City of Bremen Board of Education, Haralson County, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2002

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DEPARTMENT-oF Auo,rs ANc, AccouN1s-



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:-crtYoF BREMEN BOARD OF'EDUCATION

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HARAl.SON COUNTY. GEORGIA;'

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REP,ORT.ONAUDrr.
OF THE FINANCIAL STATEMENTS

FO. R

THE
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FISCAL

YEAR '

ENDED

JU-.NE

30;

2002

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'Russell W. Hint~~

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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 FUND 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 - NONEXPENDABLE TRUST FUND

9

F NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

10

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

20

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

22

CAPITAL PROJECTS FUND

COMBINING BALANCE SHEET

24

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

26

SCHEDULES

I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

28

2 SCHEDULE OF STATE REVENUE

30

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

31

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

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

ALLOTMENTS AND EXPENDITURES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

5

BY SITE

~
32 33

SECTION II
COMPLIANCE AND INTERNAL CONTROL REPORTS
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OYER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133

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

SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSl S

SECTION I FINANCIAL

1rn,,t.u. W. H1N10"
',TAI[ AIJDITOA
(404) 656-21/4

DEPARTMENT OF AUDITS AND ACCOUNTS
254 WJshmg1on S1rcc1. '.> W Sunc 214 AIIJnla, Gcorg1J 30334-g.\OO
June 25, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board ofEducat10n
and Supenntendent and Members of the City of Bremen Board of Education
INDEPENDENl AUDITOR'S COMBINED REPORT ON GENERAL-PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITIJRES OF FEDERAL AWARDS
Ladies and Gentlemen
We have audited the accompanying general-purpose financial statements of the City of Bremen Aoard of Educat10n. as of and for the year ended June 30, 2002, as listed in the table of contents lbese general-purpose financial statements are the respons1b1lity of the City of Bremen Board of Educauon's management Our responsibility 1s to express an op1mon on these general-purpose financial statements based on our audit
We conducted our audn in accordance wnh auditing standards generally accepted in the Umtcd States of Amenca and the standards applicable to financial audns contained in Government Auditing Standards. issued by the Comptroller General of the United States Those standards rcqmre that we plan and perform the audit to obtain reasonable assurance about whether the financial statement~ are free of matenal misstatement An audn includes examining, on a test basis. evidence supporting the amounts and disclosures in the financial statements An audit also includes assessing the accounting pnnc1ples used and s1gmficant estimates made by management, as well as evaluating the overall financial statement presentat10n We believe that our audit provides a reru.onable basis for our opinion
As described in the notes to the general-purpose financial statements, the Board of Education's financial statements have heen prepared using certain accounung practices and policies which. in our op1mon. vary in some respects from generally accepted accounting pnnc1ples These vanances are de~cnbed as follows

2002ARL-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 accountmg pnnciples
School activity accounts mamtamed at the md1v1dual schools are not mcluded m the general-purpose financial statements To conform to generally accepted accounting pnnc1ples, these accounts should be included m the general-purpose financial statements
The Board of Education did not recogmze as expenditures, m the year ended June 30. 2002, a portion of salanes and the correspondmg employer's cost of related benefits earned for contractual services completed prior to June 30, 2002 Also funds received, subsequent to June 30, 2002, from the Georgia Department of Education for the State's share of these unrecorded salanes and related benefits were not recorded as revenue m the year under review. Conversely, the similar expenditures and related revenues for contractual services completed pnor to June 30, 2001, were improperly recorded m the year ended June 30, 2002 To conform to generally accepted accountmg prmc1ples, revenues should be recorded when available and measurable and expenditures should be recorded when mcurred, rather than when funds are received or disbursed
The aggregate effects on the general-purpose financial statements of these vanances or om1ss1ons have not been determined, but are believed to be matenal
In our opimon, except for the effects on the general-purpose financial statements of the matters referred to m the precedmg paragraph, the general-purpose financial statements referred to above present fairly, m all material respects, the financial position of the City of Bremen Board of Educallon as of June 30, 2002, and the results of its operallons and the cash flows of its nonexpendable trust fund for the year then ended, m conformity with accounllng pnnc1ples generally accepted in the United States of Amenca
In accordance with Government Aud1tmg Standards, we have also issued our report dated June 25, 2003, on our consideration of the City of Bremen Board ofEducallon's mtemal control over financial reportmg and our tests of its compliance with certain provisions oflaws, regulations, contracts and granu, That report 1s an integral part of an audit performed in accordance with Government
Aud1tmg Standards and should be read m conJuncllon with this report in considenng the results of
our audit
Our audit was performed for the purpose of formmg an opimon on the general-purpose financial statements of the City of Bremen Board of Education taken a~ a whole The accompanying combmmg statements (Exhibits G through J) and the financial schedules (Schedules l through 5). which includes the Schedule of Expenditures of Federal Awards as required by U S Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Orgam=atwns. are presented for purposes of additional analysis and are not a required part of the general-purpose financial statements Such mformation has been subjected to the aud1tmg
2002ARL-13

procedures applied in the audit ofthe general-purpose financial statements and m our opinion. except for the effects ofthe matters referred to in the thud paragraph, such information 1s fairly stated, in all material respects, m relation to the general-purpose financial statements taken as a whole A copy ofthis report has been filed as a permanent record m the office of the State Auditor and made available to the press ofthe State. as provided for by Official Code of Georgia Annotated Section 506-24.
Respectfully submitted,
RWHgp 2002ARL-l3

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY

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CIJY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY
COMBINED BALANCE SHEET
ALL FUND TYPES ANP ACCOUNT GROUP JUNE 30 2002

~ Cash and Cash Equivalents
Investments
Accounts Receivable
Prepaid Items
Inventories Food Donated Commodllies Pt.dlased Food
Amount Available m Debt SeMce Fund
Amount to be Provided In Future Years For Payment ot Bond Debt Caprtal Lease Agreements
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

s

s s 703,224 37

169 690 60

4,671,890 14

54,164 48

68,011 61

425 145 70

670911 1,675 60

s

s s 757 368 85

2661287 12

51097:035 84

blABl6ITIEl;; AND FIJNQ EQ!IITY
UABILmES
Accounts Payable
Salal1e1 Payable Expired Grant Balances Payabla Contracts Payabla Retamages Payable Capital Lease Agreements General Obllgahon Bonds Payable
Total uabilllles
FUND EOUIIY
Fund Balances Reserved For Bus Roplacemont Funds For Debt Service For Endowment Corpus For lnventones Food Donated Commodrties PurchaM!d Food
For Purpose of Bond Issue
For SPLOST Protects Unreserved
Undes,gnated
Total Fund Equity

s

63 476 37 s

56 856 71 s

2200

12,681 22

100 329 77

9660

20 027 13

2,225 24

s

76 157 59 s s 157,283 26

22 274 37

s

19,661 00

s

670911

1,675 60
s 4,652,604 90

222 156 57

661 570 26

100 619 13

0 00

s

s s 681,231 26

109 003 64

5 074 761 47

Total uablhtles and Fund Equity

s

757 368 65 s

The notes to the general-purpose financial &tatement& are an lr\tegral part of ttns statement

-2 -

s 26628712

5 097 035 64

EXHIBIT "A"

DEBT SERVICE
FUND

FIDI./CIARY
FUND TYPE
TRUST FUND

s

s 85 907 64

000

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

{Memorandum Onl;i)

JUNE 30, 2002

JUNE 30, 2001

s s 5 630 912 75

1,6TT,827 65

20 000 00

567,321 99

267,005 22

652 57

s

85,907 64

870911 1 675 60
85 907 64

8,683 68 2,844 29
1 760 22

s

85 907 64 s

5,299 092 38 59,304 50

5 299 092 38 59 304 50

1,083,239 78 157 054 91

s s s 000

514441304 50

11.650,923 95

3 219 068 32

s

120 355 08 s

143 860 19

113,010 99

96,234 27

9680

431 70

20,027 13

s

59,304 50

2 225 24 59 304 50

9 028 10 157 054 91

5,385,000 00

5 385 000 00

1 085 000 00

s s 5,444,304 50

s 5 700 019 74

1 491 609 17

$

85 907 64

000 s

s

85 907 64 s

s

85 907 64 s

s

19,661 00 $

15,219 00

85 907 64

1 760 22

20 000 00

670911 1 675 60 4,852 604 90 222 156 57

8,683 68 2,844 29
182,199 19
768,709 68

000

782 189 39

728 042 89

000

s 5,950,904 21 s 1 727459 15

s s s 0 00

544430450

11,6501923 95

3,2191068 32

. 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 JO 2002

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current lnstruchon Support Services Pupil Services Improvement of Instructional Sarvas Educational Med,a Services General Administration School Admlnlstrabon Business Administrabon Maintenance and Operation of Plant Student Tranoportabon Services Cen1ral Support Serv1ces Other Support ServlC89 Food Services OperaUon En1erpnse Operabons
Cspltal OuUay Deb1Serv,ce
Principal
Interest
To1al Expend~ures
Excess of Revenues over (under) Expenditures
QTt!!;R FINANCING QURC!i (USES}
Proceeds from General Obltgabon Bonds Par Value
Capital Lease,,
Operating Transfers In
Operating Transfe~ Out
To1al Other F1nancmg Sources (Uses)
Excess of Revenues and Other Flnanang Sources over (under) Expenchtures and Other Financing Uses
FUND BALANCE JULY 1
Food lnven1ory. Net Change 1n Penod Donated Commodnles Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 7,039,706 31 $ 5351362
1,212,019 28 425 839 21

444,157 19 643,434 30
325,576 89

s $ 8,731,078 42

1413 168 38

s 6,479,092 22 $
226,839 23 151,10424 192 104 58 207,127 25 624,872 80 75,912 53 582,362 49
52,075 45
27 879 93 4 516 55
85,033 92

579,827 24
47,800 51 240,134 28
85 53 27,361 88
5,456 51 10,734 78
508,42542

15,09517 2 465 62

s s 8,706,482 18

1419826 15

s

s 24 596 24

-6 657 77

s

21,514 89

s

-1795342

s

3 561 47 $

17,95H2 17 953 42

$

28,157 71 s

11,295 65

653,073 55

100,651 45

-1,97457 -116869

FUND BALANCE JUNE 30

$

s_ _ 681 231 26

1,,09=0_03._84._

The notes to the general-purpose finanCl&I statements are an Integral part of this statement .4.

EXHIBIT "B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

(Memorandum On!);) YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

s

149,166 ~9

s s 7,633,030 39

7,386,743 85

s 519,305 37

662,953 00

696,947 92 2,394,277 65

738,325 10 2,363,339 52

81 559 89

2 618 79

835 594 78

753 476 34

s

750 032 15 $

665 571 79 $ 1155985074 $ 1124188481

$

102 000 00

1 152,851 38

s 10417013
9 951 59

s $ 1 368 973 10

s

-618 940 95 $

s s 7,058,919 48

6,554,282 60

274,639 74 391 238 52 192,19011 234,48913 624,872 80 177 912 53 567,819 00
62,810 23
27,879 93 512,941 97
85 033 92 1,152,851 38

238,700 90 481,880 73 181,36548 209,146 09 643,61648
90 261 91 571,744 03
53,532 56 3,819 65
31,978 20 506,74816
71,586 51 779,026 31

630000 00 13863102
768 631 02 $
s -103 059 23

749,265 30 15104843
s 12,263,912 45 s -704 061 71

643,733 43 67 888 76
11109111 80
132 773 01

s s 4,742,793 35
s $ 4 742 793 35 s s 4 123 852 40
950 909 07

187,206 65 $
s 187 206 65

4,930,000 00
s 21 514 89
17,953 42 -17 953 42
s 4 951 514 89

140,795 39 1179954 -1179954
140 795 39

s 84,147 42
1 760 22

4,247,453 18 $ 1 706,594 29

273,568 40 1432,41805

-1,974 57 -1 168 69

855 51 -247 67

s 5074 76147 $

85 907 64 $

- 5.

_ C[TY Of BREMEN BOARD OF EDUCATION - HARALSON COUNTY
COMBINED STATEMENT OF REVENUES EXPENDITIJRES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS!
GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30 2002

EXHIBIT c

GENERAL FUND

BUDGET

ACTUAL

REVENUES
Stale Funds Federal Funds Taxe& Other Funds
Total Revenues

s s 8 822 835 00

7 039 708 31

50 000 00

53 513 82

1,200 000 00

1.212 019 28

34 10000

25 839 21

$ 8. 18.935 00 $ 8.731,07B 2

EXPENDITURES

Current lnstrucbon Support Services Pupil SeMCeS Improvement of ln1trudk>nal SeMces EoocabOnal Madia Selvlces General Adnunistratton Schod AdmmistratK>n Business AdmriMalrrtenance 811d Operaban of Plant Swdent TranspOrtatlon Sennces Central Support SeMces Other Support SeMces Food Serw:es Openlbon En1erprt&e OperabOns
DebtServk:e
Total Expenditures
Excess of Revenues over (under) "-"<lltures

s s B,381,038 87

8, 79,092 22

202,279 00 1 2,871 00 164 87 00 190,510 00 816.285 87
73.226 61 513,569 00
55,739 00 11,000 00 29 384 00 6 038 00

226 B39.23
151,10 2
192,10 58 207,127.25 624872 80
75 912 53 562 362 9
52 075 5
27 879 93 518 55
85 033 92 17 560 99

s s 8,388,595 35

8.708.82 18

s 30,339 65 $

2 598 2

OTHER FINANl,ING SOU!lC!;S (USES!
01118rSources Other Uses
Total Other Financing Sout:es (Uses)

s 21,514 89
-17 953 2

s

3 56147

Excesa of Revenues and Other F1nanc:mg Sources

s s ~ (..-i Expenditures and Olher Financing Uses

30,339 65

28,157 71

FUND BALANCE JULY 1 2001

864 511 70

853 073 55

AdJUstmenlS Food lm,emory - Ne1 Chango In Period
Donaled Commodlbes Purchased Food

FUND BALANCE JUNE 30. 2002

$ 694,851 35 S 681 J31 28

SPECIAL REVENUE FUND

BUDGET

ACTUAL

s s 79,761 00
583,818 79

#1,15719 643, 34 30

308.885 00

325 576 89

$ 972, 64 79 $ 1. 13 168 38

s s 220 565 00

579 827 24

25,000 00 253,215 00
9,802 OD

7 800 51 20,134 28
85 53 27 361 88

5 56 51 10 734 78

83 985 00

50B, 25 2

$ 972 567 00 s 1. 19.826 15

$

-102 21 s

-8 B57 TT

s 9 788 00 s
-9 788 00

s

0 00 s

17,953 2
17 953 2

s s -102 21

11,295 65

261,514 84

100,851 5

-130,872 76

-1 97 57 -1188 69

$ 13073987 $ 10900384

The notes to the general-purpose financial statement& are en Integral part of thl& &tatemenL -7-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY STATEMENT OF REVENUES EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30, 2002

EXHIBIT"D"

OPERATING REVENUES Donations
OPERATING EXPENSES None Recorded Operating Income
NONOPERATING REVENUES Interest Eamed Net Income
FUND BALANCE JULY 1 Residual Equity Transfer Bremen Educabon Foundabon, Inc
FUND BALANCE JUNE 30

BREMEN BOARD OF EDUCATION ENDOWMENT
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2002

JUNE 30 2001

$

000 $

000 $

5 000 00

$

000 $

000 $

000

$

000 $

000 $

5 000 00

000

000

864 86

$

000 $

000 $

5,864 86

20,864 86

20,864 86

15,00000

-20 864 86

-20 864 86

000

$

000 $

ooo s___2_0_8_64_8_6_

The notes to the genera~purpose finenc,al statements are an 1n1egral part of this statement -8-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNJY STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30. 2002

EXHIBIT "E"

Cash Flows from Operating ActlVitles Cash Received from Donat10ns
Cash Flows from Noncap1tal F1nancmg Acbv1t1es Residual Equity Transfer Bremen Education Foundation, Inc
Cash Flows from lnvesbng ActMtles Interest Received on Investments Purchase of Investments Sale of Investments
Net Cash Provided by Investment Act1v1t1es
Net Increase (Decrease) m Cash
Cash and Cash Equivalents - Juty 1
Cash and Cash Equivalents - June 30

BREMEN BOARD OF EDUCATION ENDOWMENT
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$

000 $

000 $ _ _---=c5~0~00~00=-

$

-864 86 $

-864 86 $

000

$

000 $

000 $

864 86

-20,000 00

15 000 00

$

000 $

000 $

-'I 135 14

$

-864 86 $

-864 86 $

864 86

86486

66486

000

$

000 $

ooo s_ _ _864:;.;;;.;...;;;86~

The notes to the general-purpose financial statements ere an mtegral part of this statement -9-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2002

EXHIBIT"F"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The City of Bremen Board of Education (School Distnct) 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 D1stnct is organized as a separate legal entity and has the power to levy taxes. Accordingly, the School D1stnct 1s 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 of1ts operations. Fund accounting 1s designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activilles. A fund 1s a separate accounting entlty with a self-balancmg set of accounts An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect expendable available financial resources
General Fixed Assets are recorded as expenditures m the various funds at the time of purchase A General Fixed Assets Account Group 1s not presently mamtamed by the School D1stnct To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acqmred by governmental fund types.
Although "school acllvity accounts" are maintained at the individual schools, neither the assets, liab1ht1es and fund eqmty, nor the revenues, expenditures and changes in fund balances of these accounts are reflected m these financial statements. To conform to generally accepted accountmg pnnc1ples, these accounts should be recorded m the general-purpose financial statements.
The general-purpose financial statements account for all State, Federal, TaJ(es and Other funds under control of the School District, in compliance with generally accepted accounting pnnc1ples applicable to governmental umts, 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 the School D1stnct's cducat1onal act1v1lles Governmental Fund Types mc\ude
GENERAL FUND - the fund used to account for all financial resources of the School D1stnct c'l.cept those reqmred to be accounted for in another fund These transactions relate to resources obtamed 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 pnmanly from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives
- IO -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2002

EXHIBIT"F"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acqu1s1tion or construction of maJor capital facilities
DEBT SERVICE FUND-the fund used to account for the accumulation ofresources for, and the payment of, general long-term pnnc1pal, interest and paying agent fees
FIDUCIARY FUND TYPE - the fund used to account for assets held by a government umt ma trustee capacity or as an agent for md1v1duals, pnvate organizations, other government umts and/or other funds Tins fund includes
NONEXPENDABLE TRUST FUND Bremen Board of Education Endowment Fund - the fund used to account for an endowment of which the corpus 1s to be invested and preserved mtact with the resultant income to be used as necessary by the School D1stnct.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obhgat10n debt outstandmg and capital lease obligations
BASIS OF ACCOUNTING
The accounting and financial reportmg treatment apphed to a fund 1s determined by its measurement focus All governmental funds are accounted for usmg a current financial resources measurement focus With tins measurement focus, only current assets and current hab1ht1es generally are mcluded on the balance sheet Operating statements of these funds present mcreases (i e., revenues and other financing sources) and decreases (1e., expenditures and other financing uses) in net current assets. Their reported fund balance 1s considered a measure of available spendable resources
Liab1lit1es which are expected to be financed from available spendable resources are reported as hab1h11es in the governmental funds. Other liab1hties, which are not expected to be financed from avrulable spendable resources, are reported m the General Long-Term Debt Account Group.
All nonexpendablc trust funds are accounted for on a flow of economic resources measurement focus With this measurement focus, all assets and hab1ht1es associated with the operation of these funds are mcluded on the balance sheet Operatmg statements present mcreases (e g, revenues) and decreases (e.g, expenses) in net total assets
Governmental funds are accounted for using the modified accrual basis of accountmg under which:
Revenues are recogmzed when susceptible to accrual (1 e when they become both measurable and avrulable) "Measurable" means the amount of the transaction can be determmed and "available" means collectible within the current period or soon enough thereafter to be used to pay hab1ht1es of the current penod The School D1stnct considers receivables collected within sixty days after year-
- 11 -

ClTY OF BREMEN BOARD OF EOUCATION - HARALSON COUNTY
NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002

EXHIBIT "F"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
end to be available. Property truces, sales truces and mterest are considered to be susceptible to accrual Nonexchange transactions, m which the School Distnct gives (or receives) value without directly rece1vmg (or giving) equal value in exchange, include property truces, local option sales truces, intergovernmental grants and donahons. Revenue for property truces is recogniz.ed m the fiscal year for which the truces are levied. Revenue from sales truces is recogmzed in the fiscal year the resources are received or susceptible to accrual Revenue from grants and donat10ns is recognized m the fiscal year m which all eligibility requirements have been satisfied
Expenditures are generally recognized when the related fund liability is mcurred.
A departure from the above definit10ns 1s the accountmg treatment afforded the final two payments on General Fund teachers" and bus drivers' contracts, and the resources available from the Georgia Department of Educat10n for the State's share of these contracts During fiscal year 2002, a substantial number of personnel ofthe School District were employed for a one hundred and nmety day penod begmnmg m August 2001 and ending m early June 2002. Personnel contracts for this employment period specify that compensation be paid m twelve equal monthly payments beginning m September 2001 and ending m August 2002 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, 2002, compensat10n under these employment contracts had been earned, but two of the twelve monthly payments. due for July and August 2002, had not been made Payments for these two months were made and recorded as expenditures by the School D1stnct subsequent to June 30, 2002 Also, the State's port10n of the compensation pmd in July and August 2002 was received and recorded as revenue m the fiscal year subsequent to June 30, 2002 Conversely, the similar expenditures and related revenues for contractual services completed pnor to June 30, 200 I, were recorded m the year ended June 30, 2002 Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when mcurred, rather than when funds are received or disbursed.
The accrual basis of accountmg, as reqmred by generally accepted accounting pnnc1ples, 1s utilized by nonexpendable trust funds Under the accrual basis of accountmg, revenues are recorded when earned and expenses are recorded at the time liabihues are mcurred.
BUDGET
The City of Bremen Board of Education's budget 1s a complete financial plan for the School D1stnct's fiscal year and 1s bao;ed upon estimates of expenditures together with probable fundmg sources There 1s no statutory proh1b1t1on regarding overexpend1ture 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 than generally accepted accounting pnnciples
The budget process begins when the School District's admmistration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget 1s advertised at least once ma newspaper of general c1rculat10n m the locahty At the next regular meetmg ofthe
- 12 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002

EXHIBIT "F"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Board after advertisement, the Board receives comments on the tentative budget, makes rev1s10ns as necessary and adopts a final school budget. This final budget 1s then submltled, in accordance with prov1s1ons of the Quahty 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 dunng the year AH unexpended budget authonty 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 matunties of three months or less from the date of acquis1t10n m authorized financial mst1tut10ns Georgia Laws OCGA 45-8-14 authonze the School D1stnct to deposit its funds in one or more solvent banks or insured Federal savmgs and loan associations

RECEIVABLES

Receivables consist of grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from mfonnatlon available Receivables are recorded when either the asset or revenue recogmt10n cntena has been met Receivables recorded on the general-purpose financial statements do not mclude 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 2001 tax digest year (calendar year) on November 7, 2001 (levy date) Taxes were due on January 7, 2002 (hen date) Taxes collected w1thm the current fiscal year or w1thm 60 days after year-end on the 2001 tax digest are reported as revenue m fiscal year 2002 The Bremen City Clerk bills and collects the property taxes for the School D1stnct and remits the taxes collected to the School D1stnct Property tax revenues during the fiscal year ended June 30, 2002 for maintenance and operat10ns amounted to $1,212.019 28.

The tax millage rate levied for the 2001 tax year (calendar year) for the City of Bremen Board of Educat10n was as follows (a mill equals $1 per thousand dollars of assessed value)

School Operat10ns

~mills

SALES TAXES

Special Purpose Local Option Sales Tax revenue during the year amounted to $1.182.258 37 and 1s to be used for capital outlay for educational purposes or debt service Tius sales tax was authonzed by local referendum and the sales tax must be re-authonzed at least every five years

- 13 -

CITY OF BREMEN BOARD OF EDUCATlON - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30. 2002

CXHIBIT "F"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES lnventones of donated food commodities used in the preparatmn of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventones are reported on the Combined Balance Sheet at cost (first-in. first-out). Donated food commodities are recorded as revenues and expenditures at the !Jme commodity items are received Purchased foods inventones arc recorded as expenditures at the time of purchase. The inventones reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which md1cates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets
GENERAL OBLIGATION BONDS
The School District entered into a Joint agreement with the City of Bremen whereby the City of Bremen issued general obhgauon bonds on behalf of the school system. The bond premiums. discounts and issuance costs are recognized in the financial statements ofthe School D1stnct dunng the year bonds are issued. According to the terms of the aforementioned agreement, the bonds are the direct obhgatmns of the School D1stnct; therefore, the outstanding amount of these bonds 1s recorded in the General Long-Term Debt Account Group.
INTERFUND TRANSACTIONS
The School Distnct has the following types of interfund transactmns
Reimbursements of expenditures/expenses 1mtially made from a fund that are properly applicable to another fund are recorded as expenditures/expenses in the re1mbursmg fund and as reductions of expenditures/expenses m the fund that 1s reimbursed
Residual equity transfers are recorded for nonrecurnng or nonroutme permanent transfers of equity
Operating transfers are recorded for all mterfund transactions other than residual eqmty transfers and reimbursements
MEMORANDUM ONLY -TOTAL COLUMNS
Total columns on the general-purpose financial statements are captioned "Memorandum Only" to md1cate that they are presented only to facihtate financial analysis Data m these columns do not present financial pos11lon. results of operations or cash flows in conformity wl!h generally accepted accounting principles Neither are such data comparable to a consolidation lnterfund climmations have not been made m the aggregat,0,1 of this data

- 14 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002

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 many depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofmsurance, or by collateral The aggregate of the face value of such surety bond and the market value of secuntles pledged shall be equal to not less than 110 percent ofthe pubhc funds bemg secured after the deduction ofthe amount ofdeposit msurance If a depository elects the pooled method (OCGA 45-8-13 I) the aggregate ofthe market value ofthe secuntles pledged to secure a pool ofpubhc funds shall be not less than 110 percent ofthe da1lypool balance OCGA Secuon 45-8-11 (b) provides an officer holdmg public funds may, m his d1scrctmn, waive the reqmrement for secunty in the case of operatmg funds placed m demand deposit checkmg accounts
Acceptable sccunty for deposits consists of any one of or any combination of the followmg
(I) Surety bond signed by a surety company duly qualified and authonzed to transact busines~ w1thm the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporatmn,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the Umted States or of the State of Georgia,
(4) Bonds. bills, notes, certificates of indebtedness or other obligations of the countle~ or mun1c1pal1t1es of the State of Georgia.
(5) Bonds of any pubhc authority created by the laws of the State of Georgia, prov1dmg that the statute that created the authonty authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authontles created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obhgatmns of a subsidiary corporation of the Umted States government, which arc fully guaranteed by the Umted States government both as to pnnc1pal 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 Assoc1atmn, and the Federal Nauonal Mortgage Association
CATEGORIZATION OF DEPOSITS At June 30, 2002, the bank balances were $6,321,889 75 The amounts ofthe total bank balance~ are classified mto three categories of credit nsk

- 15 -

CITY OF BREMEN BOARD OF EDUCATION HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002

EXHIBIT "F"

Note 2 DEPOSITS

Category I Cash that is msured (e g, Federal depository insurance) or collaterahzed with secur1t1es held by the School District or by the School Distnct's agent in the
School D1stnct's name.
Category 2 Cash collateral1zed with securities held by the pledgmg financial mstnution's
trust department or agent m the School Distnct's name.
Category 3 Uncollaterahzed deposits (This includes any bank balance that is collateralized
with secuntles held by the pledgmg financial institution, or by its trust department or agent but not m the School D1stnct's name.)

The School D1stnct's deposits are classified by nsk category at June 30, 2002, as follows:

Risk Category

Bank Balance

I
2 3
Total

$ 183,772 31 6,138,117.44 0 00
$ 6.321,889,75

Note 3: NON-MONETARY TRANSACTIONS

The School Distnct receives food commod1t1es 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 I - Inventories

Note 4 RISK MANAGEMENT

The School D1stnct 1s exposed to various risks of loss related to torts; theft of, damage to. and destruction of assets, errors or omissions, Job related illness or mJunes to employees, acts of God and unemployment compensatmn

The School D1stnct has obtamed cornmerc1al msurance for nsk of loss associated with torts, assets, errors or omissions and Job related illness or mjwies to employees The School D1stnct has neither s1gn1ficantly reduced coverage for these nsks nor incurred losses (settlements) which exceeded the School D1stnct's msurance coverage in any of the past three years

The School D1stnct has elected to self-insure for all losses related to acts of God The School District has not experienced any losses related to this nsk in the past three years

The School D1stnct 1s self-msured with regard to unemployment compensation claims. The School Distnct accounts for claims withm the sarrye fund that the employee's salary and benefits were paid Claims are accounted for with expenditure and hab1hty bemg reported when 1t 1s probable that a loss has occurred, and the amount of that loss can be reasonably estimated The School Distnct has not mcurred any hab1h11es for unemployment compensation durmg the last two fiscal year~.

- 16 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS JUNE 30, 2002

EXHIBIT"F"

Note 4 RISK MANAGEMENT

The School D1stnct has purchased surety bonds to provide add11Ional insurance coverage as follows

Pos11Ion Covered

Amount

Supenntendent Board Treasurer All Other Employees

$ 10,000 00 $ 10,000 00 $ 50.000 00

Note 5 GENERAL LONG-TERM DEBT

CAPITAL LEASES l he City of Bremen Board of Educat10n has entered mto vanous lease agreements as lessee for copiers and mobile classrooms. These lease agreements quahfy as capital leases for accountmg purposes and, therefore, have been recorded at the present value of the future mm1mum lease payments as of the date of their inception.

GENERAL OBLIGATION DEBT OUTSTANDING General Obhgat10n Bonds currently outstanding are as follows

Purpose

Interest Rates

Amount

General Government - Senes 1997 General Government - Series 2001 (Carroll) General Government - Senes 2001 (Haralson)

3 85%-4 30% 36% 3 39%

$ 455,000 00 2,390,000 00 2.540.000.00

$ 5.385.000.00
The changes in General Long-Term Debt during the fiscal year ended June 30, 2002, were as follows

Capital Leases

General Obhgallon
Bonds

Total

Balance July I, 2001

$ 157,054 91 $ 1,085,000 00 $1,242,054.91

Additions Capital Leases GO Bonds

21,514 89

21,514.89

4,930,000 00 4,930,000 00

Deductions Debt Retired
Balance June 30. 2002

I I 9.265 30

630.000 00

749.265 30

$ 59,304.50 $ 5,385,000.00 $ 5,444,304.50

- 17 -

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

CJTY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY NOTES TO THE GENERAL-PURPOSE FlNANCJAL STATEMENTS JUNE 30. 2002

EXHIBIT "F"

Note 5 GENERAL LONG-TERM DEBT

At June 30, 2002, payments due by fiscal year which mcludes pnnc1pal and mterest for these nems arc as follows.

Fiscal Year Ended June 30

Capital Leases

General Obligallon
Bonds

Total Debt

2003 2004 2005 2006 2007 2008 - 2009
Total Principal and Interest
Deduct Imputed Interest

$ 47,097 27 $ 550,855 50 $ 597,952 77

6,832 11

540,789 75

547,621.86

4,044.00

945,495 50

949.539.50

4,044 00 1,030,617.75 1,034,661.75

3.370.00 1,131.381 75 I. 134,751.75

1,843.142 75 1.843. 142 75

$ 65,387 38 $ 6,042.283 .00 $ 6.)07.670.38

6.082 88

Net Present Value of Future
Minimum Lease Payments $ 59,304.50
Note 6: ON-BEHALF PAYMENTS

The School District has recognized revenues and expenditures m the amount of $100,766.90 for health msurance and retirement contributions pa.id on the School D1stnct"s behalf by the follm,.1ng State Agencies

Georgia Department of Education Paid to the Georgia Department of Commumty Health For Health Insurance of Non-Certified Personnel In the amount of $88,668 90

Office of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer"s Cost In the amount of$ I2,098.00

Note 7 SIGNIFICANT COMMITMENTS

The followmg 1s an analysis ofs1gn1ficant outstanding construct10n or renovat10n contracts executed by the School District as of June 30, 2002, together with funding available

- I8 -

CITY OF BREMEN BOARD OF EDUCATION HARALSON COUNTY
NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "f"

Note 7 SIGNIFICANT COMMITMENTS

PrO)ect

Unearned Executed Contracts

Fundmg Available From State

03/02S763-026 Sewell Middle School Renovations

$ 2.775,217 15 $ 473,858 37 1.259,57 I 36

$ 4.034.788,51 $ 473.858,37
The amounts descnbed m this note are not reflected m 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 Distnct beheves that such d1sallowanccs, 1f any, will be 1mmatenal to its overall financial position.

Note 9 RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (fRS)

TRS PLAN DESCRJPTION Substant1ally all teachers. admmistrat1ve and clerical personnel employed by local school d1stncts are covered by the Teachers Retirement System of Georgia (TRS), which 1s a cost-sharing multiple employer defined benefit pens10n plan TRS provides service retirement, d1sabihty retirement and survivors benefits for Its members m accordance with State statute The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtamed from the Georgia Department of Audits and Accounts

TRS CONTRJBUTIONS REQUIRED AND MADE Employees ofthe School District who are covered by TRS are required by State statute to contribute 5% of their gross eammgs to TRS The School District makes monthly employer contnbut10ns to TRS at rates adopted by the TRS Board of Trustees m accordance with State statute and as advised by their mdependent actuary The reqmred employer contnbut10n rate is 9 24% and employer contn but10ns for the current fiscal year and the preceding two fiscal years are as follows

Fiscal Year

Percentage Contributed

Required Contnbut10n

2002 2001 2000

100% 100% 100%

$ 580.997 60 $ 661,27219 $ 6 I6,007 34

I9

CITY OF BREMEN BOARD OF EDUCATION HARALSON COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 2002

ASSETS
Cash and Cash Equivalents
Accounts Receivable
lnventones Food Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

139,35318 $

56,194 97

2,375 35

6,70911 1 67560

Total Assets

$

14113189 s~_._se_.5_1..,o-=3-2

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Salanes Payable Expired Grant Balances Payable
Total L1abdrt1es
FUND EQUITY
Fund Balances Reserved For lnventones Food Donated Commodities Purchased Food Unreserved Undes,gnated
Total Fund Equity

$

6,691 18 $

16,770 85

32,042 87

41,703 91

9556

$

38 734 05 $

58 570 32

$

6,709 11

1,675 60

100 619 13 $

000

$

109 003 84 $

0 00

Total Liab1lrues and Fund Equity

$

147 737 89 S_~,;;;58::.5~7..;;0,,;;;3=-2

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

EXHIBIT "G"

FEDERAL
PROGRAMS

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$

195,548 15 $

183,292 54

$

85,63646

88,011 81

34,869 30

6,709 11 167560

8,683 68 2 844 29

$

85 63646 $

s 291 944 s1 _-==229==._.68..,9._8_1__

$

25,657 55 $

25,657 55

33,394 68

56,856 71 $

38,395 05

26,582 99

100,329 77

90,011 61

1 24

9680

431 70

$

8563646 $

182 940 83 $

128 838 36

$

$ _ _ _---'0~00~

$

000 $

6,70911 $ 1,675 60

8,683 68 2,844 29

100 619 13

89 323 48

109 003 84 s _ _1~0~0~8~51_4~5~

$

85 636 46 S

291 944 s1 s_===2..2_9._.68_9..._81.,,

- 21 -

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. 2002

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current lnstructJon Support Services Pupil Services Improvement of lnstruCIJonal Serv,ces Educallonal Media Services General Administration School Adm1n1stratIon Maintenance and Operabon of Plant Student Transportation SeMces Food Services Operallon
Total Expendrtures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES
Operating Transfers In
Excess of Revenues and Other Financing Sources over (under) Expenditures
FUND BALANCE JULY 1
Food Inventory - Net Change In Penod Donated Commodities Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

39,318 00 $

404.83919

158,076 18

322,326 89

$

51972107 $

404 839 19

$

371,388 56

13,00300
5,679 30

15,16405

5,456 51

$

508,425 42

$

508,425 42 $

41069142

$

11,295 65 $

-5,852 23

$

11,295 65 $

100,851 45

-1,974 57 -1 168 69

5 852 23
000 000

FUND BALANCE JUNE 30

$

1091003 84 $ =~----0.0..0;;;.,

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

EXHIBIT"H"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$

444,15719 $

334,596 30

$

485,358 12

643,434 30

738,32510

3 250 00

325,576 89

309,258 70

$

488 60812 $ 1,413,16838 $ 1,382,18010

$

208,438 68 $

579,827 24 $

487,269 82

34,797 51 234,454 98
85 53 12,19783
10,734 78

47,800 51 240,134 28
85 53 27,361 88
5,456 51 10,734 78 508 42542

40,259 82 336,979 97
22,208 99 41 76
5,262 00
502 188 76

$

500 709 31 $ 1,419,82615 $ 139421112

$

-12, 101 19 $

-6,657 77 $

-12,031 02

12 101 19

17 953 42

1178560

$

000 $

11,295 65 $

-245 42

000

100,851 45

100,489 03

-1,974 57 -1 168 69

855 51 -247 67

$

000 S

s _ _ 100 003 64

1_0_0_8..,5._14_5._

1

- 23 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30. 2002

ASSETS Cash and Cash Equrvalents Accounts Receivable Prepaid Items

BOND PROCEEDS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$ 4,852,626 90

$

117,098 63

Total Assets

$ 4,852,82890 $ ~ _.1..1.7...__09_8 6_3_

LIABILITIES AND FUND EQUITY
LIABILITIES
Cash Overdraft Accounts Payable Contracts Payable Reta,nages Payable
Total l.JabdrtJes
FUND EQUITY
Fund Balances Reserved For Purpose of Bond Issue For SPLOST Projects Unreserved Undes,griated
Total Fund Equity
Total l.Jab1httes and Fund Equity

$

94,846 26

$

22 00

20,02713

2 225 24

$

2200 $

117,098 63

$ 4,852,604 90
000 $ $ 4,852,604 90 $

000 000

s ___ $ 4 as2 626 90

1-1""1_0..9.8..63...._

11

See notes to the general-purpose finanaal statements - 24 -

EXHIBIT "I"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$ 4,852,626 90 $

768,317 87

$

308,047 07

425,145 70

208,685 82

652 57

$

308 047 07 $ 5,277,772 60 $_....;9~77.;..,::6;:;;56.,2=6=

$

85,890 50 $

180,736 76

2200 $

17,719 09

20,027 13

2 225 24

0 028 10

$

85 890 50 $

20301113 $ _ _~2=6~7~47~10~

$ 4,852,604 90 $

182,109 19

$

222, 156 57

222,156 57

768,709 88

000

000

000

$

222,156 57 $ 5 074 761 47 $ - ~ =050=90~9 07-

$

308 047 07 $ 5,277,772 60 $=~0~77.;,,i;:,656=,;;;26;,,,

- 25 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND
YEAR ENDED JUNE 30 2002

REVENUES
State Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Support Serv,ces Business Adm1nlstrahon
Caprtal Outlay Salanes Employee Benefits Land and Land Improvements Building and Building Improvements Equipment
DebtS8MC8 Pnncipal Interest
Total Expendrtures
Excess of Revenues over (under) Expendrtures
OTHER FINANCING SOURCES IUSESl
CaprtalLeases Proceeds from General Obhgat1on Bonds
Par Value Operating Transfers In Operahng Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expendrtures and Other F1nancmg Uses
FUND BALANCE JULY 1
FUND BALANCE JUNE 30
See notes to the genera~purpose financial statements
- 26 -

BOND PROCEEDS

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

117,098 63

$

49 278 10

$

49 278 10 $

117 098 63

$

102,000 00

6,000 00 1,313 76
$ 95,86346

67,558 32 5 782 96

$

278,518 50 $

$ -229,240 40 $

15,00000 139,724 63
154 724 63 -37,626 00

$ 4,742,793 35 156 852 76 $
s 4,899,646 11 $
$ 4,670,405 71 $ 182 19919

37,626 00 37,626 00
000 000

$ oo 418521604 s~--=-o_oo-=

EXHIBIT "J"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$

32,068 26 S

149,166 89 $

70,00000

519,305 37

519,305 37

566,674 84

32 281 79

8155989

3156769

$

583,655 42 $

750 032 15 $_~668~=2~42~5=3~

$

102,000 00

$

894,949 53

6,000 00 $ 1,31376 15,000 00 1,130,537 62

5,824 56 1,587 55 46,351 00 549,00544 176,257 76

36,611 81 4168 63

104,170 13 9 951 59

65,467 55 6 736 79

$

935 729 97 $ 1,368,97310 $

851,230 65

$

-352 074 55 $

-618 940 95 $

-182 988 12

$

106,209 78

$ 4,742,793 35

194,478 76

$

-194 478 76

-194 478 76

181,390 62 -181 376 68

$

-194 478 76 $ 4,742,793 35 $

106,223 72

$

-546,553 31 $ 4,123,852 40 $

-76,764 40

768 709 88

950,909 07

1 027 673 47

$

222 156 57 $ 5 074 761 47 s _ _9=-S0=909=_o_7_

- 27 -

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF EXPENDIJ\/RES OF FEDERAL AWARDS YEAR ENDED JUNE 30 2002

SCHEDULE "1"

FUNDING AGENCY
PROGRAM/GRANT
Agnailture, u S Departmem of
Child NutnOon Cluster Pass-Through From Georgia Departmen1 of Education Food and NutnbOn Program Food 5eMces Sdlool Breakfast Program National School Lwl<h Program
Total Ctuld Nutrttlon Ck.J1ter
Other Programs Paaa-Ttrough From Georgia Departmen1 of Education Food and Nutrition Program Food D,gtribuhon Program (1)
Total U S Department of Agriculture
Education U S Departmem of Special Educatton Ouster Pass-Through From Georgia Departmen1 of Education lndrviduels wtth OtaabOlttes Educabon Ad Part B - Speaal Education Capacrty Bu11dsng Improvement Flow Through Preschool
Total Speaal Education Cluster
Other Programs
Direct
Elemenlary and Secondary Education A,;, TIiie VII Part B - Foreign Language Assistance
Pass-Through From Georgia Department of Education
ComprehenlM!!I Sdlool Reform Demonstrabon Protect
Elementary and Secondary Eduaitlon Act
Trtle I Grant& to Local Educabonal Agendas
TIiie II Eisenhower Professional Development
TIiie VI looovatrve EducabOn Program Strategies
c1a.. Size Reduebon
Stewart B McKinney Homeless Assistance A,;,
EducabOn for Homeless Chaktren and Youth VocabOnal Educatton - Basic Grants to States
High School Program Beale Grant
Total U S Departmen1 of Educatlon
National Endowment for the Arts Pa56-Through From Georgia COuncil for the Art& Promotion of the Arts Partnership Agreement

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10553 10555

NIA s 20 915 71

NIA

108,163 13 s

s 129,078 84 s

(2) 479 428 08 (3)
479 428 08

10 550

NIA

28 997 34

s 158,076 18 s

28 997 34 508 425 42

84 027 84 027 84 173

s NIA

4,462 00 s

NIA

203,863 08

NIA

32,257 39

s 240 582 47 s

4 462 00 203 863 09 (3)
32 257 39
240 582 48

84 293 84 332 84 010 84 281 84 298 84 340 84 196 84 046
45 025

5351362

NIA

52,000 00

NIA

111,84965

NIA

17 500 00

NIA

8,193 00

NIA

22 885 00

NIA

9 000 00

NIA

10 368 00

s 523 871 74 s

53,614 75 (3) 52,044 09 (3)
111,849 65 17,505 40 (3) 6 193 00 22 877 83 (3)
9 000 00
23 842 00 (3) 537 309 20

NIA s 15,000 00 S

17 014 88 (3)

Total Federal Financial Aaatstance NIA ., Not Ava~able

-28 -

s 696 947 92 S

1,062 749 48

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF EXPENDIJURES OF FEDERAL AWARDS YEAR ENDED JUNE 30 2002

SCHEDULE "1"

Notes to Jhe Schedule ot Exoendltures of Federal Awards
(1) The amounts shown for the Food Dtslrlbutlon Program represents the Federally assigned value of nonmonetary assistance for donated commod,Oes received and/or consumed by the system dunng the OJIT8nt fiscal year
(2) Expenditures for the School Breakfast Program were not maintained separately and are included In the 2002 National School Lunch Program
(3) Expendou"" for this program Include Stale, and/or Other Funds Expenditures are not maintained by fund source
MaJor Programs are ldentrfied by an asterisk (*) In front of the CFDA number
The Sdlool Dlstnct dld not provide Federal Aaslstance to any Subreaptent
The accompanying schedule of expenditures of Federal awarda lndudes the Federal grant actrvlty of the City of Bremen Board of Educat>n and IS presented on the mod1fted aca\l8I ba&ls of account.lg which ,s the basis of accounting used In the presentation of the general-purpose financial statements

See notes to the general-purpose flnanc&al statements

- 29 -

CITY OF BREMEN BOARD OF EPUCAJION HARALSON COUNTY SCHEDULE OF STATE REVENUE
YEAR ENPEP JUNE 30 2002

SCHEDULE"?

AGENCYtfUNPING
GRANTS Educabon, Geo<goa Department or Quahty Basic Educabon
D.recl lnttrucbonal Cost
Kmdergarten Program
Ku~rten Program Earty ln1ervenbon Program
Pnmary Gradel (1-3) Program Pnmary Grades Earty lntervenbou (1-3) Program Upper ElemElltary Grades (4-5) Program Upper Elementary Grades (4-5) Earty Intervention
Program M,ddle Grades (6-8) Program High Scllool General Educat>on (!1-12) Program YOC811onel Laboratory (!1-12) Program Students with Olsab1hbes
Category I CStogory II CStogorylll Cotego<y N C8togory V Gifted Student Ca1egory YI AltematJve EduCabOn Program
Media Cenlef Program 20 Day, Addlbonel lnstruct,ou Staff and Proteasronal QeM\ie"'IOpt"""m"'''"'nt Indirect Cost Catego,"'"' Grants
Pl4)01 Tranapor!abOn Reguler
Bus Roplacement
Spararty NUl'Slng Services Pnncipal ~plements
Vocat,onal Supe,v,''" EducabOn EquallzabOn Funding Grant Food ServteeS Yocabonal EducatJon ClttlOf Slate Programs
Grades 4-B Slll1"'Mdo After Scllool Program
Health Insurance K-3 Statewide Roadmg Program Nabonal Toacher Corbficabon
-veNext Generation Schools
Preschool Handicapped Program Lottery Programs
Technology Computers In the Classroom
Georgia State F1nanong and Investment Corrrn1ssron Reuntxusement on ConstructJon Proiect,;
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and F15CSI SerVlces Pub\,c School E""'""""'" Retirement
CONTRACT Transportation Georg&& Department of Paving PrOjOCI R e , ~

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

s 427 807 00
65,617 00 892 983 00 109 964 00 507,451 00
27,347 00 900,901 00 663 856 00 201 071 00
44 069 00 82 288 00 451 396 00 162,449 00
6,26600 143 303 00 64 474 00 146 803 00
44,493 00 27 032 00 1 025 626 00

1162800 4 442 00 35 889 00 46,686 00 6,104 00 7,862 00 688 146 00
s
4 596 00

39 318 00

11112 00
BB 668 90
1550741 5 131 00
75 000 00 31,650 00

5 815 44 56 225 35

s 427 807 00
65 617 00 892 983 00 109,964 00 507,451 00
27,347 00 900,901 00 663 856 00 201 071 00
44 069 00 B2 288 00 451 396 00 162 449 00
6,266 00 143,303 00 64 474 00 146 803 00 44 493 00 27 032 00 1,025 626 00
1162800 4 442 00 35 889 00 46 686 00 6 104 00 7 862 00 688,146 00 39,318 00 4 596 00
1111200 88,668 90 15 507 41
5,131 00
75 000 00
31 650 00
5 815 44 58 225 35

S 117 098 63
340,798 40 12 098 00

11709863 340,798 40
1209800

32,068 26

32 068 26

See notes to the general-purpoae flnanaal statements

S 7 039 706 31 $ 444 157 19 S 1491166 89 S 7 633 030 39 30-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30 2002

SCHEDULE "3"

PROJECT
HARALSON COUNTY The addltlon to and the renovation, repair acquisition improvement and equipping of, exlsUng school bLNldngs, the acq1.11srtMJn of system-wKle lechnology, school ttansportabon vehicles end a new media center and the necessary property therefore end for future schoots, all at a maximum cost of $4,000,000 00
CARROU COUNTY Func:hng the acquisrtlon, construction renovation, extending end equipping of caprtal outlay pro)&C!S ttvoughoul the Bremen School System, 1nclud1ng apec,flcally bu1 wlthou1 hmrte~on reoovetions, exterlStOllS and eqLapp1ng of H A Jones Elemenrtery School to mdude a new dassroom and cafetena addlbons and other mprovernents at Bremen High School to mclude a cafetena exten:s,on and other ,mprovemems, at Sewell Middle School to include a new saence end tedmology lab and other improvements and construcbng a new physk::al educatJon feahty, mdudlng the ecquos/llon of ei property, bo1h reel end personal, necassery therefor (the "Bremen School Projects"), Iha maximum cost of such Bremen School Proiects not to exceed $2,900,000 00

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS(2)

AMOUNT EXPENDED IN CURRENT YEAR (3)

AMOUNT EXPENDED IN PRIOR YEARS (3)

PROJECT STATUS

s 4,000,000 oo s 4,000,000 oo s 562 136 n s 3,220,397 42 Ongoing

2,900,000 00 2 900,000 00

843 467 35 1,506,219 48

Ongoing

$ 6,900,000 00 $ 6,900,000 00 $ 1,405,604 12 $ 4,726 616 90

(1) The School Dlstnct's ong1nal cost estimate as speafied 1n the resolutJon callmg for the 1mposrtion of the Local Option Sales Tax
(2) The Sdloot Dlstnd's current esllmate of total cost for the pro,ects Includes au cost from pro,ed i:ncephon to complebOn
(3) The voters of Harelson County, Carroil County and the City of Bremen approved the 1mpos1boo of a 1% Hies tax to fund the above prDjeCtS and retre assooeted debt Amounts expended for these pro,eds may 111dude sales tax
proceeds state, local property taxes and/or other funds over the Ufe of Iha projects

See notes to the general-purpose ftnancial statements

- 31 -

CITY Of BREMEN BOARD OF EDUCATION HARALSON COUNTY GENERAL FUND QUALITY BASIC EDUCATION PROGRAM /QBE)
l\bbOJMENTS ANP EXPENDITURES BY PROGRAM YEAR ENDED JUNE 30 2002

SCHEDULE "4"

DESCRIPTION
Dlrect lnstnJCbOnal Programs Kindergarten Program Kindergarten Program-EarlyI -Program Pnmary Grades (1-3) Program Pnmary Grades-Early ln1ervenbon (1-3) Program Upper Elomemary Gracteo (4-5) Program Upper Elemen1ary Grades-Early lmorven!Jon (4-5) Program Moddle Gradel (6-11) Program Middle School (6-11) Program High School General Education (9-12) Program Vocahonal Laboratory (9-12) Program Sludems with Disab1itles Category I Category II CotegOI)' Ill CotegOI)' IV Category V GH\ed Slud9n1 - Calegor, VI Remedial Education Program AJtematlve EducabOn Program
TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Media Center Progrsm Staff and Profeal,onal DevelOpmam

ALLOTI.IEN"TS FROM GEORGIA DEPARTI.IEN"T OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

s

455 85800 s 404,153 53 s

10 485 B1 $

414,63914

69 919 00

75 321 54

23 95

75 345 49

951 535 00 1 198,001 64

21,993 35

1,219 994 99

11716400

125,049 4B

125 049 48

540,667 00

656,983 02

14 343 73

673,206 75

29,197 00 959 972 00 707,364 00 214,255 00 795,413 00
152,69800 68 701 00

65 160 13
1 047,899 31 1 044,531 83
146 476 35
8,956 36 83,19340 464,60043 128 160 59
59 63 212,431 T7
28,523 11 48,195 64

23 95 1271151
3,709 50 31,03766
650 00
33444 13 835 50

65,164 08 12 711 51 1,051,608 81 1,075,569 51 147,126 35
8 956 36 83 19340 464 600 43 128,160 59
59 63 212 766 21
28,523 11 61,83114

$

5 062,763 00 $ 5 759,597 78 $ 106,949 22 s 5,BBB 546 98

156 429 00 28,604 00

180,266 58 3 604 56

29,755 96 25,602 83

190 022 54 2920741

TOTAL QBE FORMULA FUNDS

s

5,247 996 00 $ 5 923 466 92 $ 164 308 01 $ 6 067 776 93

(1) Compnsed of State Funds plus Local Five MIii Sheie

See notes to the general-purpose flnanoal statement&

32

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM (QBE)
ALLOTMENTS AND EXPENDITURES - BY SITE YEAR ENDED JUNE 30. 2002

SCHEDULE 5

SITE Sewell Middle School Bremen High School Jones Elementary School Central Office (Altematrve Education Program)
TOTAL
(1) Comprised of State Funds plus Local F,ve Mill Share

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

1,188,208 00 $

1,314,759 60

1,245,161 00

1.550,194 22

2,560,693 00

2,989,957 66

68 701 00

13 635 50

$

s10021763 oo s

518681546 98

See notes to the general-purpose financ,al statements - 33 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

{L',.S~I I W. HNTO,
STATE ,IJJDITOR 140,ti 15~2, ,~

DEPARTMENT OF AUDITS AND ACCOUNTS
254 W.1~hmg1on ~lrcet, ~ W Suite 214 AIIJnlJ, Gcorg1J 10114-1\4()(1
June 25, 2003

llonorablc Sonny Perdue, Governor Member~ of the General Assembly Members of the State Board of Education
and Superintendent and Members of the C1ty of Bremen Board of Educal!on
REPORT ON COMPLIANCE AND ON INTERNAL CON fROL OVER FINANCIAL REPORTNG BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen
We have audited the financial statements of City of Bremen Board of Education as of and for the year ended June 30, 2002, and have issued our report thereon dated June 25, 2003 This report was qualified for vanous departures from generally accepted accounting principles, as 1denuficd in the auditor's report on the general-purpose financial statements We conducted our audit in accordance with auditing standards generally accepted in the Umted States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the Umted States
Compliance
As part of ohtaining reasonable assurance about whether City of Bremen Board of Education's financial stalements are free of material misstatement, we performed tests of its compliance with certain prov1s1ons of laws, regulat10ns, contracts and gnmts. noncompliance \\1th which could have a direct and matenal effect on the determination of financial statement amounts However, providing an op1mon on compliance mth those prov1s10ns was not an obJecuve of our audit, and accordingly, we do not express such an opinion fhe results ofour te~t~ disclosed no in~tances 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 of Bremen Board of Education'~ internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opin10n on the financial statements and not to provide assurance on the internal
2002YB-41

control over financial reporting. However, we noted a certam matter mvolving the mternal control over financial reportmg and its operauon that we consider to be a reportable cond1uon Reportable cond111ons mvolve matters commg to our attention relating to s1gmficant deficiencies in the design or operauon ofthe internal control over financial reporting that, in ourJudgment, could adversely affect City of Bremen Board ofEducat10n's ability to record, process. summanze and report financial data consistent wtth assertions of management in the financial statements The reportable cond111on 1s described in the accompanying Schedule of Findings and Questioned Costs as uem FS-7631-02-0 I
A matenal weakness 1s a condition m which the design or operation of one or more of the internal control components does not reduce to a relauvely low level the nsk that misstatements in amounts that would be matenal in relation to the financial statements bemg audued may occur and not be detected wtthin a umely penod by employees in the normal course of performing theu assigned funct10ns. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the intemaJ control that might be reportable conditions and, accordingly, would not necessarily disclose all reportable cond111ons that are also considered to be matenal weaknesses. However, we consider item FS-7631-02-0 I to be a matenal weakness.
This report 1s intended solely for the informauon and use of the management, members ofthe City of Bremen Board of Education, Federal awarding agencies and pass-through enIllies and is not intended to be and should not be used by anyone other than these specified parties.
---Respectfully submitted,

RWHgp 2002YB-41

Hinton State Auditor

:u~~i,,11 W. H1NJON
STATF AUDI IQR
{404) &>6-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 W.1.shmgton Street.~ W Suite 214 AtlJnta. Georgi 30334-8400
June 25. 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Supenntendent and Members of the City of Bremen Board ofEducallon
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE ro EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WI fH 0MB CIRCULAR A-133
Ladies and Gentlemen.
Compliance
We have audited the compliance of City of Bremen Board ofEducat1on with the types ofcompliance requirements described in the US Ojjice of Management and Budget (0MB) C1rc11lar A-133 Comphance Supplement that are applicable to each of1ts maJor Federal programs for the year ended June 30, 2002 City of Bremen Board of Education's major Federal programs arc 1dent1fied in the Summary of Auditor's Results Section of the accompanying Schedule of Findings and Questwned Costs Compliance with the requirements of laws, regulauons, contracts and grants applicable to each of its maJor lederal programs 1s the respons1b1lity of City of Bremen Board of Education's management. Our respons1b1lity 1s to express an opm1on on City of Bremen Board of l::ducat1on's compliance based on our audit
We conducted our audit of compliance m accordance with aud1tmg standards generally accepted m the Umted States of Amenca. the standard~ applicable to financial audits contamed m Government Aud1tmg Standards. issued by the Comptroller General of the Umted States. and 0MB Circular Al 33. A11d111 of States, Local Governments. and Non-Profit Orgam=atwns 1 hose standards and 0MB Circular A-133 require that we plan and perform the audit to obtam re~onable a~sumnce ahout 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 exam ming, on a test bas1~. evidence about the City of Bremen Board of Educat10n's compliance with those requirements and perfonnmg ~uch other procedure~ as we considered necessary in the c1rcumstances We believe that our audit provides a reasonable baMs for our op1mon Ou, audit does not provide a legal detenninauon on City of Bremen Board ofEducallon's compliance 1th those requ1remen~
w,
2002SA-I0

In our opimon, the Cny of Bremen Board of Educat10n complied. in all matenal respects, With the reqmrements referred to above that are applicable to each of its maJor Federal programs for the year ended June 30, 2002.
Internal Control Over Compliance
The management of City of Bremen Board of Education 1s responsible for establishing and maintaining effective mtcrnal control over compliance With requirements of laws, regulations. contracts and grants applicable to Federal programs In planmng and performing our audit, we considered City of Bremen Board of Education's internal control over compliance With reqmrements that could have a direct and material effect on a maJor Federal program in order to determine our audning procedures for the purpose of expressing our op1mon on compliance and to test and report on internal control over compliance in accordance With 0MB Circular A-133
Our cons1derauon of the internal control over compliance would not necessanly disclose all matters in the internal control that might be matenal weaknesses A material weakness 1s a cond1tton in which the design or operatton of one or more ofthe internal control components does not reduce to a relattvely low level of nsk that noncompliance With applicable requirements oflaws, regulattons, contracts and grants that would be matenal in relat10n to a maJor Feder-di program being audited may occur and not be detected within a ttmely penod by employees in the normal course of performing thetr assigned functions. We noted no matters involving the internal control over compliance and its operatton that we consider to be matcnal weaknesses
Thi~ report is intended solely for the informat10n and use ofthe management. members ofthe City of Bremen Board ofEducatton, Federal awardmg agencies and pass-through entitles and 1s not mtended to be and should not be used by anyone other than these specified parties
---~Respectfully submitted,

RWHgp 2002SA-I0

State Auditor

SECTION Ill 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 YF AR FINDINGS AND QUESTIONED COSTS YcAR ENDED JUNE 30, 2002

PRIOR YcAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7631-00-01 FS-7631-01-01

Further Action Not Warranted Unresolved - See Corrective Action/Responses

CORRECTIVE ACTION/RESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group FmdmgControl Number: FS-7631-01-01

The School District has contracted v.,1th Amencan Appraisal Associates to cap1taliLe assets m excess of $10,000 00 and to mamtam an inventory of computer eqmpment and assets valued at $1,000.00 to $9,999.00. The School District 1s currently workmg m con3unct1on with the Depart111ent of Education 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-7631-01-01

Previously Reported Correcllve Action Implemented

SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2002
SUMMARY OF AUDITOR'S RESULTS
Type of Report Issued on the Financial Statements The auditor's opinion on the City of Bremen Board of Education's financial statements was qualified for various departures from generally accepted accounting pnnc1ples
2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the City of Bremen Board ofEducal!on disclosed a financial statement reportable cond1t10n related to the following control category
General Fixed Assets
The reportable condition described above 1s considered to be a matenal weakness
3 Noncomphance Matenal to the Financial Statements The audit of the City of Bremen Board of Education disclosed no instances of noncompliance that were deemed to be matenal to the financial statements
4 Reportable Condit10ns in Internal Control Over Ma1or Programs The audit report for the City of Bremen Board of Education did not disclose any reportable conditions in internal control over major programs
5 Type of Report Issued on Compliance for Ma1or Programs The auditor's op1ruon on the City of Bremen Board of Education's report on comphance with reqmrements apphcable to major programs was unquahfied
6 Audit Fmdmgs Required to be Reported by Section 510(a) ofOMB Circular A-133 The City of Bremen Board of Education's audit did not disclose audit findings reqmred to be reported by section 510(a) ofOMB Circular A-133
7 Major Programs Federal awards audited as ma1or programs are as follows IO 553 Food and Nutnt1on Program - Food Services - School Breakfast Program I 0.555 Food and Nutrit10n Program - Food Services - Nat10nal School Lunch Program 84.010 Elementary and Secondary Educat10n Act - Title I - Grants to Local Educat10nal Agencies
8 Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000 00
9 Low Risk Aud1tee The City of Bremen Board of Educat10n did not qualify as a low nsk audnee as defined by Section 530 of 0MB Circular A-133
- I-

CITY OF BREMEN BOARD OF EDUCATION - HARALSON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Cond111on - Material Weakness Repeated From Prior Year Finding Control Number FS-7631-02-01 The City of Bremen Board of Education did not maintain a system-wide General Fixed Assets Account Group withm the formal accounting records as required by generally accepted accounting pnnc1pals ThIS cond1t1on results in the general-purpose financial statements of the School District being mcomplete and not in accordance with generally accepted accounting pnnc1ples Appropnate act10n 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 an inventory of land, bmldmgs and equipment owned by the School District and should include, but may not be limited to, date acquired, acqms1t10n cost. esnmatcd replacement cost, location and descnpt10n Detailed records should be maintamed of all add1t1ons and deletions to the General Fixed Assets Account Group Management's Response The School D1stnct has contracted with American Appl'!llsal to cap1tali.le assets in excess of $10,000 00 and to mamtam an mventory of computer eqmpment and assets valued at $1,000 00 to $9,999 00 The School D1stnct is currently working to meet this audit requirement at the end of the fiscal year 2003 audll, as well as, GASB 34 reqmrements lil FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported
-2 -