,799.54
$ 22.786.07

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
fUND BAlANCE JULY 1. 2000 (Restated See Note 1)
Adjustments food Inventory - Net Change in Period
Donated Commodities Purchased food

$ 103,028.00 $ 351,443.15

333,596.00

301.630.40

-11,901.00

fUND BALANCE JUNE 30, 2001

$ 424,723.00 $ 653,073,55

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 410,416,00 $ 334.596,30

619,009,00

738.325,10

290,500,00

309.258.70

$ 1,319.925,00 $ 1,382.180,10

$ 529,333.00 $ 487,269.82

42,199.00 319,959.00

40,259,82 336.979.97

21,752.00

22,208.99 41.76

5.758,00

5,262.00

410,703,00

502.188,76

$ 1,329.704,00 $ 1.394.211.12 $ -9,779.00 $ -12.031.02

$ 11,785,60

$ 11.785.60

$ -9,779.00 $ 136,117.00

-245.42 100,489.03

855.51 -247,67
$ 126.338.00 $ 100.851.45

The notes to the general-purpose financial statements are an integral part of this statement. -7

CITY OF .BREMEN BOAROOF EDUCATI@N "HARALSON COUNTY STATEMENTOF~R6VEN8ES)!&XI2ENSES;ANDicf:iANGES'IN FUNO BALANCES
FIOOCIARY'FUr'JD;~P"E:_f';j0NEXPENDAB[E TRUST FUNO . YE~RE,NDEEfjUNE '30,2001

EXHIBIT "0"

OPERATING REVENUES Donations
OPERATING EXPENSES None Recorded Operating Income
NONOPERATING REVENUES Interest Earned Net Income
FUND BALANCE JULY 1 (Restated - See Note 1)

BREMEN BOARD OF EDUCATION ENDOWMENT
FUND

TOTALS (Memorandum Only)
YEARENOED JUNE 30, 2001 JUNE 30, 2000

$

5,000,00 $

5,000.00 $

2,500.00

$

0.00 $

0.00 $

0,00

$

5,000.00 $

5.000.00 $

2,500.00

864.86

864.86

0.00

$

5,864.86 $

5,864.86 $

2,500.00

15,000.00

15,000.00

12,500.00

FUND BALANCE JUNE 30

$

20,864,86 $

20,864.86 $ ==:====15=,=0=0=0=.0=0=

".

The notes to the general-purpose financial statements are an irltegral,partof this statement. -8-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 2001

EXHIBIT"E"

Cash Flows from Operating Activities: Cash Received from Donations
cash Flows from Investing Activities: Interest Received on Investments Purchase of Investments Sale of Investments
Net cash Used by Investment Activities
Net Increase in Cash
Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

BREMEN BOARD OF EDUCATION ENDOWMENT
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

5,000.00 $

5,000.00 $

2,500.00

$

864.86 $

-20,000.00

15,000.00

864.86
-20,000.00 $
15,000.00

-15,000.00 12,500.00

$

-4,135.14 $

$

864.86 $

0.00

-4,135.14 $ 864.86 $
0.00

-2,500.00 0.00 0.00

$

864.86 $

864.86 $========0.=00=

The notes to the general-purpose financial statements are an integral part of this statement. -9-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001

EXHIBIT"F"

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES'
REPORTING ENTITY
The City ofBremen Board ofEducation (School District) was established under the laws ofthe State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The School District uses funds and an account group to report on its financial position and the results' ofits operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available fmancial resources.
General Fixed Assets are recorded as expenditures in the various funds at the time ofpurchase. A General Fixed Assets Account Group is not presently maintained by the School District. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund types,
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general-purpose financial statements.
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School District, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of a School District's educational activities. Governmental Fund Types include:
. GENERAL FUND - the fund used to account for all financial resources of the School District except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.
- 11 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON couNTY
NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30,' 2001

EXHmIT"F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities,
DEBT SERVICE FUND - the fund ~sed to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and p~ying agent fees.

FIDUCIARY FUND TYPE - the fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes:

NONEXPENDABLE TRUST FUND , BremenBoard ofEducation Endowment Fund - the furidused to account for an endowment of which the corpus is to be invested and preserved intact with the resultant income to be used as necessary by the School D i s t r i c t . ! ,.

ACCOUNT GROUP

GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to

account for general obligation debt outstanding and' capital lease obligations.

~ t



BASIS OF ACCOUNTING '.

"

'I

The accounting and financial reporting treatment applied to a fund is determined by its measurement

focus. All governmental funds.are accounted for using a current financial resources measurement

focus. With this measurement focus, only currentassets and current liabilities generally are

included on the balance sheet. OPerating statements ofthese funds present increases (i.e., revenues

and other financing sources) and decreases (i.e., expenditures and other financing uses) iri net current

assets. Their reported fund balance is considered a measure of available spendable resources.

,

.

Liabilities which are expected to be financed from available spendable resources are reported as.

liabilities inthe governmental 'funds. Other liabilities, which are not expected to be financed from

available spendable resources, are reported in the General Long-Term Debt Account Group,

All nonexpendable trust funds are accounted for on a flow of economic resources measurement

focus. With this measurement focus, all assets and liabilities associated with the operation of these

funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and

decreases (e.g., expenses) in net total assets.

.

"

Governmental funds are accounted for using the modified accrual basis 'of accounting under which:

Revenues are recognized when susceptible-to accrual (i.e., when they become both measurable and available).."Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enoughthereafter to be used to payliabilities of

- 12 :-

CITY OF BREMEN BOARD OF EDUCATION HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHffiIT"F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
the current period. The School District considers receivables collected within sixty days after yearend to be available and therefore susceptible to accrual. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, local option sales taxes, intergovernmental grants and donations. Revenue for property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 2001, a substantial number ofpersonnel ofthe School District were employed for a one hundred and ninety day period beginning in August 2000 and ending in early June 2001. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 2000 and ending in August 2001. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of'Education to the School District in the same twelve months. As of June 30, 2001, compensation under these employment contracts had . been earned, but two of the twelve monthly payments, due for July and August 2001, had not been made. Payments for these two months were made and recorded as expenditures by the School District subsequent to June 30, 2001. Also, the State's portion ofthe compensation paid in July and August 2001 was received and recorded as revenue in the fiscal year subsequent to June 30, 2001. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 2000, were recorded in the year ended June 30, 2001. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
The accrual basis ofaccounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
RESTATEMENT OF PRIOR YEAR FUND BALANCE
In prior years, the investment activities for the School District's Nonexpendable Trust Fund were reported as a part ofthe General Fund. This fund had a fund balance of$15,000.00 at June 30, 2000. For fiscal year 200 1, this fund has been reported as a Nonexpendable Trust Fund. The fund balance at July 1, 2000, has been restated as appropriate.
BUDGET
The City of Bremen Board of Education's budget is a complete financial plan for the School District's fiscal year and is based upon estimates of expenditures together with probable funding
- 13-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHmIT"F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

sources. There is no statutory prohibition regarding overexpenditure ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was.prepared on a basis other tha. n generally accepted accounting principles.

. The budget process begins when the School District's administration prepares a tentative budget for

the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised

at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe

Board after advertisement, the Board receives comments on the tentative budget, makes revisions as

necessary and adopts a final school budget. This final budget is then submitted, in accordance with

provisions of the Quality Basic Education Act, OCGA Section' 20-2-167(c), to the Georgia

Department of Education. The Board may increase or decrease the budget at any time during the

year. All unexpended budget authority lapses at fiscal year-end:'

..

CASH AND CASH EQUIVALENTS

COMPOSITION OF DEPOSITS . Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the School District to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.

INVESTMENTS

COMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates ofdeposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code ofGeorgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:

(1) Obligations issued by the State of Georgia or by other states,

(2) Obligations issued by the United States government,

(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,

(4) Obligations of any corporation of the United States government,

- 14-

, I,

I

CITY OF BREMEN BOARD OF EDUCAnON - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30,'2001

EXHmIT"F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICiES

(5) Prime banker's acceptances,

(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,

(7) Repurchase agreements, and

(8) Obligations of other political subdivisions of the State of Georgia.

RECEIVABLES

Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general-purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables,

PROPERTY TAXES

The City of Bremen fixed the property tax levy for the 2000 tax year (calendar year) on September 30, 2000 (levy date).. Taxes were due on December 20,2000 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2001. The Bremen City Clerk bills and collects the property taxes for the School District and remits the taxes collected to the School District. Property tax revenues during the fiscal year ended June 30, 2001 for maintenance and operations amounted to $1,172,485.03.

The tax millage rate levied for the 2000 tax year (calendar year) for the City of Bremen Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

5,032 mills

SALES TAXES

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $1,188,844.84 ($550,859.45 from Carroll County and $637,985.39 from Haralson County) and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection ofthe tax within Haralson County once an additional $1,716,183.77 has been collected or on June 30, 2002, whichever occurs first. The State will terminate collection of the tax within Carroll County once an additional $1,235,059.30 has been collected or on December 31, 2002, whichever occurs first.

- 15 -

CITY OF BREMEN BOARD OF EDUCATION HARALSONCOUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHIBIT "F"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES

FOOD INVENTORIES Inventories of donated food 'commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 2001, are

recorded as prepaid items.'

.

'.

GENERAL OBLIGATION BONDS

The School District entered into a joint agreement with the City of Bremen whereby the City of

Bremen issued general obligation bonds, on behalf of the school system. The bond premiums,

discounts and issuance costs are recognized in the financial statements ofthe School District during

the year bonds are issued. According to the terms ofthe aforementioned agreement, the bonds are.

the direct 'obligations of the School District; therefore, the outstanding amount of these bonds is

recorded in the General Long-Term Debt Account Group.

.' ,

INTERFUND TRANSACTIONS

The School District has the following types of interfund transactions:
Reimb'urse~ents of expenditures/expenses initially made from a fund that are properly applicable, to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
Operating transfers are recorded for ail interfund transactions other than reimbursements.

MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general-purpose financial statements are captioned "Memorandum Onlyto indicate that 'they are presented only to facilitate fmancial analysis.' Data in these columns do not present financial position, results ofoperations or cash flows 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. Certain reclassifications have been made to the comparative data to conform to the current year classifications.
- 16 -'

CITY OF BREMEN BOARD OF EDUCA nON - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHIBIT"F"

Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer thanten days a sum ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than . 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance, Ifa depository elects the pooled method (OCGA 45-R-13,1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance, OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts,
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness; or other obligations of a subsidiary corporation of the United States 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.
CATEGORIZATION OF DEPOSITS AtJune 30, 2001, the bank balances were $2,031,753.13. The amounts ofthe total bank balances are classified into three categories of credit risk:

- 17 -

,----------------~-~-~~

CITY OF BREMEN BOARD OF EDUCATION - HARALSON'COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30, 2001

EXHmITIF"

Note 2: DEPOSITS

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the School District or by the School District's agent in the School District's name.
, Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the School District's name,
Category 3 - Uncollateralized deposits, .(This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the School District's name.) ,

as The School District's deposits are classified by risk category at June 30, 2001, follows:

.~

,

Risk Category

Bank Balance

1

$ 120,000,00

2

1,911,753.13

3

0.00

Total

$ 2,031.753.13

Note 3: NON-MONETARY TRANSACTIONS

-, The School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories
.:
Note 4: RISK MANAGEMENT

The School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction ofassets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation.

The School District has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and job related illness or injuries to employees. The School District has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the School District's insurance coverage in any of the past three ye~s.

. The School District has elected to self-insure for all losses related to natural disaster. The School
District has not experienced any losses related to this risk in the past three years,
The School District is self-insured with regard to unemployment compensation claims. The School. District accounts for claims within the same fund that the employee's salary and benefits were paid. Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District has not incurred any liabilities for unemployment compensation during the last two fiscal years.

- 18 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

JUNE 30, 2001

.

EXHIBIT"F"

Note 4: RISK MANAGEMENT

The School District has purchased surety bonds to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent Board Treasurer All Other Employees

$ 10,000.00 $ 10,000.00 $ 50,000,00

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The City of Bremen Board of Education has entered into various lease agreements as lessee for mobile classrooms, school buses and copiers. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value ofthe future minimum lease payments as of the date of their inception,

GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows:

Purpose

Interest Rates

Amount

General Government - Series 1997

3,85% ':" 4.30% $ 1.085.000,00

The changes in General Long-Term Debt during the fiscal year ended June 30, 2001, were as follows:

Capital Leases

General Obligation
Bonds

Total

Balance July 1, 2000

$ 94,992.95 $ 1,650,000,00 $ 1,744,992,95

Additions Capital Leases

. 140,795.39

140,795.39

Deductions Debt Retired

78.733.43

565.000.00

643.733.43

Balance June 30, 2001

$ 157.054,91 $ 1.085.000,00 $ 1.242,054.91

At June 30, 2001, payments due by fiscal year which includes principal and interest for these items
are as follows:

- 19-

CITY OF BREMEN BOARD OF EDUCA nON - HARALSON COUNTY

NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

.

JUNE 30; 2001

EXHIBIT"F"

Note 5: GENERAL LONG-TERM DEBT

.Fiscal Year Ended June 30

Capital Leases

General . Obligation
Bonds

Total Debt

2002 2003 2004 2005

$ 81,191.42 $ 676,340.00 . $ 757,531.42

67,295.86

474,565.00

541,860.86

12,174.23

12,174.23

11.675.99

11,675.99

Total Principal and Interest $ 172,337.50 $ 1.150,905.00 $ 1.323,242.50

Deduct: Imputed Interest

15,282.59

Net Present Value of Future Minimum Lease Payments $ 157,054.91

Note 6: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures in the amount of $109,240.65 for health insurance and retirement contributions paid on the School District's behalfby the following . State Agencies.

Georgia Department of Education Paid to the Georgia Department of Community Health For Health Insurance ofNon-Certified Personnel In the amount of $92,616.65

Office of Treasury and.Fiscal Services Paid to the Public School Employees Retirement System For Public School Einployees Retirement (PSERS) Employer's Cost In the, amount of$16,624.00
Note 7: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed

by the School District as of June 30, 2001:

..

- 20-

'. ~. '.

. :~

CITY OF BREMEN BOARD OF EDUCAnON - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHmIT"F"

Note 7: SIGNIFICANT COMMITMENTS

Project

Unearned Executed Contracts

Central Office Renovation Construction ofNew Maintenance
Building at Bremen High School Bremen High School Renovation Additions to H, A. Jones Elementary Resurfacing of Parking Lot at Bremen
High School and H. A. Jones Elementary

$ 4,349.00
6,572.00 163,015.26 78,495.47
42,175.50

$ 294,607.23

The amounts described in this note are not reflected in the general-purpose financial statements.

Note 8: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position.

Note 9: SUBSEQUENT EVENTS

In the subsequent fiscal year, voters authorized the School District to issue general obligation bonds in the amount of $2,540,000.00 and $2,390,000.00. The proceeds from the $2,540,000.00 bond issue will be used for the purpose of providing funds to payor to be applied toward the cost of acquiring, constructing and equipping school buildings and other buildings and facilities useful or desirable in connection therewith, adding to, renovating, repairing, improving and equipping existing school buildings and other buildings and facilities useful or desirable in connection therewith, including constructing, modifying and equipping classrooms, acquiring system-wide technology improvements, acquiring school transportation vehicles, acquiring the necessary property for such schools, both real and personal and for future school sites and paying expenses incident to accomplishing the foregoing. The proceeds from the $2,390,000.00 bond issue will be used for the purpose of providing funds to payor to be applied toward the cost of (i) funding a portion of the acquisition, construction and equipping of capital outlay projects throughout the Bremen School System including additions, improvements, renovations, modifications and equipping of existing schools and the acquisition of all necessary property, both real and personal, necessary therefor. .

- 21 -

CITY OF BREMEN BOARD OF EDUCAnON -HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2001

EXHIBIT"F"

Note 9: SUBSEQUENT EVENTS

In the subsequent fiscal year, voters of the School District voted in favor of two Special Purpose Local Option Sales Tax referendums for educational purposes. The impositions ofthe taxes by the voters, as stated on the Official Ballots ofthe City ofBremen and applicable to the City ofBremen Board of Education are as follows:

City ofBremen within Haralson County

"Shall a special 1 percent sales and use tax be imposed in the City ofBremen for a period of

time not to exceed 20 consecutive calendar quarters commencing upon the expiration of the

current 1 percent sales and use tax for educational purposes for the raising of not more than

$17,100,000 for the purpose of ... (a) for the City of Bremen, acquiring, constructing and

equipping school buildings and other buildings and facilities useful or desirable in connection

. therewith, adding to, renovating, repairing, improving and equipping existing school buildings

and other buildings and facilities useful or desirable in connection therewith, including

constructing, modifying and equipping classrooms, acquiring system-wide technology

improvements, acquiring school transportation vehicles and acquiring the necessary property

for such schools, both real and personal, and for future school sites, all at a maximum cost of

$4,900,000.00, as described in the Notice of Election..."

'

City ofBremen within Carroll County
a "Shall special one percent sales and use tax be imposed in Carroll Comity (such tax to be a
continuation ofthe existing 1% sales and use tax and not an additional sales and use tax) for a period oftime not to exceed five years (20 calendar quarters) commencing upon the expiration ofthe existing one percent sales and use tax currently in force, and for the raising ofnot more than $110,000,000 for the purpose of... (vi) funding the acquisition, construction, renovation, modification, improvement, extending and equipping of projects throughout the Bremen School System, including, but without limitation, additions, renovations and improvements of . certain existing system facilities, system-wide technology improvements, the. acquisition of school transportation vehicles; the acquisition of land for additional schools, and the acquisition of all property, both real and personal, deemed necessaryand advisable therefor including the funding ofcapitalized interest on debt ofthe City ofBremen with respect to the Bremen School Projects (the "Bremen School Projects"), the maximum costs ofsuch Bremen School Projects not to exceed $4,840,000, as described in the Notice of Election..."

Note 10: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION

,"

Substantially all teachers, administrative and clerical personnel employed by local school districts

are covered by the Teachers Retirement System ofGeorgia (TRS), which is a cost-sharing multiple

employer defined benefit pension plan. TRS provides service retirement, disability retirement and

survivors benefits for its members in accordance with State statute. The Teachers Retirement

System of Georgia issues a separate stand alone financial audit report and a copy can be obtained

from the Georgia Department of Audits and Accounts.

- 22-

111I ~

CITY OF BREMEN BOARD OF EDUCA nON - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2001

EXHffiIT"F"

Note 10: RETIREMENT PLANS

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The School District makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2001 2000 1999

100% 100% 100%

$ 661,272.19 $ 616,007.34 $ 601,628.15

- 23-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2001

ASSETS Cash and Cash Equivalents . .'Accounts Receivable Inventories
Food Donated Commodities Purchased Food
Total Assets

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

125,314.40 $

45,483.86

395.29

8,683.68 2,844.29

$

137,237.66 $ =====4~5=.4=8=3=.8=6=

Total Liabilities and Fund Equity

$========= $

137,237.66

45.483.86

See notes to the general-purpose financial statements. - 24

EXHIBIT"G"

FEDERAL PROGRAMS

TOTALS

JUNE 3D,2001

JUNE 3D, 2000

$

12,494.28 $

183,292.54 $

202,124.05

34,474.01

34,869.30

27,842.95

8,683.68 2,844.29

7,828.17 3,091.96

$

46,968.29 $ 229,689.81 $ =====2=4=0=,=88=7=.=1=3=

$

19,041.54 $

38,395.05 $

44,573.79

27,495.05

90,011.61

90,318.21

431.70

431.70

5,506.10

$

46,968.29 $

128,838.36 $

140,398.10

$

$ ------';;.;.;;.,0;.;0;0...

$

0.00 $

8,683.68 $ 2,844.29

7,828.17 3,091.96

89,323.48

89,568.90

100,851.45 $ _ _1=0l.0..,4.:8..9:,.;0=3:'"

$

======a====== 46,968.29 $

229,689.81 $

240,887.13

- 25-

,-----------------~-~-----~~-
CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2001

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration School Administration Maintenance and Operation of Plant Food Services Operation
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JUL Y 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

'$

37,606.00 $

296,990,30

155,078.64

309,258.70

$

501,943,34 $

296,990,30

$

265.991,10

$

502,188.76

13.886.21 488.00
11,501.38 41.76
5,262.00

$

502,188.76 $

297,170.45

$

-245.42 $

-180.15

$

-245.42 $

100,489.03

855.51 -247.67

180.15
0.00 0.00

. $ 100,851.45 $======0=.00=

See notes to the general-purpose financial statements. - - 26-

EXHIBIT"H"

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30, 2001 JUNE 30, 2000

$

334,596.30 $

380,314.91

$

583,246.46

738,325.10

676,008.53

309,258.70

297,921.01

$

583.246.46 $ 1.382,180.10 $ 1.354.244.45

$

221,278.72 $

487,269.82 $

514,464.65

26,373.61 336,491.97
10,707.61

40,259.82 336,979.97
22,208.99 41.76
5,262.00 502,188.76

17,727.32 327,971.08 25,767.99
3,162.56 448,590.86
9,788.55

$

594,851.91 $ 1.394,211.12 $ 1.347,473.01

$

-11,605.45 $

-12,031.02 $

6,n1.44

11,605.45

11,785.60

16,216.55

$

0.00 $

-245.42 $

22,987.99

0.00

100,489.03

80,072.31

855.51 -247.67

-3,107.86 536.59

$

0.00 $

100,851.45 $

100,489.03

- 27-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 3D, 2001

ASSETS Cash and Cash Equivalents Accounts Receivable Prepaid Items

BOND PROCEEDS

GEORGIASTATE FINANCING AND
INVESTMENT COMMISSION

$

187,183.16 $

0.00

,-;;
1,836.00

Total Assets

$ 189,019.16 $=======0.=00=

See notes to the general-purpose financial statements. - 28-

EXHIBIT "I"

SPECIAL PURPOSE LOCAL OPTION
SALES TAX.

TOTALS

JUNE 30, 2001

JUNE 30. 2000

$

581.134.71 $

768.317.87 $

835.999.93

206.849.82

208,685.82

192,418.89

652.57

652.57

$

788,637.10 $

9n,656.26 $ 1.028,418.82

$

10.899.12 $

17,719.09 $

9,028.10

9.028.10

$

19,927.22 $

26,747.19 s

745.35 745.35

$

182.199.19 $

422,918.40

$

768,709.88

768.709.88

604,755.07

0.00

0.00

0.00

$

768,709.88 $

950.909.07 $ 1,027.673.47

$

788,637.10 $

977,656.26 $ 1,028,418.82

- 29-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 3D, 2001

FUND BALANCE JUNE 30

$

182,199,19 $========0.=00=

See notes to the general-purpose financial statements, - 30 ~

EXHIBIT"J"

SPECIAL PURPOSE LOCAL OPTION
SALES TAX

TOTALS

YEAR ENDED

JUNE 30, 2001

JUNE 30, 2000

$

70,000.00 $

70,000.00 $

78,242.87

566,674.84

566,674.84

841,853.97

16,284.32

31,567.69

38,349.82

$

652,959.16 $

668,242.53 $_-..:=.9&5.8..,.4:4..6:.6=6:..

$

5,824.56 $

5;499.96

1,587.55

1,311.75

$

43,851.00

46,351.00

3,853.86

519,061.38

549,005.44

941,727.97

82,675.76

176,257.76

29,931.12 6,145.81

65,467.55 6,736.79

11,721.09 1,147.44

$

681,665.07 $

851,230.65 $

965,262.07

$

-28,705.91 $ -182,988.12 $

-6,815.41

$

12,646.78 $

106,209.78 $

88,207.00

180,013.94

181,390.62

322,353.22

-181,376.68

-452,445.72

$

192,660.72 $

106,223.72 $

-41,885.50

$

163,954.81 $

-76,764.40 $

-48,700.91

604,755.07

1,027,673.47

1,076,374.38

$

768,709.88 $

950,909.07 $ 1,027,673.47

- 31 -

CITY OF BREMENBOARDOF EDUCATION - HARALSON COUNTY SCHEDULEOF EXPENDITURES OF FEDERALAWARDS YEAR ENDEDJUNE 30, 2001

SCHEDULE"1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

Agriculture, U, 5, Department of Child Nutrition Cluster Pass-Through From Georgia Departmentof Education Food and Nutrition Program Food Services School Breakfast Program National School Lunch Program

" 10.553
. 10.555

N1A $ 19,181.92

N1A

107,856.13 $

(2) 474,148.17 (3)

Total Child Nutrition Cluster

$ 127,038.05 $

474,148.17

Other Programs Pass-ThroughFrom Georgia Departmentof Educatlon Food and Nutrition Program Food Distribution Program (1)

10,550

N1A

28,040.59

28,040.59

Total U. S. Departmentof Agriculture

$ 155,078.64 $

502,188.76

Education,U. S. Departmentof Special Education Cluster Pass-ThroughFrom Georgia Departmentof Education Individualswith DisabilitiesEducationAct Part B - Special Education Capacity Building Improvement Flow Through Preschool

. 84.173 * 84.027 * 84.173

N1A $ 4,684.00 $

N1A

190.335.79

N1A

.24,879.93

4,684.00 190,335.79 24,879.93

Total Special EducationCluster

$ 219,899.72 $

219,899.72

Other Programs Direct Bementary and SecondaryEducationAct Title VII Part B - Foreign Language Assistance Pass-ThroughFrom Georgia Departmentof Education ComprehensiveSchool Refonn Demonstration Project Elementaryand SecondaryEducationAct Title I Grants to Local EducationalAgencies Title II Eisenhower Professional Development Title VI Innovative EducationProgramStrategies Class Size Reduction Goals 2000 State and Local EducationSystemicImprovement Grants Stewart B. McKinney HomelessAssistanceAct Education for Homeless Childrenand Youth Vocational Education- Basic Grants to States High School Program Basic Grant Tech Prep Education

84.293 84.332
84.010 84.281 84.298 84.340 84.276 84.196
84.048 84.243

Total U. S, Departmentof Education

56,599.66

N1A

50,000.00

N1A

n.998.08

N1A

16.000.00

N1A

5,747.00

N1A

18,187.00

N1A

112,500.00

N1A

7,407.00

N1A

8,908.00

N1A

10,000.00

$ 583,246.46 $

~,599.66
50,044.65 (3)
n,998.08 16.031.09 (3)
5.765.76 (3) 18,187.00 114,619.42 (3)
7,413.57 (3)
18,041.51 (3) 10,251.45 (3) 594,851.91

Total Federal FinancialAssistance
N1A = Not Available

- 32-

$ 738,325.10 $ 1,097,040.67

CITYOF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE30. 2001

SCHEDULE "1"

Notesto the Schedule of Expenditures of Federal Awards
(1) The amountsshownfor the FoodDistribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/orconsumed by the system duringthe currentfiscal year.
(2) Expenditures for the SchoolBreakfast Program werenot maintained separately and are included In the 2001 National School lunch Program.
(3) Expenditures for this program includeState.and/orOtherFunds. Expenditures are not maintained by fund source.
MajorPrograms are Identified by an asterisk(*) In front of the CFDAnumber.
The SchoolDlstrid did not provideFederal Assistance to anySubreclplent.
The accompanying schedule of expenditures of Federal awards includes the Federal grantactivityof the City of BremenBoard of Education and is presented on the modified aeaual basisof accounting whichis the basis of accounting usedIn the presentation of the general-purpose financial statements.

See notesto the general-purpose financial statements.

- 33-

CITYOF BREMEN BOARP OF EPUCATION - HARALSON COUNTY SCHEPULE OF STATE REVENUE YEARENDEDJUNE 30, 2001

SCHEDULE "2"

AGENCYIFUNplNG
GRANTS Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program- EarlyIntervention Program PrimaryGrades (1-3) Program PrimaryGrades - EarlyIntervention (1-3) Program Upper Elementary Grades(4-5) Program Middle Grades (6-8) Program High SChool GeneralEducation (9-12) Program VocationalLaboratory(9-12) Program Studentswith Disabilities CategoryI CategoryII CategoryIII Category IV CategoryV Gifted Student- CategoryVI RemedialEducation Program AlternativeEducation Program Media Center Program Staff and Professional Development Indirect Cost CategoricalGrants Pupil Transportation Regular Bus Replacement Nursing Services Principal Supplements VocationalSupervisors Education Equalization FundingGrant Food Services Other State Programs At-Risk SummerSchool Program Health Insurance Innovative Programs Mentor Teachers NationalTeacher Certiflcation Next Generation Schools PreschoolHandicapped Program RemedialSummerSchool Lottery Programs Applied TechnologyLabs Computersin the Classroom
Office of School Readiness Pre-Kindergarten Program
Office of Treasuryand Fiscal Services Public School Employees Retirement
CONTRACTS CommunityAffairs, GeorgiaDepartment of Local Assistance Grant
Education, Georgia Department of Georgia's Reading Challenge

GOVERNMENTAL FUNDTYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 356,961,00 74,206,00
981,651,00 114,843,00 482,987.00 880,380.00 708,463,00 208,276,00
12,842.00 77,964.00 495,017.00 119,427.00
6,489,00 136,560.00
53,933,00 67,267,00 148,454.00 38,257,00 1,009,912.00

$ 356,961,00 74,206.00
981,651.00 114,843.00 482,987.00 880,380.00 708,463.00 208,276,00
12,842.00 77,964.00 495,017.00 119,427.00
6,489.00 136,560.00
53,933.00 67,267.00 148,454.00 38,257,00 1,009,912.00

10,980.00. 3,877.00
46,535.00 6,046.00 7,386.00
639,561.00 $

37,606,00

1,067,76 92,616,65
5,000,00 489.00
5,216.00 75,000.00 30,701,00
1,958.14

$ 70,000.00 29,014,00

10,980.00 3,877.00
46,535.00 6,046.00 7,386.00
639,561.00 37,606,00
1,067.76 92,616,65
5,000.00 489.00
5,216.00 75,000,00 30,701.00
1,958.14
70,000.00 29,014.00

267,976,30

267,976.30'

16,624.00

16,624.00

32,000.00 33,201.00

32,000,00 33,201.00

See notes to the general-purpose financialstatements.

$ 6,982,147.55 $ 334,596.30 S 70,000.00 S 7,386,743.85 - 34-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2001

SCHEDULE "3"

PROJECT

.ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS (3)

PROJECT STATUS

HARALSON COUNTY The addition to and the renovation, repair, acquisition, improvement and equipping of, existing school bUildings, the acquisition of system-wide technology, school transportation vehicles and a new media center and the necessary property therefore and for future schools, all at a maximum cost of $4,000,000.00

$ 4,000,000.00 $ 4,000,000.00 $ 134,207.58 $ 3,086,189.84 Ongoing

CARROLL COUNTY Funding the acquisition, construction, renovation, extending and equipping of capital outlay projects throughout the Bremen School System, including specifically, but without limitation, . renovations, extensions and equipping of H. A Jones Elementary School to include a new classroom and cafeteria additions and other improvements; at Bremen High School to include a cafeteria extension and other improvements; at Sewell Middle School to include a new science and technology lab and other improvements; and constructing a new physical education facility, inciuding the acquisition of all property, both real and personal, necessary therefor (the "Bremen School Projects"), the maximum cost of such Bremen School Projects not to exceed $2,900,000.00

2,900,000,00

2,900,000.00

669,018.29

837,201.19 Ongoing

s s $ 6,900,000,00 $ 6,900,000,00

803,225.87

3,923,391,03

(1) The School District's original cost estimate as specified in the resolution calling for the Imposition of the Local Option Sales Tax,

(2) The School District's current estimate of total cost for the projects, Includes all cost from project inception to completion.

(3) The voters of Haralson County, Carroll County and the City of Bremen approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the general-purpose financial statements.

- 35-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY GENERAL FUND - aUALITY BASIC EDUCATION PROGRAM laBEl
, ALLOTMENTS AND EXPENDITURES - BY PROGRAM YEAR ENDED JUNE 30, 2001

SCHEDULE "4"

PESCRIPTION
Direct Instructional Programs Kindergarten Program Kindergarten Program-Early Intervention Program Primary Grades (1-3) Program Primary Grades-Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Dis,abilitles; Category I Category II Category 11/ Category IV Gifted Student - Category VI Remedial Education Program Alternative Education Program
TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Media center Program Staff and Professional Development

ALLOTMENTS , FROM GEORGIA . DEPARTMENT OF EDUCATION (1)

ELIGIBLE aBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

$

377,940,00 $ 350,759.42 $

8,742,78 $

359,502,20

78,567.00

114,619.66

114,619.66

1,039,344.00 1,098,200.99

23,395.53

1,121,596,52

121,592.00

158,855.44

158,855.44

511,373.00

642,637.60

5,199.40

647,837.00

932,121.00

993,601.89

12,961.67

1,006,563.56

750,100,00

880,607.65

26.343.40

906,951.05

220.517.00

163,559.65

457.97 '

164,017.62

753,568.00

24,022.22

267,10

24,289.32

48,536.92

48,536.92

493,345.86

3,166.45

496.512.31

150.217.18

150,217.18

144,586,00

254.167.05

721.97

254,889.02

57.103,00

63,325,96

729.28

64.055.~4

71,220.00

23,225.72

44,049.54

67,275.26

$

5,058.031.00 $ 5,459,683.21 $ 126,035,09 $ 5,585,718.30

157.179.00 40,505,00

153,040.10 11,466.11

26,066.13 29,038,89

179,106.23 40,505.00

TOTAL aBE FORMULA FUNDS

$

5,255,715.00 $ 5,624,189.42 $ 181,140,11 $ 5,805,329,53

(1) Comprised of State Funds plus Local Five Mill Share.

See notes to the general-purpose financial statements.

- 36-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY GENERALFUND - QUALITY BASIC EDUCATION PROGRAM CgBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 3D. 2001

SCHEDULE "5"

Sewell Middle School Bremen High School Jones Elementary School Central Office (AlternativeEducation Program)
TOTAL
(1) Comprised of State Funds plus Local Five Mill Share.

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

1,141,057.00 $ 1,248,765.48

1,297,938.00

1,433,540.63

2,547,816.00

2,903,412.19

71,220.00

$

5,058,031.00 $ ===~i:5!,:5:8:5::,7==1=8=.=3=0=

/ See notes to the general-purpose financial statements.
- 37-

I.
SECTIONll . COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.W. Suite 214 Atlanta. Georgia 30334-8400
July 3,2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City ofBremen Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the fmancial statements of City of Bremen Board of Education as of and for the year ended June 30,2001, and have issued our report thereon dated July 3,2002. This report was "" qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general-purpose financial statements. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the" Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether City of Bremen Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour audit, and accordingly, we do not express such an opinion. The results ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered City ofBremen Board ofEducation's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal
2001YB-41

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in our judgment, could adversely affect City ofBremen Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-7631-01-01.

A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-7631-01-01 to be a material weakness.

This report is intended solely for the information and use ofthe management, members ofthe City of

I

Bremen Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.

___R-..espectfully submitted,
1.O.~
Ru ell W. Hinton State Auditor

RWH:gp 2001YB-41

RUSSELL W. HINTON
STATEAUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w.. Suite 214 Atlanta. Georgia 30334-8400
July 3,2002

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City ofBremen Board ofEducation
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133
Ladies and Gentlemen:
Compliance
We have audited the compliance ofCity ofBremen Board ofEducation with the types ofcompliance requirements described in the US. Office of Management and Budget (OMB) Circular A-i33 Compliance Supplement that are applicable to each ofits major Federal programs for the year ended June 30, 2001. City of Bremen Board of Education's major Federal programs are identified in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of City of Bremen Board of Education's management. Our responsibility is to express an opinion on City of Bremen Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A133, Audits' of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types ofcompliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the City of Bremen Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on City of Bremen Board of Education's compliance with those requirements.
2001SA-40

In our opinion, the City of Bremen Board of Education complied, in all materialrespects, with the

requirements referred to above that are applicable to each ofits major Federal programs for the year

ended June 30, 2001.

.

Internal Control Over Compliance

The management of City of Bremen Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered City ofBremen Board ofEducation's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-B3.

We noted a certain matter involving the internal control over compliance and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over compliance that, in our judgment, could adversely affect the City of Bremen Board of Education's ability to administer a major Federal program in accordance with applicable requirements oflaws, regulations, contracts and grants. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as item FA-7631-01-01.

A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level of risk that noncompliance with the applicable requirements oflaws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we believe the reportable condition described above is not a material weakness.

This report is intended solely for the information and use ofthe management, members ofthe City of Bremen Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.

Respectfully submitted,
~~
Russ II W. Hinton State Auditor

RWH:gp 2001SA-40

SECTIONID AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-763 1-99-0 1 FS-763 1-00-01

Further Action Not Warranted Unresolved - See Corrective ActionlResponses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-763l-00-0l

The Board has contracted with American Appraisal Associates to capitalize assets in excess of $10,000.00 and to maintain an inventory of computer equipment and assets valued at $1,000.00 to $9,999.00. The School District is currently working in conjunction with the Department ofEducation to add the fixed asset software (FASgov Capital Assets Inventory) to the PC Genesis program.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FA-763 1-99-02 FA-763 1-99-03 FA-763 1-00-01 FA-763 1-00-02 FA-763 1-00-03

Further Action Not Warranted Further Action Not Warranted Previously Reported Corrective Action Implemented Previously Reported Corrective Action Implemented Previously Reported Corrective Action Implemented

SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF BREMEN BOARD OF EDUCAnON - HARALSON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2001

I SUMMARY OF AUDITOR'S RESULTS

1. Type ofReport Issued on the Financial Statements The auditor's opinion on the City ofBremen Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles.

2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the City ofBremen Board ofEducation disclosed a financial statement reportable condition related to the following control category.

General Fixed Assets

The reportable condition described above is considered to be a material weakness.

3. Noncompliance Material to the Financial Statements The audit of the City of Bremen Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.

4. Reportable Conditions in Internal Control Over Major Programs The audit report for the City ofBremen Board ofEducation disclosed a reportable condition in internal control over major programs for the following compliance requirement.

Equipment and Real Property Management

The reportable condition described above is not considered to be a material weakness.

5. Type of Report Issued on Compliance for Major Programs

The auditor's opinion on the City ofBremen Board ofEducation's report on compliance with

requirements applicable to major programs was unqualified.

'

6. Audit Findings Required to be Reported by Section .51O(a) ofOMB Circular A-l33 The City of Bremen Board of Education's audit disclosed an audit finding required to be reported by section .51O(a) ofOMB Circular A-133. This audit finding is included in section IV of this report.

- 1-

CITYOF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30,2001
I SUMMARY OF AUDITOR'S RESULTS
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10.555 Food and Nutrition Program - Food Services - National School Lunch Program 84.173 Individuals with Disabilities Education Act - Part B - Special Education Capacity Building Improvement 84.027 Individuals with Disabilities Education Act - Part B - Special Education Flow Through 84.173 Individuals with Disabilities Education Act - Part B - Special Education Preschool
8. Type "A'i Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The City of Bremen Board of Education did not qualify as a low risk auditee as defined by Section .530 ofQMB Circular A-B3.
,
IT FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7631-01-01
The City of Bremen Board of Education did not maintain a system-Wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. this condition results in the general-purpose financial statements ofthe School District .being incomplete and not in accordance with generally accepted accounting principles..Appropriate action should be taken by the School District to establish accounting controls and procedures to provide for maintenance.ofa General Fixed Assets Account Group. These subsidiary records should include ari inventory of land, buildings and equipment owned by the School District and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained ofall additions and deletions to the General Fixed Assets Account Group.
Management's Response:
Management has contracted with American Appraisal Associates to capitalize assets in excess of $10,000.00 and to maintain an inventory of computer equipment and assets valued at $1,000.00 to $9,999.00. The School District is currently working in conjunction with the Department of
-2-