GA A'800 .R\ E~3 c.J. IqCi5 -q(, AUDIT REPORT CITY OF CARROLLTON BOARD OF EDUCATION CARROLL COUNTY, GEORGIA YEAR ENDED JUNE 30, 1996 STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400 CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE EXIllBITS 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 3 C STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS 5 D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 6 ADDITIONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING BALANCE SHEET 18 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 22 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 26 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 27 SCHEDULES 1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 28 2 CASH AND CASH EQUIVALENTS 30 3 ACCOUNTS RECEIVABLE 31 SCHEDULE OF REVENUE 4 STATE 32 5 TAXES AND OTHER 33 SCHEDULE OF EXPENDITURES BY OBJECT 6 GENERAL AND SPECIAL REVENUE FUNDS 35 7 LOTTERY PROGRAMS 36 CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY - TABLE OF CONTENTS - SECTION I FINANCIAL ADDITIONAL FINANCIAL INFORMATION SCHEDULES ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 8 OVERALL 39 9 BY PROGRAM 40 10 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS 42 SECTION II COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS SECTION ill INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY - TABLE OF CONTENTS - SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS SECTION V PERTINENT VIEWS OF RESPONSffiLE OFFICIALS PERTINENT VIEWS OF RESPONSffiLE OFFICIALS SECTION I FINANCIAL CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 May 8, 1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the City of Carrollton Board of Education INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE Ladies and Gentlemen: We have audited the general purpose financial statements (Exhibits A through D) of the City of Carrollton Board of Education, as of and for the year ended June 30, 1996, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in the notes to the general purpose financial statements, the Board'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: * The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. 96ARL-13 * 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 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 present fairly, in all material respects, the financial position of the City of Carrollton Board of Education as of June 30, 1996, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued a report dated May 8, 1997, on our consideration ofthe Board's internal control structure and a report dated May 8, 1997, on its compliance with laws and regulations. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements ofthe City of Carrollton Board ofEducation taken as a whole. The combining statements (Exhibits E through H) and the financial schedules (Schedules 1 through 10 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part ofthe general purpose financial statements of the City of Carrollton Board of Education. Such information has been subj ected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24. Respectfully submitted, CLV:dt 96ARL-13 Claude L. Vickers State Auditor CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY - 1- The notes to the general purpose financial statements are an integral part of this statement. -2- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1996 EXHIBIT"B" GENERAL FUND SPECIAL REVENUE FUND CAPITAL PROJECTS FUND TOTALS (Memorandum Only) YEAR ENDED JUNE 30, 1996 JUNE 30, 1995 REVENUES State Funds Federal Funds Taxes and Other Funds $ 11,670,655,93 $ 964,056.80 $ 37,003.65 1,226,425.46 6,621,026,49 501,779.78 0,00 $ 12,634,712.73 $ 1,263,429,11 7,122,806,27 10,038,184.63 1,321,068,89 6,651,095,25 Total Revenues $ 18,328,686,07 $ 2,692,262,04 $ 0,00 $ 21,020,948,11 $ 18,010,348,77 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 Other Operations of Non-Instructional Services Capital Outlay Debt Service Principal Interest $ 12,258,054,96 $ 1,192,168,62 $ 633,457,87 688,879,89 445,783,73 406,814,15 1,140,555,15 85,160,83 1,312,989.40 663,145,24 85,111,64 6,395,20 37,609,13 154,598,15 68,900,28 189,267,20 43,657,79 104,860,82 28,120,85 31,009,63 12,465,95 15,724,59 1,138,011,67 12,384,23 476,602,33 79,283,71 10,776,33 2,208,27 0.00 $ 13,450,223,58 $ 11,027,635.70 822,725,07 732,537,68 445,783,73 511,674,97 1,140,555.15 85,160.83 1,341,110.25 694,154,87 97,577.59 22,119,79 1,175,620.80 166,982,38 68,900.28 656,718,63 543,514,04 406,750,69 562,669,94 827,879,12 84,783,07 1,298,113,87 638,628,26 106,030,57 13,315,11 1,116,553,25 139,520.49 109,584,49 487,378.66 81,491.98 565,587,38 101,286,28 Total Expenditures $ 18,543,341.66 $ 2,780,655.95 $ 0.00 $ 21,323,997.61 $ 18,198,570.89 Excess of Revenues over (under) Expenditures $ -214,655,59 $ -88,393,91 $ 0,00 $ -303,049.50 $ -188,222,12 OTHER FINANCING SOURCES (USES) Proceeds from Sale of School Properly Capital Leases Operating Transfers In Operating Transfers Out $ 100,000.00 676,654,53 $ -241,284,92 95,936.92 $ $ 145,348.00 100,000,00 $ 676,654,53 241,284.92 -241,284,92 100,000.00 42,583,38 -42,583.38 Total Other Financing Sources (Uses) $ 535,369,61 $ 95,936.92 $ 145,348,00 $ 776,654.53 $ 100,000,00 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ 320,714,02 $ 7,543.01 $ 145,348,00 $ 473,605.03 $ -88,222.12 FUND BALANCE JULY 1 2,415,447,70 228,423,62 0,00 2,643,871.32 2,733,423.53 Food Inventory - Net Change in Period Donated Commodities Purchased Food -8,014,02 -2,040,20 -8,014,02 -2,040.20 8,507.40 -9,837.49 FUND BALANCE JUNE 30 $ 2,736,161,72 $ 225,912.41 $ 145,348.00 $ 3,107,422,13 $ 2,643,871.32 The notes to the general purpose financial statements are an integral part of this statement. -3- THIS PAGE LEFT BLANK CITY OF CARROLLTON BOARD OF EDUCATION -CARROLL COUNTY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS YEAR ENDED JUNE 30, 1996 EXHIBIT"C" GENERAL FUND ACTUAL (BUDGET BUDGET BASIS) REVENUES State Funds Federal Funds Taxes and Other Funds $ 10,171,300,00 $ 11,670,655,93 37,003,65 6,050,071,00 6,621,026.49 Total Revenues $ 16,221,371,00 $ 18,328,686,07 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 Other Operations of Non-Instructional Services Capital Outlay Debt Service $ 11,076,031,00 $ 12,258,054,96 599,643.00 536,563.00 449,307,00 444,983,00 1,088,665,00 89,073,00 1,465,500.00 954,547,00 93,969,00 30,516.00 155,713,00 100,000,00 633,457,87 688,879.89 445,783.73 406,814.15 1,140,555,15 85,160,83 1,312,989.40 663,145,24 85,111,64 6,395,20 37,609.13 154,598.15 68,900.28 555,886.04 Total Expenditures $ 17,084,510,00 $ 18,543,341.66 Excess of Revenues over (under) Expenditures $ -863,139.00 $ -214,655.59 OTHER FINANCING SOURCES (USES) Other Sources Other Uses $ 100,000.00 $ 776,654.53 -241,284.92 Total Other Financing Sources (Uses) $ 100,000.00 $ 535,369.61 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -763,139.00 $ 320,714.02 FUND BALANCE JULY 1, 1995 2,540,028,64 2,415,447.70 FUND BALANCE JUNE 30,1996 $ 1,776,889.64 $ 2,736,161.72 SPECIAL REVENUE FUND ACTUAL (BUDGET BUDGET BASIS) $ 586,352.00 $ 964,056,80 988,368,00 1,226,425.46 452,000.00 501,779.78 $ 2,026,720.00 $ 2,692,262,04 $ 702,511.00 $ 1,192,168,62 115,558.00 35,168.00 189,267,20 43,657.79 70,380,00 104,860,82 35,216,00 10,752.00 32,139.00 1,024,996.00 28,120,85 31,009,63 12,465.95 15,724.59 1,138,011.67 12,384,23 12,984,60 $ 2,026,720.00 $ 2,780,655,95 $ 0,00 $ -88,393.91 $ 0.00 $ 95,936,92 $ 0.00 $ 95,936.92 $ 0,00 $ 7,543.01 264,464.81 198,584.47 $ 264,464.81 $ 206,127.48 The notes to the general purpose financial statements are an integral part of this statement. - 5- CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Carrollton Board ofEducation (Board) 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. With the exception ofthe departures from generally accepted accounting principles disclosed in these notes, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all of the fund types and account groups of the Board. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards. The more significant of the Board's accounting policies are described below. REPORTING ENTITY In evaluating how to define the governmental unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". The primary government consists of all the organizations that compose the legal entity of the City of Carrollton Board of Education. Based upon the application ofthe above criteria, the City of Carrollton Board of Education is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in the City of Carrollton, Georgia. The Board is not included in any other governmental "reporting entity" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards. Board members were elected by the public and have decision making authority, the power to designate management, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the amount of funding needed to support the school system each year. FUND ACCOUNTING The Board uses funds and an account group to report on its fmancial position and the results of its 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 financial resources. General Fixed Assets are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not presently maintained by the Board. 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. -6- CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXillBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 fmancial statements. The general purpose fmancial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, 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 Board's educational activities. Governmental Fund Types include: GENERAL FUND - the fund used to account for all financial resources ofthe Board 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 ofspecific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for material capital lease obligations. BASIS OF ACCOUNTING 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 current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (Le., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources. Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities, which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group. -7- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY EXIDBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are property taxes, intergovernmental grants and investment income. Property taxes are considered available ifthey are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end. Expenditures are generally recognized when the related fund liability is incurred. A substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August of 1995 and ending in early June 1996. Employment contracts for these employment periods typically specify that compensation be paid in twelve equal monthly payments beginning in September 1995 and ending in August 1996. State grants to fund the State's share of these contracts are disbursed to the Board in the same twelve month period. In accordance with generally accepted accounting principles, salary and fringe benefit expenditures and the related revenue from the State to fund these contracts are recorded in the fiscal period covered by these financial statements. BUDGET The City of Carrollton Board ofEducation's budget is a complete fmancial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general 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, 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. The Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data forthe General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit "B" of this report: -8- CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FUND BALANCE JULY 1, 1995 Adjustments Inventories - July 1, 1995 Food Donated Commodities Purchased Foods Fund Balance July 1, 1995 (Budget Basis) Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses FUND BALANCE JUNE 30, 1996 (Budget Basis) CASH AND CASH EQUIVALENTS Special Revenue Fund $ 228,423.62 -21,024.13 -8,815.02 $ 198,584.47 7,543.01 $ 206,127.48 COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofdeposits (including savings and N.O.W. accounts) in authorized fmancial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. RECEIVABLES Receivables consist of grant reimbursements due from State or other grantors for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose fmancial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. PROPERTY TAXES The City of Carrollton City Clerk fixed the property tax levy for the 1995 tax year (calendar year) on September 18, 1995 (levy date). Taxes were due on December 20,1995. The lien date for property taxes was January 1, 1995. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1996 since their collection meets the criteria ofGASB codification section P70.103. The City of Carrollton City Clerk bills and collects the property taxes for the Board of Education and remits the balance of taxes collected to the Board. - 9- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY EXffiBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The tax millage rate levied for the 1995 tax year (calendar year) for the City of Carrollton Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): School Operations 18.34 mills 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 of purchase. 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. INTERFUND TRANSACTIONS The Board has the following types of interfund transactions: Reimbursements of expenditures initially made from a fund that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed. Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate fmancial analysis. Data in these columns do not present fmancial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. 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 than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities shall be equal to not less than 110 percent of the public funds being secured - 10- CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30,1996 Note 2: DEPOSITS after the deduction of the amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts. Acceptable security for deposits consists of anyone 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 and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 1996, the bank balances were $3,463,728.91. The amounts of the total bank balances are classified into three categories of credit risk: Category I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board'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 Board's name.) - 11 - CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXlllBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 2: DEPOSITS The Board's deposits are classified by risk category at June 30, 1996, as follows: Risk Category 1 2 3 Total Note 3: NON-MONETARY TRANSACTIONS Bank Balance $ 110,431.11 0.00 3,353,297.80 $ 3.463,728.91 The Board 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 Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation. The Board has obtained commercial insurance for risk of loss associated with torts, assets, errors or omissions, job related illness or injuries to employees and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years. The Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund 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. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: 1995 1996 Beginning of Year Liability Claims and Changes in Estimates $ 0.00 $ 824.00 $ $ 0.00 $ 2,980.00 $ Claims Paid End ofYear Liability 824.00 $ 0.00 2,980.00 $ 0.00 - 12 - CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 5: GENERAL LONG-TERM DEBT CAPITAL LEASES The City of Carrollton Board of Education has entered into various lease agreements as lessee for classroom computer, equipment and buses. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. The changes in General Long-Term Debt during the fiscal year ended June 30, 1996, were as follows: Capital Leases Balance July 1, 1995 $ 1,214,744.17 Additions 676,654.53 Deductions Payments 487,378.66 Balance June 30, 1996 $ 1.404,020.04 At June 30, 1996, payments due, by fiscal year which includes principal and interest for these items are as follows: Fiscal Year Ended June 30 Capital Leases 1997 1998 1999 2000 2001 $ 679,508.85 332,165.31 230,033.31 227,869.21 112,275.00 Total Principal and Interest $ 1,581,851.68 Deduct: Imputed Interest 177,831.64 Net Present Value of Future Minimum Lease Payments $ 1.404,020.04 - 13 - CITY OF CARROLLTON BOARD OF EDUCAnON CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30,1996 Note 6: ON-BEHALF PAYMENTS The Board has recognized revenues and expenditures in the amount of$361,066.44 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies. Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $302,652.76 Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $20,297.68 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$38,116.00 Note 7: 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 Board believes that such disallowances, if any, will be immaterial to its overall financial position. The Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the general purpose financial statements. Note 8: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS). TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. A member is eligible for service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service - 14 - CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30,1996 Note 8: RETIREMENT PLANS multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death. Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest. The Board's payroll for employees covered by TRS for the year ended June 30, 1996, was $10,716,602.89; total payroll was $12,177,032.13. TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1996 that rate for employer contributions was 11.81 %. The interest rate assumption (rate of return on investments) was 7.50%. Total contributions made during fiscal year 1996 amounted to $1,801,321.62, of which $1,265,490.08 was made by the Board and $535,831.54 was made by employees. These contributions represented 11.81 % (Board) and 5% (employees) of covered payroll. TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No.5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure of the pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among other PERS and among other employers. - 15 - CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30,1996 Note 8: RETIREMENT PLANS Total unfunded pension benefit obligation ofTRS as of June 30, 1995, was as follows: Total pension benefit obligation $17,442,607,000.00 Net assets available for benefits, at cost 15,857,066,000.00 Unfunded pension benefit obligation $ 1.585,541.000.00 The measurement ofthe total pension benefit obligation is based on an actuarial valuation as ofJune 30,1995. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers. Total contributions from all employers to TRS for fiscal year ended June 30, 1996 were $607,275,000.00. The Board's contribution for the year ended June 30, 1996 of$I,265,490.08 was actuarially determined and represented .2083% of total contributions made by all participating employers. Ten year historical trend information is presented in the 1996 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due. PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS) PSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia in accordance with State statute. PSERS provides, in accordance with State statute, service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number ofyears of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number of years of service. If there are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life half of what the employee would have received upon retirement. - 16 - CITY OF CARROLLTON BOARD OF EDUCAnON - CARROLL COUNTY EXlllBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1996 Note 8: RETIREMENT PLANS Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest. There were 96 employees covered under PSERS for the year ended June 30, 1996. PSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees. Total contributions from employees ofthe Board made during fiscal year 1996 amounted to $3,144.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1996, was $9,817,769.80. Note 9: SURETY BONDS The School Superintendent, Dr. Ronnie Williams, is bonded in the amount of $100,000.00 with the Hartford Fire Insurance Company, Windsor, Connecticut, their Bond No. 4684116, on which premium was paid through July 1, 1997. - 17 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 3D, 1996 ASSETS Cash and Cash Equivalents Accounts Receivable Inventories Food Donated Commodities Purchased Food Total Assets LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Inventories Food Donated Commodities Purchased Food For School Food Equipment Unreserved Designated for Equipment Purchases Undesignated Total Fund Equity Total Liabilities and Fund Equity SCHOOL FOOD SERVICES FUND FAMILY CONNECTION FUND LOTTERY PROGRAMS STATE PRESCHOOL HANDICAPPED PROGRAM $ 259,718.79 $ 0.00 5,481.67 $ 6,250.00 $ 222,319.80 13,010.11 6,774.82 $ 284,985.39 $ 6,250.00 $ 222,319.80 $====0=.0==0 $ $ 4,197.98 54,875.00 6,250.00 $ 152,326.69 16,145.89 53,847.22 $ 59,072.98 $ 6,250.00 $ 222,319.80 $ 13,010.11 6,774.82 $ 19,784.93 11,074.58 195,052.90 $ 0.00 $ 0.00 $ 0.00 $ 225,912.41 $ 0.00 $ 0.00 $ 0.00 $ 284,985.39 $ 6,250.00 $ 222,319.80 $===~O.;;;O;;,O See notes to the general purpose financial statements. -18- EXHIBIT"E" Page 1 ELEMENTARY AND SECONDARY EDUCATION ACT TITLE I TITLE VI GRANTS TO TITLE II INNOVATIVE EDUCATION OF LOCAL EISENHOWER EDUCATION CHILDREN WITH EDUCATIONAL PROFESSIONAL PROGRAM DISABILITIES AGENCIES DEVELOPMENT STRATEGIES $ 0.00 $ 0.00 $ 0.00 $ 36,924.00 $ 0.00 $ 36,924.00 $ 0.00 $=======0=.0=0 $ 4,077.79 7,384.03 25,462.18 $ 36,924.00 $ 0.00 $ 0.00 $ 0.00 $ --'-0...;..00"- $ 0.00 $ 0.00 $ 0.00 $ ---:;O.:.;:.O~O $ 0.00 $ 36,924.00 $ 0.00 $ =======0,;;;.0;::0 - 19- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30,1996 ASSETS Cash and Cash Equivalents Accounts Receivable Inventories Food Donated Commodities Purchased Food Total Assets LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Total Liabilities FUND EQUITY Fund Balances Reserved For Inventories Food Donated Commodities Purchased Food For School Food Equipment Unreserved Designated for Equipment Purchases Undesignated Total Fund Equity Total Liabilities and Fund Equity EDUCATION FOR HOMELESS CHILDREN AND YOUTH INDIVIDUALS WITH DISABILITIES EDUCATION ACT PARTB SPECIAL EDUCATION FLOW THROUGH PRESCHOOL $ 0.00 $ 640.80 $ 60,333.00 5,652.00 $==~O,;;;;'O~O $ 60,333.00 $===6=0;,2=9=2=.8=0 $ 44,578.17 3,539.38 $ 12,211.32 4.13 $ 60,333.00 $ 1,379.00 4,877.74 36.06 6,292.80 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ =====0=.0=0 $ 60,333.00 $ ===6==,2=9=2=.8=0 See notes to the general purpose financial statements. - 20- EXHIBIT"E" Page 2 GOALS 2000 STATE AND "LOCAL EDUCATION SYSTEMIC IMPROVEMENT GRANTS LEARN AND SERVE AMERICA VOCATIONAL EDUCATION TOTALS FEDERAL JUNE 30,1996 JUNE 30,1995 $ 0.00 $ 0.00 $ 260,359.59 $ 252,329.69 $ 4,361.59 341,322.06 310,369.55 13,010.11 6,774.82 21,024.13 8,815.02 $===~O';;;;,OO;;;,$ 4,361.59 $==~O;;,;;'O;,;,O $ 621,466.58 $ 592,538.39 $ 4,361.59 $ 4,361.59 $ 211,594.24 $ 249,588.56 32,646.28 12,031.42 151,273.46 102,339.79 40.19 155.00 $ 395,554.17 $ 364,114.77 $ 13,010.11 $ 21,024.13 6,774.82 8,815.02 23,575.85 $ 19,784.93 $ 53,415.00 11,074.58 $ 0.00 $ 0.00 $ 0.00 195,052.90 175,008.62 $ 0.00 $ 0.00 $ 0.00 $ 225,912.41 $ 228,423.62 $===~O;,;;'O,;"O $ 4,361.59 $====,=0.=0,,=0 $ 621,466.58 $ 592,538.39 - 21 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30,1996 REVENUES State Funds Federal Funds Taxes and Other Funds Total Revenues EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services Debt Service Principal Interest Total Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES Operating Transfers In Excess of Revenues and Other Financing Sources over (under) Expenditures FUND BALANCE JULY 1 Food Inventory - Net Change in Period Donated Commodities Purchased Food FUND BALANCE JUNE 30 SCHOOL FOOD SERVICES FUND FAMILY CONNECTION FUND LOTTERY PROGRAMS STATE PRESCHOOL HANDICAPPED PROGRAM $ 72,818,00 $ 616,112.31 454,539.74 $ 1,143,470.05 $ 50,000,00 $ 798,864,80 $ 47,240,04 97,240.04 $ 798,864,80 $ 42,374.00 42,374,00 $ 732,018.96 $ $ 57,610.58 69,787.47 9,289.81 $ 1,121.18 37,647.65 355.69 28,120,85 5,730.13 21,127,58 1,134,805.86 1,701.24 3,205,81 12,384.23 10,776.33 2,208.27 $ 1,135,927.04 $ 113,372.59 $ 878,592.01 $ $ 7,543,01 $ -16,132,55 $ -79,727.21 $ 42,374,00 42,374.00 0.00 16,132.55 79.727.21 $ 7,543,01 $ 0,00 $ 0.00 $ 0.00 228,423,62 0.00 0,00 0.00 -8,014.02 -2,040.20 $ 225,912.41 $ 0.00 $ 0.00 $====,,0=.0,,=0 See notes to the general purpose financial statements. - 22- EXHIBIT"F" Page 1 ELEMENTARY AND SECONDARY EDUCATION ACT TITLE I TITLE VI GRANTS TO TITLE II INNOVATIVE EDUCATION OF LOCAL EISENHOWER EDUCATION CHILDREN WITH EDUCATIONAL PROFESSIONAL PROGRAM DISABILITIES AGENCIES DEVELOPMENT STRATEGIES $ 120.00 $ 232,096.00 $ 12,240.00 $ 20,898.00 $ .:.:12:..::0.:..::.0.=...0 $ 232,096.00 $ 12,240.00 $ _ _.;;;..20'-'-,8;...;.9_8...;..00"- $ 213,045.68 $ 20,898.00 $ 120.00 $ 12,079.48 6,584.37 160.52 12,465.95 $ .:.:12:.:0.:.:.0.=..0 $ 232,096.00 $ 12,240.00 $ _ _-=20=..!.,=.:89:..::8~.0.=...0 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 0.00 0.00 $ 0.00 0.00 0.00 $ 0.00 $ 0.00 $ 0.00 $ ======,=0.==00= - 23- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 1996 FUND BALANCE JUNE 30 $ 0.00 $ 0.00 $ =======-0=.0=0 See notes to the general purpose financial statements. - 24- EXHIBIT"F" Page 2 GOALS 2000 STATE AND LOCAL EDUCATION SYSTEMIC IMPROVEMENT GRANTS LEARN AND SERVE AMERICA VOCATIONAL EDUCATION FEDERAL TOTALS YEAR ENDED JUNE 30,1996 JUNE 30,1995 $ 964,056.80 $ 544,383.20 $ 20,000.00 $ 4,361.59 $ 71,124.75 1,226,425.46 1,249,392.89 501,779.78 511,793.36 $ 20,000.00 $ 4,361.59 $ 71,124.75 $ 2,692,262.04 $ 2,305,569.45 $ 2,141.59 $ 71,118.41 $ 1,192,168.62 $ 819,940.07 $ 20,000.00 2,220.00 15.00 68.50 189,267.20 43,657.79 104,860.82 28,120.85 31,009.63 12,465.95 15,724.59 1,138,011.67 206,390.16 91,122.93 146,433.72 24,605.17 12,000.00 13,315.11 1,085,386.89 12,384.23 11,208.85 10,776.33 2,208.27 10,058.83 2,925.77 $ 20,000.00 $ 4,361.59 $ 71,201.91 $ 2,780,655.95 $ 2,423,387.50 $ 0.00 $ 0.00 $ -77.16 $ -88,393.91 $ -117,818.05 77.16 95,936.92 42,583.38 $ 0.00 $ 0.00 $ 0.00 $ 7,543.01 $ -75,234.67 0.00 0.00 0.00 228,423.62 304,988.38 -8,014.02 -2,040.20 8,507.40 -9,837.49 $ 0.00 $ 0.00 $ 0.00 $ 225,912.41 $ 228,423.62 - 25- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30. 1996 EXHIBIT"G" ASSETS Cash and Cash Equivalents FUND EQUITY Fund Balances Reserved For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity LOTIERY PROJECT PROJECT 97-766-043 97-766-044 TOTAL JUNE 30, 1996 $ 47,331.00 $ 98,017.00 $ 145,348.00 $ 47,331.00 $ 98,017.00 $ 145,348.00 0.00 0.00 0.00 $ 47,331.00 $ 98,017.00 $ 145,348.00 See notes to the general purpose financial statements. - 26- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY EXHIBIT "Hit COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES CAPITAL PROJECTS FUND YEAR ENDED JUNE 3D. 1996 REVENUES None Recorded EXPENDITURES None Recorded Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES Operating Transfers In Excess of Revenues and Other Financing Sources over (under) Expenditures FUND BALANCE JULY 1 FUND BALANCE JUNE 30 LOTTERY PROJECT PROJECT 97-766-043 97-766-044 TOTAL YEAR ENDED JUNE 30, 1996 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 47,331.00 $ 98,017.00 $ 145,348.00 $ 47,331.00 $ 98,017.00 $ 145,348.00 0.00 0.00 0.00 $ 47,331.00 $ 98,017.00 $ 145,348.00 See notes to the general purpose financial statements. - 27- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30,1996 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT Agriculture, U. S. Department of Through Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1996 Grant National School Lunch Program 1996 Grant Food Distribution Program (1) Total U. S. Department of Agriculture Education, U. S. Department of Direct Impact Aid 1996 Grant Through Georgia Department of Education Elementary and Secondary Education Act Title I Education of Children with Disabilities in State Operated or Supported Schools 1996 Grant Grants to Local Educational Agencies 1996 Grant Title II Eisenhower Professional Development 1996 Grant Title VI Innovative Education Program Strategies 1996 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1996 Grant Preschool 1996 Grant Goals 2000 State and Local Education Systemic Improvement Grants 1996 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1995 Grant 1996 Grant Tech-Prep Education 1995 Grant 1996 Grant Education for Homeless Children and Youth 1996 Grant Total U. S. Department of Education CFDA NUMBER FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 10,553 $ * 10.555 10.550 $ 122,618.06 435,233.31 $ 58,260.94 616,112.31 $ (2) 1,077,666.10 58,260.94 1,135,927.04 84.041 $ 9,013.65 (4) 84.009 84.010 84.281 84.298 120.00 $ 232,096.00 120.00 232,096.00 12,240.00 12,240.00 20,898.00 20,898.00 84.027 84.173 84.276 164,356.87 65,115.94 20,000.00 164,356.87 65,115.94 20,000.00 84.048 84.048 84.243 84.243 84.196 $ 17,199.00 32,624.75 10,791.00 38,500.00 20,000.00 642,955.21 $ (3) 32,624.75 (3) 38,577.16 (3) 20,000.00 606,028.72 - 28 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30,1996 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT Commission on National Community Service Through Georgia Department of Education Learn and Serve America 1996 Grant CFDA NUMBER FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD 94.004 $ 4,361.59 $ 4""",3;:;.;;6;...;.1=,5,;;..9 Total Federal Financial Assistance The Major Program is identified by an asterisk (*) in front of the CFDA number, $ 1,263,429.11 $ 1,746,317.35 (1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year. (2) Expenditures for the School Breakfast Program were not maintained separately and are included in the 1996 National School Lunch Program. (3) Expenditures for this program include State and/or Other Funds, Expenditures are not maintained by fund source. (4) Funds earned on this program do not require reporting of expenditures. See notes to the general purpose financial statements. - 29 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY CASH AND CASH EQUIVALENTS JUNE 30,1996 INTEREST BEARING ACCOUNTS Citizens Bank and Trust, Carrollton, Georgia N.OW. Accounts (6.75%) Suntrust Bank, Atlanta, Georgia Money Market Account (Variable) SCHEDULE "2" $ 2,694,860.46 11,074.58 $ 2,705,935.04 See notes to the general purpose financial statements. - 30 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY ACCOUNTS RECEIVABLE JUNE 30,1996 SCHEDULE "3" Carroll County Board of Education Youth Apprentice Program City of Carrollton City Clerk City Wide School Tax Education, Georgia Department of Quality Basic Education Deferred Summer Salaries - FY 1996 Food Services School Breakfast Program National School Lunch Program Other State Program Mentor Teacher Program Lottery Program Instructional Technology Federal Programs Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Individuals with Disabilities Education Act Part B - Special Education Flow-Through Preschool Learn and Serve America Medical Assistance, Georgia Department of Medical Services Office of School Readiness Pre-Kindergarten Program GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 4,040.00 $ 4,040,00 415,750,95 415,750.95 1,349,784,00 $ 4,479.78 473,11 5,008.56 47,864.80 1,349,784,00 473.11 5,008.56 4,479.78 47,864.80 36,924.00 60,333.00 5,652.00 4,361.59 6,250.00 174,455.00 36,924.00 60,333.00 5,652.00 4,361.59 6,250.00 174,455.00 $ 1.774.054.73 $ 341,322.06 $ 2,115,376.79 See notes to the general purpose financial statements. - 31 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30,1996 SCHEDULE "4" AGENCYIFUNDING GRANTS Education, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Mid-term Adjustment Counselors Grades 4 and 5 Local Fair Share Deferred Summer Salaries - FY94 Deferred Summer Salaries - FY95 Educational Equalization Funding Grant Food Services Other State Programs At-Risk Summer School Program Health Insurance Innovative Programs Mentor Teacher Program Next Generation Schools Preschool Handicapped Program Special Education Low Incidence Grant Teachers' Retirement Technology Training Lottery Programs Applied Technology Labs Instructional Technology Pre-Kindergarten Program Safe Schools Grant Technology Installation Medical Assistance, Georgia Department of Medical Services Office of School Readiness Pre-Kindergarten Program Office of Treasury and Fiscal Services Public School Employees Retirement CONTRACT Education, Georgia Department of Leadership Seminar - Georgia Education Leadership Academy OTHER Administrative Services, Department of Distant Learning - Interlink Project See notes to the general purpose financial statements. - 32 - GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 6,866,194.00 1,102,129.00 141,791.00 288,986.00 92,202.00 1,922,735.00 194,547.00 58,591.00 252,887.00 281,976.00 76,429.00 212,440.00 19,553.00 -1,653,384.00 -1,210,392.00 1,349,784.00 460,899.00 $ 7,125.96 302,652.76 5,000.00 7,404.78 56,694.00 24,585.00 20,297.68 25,765.00 $ 6,866,194.00 1,102,129.00 141,791.00 288,986.00 92,202.00 1,922,735.00 72,818.00 194,547.00 58,591.00 252,887.00 281,976.00 76,429.00 212,440.00 19,553.00 -1,653,384.00 -1,210,392.00 1,349,784.00 460,899.00 72,818.00 42,374.00 7,125.96 302,652.76 5,000.00 7,404.78 56,694.00 42,374.00 24,585.00 20,297.68 25,765.00 100,000.00 62,864.80 256,960.00 4,650.00 30,000.00 100,000.00 62,864.80 256,960.00 4,650.00 30,000.00 50,000.00 50,000.00 344,390.00 344,390.00 38,116.00 38,116.00 10,000.00 10,000.00 715,647.75 715,647.75 $ 11,670,655.93 $ 964,056.80 $ 12,634,712.73 CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF TAXES AND OTHER REVENUE YEAR ENDED JUNE 30, 1996 SCHEDULE "5" Taxes City Wide School Tax Other Donations Interest Earned Medical Services Department of Family and Children's Services, Carroll County Medical Assistance, Georgia Department of Milk Court Settlement Rents Sales Adult Meals Breakfast Lunches Supplemental School Assets Shared Service Contributions Carroll County Board of Education Tuition Other GOVERNMENTAL FUND TYPES SPECIAL GENERAL REVENUE FUND FUND TOTAL $ 5,877,001.85 $ 5,877,001.85 $ 157,915.79 606.26 22,988.59 606.26 180,904.38 17,743,14 45,101.10 16,610.43 499,939.16 6,715,02 1,648.50 44,625.28 83.71 49,520.21 7,929.80 324,908.03 49,109.40 360,00 1,648.50 44,625.28 83.71 17,743.14 49,520.21 7,929.80 324,908.03 49,109.40 45,101.10 16,610.43 499,939.16 7,075.02 $ 6,621,026.49 $ 501,779.78 $ 7,122,806.27 See notes to the general purpose financial statements. - 33 - THIS PAGE LEFT BLAHK CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF EXPENDITURES BY OBJECT GENERAL AND SPECIAL REVENUE FUNDS YEAR ENDED JUNE 30, 1996 SCHEDULE "6" EXPENDITURES Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Insurance Communications Tuition Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures Nonoperating Costs Principal and Interest Building and Building Improvements Equipment GENERAL FUND SPECIAL REVENUE FUND TOTAL $ 10,896,850,54 $ 1,280,181,59 $ 12,177,032,13 3,385,203,27 356,697,89 3,741,901.16 109,163,63 26,789,21 135,952,84 387,293,17 33,482,17 420,775,34 20,382,68 20,382,68 26,387.25 2,962.46 29,349,71 160,872.45 640.00 161,512.45 38,505,36 38,505,36 31,514,00 31,514,00 86,041,33 825,73 86,867,06 95,377,13 95,377,13 4,263,84 4,263,84 10,506,00 38,556,28 49,062,28 15,881,55 35,742,87 51,624.42 674,955,85 179,099,79 854,055.64 373,300,62 18,812,65 392,113,27 527,143,25 527,143,25 143,171,33 4,547,61 147,718.94 14,970,50 2,790,00 17,760.50 36,076,51 6,037,28 42,113,79 555,886.04 68,060,28 1,412,942.17 12,984.60 249,098.73 568,870,64 68,060,28 1,662,040.90 Total Expenditures $ 18,543,341.66 $ 2,780,655.95 $ 21,323,997.61 See notes to the general purpose financial statements. - 35 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF EXPENDITURES BY OBJECT LOTTERY PROGRAMS YEAR ENDED JUNE 30, 1996 EXPENDITURES Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Water, Sewer, and Cleaning Services Communications Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures Nonoperating Costs Principal and Interest Equipment Total Expenditures APPLIED TECHNOLOGY LABS INSTRUCTIONAL TECHNOLOGY PRE-KINDERGARTEN PROGRAM $ $ $ 100,000.00 12,984.60 55,156.81 413,531.41 118,643.32 4,786.08 1,919.44 2,962.46 825.73 20,554.93 8,788.24 58,681.49 18,812.65 3,205.81 2,690.87 1,542.00 3,913.17 14,943.00 $ 100,000.00 $ 68,141.41 $ =======6=75=,8=0=0=.6=0 See notes to the general purpose financial statements. - 36 - SCHEDULE "7" SAFE SCHOOLS GRANT TECHNOLOGY INSTALLATION TOTAL $ 413,531.41 118,643.32 4,786.08 1,919.44 2,962.46 825.73 20,554.93 8,788.24 58,681.49 18,812.65 3,205.81 2,690.87 1,542.00 3,913.17 12,984.60 $ 4,650.00 $ _ _.:;.;30,-,-,0;.:;0;.:;.0:;.;.0.:;.;0 204,749.81 $ 4,650.00 $ 30,000.00 $ 878,592.01 - 37 - THIS PAGE LEFT BLANK CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1996 SCHEDULE "8" Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis Salaries (1)(2) Operations Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures per Audit THIRTEEN WEIGHTED AND MEDIA CENTER PROGRAMS 100% TEST FOR OPERATIONS PORTION OF THIRTEEN WEIGHTED PROGRAMS $ 8,591,405.00 $ _ _-=2=54~,=68=3..:.::.0~0 $ 9,255,434.61 800,885.06 $ _ _~7-=27.:..J.,.;..;73=5..:.::.0....:...4 $ 10,056,319.67 -139,556.06 $ 9,916,763.61 Amount of Underexpenditure for Total Allotment $ 0.00 $ =====0=,0==0 Note: (1) Salary accruals (July and August 1996 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines. (2) Salary accruals (July and August 1995 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines. See notes to the general purpose financial statements. - 39 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS BY PROGRAM GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30,1996 GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*J Grades 1 3 (*J Sub-Total- K-3 Grades 4 5 (*J Grades 6 - 8 rJ Grades 9 - 12 (*J High School Laboratories (*J Vocational Education Laboratories (*J Total General and Career Education Programs SPECIAL EDUCATION PROGRAMS Regular Programs Category I rJ Category II rJ Category III (*J Category IV (*J Sub-Total - RegUlar Category V (GiftedJ r) Total Special Education Programs REMEDIAL EDUCATION PROGRAM (*) Total Thirteen Weighted Programs MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs Total Thirteen Weighted and Media Center Programs STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development Total Staff Development Programs (*J Identifies Thirteen Weighted Programs, (1J Salary accruals (July and August 1996 Deferred Salaries) reported as expenditures in the General Purpose Financial Statements are not included on this analysis in order to comply with program guidelines. See notes to the general purpose financial statements. ALLOTMENTS FROM DEPARTMENT OF EDUCATION REQUIRED ORIGINAL % ORIGINAL MID-TERM $ 724,001,00 $ 651,600,90 $ 1,870,851,00 1,683,765,90 $ 2,594,852,00 90 $ 2,335,366,80 $ 886,122,00 90 797,509,80 1,509,182,00 90 1,358,263,80 220,079,00 90 198,071,10 1,307,995,00 90 1,1n,195,50 347,964,00 90 313,167,60 $ 6,866,194,00 $ 6,179,574,60 $ 27,800,40 -43,457,40 -15,657,00 -37,347,30 -31,949,10 45,553.40 23,578,10 -27,746,10 -43,568,00 $ 831,507,00 $ 748,356,30 $ 148,886,90 $ 831,507,00 90 $ 748,356,30 $ 270,622,00 90 243,559.80 $ 1,102,129,00 $ 991,916.10 $ $ 141,791,00 90 $ 127,611.90 $ $ 8,110,114,00 $ 7,299,102,60 $ 148,886,90 -25,659,90 123,227,00 110,895,00 190,554,00 $ 232,332,00 90 $ 209,098,80 $ 56,654,00 90 50,988.60 $ 288,986,00 $ 260,087.40 $ 628,00 1,123,00 1,751.00 $ 8,399,100,00 $ 7,559,190.00 $ 192,305,00 $ 22,741,00 69,461,00 $ 22,741,00 $ 69,461,00 0,00 0,00 $ 92,202.00 100 $ 92,202.00 $=====0,=0=0 (2) Salary accruals (July and August 1995 Deferred Salaries) reported as expenditures in the prior year General Purpose Financial Statements are included on this analysis as required by program guidelines, 40 - SCHEDULE "9" TOTAL REQUIRED ACTUAL EXPENDITURES SALARIES (1)(2) OPERATIONS TOTAL AMOUNT OF UNDEREXPENDITURE FOR REQUIRED ALLOTMENT $ 679,401.30 $ 733,546.85 $ 47,454.27 $ 781,001.12 1,640,308.50 1,939,524.36 136,391.79 2,075,916.15 $ 2,319,709.80 $ 2,673,071.21 $ 183,846.06 $ 2,856,917.27 $ 0.00 760,162.50 1,105,224.78 100,177.54 1,205,402.32 0.00 1,326,314.70 1,390,565.75 38,451.97 1,429,017.72 0.00 243,624.50 300,588.46 85,979.69 386,568.15 0.00 1,200,773.60 1,323,722.99 168,466.09 1,492,189.08 0.00 285,421.50 453,588.51 122,866.97 576,455.48 0.00 $ 6,136,006.60 $ 7,246,761.70 $ 699,788.32 $ 7,946,550.02 $ 897,243.20 $ 114,602.70 $ 237,355.19 611,902.67 26,705.02 2,460.20 $ 2,552.69 10,917.55 530.20 117,062.90 239,907.88 622,820.22 27,235.22 $ 897,243.20 $ 990,565.58 $ 16,460.64 $ 1,007,026.22 0.00 217,899.90 345,696.12 10,736.08 356,432.20 0.00 $ 1,115,143.10 $ 1,336,261.70 $ 27,196.72 $ 1,363,458.42 $ 238,506.90 $ 315,268.17 $ 750.00 $ 316,018.17 0.00 $ 7,489,656.60 $ 8,898,291.57 $ 727,735.04 $ 9,626,026.61 $ 209,726.80 $ 357,143.04 $ 357,143.04 0.00 52,111.60 $ 73,150.02 73,150.02 0.00 $ 261,838.40 $ 357,143.04 $ 73,150.02 $ 430,293.06 $ 7,751,495.00 $ 9,255,434.61 $ 800,885.06 $ 10,056,319.67 $ 0.00 $ 22,741.00 69,461.00 $ ==;:;;92~,2~0~2~.0~0 $ 92,202.96 $ 92,202.96 $ 92,202.96 $ 92,202.96 $========0='0=0 - 41 - CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS YEAR ENDED JUNE 30.1996 SCHEDULE "10" BOARD MEMBER ADDRESS Dr. James Pope, Chairman (*) 111 Amy Lane Carrollton, Georgia 30117 Mr. Tommy Gable (*) 1025 Rome Street Carrollton, Georgia 30117 Mrs. Helen Fay Lewis (*) 119 Canterbury Drive Carrollton, Georgia 30117 Mr. Joshua Mabry (*) 255 Old King Street Carrollton, Georgia 30117 Dr. Jimmy Morrow (*) 107 Golf View Court Carrollton, Georgia 30117 Mr. David Parkman (*) 104 Golf View Court Carrollton, Georgia 30117 (*) Denotes Board Members Serving as of June 30, 1996 COMPENSATION TRAVEL $ 2,350.00 $ 1,472.16 2,150.00 716.30 2,150.00 1,571.83 2,250.00 771.72 2,200.00 970.38 2,350.00 1,430.29 $ 13,450.00 $ ====6::l::,9=3=:2:;.6=8 See notes to the general purpose financial statements. - 42 - SECTIONll COMPLIANCE CLAUDE L. VICKERS STATE AUDITOR (404) 6562174 DEPARTMENT OF AUDITS 254 Washington Street, SW., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board of Education and Superintendent and Members of the City of Carrollton Board of Education COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose fmancial statements of the City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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 generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. Compliance with laws, regulations, contracts, and grants applicable to City of Carrollton Board of Education is the responsibility of the Board's management. As part of obtaining reasonable assurance about whether the general purpose fmandal statements are free of material misstatement, we performed tests of the Board's compliance with certain provisions of laws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests of compliance disclosed a material instance of noncompliance, which is described in the Schedule of Findings and Improper or Questioned Costs. As also described in the Schedule of Findings and Improper or Questioned Costs, the material instance of noncompliance noted above have been corrected in the financial statements. 96CRL-20 We considered this material instance of noncompliance in forming our opinion on whether the fiscal year 1996 general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated May 8, 1997 on those general purpose financial statements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, CLV:dt 96CRL-20 Claude L. Vickers State Auditor CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the City of Carrollton Board of Education SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose fmancial statements of the City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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 have applied procedures to test the City of Carrollton Board ofEducation's compliance with the following requirements applicable to each of its Federal fmancial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996: (l) Political Activity (5) Allowable Costs/Cost Principles (2) Civil Rights (6) Drug-Free Workplace Act (3) Cash Management (7) Audit Follow-UplResolution (4) Federal Financial Reports (8) Administrative Requirements Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits of State and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Carrollton Board of Education's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. 96CRL-40 With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the City of Carrollton Board of Education had not complied, in all material respects, with those requirements. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, CLV:dt 96CRL-40 Claude 1. Vickers State Auditor CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members ofthe City of Carrollton Board of Education SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements ofthe City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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 have also audited the City of Carrollton Board of Education's compliance with the requirements governmg: (1) Types of Services Allowed or Unallowed (5) Applicable Special Tests and Provisions (2) Eligibility (3) Matching, Level of Effort, and/or Earmarking (6) Other Requirement Claims for Advances and Reimbursements (4) Reporting These requirements are applicable to the major Federal financial assistance program, which is identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996. The management of the City of Carrollton Board of Education is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. 96CRL-80 We conducted our audit of compliance in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office of M~agementand Budget (OMB) Circular A-128, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the City of Carrollton Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal fmancialassistance program for the year ended June 30, 1996. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:dt 96CRL-80 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members ofthe City of Carrollton Board of Education SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS Ladies and Gentlemen: We have audited the general purpose financial statements of the City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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. In connection with our audit of the fiscal year 1996 general purpose financial statements of the City of Carrollton Board of Education and with our consideration ofthe Board's control structure used to administer Federal fmancial assistance programs, as required by Office of Management and Budget (OMB) Circular A128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1996. As required by OMB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governmg: (l) Types of Services Allowed or Unallowed (2) Eligibility Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Carrollton Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the City of Carrollton Board of Education had not complied, in all material respects, with those requirements. 96CRL-120 This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, t%: Claude L. Vickers State Auditor CLV:dt 96CRL-120 SECTIONID INTERNAL CONTROL L. CLAUDE VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the City of Carrollton Board of Education REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the general purpose fmancial statements of the City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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 generally accepted auditing standards, and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. The management of the City of Carrollton Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. In planning and performing our audit of the general purpose financial statements of the City of Carrollton Board of Education for the year ended June 30, 1996, we obtained an understanding of the internal control 96ICL-3 structure. With respect to the internal control structure, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk in order to detennine our auditing procedures for the purpose of expressing our opinion on the general purpose fmancial statements and not to provide an opinion on the internal control structure. Accordingly, we do not express such an opinion. We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report fmancial data consistent with the assertions of management in the general purpose financial statements. As described in the Schedule of Findings and Improper or Questioned Costs, a reportable condition was noted in the following control category: General Fixed Assets A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the nonnal course of perfonning their assigned functions. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition disclosed above is also considered to be a material weakness. This condition was considered in detennining the nature, timing, and extent ofthe procedures to be perfonned in our audit ofthe City of Carrollton Board of Education's financial statements and this report does not affect our report thereon dated May 8, 1997. This report is intended for the infonnation of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~..-._--, Claude L. Vickers State Auditor CLV:dt 96ICL-3 CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 May 8,1997 Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the City of Carrollton Board of Education SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS Ladies and Gentlemen: We have audited the general purpose financial statements of the City of Carrollton Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated May 8, 1997. 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 have also audited the City of Carrollton Board of Education's compliance with requirements applicable to its major Federal financial assistance program and have issued our opinion thereon dated May 8, 1997. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (OMB) Circular A-l28, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose fmancial statements are free of material misstatement and about whether the City of Carrollton Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. In planning and performing our audit for the year ended June 30, 1996, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with OMB Circular A-l28. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated May 8, 1997. 96ICL-9 The management ofthe City of Carrollton Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal fmancial assistance programs are managed in compliance with applicable laws and regulations. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purposes of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories: GENERAL REQUIREMENTS SPECIFIC REQUIREMENTS (1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (1) Types of Services Allowed or Unallowed (2) Eligibility (3) Matching, Level of Effort, and/or Earmarking (5) Allowable Costs/Cost Principles (4) Reporting (6) Drug-Free Workplace Act (7) Audit Follow-UplResolution (8) Administrative Requirements (5) Applicable Special Tests and Provisions (6) Other Requirement Claims for Advances and Reimbursements For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1996, the City of Carrollton Board of Education expended 54% of its total Federal fmancial assistance under a major Federal financial assistance program and the following nonmajor Federal financial assistance program: Elementary and Secondary Education Act Title I - Grants to Local Educational Agencies 96ICL-9 We performed tests of controls, as required by OMB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements and specific requirements as described above that are applicable to the Board's major Federal financial assistance program, which is identified in the Schedule of Federal Financial Assistance, and the aforementioned nonmajorprogram. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might constitute material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more ofthe internal control structure elements or operation ofthe specific internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal fmancial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~~ Claude L. Vickers State Auditor CLV:dt 96ICL-9 SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1996 PRIOR YEAR AUDIT FOLLOW-UPIRESOLUTION Failure to Meet Expenditure Requirements Financial Statements Finding Resolved Audit Control Number 7661-93-03 The audit report for the year ended June 30, 1993, stated that the Board had an underexpenditure of Quality Basic Education (QBE) funds of $30,321.20 for the StaffDevelopment - Professional Development Stipends Program. For the year under review, an adjustment was made to the Board's local fair share by the Georgia Department of Education to refund the underexpenditure as required. AUDIT FOLLOW-UPIRESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $52,384.61 Audit Control Number 7661-94-01 The audit report for the year ended June 30, 1994, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of $52,384.61 for Staff Development - Professional Development Stipends Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this expenditure as required. The underexpenditure of$52,384.61 should be returned to the Georgia Department of Education through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. PRIORYEAWCURRENTYEAR GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7661-93-02 The audit report for the year ended June 30, 1995, noted that the management of the City of Carrollton Board of Education had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account - 1- CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS YEAR ENDED JUNE 30, 1996 PRIOR YEAR/CURRENT YEAR GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7661-93-02 Group. The subsidiary records should include an inventory of land, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement 'cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. CURRENT YEAR GENERAL LEDGER Failure to Transfer Local Matching Funds Financial Statements Material Noncompliance Audit Control Number 7661-96-01 The Board received approval for Lottery-Exceptional Growth Capital Outlay Projects funded through the Georgia Department of Education for the 1996 fiscal year. Both the instructions in Chapter 41 of the Financial Management for Georgia Local Units of Administration (FMGLUA) and the agreement signed by the Board to receive the funding, require that the Board transfer local matching funds by year end and designate those funds by project name and number. For the year under review, the transfers were not made by the Board. This condition occurred because management disregarded the requirements of FMGLUA. Correcting audit adjustments were necessary to transfer $47,331.00 and $98,017.00 from the General Fund to the Lottery Projects 97-766-043 and 97-766-044, respectively. -2- SECTION V PERTINENT VIEWS OF RESPONSffiLE OFFICIALS CITY OF CARROLLTON BOARD OF EDUCATION - CARROLL COUNTY PERTINENT VIEWS OF RESPONSIBLE OFFICIALS YEAR ENDED JUNE 30, 1996 GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7661-93-02 Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff, the Board has decided not to pursue the recording of general fixed assets on the financial statements. We do, however, maintain an up-to-date inventory. GENERAL LEDGER Failure to Transfer Local Matching Funds Financial Statements Material Noncompliance Audit Control Number 7661-96-01 We received a letter from Dr. Hall Rogers, dated April 10, 1996, stating that the State Department of Education had approved a contractual agreement between our board of education and the State Board of Education and that growth funds would be available after July 1, 1996 (FY97). It was our understanding from this letter that the transfer oflocal funds to the capital outlay account for the Carrollton City School System Project Numbers 97-766-043 and 97-766-044 would need to be accomplished by 6/30/97. This letter also stated that staff of the Georgia Department of Educations' Facilities Services section were available to assist with any questions we might have. We called the Facilities Section and spoke to Jerry Rochelle, Education Service Program Director, and Pat Counts, Education Research and Evaluation Specialist and asked them for their opinion concerning the time requirements for the transfer ofthe local funds to the capital outlay account. Both agreed that they thought no local funds had to be transferred to the capital outlay account until the year ending 6/30/97. Then, on July 11, 1997, we received a telephone call from the state auditor informing us about this audit exception. Carrollton City Schools had funds in the FY96 budget readily available to transfer to the capital outlay account and would have if we had known we were supposed to at that time. Carrollton City Schools did not, and would not intentionally disregard any requirements ofFMGLUA. Auditor's Note: As stated in the audit finding both the contractual agreement signed by the Board and Financial Management for Georgia Local Units of Administration require local matching funds to be transferred to the Capital Projects Fund by June 30 of the fiscal year the contract is signed. As noted above, these contracts were approved/signed in April 1996, therefore local matching funds were required to be transferred no later than June 30, 1996.