Audit report, City of Pelham Board of Education, Mitchell County, Georgia, year ended June 30, 1999

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AUDIT REPORT CITY OF PELHAMBOARD OF EDUCATION
MITCHELL COlJ'NTY, GEORGIA YEAR ENDED JUNE 30, 1999

"-~-..:-

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STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIDITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINEDSTATEMENTS-OVERVlliW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

4

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D

STATEMENT OF REVENUES, EXPENSES AND

CHANGES IN FUND BALANCES

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

8

E

STATEMENT OF CASH FLOWS

FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND

9

F NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

11

ADDITIONAL FINANCIAL INFORMATION

COMBINING AND INDIVIDUAL FUND STATEMENTS

SPECIAL REVENUE FUND

G

COMBINING BALANCE SHEET

22

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

23

CAPITAL PROJECTS FUND

I

COMBINING BALANCE SHEET

24

J

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

25

FIDUCIARY FUND TYPES

K

COMBINING BALANCE SHEET

26

L

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

AGENCY FUND

27

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

28

2 SCHEDULE OF STATE REVENUE

30

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

31

4 SCHEDULE OF EXPENDITURES

LOTTERY PROGRAMS

32

ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

5

OVERALL

33

6

BY PROGRAM

34

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

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

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

SECTION I FINANCIAL

RUSSELL W. HINTON
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.W.. Suite 214 Atlanta. Georgia 30334-X4()()
June 15,2000

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City of Pelham Board of Education
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Ladies and Gentlemen:
We have audited the accompanying general purpose financial statements of the City of Pelham Board of Education, as of and for the year ended June 30, 1999, as listed in the table of contents. These general purpose financial statements are the responsibility of the City of Pelham Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards,.issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the 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 fmancial 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.

99ARL-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 Board did not recognize as expenditures, in the year ended June 30, 1999, a portion of salaries
and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1999. Also funds received, subsequent to June 30, 1999, from the Georgia Department of Education for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1998, were improperly recorded in the year ended June 30, 1999. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed.
The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Pelham Board of Education as of June 30, 1999, and the results of its operations and the cash flows of its nonexpendab1e trust fund for the year then ended, in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated June 15,2000, on our consideration ofthe City ofPelham Board ofEducation's internal control over financial reporting and our tests of its compliance with certain provisions oflaws, regulations, contracts and grants.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements ofthe City of Pelham Board of Education taken as a whole. The accompanying combining and individual fund statements (Exhibits G through L) and the financial schedules (Schedules 1 through 6), which includes the Schedule of Expenditures of Federal Awards as required byU. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part ofthe general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects 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.
99ARL-13

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,
~4.'~ ~ .g~ Russell W. Hinton State Auditor
RWH:jb 99ARL-13

CITY OF PELHAM BOARD OF EDUCAnON - MITCHELL COUNTY

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30, 1999

ASSETS Cash and Cash Equivalents Investments Accounts Receivable Prepaid Items Inventories
Food Donated Commodities Purchased Food
Amount to be Provided in Future Years For Payment of Capital Lease Agreements
Total Assets

GENERAL FUND

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

REVENUE

PROJECTS

FUND

FUND

$

940,595.71 $

56,198.67 $

169,154.63

810,000.00

84,272.48

177,682.02

105,982.71

27,048.07

7,181.92 5,466.55

$ 1,861,916.26 $

246,529.16 $ ===~=2=7=5;,1,3=7=.3=4.

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Retainages Payable Funds Held for Others Capital Lease Agreements
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Bus Replacement Funds For Debt Service For Endowment Corpus For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For SPLOST Projects Unreserved Designated for Self-Insurance Undesignated
Total Fund EqUity

$

24,210.95 $

110,880.50

80,177.00

$'

135,091.45 $

80,177.00

$

25,158.00

3,050.55

$
108,868.67 1,724,839.04
$ 1,861,916.26 $

7,181.92 5,466.55
$
98,789.24
111 ,437.71 $

194,315.58
644.76 194,960.34

Total Liabilities and Fund Equity

$ 1,861,916.26 $

The notes to the general purpose financial statements are an integral part of this statement. -2-

246,529.16 $

275,137.34

EXHIBIT "A"

DEBT SERVICE
FUND

FIDUCIARY FUND TYPES TRUST AND AGENCY FUNDS

ACCOUNT GROUP GENERAL
LONG-TERM DEBT

TOTALS

(Memorandum Only)

JUNE 30,1999

JUNE 30,1998

$

0.00 $

5,843.49

$ 1,171,792.50 $ 1,047,513.07

20,000.00

830,000.00

830,000.00

1,046.03

368,983.24

308.417.41

27,048.07

27,934.00

- - - - - - $ -_---.44:,9.6=0.=14~

7,181.92 5,466.55
44,960.14

9,343.51 5,315.11
87,291.13

$

0.00 $

26,889.52 $

44,960.14 $ 2,455,432.42 $ 2,315,814.23

$

104,387.95 $

22,436.19

110,880.50

94,926.61

1,355.45

14,747.20

$

194.78

194.78

131.18

$

44,960.14

44,960.14

87,291.13

$

194.78 $

44,960.14 $

260,423.37 $

220,887.76

$

20,000.00

$

0.00

6,694.74

$

0.00 $

26,694.74

$

25,158.00 $

21,321.00

28,882.50

20,000.00

20,000.00

3,050.55

3,050.55

7,181.92 5,466.55 194,315.58

9,343.51 5,315.11 274,685.03

108,868.67 1,830,967.78

94,535.86 1,637,792.91

$ 2,195,009.05 $ 2,094,926.47

$

0.00 $

26,889.52 $

44,960.14 $ 2,455,432.42 $ 2,315,814.23

-3-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 3D, 1999

FUND BALANCE JUNE 30

$

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

1,861,916.26 $====11~1~,4;37,.7.1.

EXHIBIT "B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS

{Memorandum Only}

YEAR ENDED

JUNE 30,1999

JUNE 30,1998

$ 6,860,881.77 $ 6,672,202.32

1,110,256.40

1,183,900.68

$

553,732.41 $

119,558.30

1,204,050.01

1,193,170.17

7,642.82

197,476.96

160,849.09

$

561,375.23 $

119,558.30 $ 9,372,665.14 $ 9,210,122.26

$ 5,743,099.98 $ 5,500,538.12

$

646,160.68

312,414.25 174,215.37 154,608.39 170,519.95 520,091.82 136,772.59 499,973.89 26,031.61
43,185.74 23,799.18 607,981.87
4,682.16 659,160.68

293,949.53 173,911.38 142,931.08 156,010.86 451,393.49 121,876.99 516,052.36 27,681.81
56,557.14 27,429.00 610,736.71 4,185.32 169,545.52

$

90,000.00

57,765.00

675.80

132,330.99 63,187.52
675.80

124,855.18 69,148.33
672.43

$

646,160.68 $. 148,440.80 $ 9,272.731.79 $ 8,447,475.25

$

-84,785.45 $

-28,882.50 $

99,933.35 $

762,647.01

$

17,586.62 $

-17,586.62

$

0.00 $

209.72 -209.72
0.00

$

-84,785.45 $

-28,882.50 $

99,933.35 $

762,647.01

279,745.79

28,882.50

2,070,391.11

1,309,057.72

-2,161.59 151.44

-1,715.58 401.96

$

194,960.34 $

0.00 $ 2,168,314.31 $ 2,070,391.11 -5-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30,1999

EXHIBIT"C"

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

REVENUES

State Funds Federal Funds Taxes Other Funds

$ 6,442,682.00 $ 6,581,268.78

30,240.00

3,441,58

484,000,00

530,759.30

13,500.00

90,995,38

Total Revenues EXPENDITURES

$ 6,970,422.00 $ 7,206,465.04

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 Community Services Operations
Capital Outlay Debt Service

$ 5,248,664.00 $ 5,041,094.27

286,336.00 168,058.00 152,724.00 149,106.00 587,039.00 231,496,00 601,419.00
69,488.00 59,433.00 12,900.00

285,339.22 158,831.31 154,608.39 130,315.76 520,091.82 136,772.59 483,579.38
26,031.61 43,185.74 10,492.11

8,000.00

4,682.16 13,000.00

Total Expenditures

$ 7,574,663,00 $ 7,008,024.36

Excess of Revenues over (under) Expenditures

$ -604,241,00 $ 198,440.68

OTHER FINANCING SOURCES (USES)

Other Sources Other Uses

$

-15,614.00 $

-17,586.62

Total Other Financing Sources (Uses)

$

-15,614.00 $

-17,586.62

Excess of Revenues and Other Financing Sources
over (under) Expenditures and Other Financing Uses $

-619,855.00 $

180,854.06

FUND BALANCE JULY 1,1998

1,510,618.01

1,681,062.20

Adjustments Food Inventory - Net Change in Period
Donated Commodities Purchased Food

-1,413.64

FUND BALANCE JUNE 30. 1999

$

889,349.37 $ 1,861,916.26

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$

280,085.71 $

279,612.99

1,137,541,00

1,106,814,82

101,804.00

98,838,76

$ 1,519,430.71 $ 1,485,266,57

$

753,919.00 $

702,005.71

27,735.00 18,509,00

27,075.03 15,384.06

42,643.00

40,204,19

16,400.00

16,394.51

13,191.00 664,178,00

13,307.07 607,981.87

47,753.51

$ 1,536,575.00 $ 1,470,105.95

$

-17,144,29 $

15,160.62

$

15,614.00 $

17,586.62

$

15,614.00 $

17,586.62

$

-1,530.29 $

32,747.24

80,700.62

80,700.62

-14,524.92

-2,161.59 151.44

$

64,645.41 $ 111,437.71

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

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCES
FIDUCIARY FUND TYPE - NONEXPENDABLE TRUST FUND YEAR ENDED JUNE 30.1999

EXHIBIT "0"

OPERATING REVENUES Donations
OPERATING EXPENSES Current Support Services Other Support Services Community Services Operations Total Operating Expenses Operating Income
NONOPERATING REVENUES Interest Earned Net Income
FUND BALANCE JULY 1
FUND BALANCE JUNE 30

C.M.AND BERNICE C. STRIPLING PELHAM FFA SCHOLARSHIP TRUST FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30,1999 JUNE 30. 1998

$

1.914.86 $

1.914.86 $

1.000.00

$

1,000.00 $

1.000.00 $

1,455.00

209.35

$

1.000.00 $

1.000.00 $

1,664.35

$

914.86 $

914.86 $

-664.35

1.244.52

1.244.52

1.141.37

$

2.159.38 $

2,159.38 $

477.02

24.535.36

24.535.36

24,058.34

$

26,694.74 $

=== 26,694.74 $_-=2=4~,5.3...5......36

The notes to the general purpose financial statements are an integral part of this statement. - 8-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY STATEMENT OF CASH FLOWS
FIDUCIARY FUND TYPE - NON EXPENDABLE TRUST FUND YEAR ENDED JUNE 30,1999

EXHIBIT "E"

Cash Flows from Operating Activities: Cash Received from Donations Cash Paid for Scholarships
Net Cash Provided (Used) by Operating Activities
Cash Flows from Investing Activities: Interest Received on Investments Cash Paid for Purchase of Investments
Net Cash Provided (Used) by Investing Activities
Net Increase (Decrease) in Cash
Cash and Cash Equivalents - July 1
Cash and Cash Equivalents - June 30

C.M.AND BERNICE C. STRIPLING PELHAM FFA SCHOLARSHIP TRUST FUND

TOTALS (Memorandum Only)
YEAR ENDED JUNE 30,1999 JUNE 30,1998

$

1,914.86 $

1,914.86 $

-1,000.00

-1,000.00

1,000.00 -1,664.35

$

914.86 $

914.86 $

-664.35

$

1,150.00 $

1,150.00 $

1,100.00

-20,000.00

$

1,150.00 $

1,150.00 $

-18,900.00

$

2,064.86 $

2,064.86 $

-19,564.35

3,583.85

3,583.85

23,148.20

$

5,648.71 $

5,648.71 $_........""3"","5'=8=3...8..5...

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

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The City of Pelham Board of Education (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists of all the organizations that compose its legal entity.
FUND ACCOUNTING
The Board uses funds and an account group to report on its financial 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 fmancial 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.
Although "school activity accounts" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements.
The general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the 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 ofa 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 received primarily from the Georgia Department ofEducation and from the Federal government to accomplish specific educational objectives.
- 11 -

CITY OF PELHAM BOARD OF EDUCA nON - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities.
DEBT SERVICE FUND - the fund used to account for the accumulation of resources for, and the payment of, general long-term principal, interest and paying agent fees for the City of Pelham, Georgia, General Obligation School Bonds, Series 1993.
FIDUCIARY FUND TYPES - the funds used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. These funds include:
NONEXPENDABLETRUSTFUND C. M. and Bernice C. Stripling Pelham FFA Scholarship Trust Fund - the fund used to account for an endowment of which the corpus is to be invested and preserved intact with the resultant income to be used to provide a scholarship to the most outstanding graduating student in the Agricultural Education (Future Farmers of America) Program at Pelham High School.
AGENCY FUND - the fund used to account for assets held in a fiduciary capacity for other funds, governments, or individuals.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for 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 (i.e., 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.
All nonexpendable trust funds are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation of these funds are included on the balance sheet. Operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
- 12-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30,1999
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Agency funds are purely custodial in nature and do not involve measurement of results of operations.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are property taxes, local option sales taxes, intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
A departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1999, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1998 and ending in early June 1999. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1998 and ending in August 1999. State grants to fund the State's share ofthese contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1999, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1999, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1999. Also, the State's portion of the compensation paid in July and August 1999 was received and recorded as revenue in the fiscal year subsequent to June 30, 1999. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1998, were recorded in the year ended June 30, 1999. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed.
The accrual basis of accounting, as required by generally accepted accounting principles, is utilized by nonexpendable trust funds. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.
Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities.
BUDGET
The City ofPelham Board ofEducation's budget is a complete financial 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
- 13-

CITY OF PELHAM BOARD OF EDUCAnON - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
prepared by fund, function and object. The legal level ofbudget 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 ofEducation. The Board may increase or decrease the budget at any time during the year, All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial 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.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
- 14-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30. 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(7) Repurchase agreements, and

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

RECEIVABLES

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

PROPERTY TAXES

The City of Pelham fixed the property tax levy for the 1998 tax year (calendar year) on September 30, 1998 (levy date). Taxes were due on December 20, 1998. The lien date for property taxes was January 1, 1998. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1999. The City of Pelham City Clerk bills and collects the property taxes for the Board of Education.

The tax millage rate levied for the 1998 tax year (calendar year) for the City of Pelham Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

7.50 mills

SALES TAXES

Local Option Sales Tax revenue during the fiscal year amounted to $340,925.23 and was recorded in the General Fund. Local Option Sales Tax is to be used for the maintenance and operation of the Board.

Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $673,290.71 and was recorded in the Capital Projects and Debt Service Funds. The State will terminate collection of this tax once an additional $2,451,216.10 has been collected or on June 30, 2002, whichever occurs first.

- 15 -

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30. 1999

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES

FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time 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.

PREPAID ITEMS

Payments made to vendors for services that will benefit periods subsequent to June 30, 1999, are recorded

as prepaid items.

.

LONG-TERM DEBT AGREEMENT

The City of Pelham, Georgia issued General Obligation Bonds to provide funds for the acquisition and construction of major capital facilities. The general obligation bonds are direct obligations and pledge the full faith and credit ofthe City ofPelham, Georgia. In accordance with the bond validation (Civil Action File No. 93-V-743)" ...the City ofPelham shall provide for the assessment and collection ofan annual tax sufficient in amount to pay the principal of and interest on said debt by the levy of an annual tax upon all property subj ect to taxation for school bond purposes within the corporate limits of the city...." Accordingly, the general long-term debt associated with these bonds should be reported in the City ofPelham general purpose financial statements. Even though the City ofPelham, Georgia issued these bonds, the City ofPelham Board of Education made debt service payments on this debt during fiscal year 1999.

INTERFUND TRANSACTIONS

The Board has the following types of interfund transactions:

Reimbursements of expenditures/expenses initially made from a fund that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund' and as reductions of expenditures/expenses in the fund that is reimbursed.

Operating transfers are recorded for all interfund transactions other than reimbursements.

- 16-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30. 1999
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 financial analysis. Data in these columns do not present financial position, results of operations or cash flows in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
Note 2: DEPOSITS
COLLATERALIZAnON 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 pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. OCGA Section 45-8-11(b) 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 ofthe United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations ofthe counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home
- 17 -

CITY OF PELHAM BOARD OF EDUCA nON - MITCHELL COUNTY EXHIBIT "F"
NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999

Note 2: DEPOSITS

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, 1999, the bank balances were $2,410,285.24. The amounts of the total bank balances are classified into three categories of credit risk:

Category 1 - 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.)

The Board's deposits are classified by risk category at June 30, 1999, as follows:

Risk Category

Bank Balance

1

$ 303,974.89

2

50,469.00

3

2,055,841.35

Total

$ 2.410.285.24

Note 3: NON-MONETARY TRANSACTIONS

The Board receives food commodities from the United States Department ofAgriculture (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 ofloss associated with torts and assets. 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.

- 18 -

CITY OF PELHAM BOARD OF EDUCADON - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999

Note 4: RISK MANAGEMENT

The Board has elected to self-insure for all losses related to natural disaster. In addition, the Board has elected to self-insure for errors or omissions, which includes, among other risks, risks for sexual harassment and discrimination. The Board has not experienced any losses related to these risks in the past three years.

The Board is self-insured with regard to unemployment compensation claims. A premium is charged when needed by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Board accounts for claims 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:

Beginning of Year Liability

Claims and Changes in Estimates

Claims Paid

End of Year Liability

1998 1999

$

2,150.00 $

6,158.00 $

3,828.00 $

4.480.00

$

4.480.00 $

327.00 $

4,807.00 $

0.00

The Board participates in the Georgia Education Workers' Compensation Trust, a public entity risk pool

organized on December 1, 1991 to develop, implement and administer a program of workers' compensation

self-insurance for its member organizations, The Board pays an annual premium to the Trust for its general

insurance coverage, Additional insurance coverage is provided through an agreement by the Trust with the

United States Fidelity and Guaranty Company to provide coverage for potential losses sustained by the Trust

in excess of $250,000,00 loss per occurrence, up to $2,000,000,00,

.

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

Position Covered

Amount

Superintendent Each Principal Office Manager/Bookkeeper Personnel/Payroll Clerk Accounts Payable Clerk Secretary/Bookkeeper

$ 10,000.00 $ 5,000,00 $ 5,000.00 $ 5,000,00 $ 5,000,00 $ 5,000,00

- 19-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F"
NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30, 1999

Note 5: GENERAL LONG-TERM DEBT

CAPITAL LEASES The City ofPelham Board of Education has entered into a lease agreement as lessee for computer equipment. This lease agreement qualifies 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 theinception.

The changes in General Long-Term Debt during the fiscal year ended June 30, 1999, were as follows:

Capital Leases

Balance July 1, 1998

$ 87,291.13

Deductions Debt Retired

42.330.99

Balance June 30, 1999

$ 44.960.14

At June 30, 1999, payments due by fiscal year which includes principal and interest for these items are as follows:

Fiscal Year Ended June 30

Capital Leases

2000

$ 47,753,51

Deduct: Imputed Interest

2,793.37

Net Present Value ofFuture Minimum Lease Payments

$ 44,960.14

Note 6: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of$117,650.08 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies.

Georgia Department ofEducation Paid to the State Merit System of Personnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $94,578.02

- 20-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY EXHIBIT "F" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS
JUNE 30. 1999

Note 6: ON-BEHALF PAYMENTS

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $8,352.06

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$14,720.00

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.

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 defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% oftheir 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. The required employer contribution rate is 11.95% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

1999 1998 1997

100% 100% 100%

$ 631,106.21 $ 585,690.63 $ 531,340.71

- 21 -

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30,1999

EXHIBIT "G"

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS JUNE 30,1999 JUNE 30, 1998

$ 129,592.83 $ 22,528.01

$ 152,120.84 $ 100,200.29

1,173,31

1,657.59 $ 174,851.12

177,682.02

133,096.79

7,181,92 5,466.55

7,181.92 5,466.55

9,343.51 5,315.11

$ 143,414,61 $ 24,185.60 $ 174,851,12 $ 342,451.33 $ 247,955.70

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 Unreserved Undesignated
Total Fund Equity

$

4,903.98 $

27,072.92

$ 31,976.90 $

$

7,181.92

5,466.55

98,789.24 $

$ 111,437.71 $

$ 4,813.74 19,371,86

95,922,17 $ 14,493,23 64,435.72

24,185,60 $ 174,851.12 $

0.00 $ 0.00 $

$
0.00 0,00 $

95,922.17 $ 24,210.95 110,880.50
231,013.62 $
7.181.92 $ 5,466.55 98,789.24 111,437.71 $

56,902.55 17,520.47 91,476.61 1,355.45 167,255.08
9.343.51 5.315.11 66.042.00 80,700.62

Total Liabilities and Fund Equity

$ 143,414.61 $ 24.185.60 $ 174,851.12 $ 342,451.33 $ 247,955.70

See notes to the general purpose financial statements.

- 22-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30.1999

EXHIBIT"H"

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

FEDERAL PROGRAMS

TOTALS YEAR ENDED JUNE 30.1999 JUNE 30, 1998

REVENUES

State Funds Federal Funds Other Funds

$ 47,728.00 $ 231,884.99

$ 279,612.99 $ 237,369.83

494,162.35

$ 612.652.47

1,106,814.82

1,176,494.02

98,838.76

98.838.76

88,605.71

Total Revenues

$ 640,729.11 $ 231,884.99 $ 612,652.47 $ 1,485,266.57 $ 1,502,469.56

EXPENDITURES

Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Student Transportation Services Other Support Services Food Services Operation
Debt Service Principal Interest

$ 156,257.54 $ 545,748.17 $

23,203.98 379.21
5,413.35 16,394.51

3,871.05 15,004.85 34,790.84

$ 607,981.87

13,307.07

42,330.99 5,422.52

702,005.71 $
27,075.03 15,384.06 40,204.19 16,394.51
13,307.07 607,981.87
42,330.99 5,422.52

715,831.12
26,106.20 16,948.33 39,945.39 13,135.74
1,160.96 16,928.98 610,736.71
39,855.18 7,898.33

Total Expenditures

$ 607,981.87 $ 249,402.10 $ 612,721.98 $ 1,470,105.95 $ 1,488,546.94

Excess of Revenues over (under) Expenditures

$ 32,747.24 $ -17,517.11 $

-69.51 $

15,160.62 $

13,922.62

OTHER FINANCING SOURCES

Operating Transfers In

17,517.11

69.51

17,586.62

0.93

Excess of Revenues and Other Financing Sources

over (under) Expenditures

$

32,747.24 $

0.00 $

0.00 $

32,747.24 $

13,923.55

FUND BALANCE JULY 1

80,700.62

0.00

0.00

80,700.62

68,090.69

Food Inventory .. Net Change in Period Donated Commodities Purchased Food

-2,161.59 151.44

-2,161.59 151.44

-1,715.58 401.96

FUND BALANCE JUNE 30

$ 111,437.71 $

0.00 $

0.00 $ 111,437.71 $

80,700.62

See notes to the general purpose financial statements.

- 23 ..

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 1999

EXHIBIT "I"

ASSETS Cash and Cash Equivalents Accounts Receivable

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30, 1999

JUNE 30, 1998

$

644,76 $

168,509,87 $

169,154.63 $

198,844.32

105,982.71

105,982.71

95,648.67

Total Assets

$

644,76 $

274,492,58 $

275,137,34 $ =====2=9"=4=,4=9=2=.=9=9=

LIABILITIES AND FUND EQUITY

LIABILITIES

Accounts Payable Retainages Payable

Total Liabilities

FUND EQUITY

Fund Balances

Reserved

For SPLOST Projects

Unreserved

Undesignated

$

Total Fund Equity

$

$

80,177.00 $

80,177.00

$

14,747.20

$

80,177.00 $

80,177.00 $

14,747.20

$
644.76
644.76 $

194,315.58 $
0.00
194,315.58 $

194,315.58 $
644.76
194,960.34 $

274,685.03 5,060.76
279,745.79

Total Liabilities and Fund Equity

$

644.76 $

274,492.58 $

275,137.34 $

294,492.99

See notes to the general purpose financial statements.

- 24-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30,1999

EXHIBIT"J"

BOND PROCEEDS

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

YEAR ENDED

JUNE 30, 1999

JUNE 30,1998

REVENUES

Taxes Other Funds

$

0,00 $

553,732.41 $

553,732.41 $

433,261,26

7,642,82

7,642.82

3,749.77

Total Revenues

$

0,00 $

561,375.23 $

561,375,23 $

437,011.03

EXPENDITURES

Capital Outlay Land and Land Improvements BUilding and Building Improvements Equipment
Total Expenditures

$

7,280.96 $

7,280.96

$

4,416.00

576,723.72

581,139,72 $

162,322.00

57,740.00

57,740.00

$

4,416.00 $

641,744.68 $

s 646,160.68

162,322.00

Excess of Revenues over (under) Expenditures $

-4,416.00 $

-80,369.45 $

-84,785.45 $

274,689.03

FUND BALANCE JUL Y 1

5,060.76

274,685.03

279,745.79

5,056.76

FUND BALANCE JUNE 30

$

644.76 $

194,315.58 $

194,960,34 $ ====o:;2;~7;9.,.7;4,;5;.;7,9;~

See notes to the general purpose financial statements.

- 25-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 3D, 1999

EXHIBIT OK"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable
Total Assets

NON EXPENDABLE TRUST FUND
ENDOWMENT FUND C,M,AND BERNICE C. STRIPLING
PELHAM FFA SCHOLARSHIP TRUST FUND

AGENCY FUND

TOTALS

JUNE 30,1999

JUNE 30,1998

$

5,648.71 $

194.78 $

5,843.49 $

3,715.03

20,000,00

20,000.00

20,000.00

1,046.03

1,046.03

951,51

$

26,694.74 $

194.78 $

=========== 26,889.52 $

24,666.54

Total Liabilities and Fund Equity $

26,694.74 $

194,78 $

26,889.52 $ _===-,,;;;2,,;4,=,6=6=6==.5=4-=

See notes to the general purpose financial statements,

- 26-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30, 1999

EXHIBIT "L"

REMEMBRANCE GIFT FUND
ASSETS Cash and Cash Equivalents

BALANCE JULY 1,1998

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30,1999

$

131.18 $

170.00 $

106.40 $ ====.;;,==19=4=.7=8=

LIABILITIES Funds Held for Others

$

131.18 $

170.00 $

106.40 $ ====.;;,==19=4=.7=8=

See notes to the general purpose financial statements.
- 27-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEARENDED JUNE 30,1999

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Agriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food and Nutrition Program Food Services School Breakfast Program 1999 Grant National School Lunch Program 1999 Grant
Total Child Nutrition Cluster
Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1)
Total U. S. Department of Agriculture
Corporation for National and Community Service Pass-Through From Southwest Georgia Regional Educational Service Agency Learn and Serve America School and Community Based Programs 1999 Grant
Education, U. S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Individuals with Disabilities Education Act Part B - Special Education Flow Through 1999 Grant Preschool 1999 Grant Part C - Special Education Special Education Capacity Building Improvement 1999 Grant
Total Special Education Cluster
Other Programs Direct Impact Aid 1999 Grant Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1999 Grant Title 1/ Eisenhower Professional Development 1998 Grant 1999 Grant Title 1/1 Technology Literacy Challenge Fund Grants 1999 Grant Title VI Innovative Education Program Strategies 1999 Grant

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

. 10.553
10.555

N/A

$

N/A

$

100,329.96 356,812.67 $ 457,142.63 $

(2) 570,962.15 (3) 570,962.15

10.550

NlA $

37,019.72 494,162.35 $

37,019.72 607,981.87

94.004

NlA

$

700.00 $

700.00

84.027 84.173
84.173

NlA

$

NlA

N/A $

99.981.10 $ 17,238.88
5,988.00 123,207.98 $

99,981.10 17,238.88
5,988.00 123,207.98

84.041

3,441.58

(4)

84.010

NlA

84.281

NlA

84.281

N/A

84.318

NlA

84.298

N/A

198,537.00
530.49 14,446.09
54,883.00
8,413.00

198,537.00
600.00 (3) 14,446.09
54,883.00
8,413.00

-28 -

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 1999

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Education, U. S. Department of Other Programs Pass-Through From Georgia Department of Education Goals 2000 State and Local Education Systemic Improvement Grants 1998 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1999 Grant Pass-Through From Mitchell County Board of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1999 Grant
Total U. S. Department of Education

CFDA NUMBER
84.276 84.048 84,010

PASSTHROUGH
ENTITY ID
NUMBER

N/A

$

N/A

N/A
$

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

8,747.91 $

8,747.91

11,234.00

11,234.00

191,953.00

191,953.00

615,394.05 $ _ _=61=2~,0:21:.9.8.

Total Federal Financial Assistance
N/A = Not Available

$

1,110,256.40 $_~1~ ,22~0,= 70= 3.8=5

Notes to the Schedule of Expenditures of Federal Awards

(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 1999 National School Lunch Program.
(3) Expenditures for this program indude State, and/or Other Funds. Expenditures are not maintained by fund source.
(4) Funds eamed on this program do not require reporting of expenditures.

Major Programs are identified by an asterisk (*) in front of the CFDA number.

The Board did not provide Federal Assistance to any Subrecipient.

The accompanying schedule of expenditures of Federal awards indudes the Federal grant activity of the City of Pelham Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the general purpose financial statements.

See notes to the general purpose financial statements.

- 29-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1999

SCHEDULE "2"

AGENCY/FUNDING
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 Limited English Speaking Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Technology Specialist Local Five Mill Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs At-Risk Summer School Program Environmental Science Program Health Insurance Innovative Programs Preschool Handicapped Program Remedial Summer School Program Student Records Teachers' Retirement Year 2000 Project Funding Lottery Programs Assistive Technology Computers in the Classroom
Office of School Readiness Pre-Kindergarten Program
Office of Treasury and Fiscal Services Public School Employees Retirement
CONTRACT Education, Georgia Department of Reading First Grant

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$ 3,340,613.00 611,578.00 159,450.00 145,420.00 42,395.00 964,265.00
25,657.00 3,837.00
11,702.00 127,393.00 137,202.00 82,768.00
13,133.00 28,842.00 -115,715.00 803,173.00
$ 1,762.00
6,710.90 500.00
94,578.02 5,000.00
25,019.00 3,224.05 1,215.75 8,352.06 11,376.00
14,720.00

$
47,728.00
5,159.28 32,139.00 194,586.71

27,098.00

TOTAL
3,340,613.00 611,578.00 159,450.00 145,420.00 42,395.00 964,265.00
25,657.00 3,837.00 11,702.00
127,393.00 137,202.00 82,768.00
13,133.00 28,842.00 -115,715.00 803,173.00 47,728.00
1,762.00
6,710.90 500.00
94,578.02 5,000.00
25,019.00 3,224.05 1,215.75 8,352.06 11,376.00
5,159.28 32,139.00
194,586.71
14,720.00
27,098.00

$ 6,581,268.78 $

279,612.99 $ 6,860,881.77

See notes to the general purpose financial statements. - 30-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 1999

SCHEDULE "3"

PROJECTS
The repayment of principal and interest on outstanding City of Pelham General Obligation School Bonds, Series 1993, coming due on February 1, 1998, and semiannually thereafter as set forth in Exhibit "B" attached hereto and, by this reference thereto, incorporated herein, the maximum amount of debt to be retired not to exceed $1,612,300.00
The acquisition, construction and equipping of capital outlay Projects for the Pelham School System consisting of a new pre-kindergarten building on the campus of the Pelham Elementary School and additions, expansions, improvements, renovations, modifications and equipping of existing school facilities of the Pelham School System, in an amount not to exceed $2,121,273.00

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED
COST (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

$ 1,612,300.00 $

1,612,300.00 $

148,440.80 $

2,121,273.00

2,121,273.00

641,744.68

AMOUNT EXPENDED
IN PRIOR YEARS
146,922.43
162,322.00

$ 3,733,573.00 $

3,733,573.00 $

790,185,48 $ ====30=9,2~44~.4=3

(1) The Board's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax.
(2) The Board's current estimate of total cost for each project. Includes all cost from project inception to completion.
(3) The voters of the City of Pelham approved the imposition of a 1% sales tax to fund the above projects. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the general purpose financial statements.

- 31 -

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF EXPENDITURES LOTIERY PROGRAMS YEAR ENDED JUNE 30, 1999

SCHEDULE "4"

EXPENDITURES

ASSISTIVE TECHNOLOGY

COMPUTERS INTHE
CLASSROOM

PRE-KINDERGARTEN PROGRAM

Current

Instruction

$

Support Services

Pupil Services

Improvement of Instructional Services

General Administration

Maintenance and Operation of Plant

Debt Service

Principal

Interest

6,723.28

$

$

42,330.99

5,422.52

149,534.26 $
23,203.98 379.21
5,413.35 16,394.51

TOTAL
156,257.54
23,203.98 379.21
5,413.35 16,394.51
42,330.99 5,422.52

Total Expenditures

$

6.723.28 $

47,753.51 $

194,925.31 $ ====204:;9';,;4;0;;2;;.;1'=0=

RECAP: Salaries and Benefits Pre-Kindergarten Program Other Expenditures Assistive Technology Computers in the Classroom Pre-Kindergarten Program

$

155,627.29

6,723.28 47,753.51 39,298.02

$

249,402.10

See notes to the general purpose financial statements.

- 32-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30,1999

SCHEDULE "5"

Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis
Salaries Operations
Less: Expenditures for Media Center Programs in Excess of Total Media Allotment
Expenditures per Audit
Amount of Underexpenditure for Total Allotment

FOURTEEN WEIGHTED AND MEDIA CENTER
PROGRAMS

100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS

$

4,257,061.00 $ _ _-..:..1:::.3::..9!.::,:.9..:.7.-:1..:..:0:..:0:...

$

4,467,712.59

282,679.73 $ _ _--=2-.:4.=8.!.,:=8.:0...7:...::6..:6:...

$

4,750,392.32

-9,188.39
$ -_-.:.!.:.4..,.7..4:1..,.2.0:~3=..=9.3..

$

0.00 $========0=.00=

See notes to the general purpose financial statements. - 33 -

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30,1999

GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (0) Grades 1 - 3 (*) Sub-Total- K-3 Grades 4 - 5 (0) Grades 6 - 8 (0) Grades 9 - 12 (0) High School Laboratories (0) Vocational Education Laboratories (0) Total General and Career Education Programs
SPECIAL EDUCATION PROGRAMS Regular Programs Category II (*) Category III (*) Sub-Total - Regular Category VI (Gifted) (*) Total Special Education Programs
REMEDIAL EDUCATION PROGRAM C*) Total Fourteen Weighted Programs
MEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs
Total Fourteen Weighted and Media Genter Programs

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

357.938.00

$

322.144,20 $

981.602.00

883,441.80

$ 1.339.540.00 90 $ 1.205.586.00 $

392,399,00 90

353.159.10

749.891.00 90

674,901.90

398,419.00 90

358.577.10

198.848,00 90

178.963,20

261.516.00 90

235.364.40

$ 3,340,613.00

$ 3.006,551.70 $

0.00 0.00
0.00

$

593.918.00

$

534.526.20 $

0.00

$

593.918,00 90 $

534,526.20 $

17.660.00 90

15.894.00

$

611.578.00

$

550,420.20 $

$

159,450.00 90 $

143,505.00 $

$ 4,111,641,00

$ 3.700.476.90 $

0.00
0.00 0.00 0.00

$

114.220.00 90 $

102,798.00 $

0.00

31,200.00 100

31.200.00

$

145,420.00

$

133.998.00 $

0.00

$ 4.257.061,00

$ 3.834,474.90 $

0.00

STAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development
Total Staff Development Programs (*) Identifies Fourteen Weighted Programs, See notes to the general purpose financial statements.

$

13,371.00

$

13.371.00 $

0.00

29.024.00

29.024.00

0.00

$

42.395.00 100 $

========== 42.395.00 $

0.00

- 34 -

SCHEDULE "6"

EDUCATION TOTAL
REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

322,144.20 $

287,600.23 $

5,354.45 $

292,954.68

883,441.80

923.149.20

26.863.48

950,012.68

$ 1,205,586.00 $ 1,210,749.43 $

32,217.93 $ 1,242,967.36 $

0.00

353,159.10

418,597.00

11,243.95

429,840.95

0.00

674,901.90

920,196.47

18,651.29

938,847.76

0.00

358,577.10

412,329.66

91,770.77

504,100.43

0.00

178,963.20

281,892.71

28,464.30

310,357.01

0.00

235,364.40

260,687.64

49,288.88

309,976.52

0.00

$ 3,006,551.70 $ 3,504,452.91 $

231,637.12 $ 3,736,090.03

$

534,526.20

$

312,027.69 $ 284,698.90

6,701.85 $ 4.202.77

318,729.54 288.901.67

$

534,526.20 $

596,726.59 $

10,904.62 $

607,631.21

0.00

15,894.00

39,592.23

1,501.66

41,093.89

0.00

$

550,420.20 $

636,318.82 $

12,406.28 $

648.725.10

$

143,505.00 $

206,204.54 $

4,764.26 $

210,968.80

0.00

$ 3,700,476.90 $ 4.346,976.27 $

248,807.66 $ 4,595,783.93

$

102,798.00 $

120,736.32

$

120,736.32

0.00

31,200.00

$

33,872.07

33,872.07

0.00

$

133,998.00 $

120,736.32 $

33,872.07 $

154,608.39

$ 3,834,474.90 $ 4,467,712.59.$

282,679.73 $ 4,750,392.32 $

0.00

$

13,371.00

29,024.00

$ ==~;;4;2,,3;9:5.=00=

$

35,520.50 $

35,520.50

6,967.17

6,967.17

$

42,487.67 $

42,487.67 $=========0=.0=0

- 35 -

SECTION II COMPLIANCE AND INTERNAL CONfROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.w., Suite 214 Atlanta. Georgia 30334-X400
June 15,2000

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City of Pelham Board of Education
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the financial statements ofCity ofPelham Board of Education as of and for the year ended June 30, 1999, and have issued our report thereon dated June 15,2000. 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 the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States.
Compliance
As part of obtaining reasonable assurance about whether City of Pelham Board of Education's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered City of Pelham Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its
99YB-40

operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect City of Pelham Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as item FS- 7841-99-0 I.
A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and 'accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, we consider item FS-7841-99-01 to be a material weakness.
This report is intended solely for the information and use of management, members of the City of Pelham Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,

RWH:jb 99YB-40

R sell W. Hinton State Auditor

RUSSELL \\T. HINTON
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street. S.W., Suite 214 Atlanta. Georgia 30334-H400
June 15,2000

Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education
and Superintendent and Members of the City of Pelham Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133
Ladies and Gentlemen:
Compliance
We have audited the compliance of City of Pelham Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1999. City of Pelham Board of Education's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements oflaws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of City of Pelham Board of Education's management. Our responsibility is to express an opinion on City ofPelham Board ofEducation's compliance based on our audit.
We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the City of Pelham Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on City of Pelham Board of Education's compliance with those requirements.

99SA-lO

In our opinion, the City of Pelham Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30,1999.
Internal Control Over Compliance
The management of City of Pelham Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered City of Pelham Board of Education's internal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more ofthe internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use of management, members of the City of Pelham Board ofEducation, Federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully submitted,
~tU.~-:s Russell W. Hinton State Auditor
RWH:jb 99SA-IO

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

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 1999

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7841-97-01 FS-7841-97-03 FS-7841-98-01 FS-7841-98-02

Unresolved-See Corrective ActionJResponses Further Action Not Warranted Unresolved-See Corrective ActionJResponses Unresolved-See Corrective ActionJResponses

CORRECTIVE ACTIONIRESPONSES

AUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Amount: $3,050.55 Finding Control Number: FS-7841-97-01

We concur with this finding. This finding will be resolved by Georgia Department of Education through a future increase in Board's Local Five Mill Share portion ofQBE Allotments.

EMPLOYEE COMPENSATION Salary Overpayment Amount: $412.27 Finding Control Number: FS-7841-98-01

We concur with this finding. The overpayment has been explained to the employee by the Superintendent. He has been asked to repay the $412.27. This employee voluntarily resigned on February 9, 1999, before the overpayment was discovered. He refuses to repay the balance of $412.27.

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7841-98-02

We concur with this finding. 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 fmancial statements.

SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1999
I SUMMARY OF AUDITOR'S RESULTS
1. Type of Report Issued on the Financial Statements The auditor's opinion on the City of Pelham Board of Education's financial statements was qualified for various departures from generally accepted accounting principles.
2. Reportable Conditions in Internal Control Disclosed by the Audit ofthe Financial Statements The audit report for the City of Pelham Board of Education disclosed a financial statement reportable condition related to the following control category.
General Fixed Assets
The reportable condition described above is considered to be a material weakness.
3. Noncompliance Material to the Financial Statements The audit of the City of Pelham Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements.
4. Reportable Conditions in Internal Control Over Major Programs The audit report for the City ofPelham Board ofEducation did not disclose any reportable conditions in internal control over major programs.
5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the City of Pelham Board of Education's report on compliance with requirements applicable to major programs was unqualified.
6. Audit Findings Required to be R{(ported by Section .5lO(a) ofOMB Circular A-133 The City ofPelham Board of Education's audit did not disclose audit findings required to be reported by section .5IO(a) ofOMB Circular A-I33.
7. Major Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program - Food Services - School Breakfast Program 10,555 Food and Nutrition Program - Food Services - National School Lunch Program
8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $300,000.00.
9. Low Risk Auditee The City ofPelham Board ofEducation was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.
- 1-

CITY OF PELHAM BOARD OF EDUCATION - MITCHELL COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 1999
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7841-99-01 The City ofPelham Board ofEducation did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements 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 Group. These 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. ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
-2-