City of Social Circle Board of Education, Walton County, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2000

STATE OF GEORGIA

DEPARTMENT OF AUDITS AND ACCOUNTS

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CITY OF SOCIAL CIRCLE BOARD OF EDUCATION
WALTON COUNTY, GEORGIA

REPORT ON AUDIT



OF THE FINANCIAL STATEMENTS

FOR THE FISCAL YEAR ENDED JUNE 30,2000

Russell W. Hinton State Auditor

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

CAPITAL PROJECTS FUND

G

COMBINING BALANCE SHEET

H

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

SCHEDULES

1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

2 SCHEDULE OF STATE REVENUE

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

ANALYSIS OF

EXPENDITURE REQUIREMENTS

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS

4

OVERALL

5

BY PROGRAM

Page
2
4
6
7
16
18
20
22
24
26
27
29
30

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY - TABLE OF CONTENTS -
SECTION II 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 vnTH GOVERNMENT AUDITING STANDARDS

REPORT ON COMPLIANCE wrrn REQUIREMENTS APPLICABLE TO EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE wrrn
OMB CIRCULAR A-l33
SECTION ill AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS .~,-Y 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 30334-8400
March 16,2001

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 Social Circle 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 ofthe City ofSocial Circle Board of Education, as of and for the year ended June 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility ofthe City of Social Circle 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 of the 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 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 ofthe 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.
2000ARL-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, 2000, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 2000. Also funds received, subsequent to June 30, 2000, 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, 1999, were improperly recorded in the year ended June 30, 2000. 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 Social Circle Board of Education as ofJune 30, 2000, and the results ofits operations 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 March 16, 2001, on our consideration of the City of Social Circle Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the City of Social Circle Board of Education taken as a whole. The accompanying combining statements (Exhibits E through H) and the financial schedules (Schedules 1 through 5), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of
Management and Budget Circular A-B3, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the
general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole.
2000ARL-13

A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code ofGeorgia Annotated Section 50-
6-24.

RWH:gp 2000ARL-13

Respectfully submitted,

...... .
R sell W. Hinton State Auditor



CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY
,

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINED BALANCE SHEET ALL FUND TYPES JUNE 30, 2000

ASSETS
Cash and Cash Equivalents
Investments
Accounts Receivable
Inventories Food Donated Commodities Purchased Food

GOVERNMENTAL FUND

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

299,546.84 $

92,519.31

940,000.00

12,569.86

54,049.13

6,001.09 1,786.26

Total Assets

$ 1,252,116.70 $====15~4=,3=5=5=.7=9=

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Salaries Payable Expired Grant Balances Payable Contracts Payable Retainages Payable
Total Liabilities
FUND EQUITY
Fund Balances Reserved For Continuation of Federal Programs For Expired Grant Balances/Questioned Costs For Inventories Food Donated Commodities Purchased Food For SPLOST Projects For State Capital Outlay Projects Unreserved Undesignated
Total Fund Equity

$

59,334.90 $

28,333.82

4,642.10

46,949.40

1,195.43

$

63,977.00 $ _---'''''7''6''',-4''7"8'-.=6=5_

$

1,136.01

6,001.09 1,786.26

$ _.....:...J..:==~ $

68,953.78 77,877.14

Total Liabilities and Fund Equity

$ 1,252,116.70 $ ======1=5=4=,=3=5=5....7...9ic:

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

EXHIBIT "A"

TYPES CAPITAL
PROJECTS FUND

TOTALS

(Memorandum OnIV:...-_ _

JUNE 30, 2000

JUNE 30,1999

$

441,398.76 $

833,464.91 $

556,885.04

2,050,000.00

2,990,000.00

1,800,000.00

194,847.09

261,466.08

204,563.06

6,001.09 1,786.26

6,452.52 1,950.44

$ 2,686,245.85 $ 4,092,718.34 $ 2,569,851.06

$

2,581.95 $

90,250.67 $

119,502.69

51,591.50

49,365.36

1,195.43

2,221.81

235,317.32

235,317.32

25,612.45

25,612.45

$

263,511.72 $

403,967.37 $ _ _1.:7.1..,0:.8.9..:8.6==~

$

1,136.01 $

3,413.21

3,594.85

$

453,540.35

1,969,193.78

6,001.09 1,786.26 453,540.35 1,969,193.78

6,452.52 1,950.44 382,588.62 842,798.63

0.00

1,257,093.48

1,157,962.93

$ 2,422,734.13 $ 3,688,750.97 $ 2,398,761.20

$ ==21686,245.85 $

4,092,718.34 $

2,569,851.06

-3-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES
YEAR ENDED JUNE 30, 2000

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USESl
Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
Food Inventory - Net Change in Period Donated Commodities Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 5,691,450.76 $
1,038,335.03 850,538.40

257,154.72 549,319.85
145,404.90

$ 7,580,324. 19 $ _---..::::..::9:..5..:1.=,.:8...7:::9.:...4.:,7;:..-

$ 4,454,969.92 $
271,923.93 70,430.64
153,564.41 288,980.70 526,611.02
589,327.17 309,855.34
143,442.43 47,885.11

318,802.42
47,247.26 77,098.39
3,563.74 17,885.17
1,000.00 2,362.53
1,415.00 42,840.83 425,973.53

$ 6,856,990.67 $ _ _9=3~8=,:18.8...87.-
$ 723,333.52 $ _ _-:1.3:,:6:=90=.6:0:-

$
$ ------'--=18.:5:0-

$

-18.50 $

$

723,315.02 $

464,824.68

18.50
--=18-=.5:0:-
13,709.10 64,783.57
-451.43 -164.10

FUND BALANCE JUNE 30

$ 1,188, 139.70 $ ==...;.,;7.7~;,,8;7,7,;.1,;4;~

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

EXHIBIT "B"

CAPITAL PROJECTS
FUND

TOTALS

(Memorandum Only)

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

254,170.00 $ 6,202,775.48 $ 5,657,516.80

549,319.85

592,133.59

810,037.56

1,848,372.59

1,562,320.19

95,954.76

1,091,898.06

780,028.32

$ 1,160,162.32 $ 9,692,365.98 f 8,591,998.90

$

$ --==.6.0:.6:,.5.:8.1....1:4.-

$

606,581.14 $

$

553,581.18 $

4,773,772.34 $ 4,544,121.12

319,171.19 147,529.03 157,128.15 306,865.87 526,611.02
1,000.00 591,689.70 309,855.34
1,415.00 186,283.26 473,858.64 606,581.14

291,425.83 186,971.23 157,282.64 343,757.77 548,118.28
1,000.00 518,735.35 291,843.41
187.75 182,002.56 473,524.80 152,324.84

8,401,760.68 $ 7,691,295.58

1,290,605.30 $ _---:90=0~,7=0:3..3.2.

$

18.50 $

309,275.02

-18.50

-309,275.02

$

0.00 $

---::;0.;..:;0..;0::...

$

553,581.18 $ 1,290,605.30 $

900,703.32

,

1,869,152.95

2,398,761.20

1,496,495.10

-451.43 -164.10

1,540.20 22.58

$ 2,422,734.13 $ 3,688,750.97 $ 2,398,761.20 - 5-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON 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, 2000

EXHIBIT "C"

REVENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
Total Expenditures
Excess of Revenues over (under) Expenditures

OTHER FINANCING SOURCES (USES)
Other Sources Other Uses
Total Other Financing Sources (Uses)
Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1, 1999
Adjustments Food Inventory - Net Chantle in Period
Donated Commodities Purchased Food

GENERAL FUND

ACTUAL

(BUDGET

BUDGET

BASIS)

$ 5,539,911.00 $ 5,691,450.76

21,200.00

1,028,202.91

1,038,335.03

304,400.00

850,538.40

$ 6,893,713.91 $ 7,580,324.19

$ 4,548,328.03 $ 4,454,969.92

250,637.45 64,716.68 171,923.57 312,719.12 537,102.91

271,923.93 70,430.64 153,564.41
288,980.70 526,611.02

601,514.96 315,632.65

589,327.17 309,855.34

131,736.67 79,458.71

143,442.43 47,885.11

$ 7,013,770.75 $ 6,856,990.67

$ -120,056.84 $ 723,333.52

$ - - - - = --=18:..5.0. . $ - - - - = --=18:..5.0. .

$ -120,056.84 $ 723,315.02

449,094.22

464,824.68

-11,232.16

FUND BALANCE JUNE 30, 2000

$ 317,805.22 $ 1,188,139.70

SPECIAL REVENUE FUND

ACTUAL

(BUDGET

BUDGET

BASIS)_

$ 32,000.00 $ 257,154.72 579,730.00 549,319.85 125,550.00 1,200.00 145,404.90
$ 738,480.00 $ 951,879.47

$ 143,906.00 $ 318,802.42

79,708.00 25,415.00
3,300.00 3,496.00

47,247.26 77,098.39
3,563.74 17,885.17

1,000.00 2,000.00
300.00 56,605.00 427,350.00

1,000.00 2,362.53
1,415.00 42,840.83 425,973.53

$ 743,080.00 $ 938,188.87

$ -4,600.00 $ 13,690.60

$ 18.50
$ --""""1"8'.5=0-

$ -4,600.00 $ 13,709.10

67,035.71

64,783.57

-2,882.95

-451.43 -164.10

$ 59,552.76 $ 77,877.14

The notes to the general purpose financial statements are an integral part of this statement. -6-

CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The City ofSocial Circle 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. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. 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 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.
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 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 of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives.

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CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note I: 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.
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 ofthese 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.
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 2000, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1999 and ending in early June 2000. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1999 and ending in August 2000. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 2000, compensation under these employment contracts had been earned, but two ofthe twelve monthly payments, due for July and August 2000, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 2000. Also, the State's portion ofthe compensation paid in July and August 2000 was received and recorded as revenue in the fiscal year subsequent to June 30, 2000. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1999, were recorded in the year ended June 30, 2000. 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.

-8-

CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT liD"

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUDGET
The City of Social Circle Board of Education'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 ofthe budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles.
The budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval ofthis tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with

provisions of the Quality Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws OCGA 45-8-14 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 ofone year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code 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 of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(I) 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,
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CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(5) Prime banker's acceptances,

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

(7) Repurchase agreements, and

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

RECEIVABLES

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

PROPERTY TAXES

The City of Social Circle fixed the property tax levy for the 1999 tax year (calendar year) on October 20, 1999 (levy date). Taxes were due on December 20, 1999. The lien date for property taxes was January 1, 1999. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 2000. The Social Circle City Clerk bills and collects the property taxes for the Board of Education and remits the taxes collected to the Board.

The tax millage rate levied for the 1999 tax year (calendar year) for the City of Social Circle Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

12.99 mills

SALES TAXES

Special Purpose Local Option Sales Tax (SPLOST) is to be used for capital outlay for educational purposes and is collected in Walton County and Newton County. The Walton County SPLOST will provide the City of Social Circle Board of Education with a maximum of $5,000,000.00 and the Newton County SPLOST will provide the City ofSocial Circle Board ofEducation with a maximum of $5,000,000.00 The Walton County SPLOST revenue during the fiscal year amounted to $804,025.99 and was recorded in the Capital Projects Fund. The State will terminate collection of this tax once an additional $3,228,583.50 has been collected or on December 31,2002, whichever occurs first. The Newton County SPLOST revenue during the fiscal year amounted to $6,011.57 and was recorded in the Capital Projects Fund. The State will terminate collection ofthis tax once an additional $4,993,988.43 has been collected or on December 31,2004, whichever occurs first.

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CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVENTORIES
FOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (first-in, first-out). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time ofpurchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements.
Additionally, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources has not been recorded in the General Long-Term Debt Account Group as this liability is also deemed to be immaterial to the fair presentation ofthese financial statements.
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 financial analysis. Data in these columns do not present financial position or results ofoperations 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.

- 11 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

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 ofmoney which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate ofthe face
value of such surety bond and the market value of securities pledged shall be equal to not less than
11 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance.
If a depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe
securities pledged to secure a pool ofpublic funds shall be not less than 11 percent ofthe daily pool balance. OCGA Section 45-8-11 (b) provides an officer holding public funds may, in his discretion, waive the requirement for security in the case ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of 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 ofthe 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 ofdevelopment authorities created by the laws ofthe State of Georgia, and .
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZAnON OF DEPOSITS At June 30,2000, the bank balances were $4,150,151.08. The amounts ofthe total bank balances are classified into three categories of credit risk:

- 12 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note 2: DEPOSITS

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, 2000, as follows:

Risk Category

Bank Balance

1

$ 100,000.00

2

4,050,151.08

3

0.00

Total

$...4J50J51.08

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 ofloss 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, 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:

- 13-

CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

Note 4: RISK MANAGEMENT

1999 2000

Beginning of Year Liability_

Claims and Changes in Estimates

$

0.00 $

2,191.00 $

$

0.00 $

1,186.00 $

Claims Paid

End of Year Liability_

2,191.00 $,_ _~0= .00

1,186.00 $,

~ 0.~ 00

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

Position Covered
Superintendent Curriculum Director Each Principal

Amount
$ 5,000.00 $ 5,000.00 $ 5,000.00

Note 5: ON-BEHALF PAYMENTS

The Board has recognized revenues and expenditures in the amount of $96,368.62 for health
insurance and retirement contributions paid on the Board's behalfby the following State Agencies.

Georgia Department ofEducation Paid to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel
In the amount of $74,967.03

Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost
In the amount of $4,957.59

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 $16,444.00

Note 6: SIGNIFICANT COMMITMENTS

The following is an analysis ofsignificant outstanding construction or renovation contracts executed
by the Board as of June 30, 2000, together with funding available:

Project
GSFIC 99-786-093

Unearned Executed Contracts
$ 8,Q77~514.19

Funding Available From State
$ 5.224.386.00

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

- 14-


CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 2000

EXHIBIT "D"

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: ACCUMULATED EMPLOYEES' LEAVE

Twelve month employees earn vacation leave at the rate of twelve days per year. Vacation leave may be accumulated from year to year, to a maximum oftwenty-four days. Employees will be paid at their most recent rate of pay, for vacation leave earned but not taken at the time of resignation, retirement or other termination of employment, up to a maximum of twelve days. See Note 1 Compensated Absences

Note 9: 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% 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. The required employer contribution rate is 11.29% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2000 1999 1998

100% 100% 100%

$ 524,113.13 $ 540,835.52 $ 489,294.94

- 15 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30, 2000

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

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

$

85,480.19 $

23,182.09

137.20

13,524.83

6,001.09 1,786.26

$

93,404.74 $===.......~ 36,7~ 06.~ 92

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable



Total Liabilities

FUND EQUITY

Fund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated Commodities Purchased Food Unreserved Undesignated

Total Fund Equity

Total Liabilities and Fund Equity

$

1,203.27 $

19,197.06

15,460.34

17,509.86

$

16,663.61 $ _ _~3.6.:,7.0.=6=.9:.2..

$

6,001.09

1,786.26

68,953.78 $

$

76,741.13 $

---:0=.0:.0...
---:0=.0:.0...

$

93,404.74 $ _ _~ 36,~ 706~ .92...

See notes to the general purpose financial statements. - 16 -

EXHIBIT "E"

FEDERAL
PROGRAMS

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

108,662.28 $

131,698.26

$

40,387.10

54,049.13

22,976.64

6,001.09 1,786.26

6,452.52 1,950.44

$

40,387.10 $

170,498.76 $==~1~6~3,;07;7..86.

$

16,142.97 $

16,142.97

7,933.49

28,333.82 $

46,707.12

13,979.20

46,949.40

49,365.36

1,195.43

1,195.43

2,221.81

$

39,251.09 $

92,621.62 $ _ _=98=,2.9..4:..2=9-

$

1,136.01 $

1,136.01 $

3,413.21

6,001.09 1,786.26

6,452.52 1,950.44

0.00

68,953.78

52,967.40

$

1,136.01 $

77,877.14 $ _ _~6~4=,7:8.3...57..

$

40,387.10 $

170,498.76 $ =-====1=6==3.,0!7,;7=.8=6=~

-17 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30, 2000

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation
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
See notes to the general purpose financial statements.
- 18 -

SCHOOL FOOD
SERVICES FUND

LOTIERY PROGRAMS

$

34,130.00 $

223,024.72

259,658.38

145,404.90

$ 439,193.28 $ _---==2=2.3:.,.0:.2.:4...:7=2_

$

192,304.48

16,071.63 4,111.57

3,816.71

1,000.00 2,362.53

$--4=23,=20= 6.9~8

609.75 2,766.55

$ 423,206.98 $ _---==2.2::3..,.0.:4.3:=.2=2_


$

15,986.30 $

. -18.50

$

15,986.30 $

61,370.36

-451.43 -164.10

18.50
0.00 0.00

$

76,741 .13 $ ===~;;,;.;;;,0;.;0;0..

EXHIBIT "F"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30, 1999

$

257,154.72 $

238,014.44

$

289,661.47

549,319.85

592,133.59

145,404.90

135,263.36



$

289,661.47 $

951,879.47 $

965,411.39

$

126,497.94 $

318,802.42 $

311,825.06

31,175.63 72,986.82
3,563.74 14,068.46
1,415.00 42,231.08

47,247.26 77,098.39
3,563.74 17,885.17
1,000.00 2,362.53
1,415.00 42,840.83 425,973.53

23,930.95 131,467.56
3,758.12 3,065.98 2,741.20 1,000.00 2,869.11 1,883.00
187.75 44,166.88 429,260.05

$

291,938.67 $

938,188.87 $ _---'95=6~,1=5;5..6.6.

$

-2,277.20 $

13,690.60 $

9,255.73

.

18.50

0.02

$

-2,277.20 $

13,709.10 $

9,255.75

3,413.21

64,783.57

53,965.04

-451.43 -164.10

1,540.20 22.58

$

1,136.01 $

==== 77,877.14 $ =====6=4.,.7...8..3.57



- 19-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 2000

ASSETS Cash and Cash Equivalents Investments Accounts Receivable

Total Assets
LIABILITIES AND FUND EQUITY LIABILITIES
Cash Overdraft Accounts Payable Contracts Payable Retainages Payable
Total Liabilities FUND EQUITY
Fund Balances Reserved For SPLOST Projects For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity
Total Liabilities and Fund Equity

REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

0.00 $

291,965.58

1,900,000.00

38,410.27

$

0.00 $=~ 2,2~ 30~ ,37~ 5.8~ 5

$

252.30

235,317.32

25,612.45

261,182.07



$

1,969,193.78

$---~0.0~0

0.00

$

0.00 $ _---:.1J,=9:6J9..,1.:9.3:.:7:8~~

$

0.00 $=2~ ,23~ 0,37~ 5.8~ 5

See notes to the general purpose financial statements. - 20

EXHIBIT "G"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

JUNE 30, 2000

JUNE 30, 1999

$

149,433.18 $

441,398.76 $

348,509.77

150,000.00

2,050,000.00

1,500,000.00

156,436.82

194,847.09

154,192.69

$

455,870.00 $ 2,686,245.85 $ 2,002,702.46

$

133,549.51

$

2,329.65 $

2,581.95

235,317.32

25,612.45

$

2,329.65 $

263,511.72 $ _ _1.3:3,.54=9=.5=1~

$

453,540.35 $

453,540.35 $

382,588.62

1,969,193.78

842,798.63

0.00

0.00

643,765.70

$

453,540.35 $ 2,422,734.13 $ 1,869,152.95

$

455,870.00 $ 2,686,245.85 $ 2,002,702.46

- 21 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 2000

REVENUES State Funds Taxes Other Funds Total Revenues
EXPENDITURES Capital Outlay Land and Land Improvements Building and Building Improvements Total Expenditures
Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES)
Operating Transfers In Operating Transfers Out
Total Other Financing Sources (Uses)

Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses
FUND BALANCE JULY 1
FUND BALANCE JUNE 30


REGULAR

GEORGIA STATE FINANCING AND
INVESTMENT COMMISSION

$

254,170.00

$--1~ 8,7~ 97.0~6

73,655.64

$

18,797.06 $ _ _=3.2.7.t,=8=2.5..6:.4...

$

0.00

- - - - - - $ --==.:::5..9:9..,9:.5.1...4:.9.~

$

0.00 $ _ _=5=.9::9:,.9.:5..1:...4..9:..~

$

18,797.06 $ _ _-'2:7':2":,1:.2.L5..:8..5:=~

$ -662,562.76

1,398,521.00

$

-662,562.76 $_-..1:,.3J9=8=,5c2.1:.0.0=~

$

-643,765.70 $

1,126,395.15

643,765.70

842,798.63

$

1,969,193.78

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

EXHIBIT "H"

SPECIAL PURPOSE LOCAL OPTION SALES TAX

TOTALS

YEAR ENDED

JUNE 30, 2000

JUNE 30,1999

$

254,170.00

$

810,037.56

810,037.56 $

697,211.24

3,502.06

95,954.76

46,892.67

$

813,539.62 $ 1,160, 162.32 $ _ _7:...4.:.4..:.,..1..:.0.::3:.::.:9=.1..:....-

$

50,175.00

$

6,629.65 $ _ _6=0=6.,.:5.8:.1.:..1..4:.-

102,149.84

$

==..:.:.:::...:.- 6,629.65 $

606,581.14 $ _ _152,324.84

$

806,909.97 $

553,581.18 $ _---:=..5:.9.&1.,.7:.7..9:..=07:...

$ 1,398,521.00 $

727,218.17

$

-735,958.24

-1,398,521.00

-417,943.17

$

-735,958.24 $

0.00 $ _---:3=0=9,2-=75:.:0.0..

$

70,951.73 $

553.581.18 $

901,054.07

382,588.62

1,869,152.95

968,098.88

$

453,540.35 $ 2,422.734.13 $ 1,869,152.95




- 23-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2000

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT

CFDA NUMBER

PASSTHROUGH
ENTITY 10
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

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

10.553
10.555

Total Child Nutrition Cluster

N/A

$ 54.975.52

N/A

178,818.27 $

$ 233,793.79 $

(2)
397,342.39 (3)
397,342.39

Other Programs Pass-Through From Georgia Department of Education Food and Nutrition Program Food Distribution Program (1)
Total U. S. Department of Agriculture

10.550

N/A

25,864.59

25,864.59

$ 259,658.38 $ _ _~ 423=.20=6.9~ 8

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 Preschool
Total Special Education Cluster

84.027 84.173

N/A

$ 87.080.81 $

N/A

7.918.00

$ 94.998.81 $

87.080.81 7.918.00
94.998.81

Other Programs Pass-Through From Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Title II Eisenhower Professional Development Title VI Innovative Education Program Strategies Class Size Reduction Safe and Drug-Free Schools and Communities Vocational Education - Basic Grants to States High School Program Basic Grant
Total U. S. Department of Education

84.010 84.281 84.298 84.340 84.186
84.048

N/A

132.870.32

N/A

18.090.00

N/A

8,725.00

N/A

16.276.00

N/A

6,581.34

134.030.55
19.206.97
8.725.00 16,276.00 6.581.34

N/A

12,120.00

12,120.00

$ 289,661.47 $ _ _~2:9.c1:.:9:3:=8..:6.7..

Total Federal Financial Assistance
N/A = Not Available

$ 549,319.85 $==,;"7,1;5,,1;4;5;.6~5~

- 24-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 2000

SCHEDULE "1"

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 2000 National School Lunch Program.
(3) Expenditures on this program include State, and/or Other Funds. Expenditures are not maintained by fund source.
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 includes the Federal grant activity of the City of Social Circle 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.

- 25-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION WALTON COUNTY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2000

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

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

Alternative Program

At-Risk Summer School Program

Health Insurance

Innovative Programs

Mentoring Program

Preschool Handicapped Program

Remedial Summer School Program

Teachers' Retirement

Year 2000 Project Funding

Lottery Programs

Assistive Technology

Computers in the Classroom

Georgia State Financing and Investment Commission Reimbursement on Construction Projects

Human Resources, Georgia Department of Second Step Violence Prevention Program

Office of School Readiness Pre-Kindergarten Program

Office of Treasury and Fiscal Services Public School Employees Retirement

CONTRACT Education, Georgia Department of Georgia's Reading Challenge Program

GOVERNMENTAL FUND TYPES

SPECIAL

CAPITAL

GENERAL

REVENUE

PROJECTS

FUND

FUND

FUND

TOTAL

$ 3,118,791.00
553,330.00 100,521.00 131,225.00
36,274.00 858,458.00

117,192.00 36,602.00
119,597.00 113,187.00
67,584.00 14,444.00 28,842.00 -360,154.00 544,954.00
$
15,000.00

34,130.00

35,000.00 3,861.47
74,967.03 5,000.00 1,458.00
18,021.00 2,888.67 4,957.59 8,953.00

9,799.83 53,000.00

$ 3,118,791.00
553,330.00 100,521.00 131,225.00
36,274.00 858,458.00
117,192.00 36,602.00
119,597.00 113,187.00
67,584.00 14,444.00 28,842.00 -360,154.00 544,954.00 34,130.00 15,000.00
35,000.00 3,861.47
74,967.03 5,000.00 1,458.00
18,021.00 2,888.67 4,957.59 8,953.00
9,799.83 53,000.00

$ 254,170.00
2,853.00 160,224.89
16,444.00

254,170.00 2,853.00
160,224.89 16,444.00

21,200.00


. 21,200.00

$ 5,691,450.76 $ 257,154.72 $ 254,170.00 $ 6,202,775.48

See notes to the general purpose financial statements.

- 26-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS YEAR ENDED JUNE 30, 2000

SCHEDULE "3"

PROJECT
Adding to, renovating, repairing, improving and equipping the existing educational buildings, properties and facilities of the City of Social Circle School District, including, but not limited to the acquisition, construction and equipping of a new school to accommodate grades 6-12. The acquisition, construction and equipping of a new cafeteria at the building which will become the new Social Circle Elementary School and the re-roofing and renovation of all existing school buildings and facilities in the City of Social Circle School District to comply with all regulations and pay expenses incident thereto.

ORIGINAL ESTIMATED
COST (1)_

CURRENT ESTIMATED
COST (2)

AMOUNT EXPENDED IN CURRENT
YEAR (3)

AMOUNT EXPENDED
IN PRIOR YEARS

$ 5,000,000.00 $ 10,748,500.00 $ 606,581.14 $ 184,186.18

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



See notes to the general purpose financial statements.

- 27-

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 2000

SCHEDULE "4"

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

$

3,903,867.00 $ __-..1:.2:=5=,8:.6.:5:...0::0..

$

4,133,319.64

230,082.00 $ _ _ 195,682.00 --'-':;;.::",:.;=;.;:",:;.,.

$

4,363,401.64

-40,698.57
$ --~:=.:4.:,3.2..2:,7=.0.3:..0.7.

$

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

See notes to the general purpose financial statements. - 29 -

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM
GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 2000

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

ALLOTMENTS FROM GEORGIA DEPARTMENT OF

REQUIRED

ORIGINAL

%

ORIGINAL

MID-TERM

$

303,649.00

$

273,284.10 $

798,749.00

718,874.10

$ 1,102,398.00 90 $

992,158.20 $

431,129.00 90

388,016.10

716,020.00 90

644,418.00

309,895.00 90

278,905.50

266,268.00 90

239,641.20

293,081.00 90

263,772.90

$ 3,118,791.00

$ 2,806,911.90 $

0.00 0.00
---0:.0:=0

$

534,116.00

$

480,704.40 $

0.00

$

534,116.00 90 $

480,704.40 $

19,214.00 90

17,292.60

$

553,330.00

$

497,997.00 $

$

100,521.00 90 $

90,468.90 $

$ 3,772,642.00

$ 3,395,377.80 $

$

104,690.00 90 $

26,535.00 100

94,221.00 $
26,535.00

$

131,225.00

$

120,756.00 $

0.00
---0:.0:=0
---0:.:0=0
-..:::0.:.:0:.:0:..
0.00
-..::0:.:.:0:.:0:..

Total Fourteen Weighted and Media Center Programs $ 3,903,867.00

$ 3,516,133.80 $=-_======0;;.,0;0;.

STAFF DEVELOPMENT PROGRAMS
Cost of Instruction Professional Development

$

11,776.00

24,498.00

$

11,776.00 $

24,498.00

0.00 0.00

Total Staff Development Programs
(*) Identifies Fourteen Weighted Programs.
See notes to the general purpose financial statements.

$

36,274.00 100 $

36,274.00 $===......======0=.;0;,0;;.

- 30 -

SCHEDULE "5"

EDUCATION . TOTAL REQUIRED

ACTUAL EXPENDITURES

SALARIES

OPERATIONS

TOTAL

AMOUNT OF UNDEREXPENDITURE
FOR REQUIRED ALLOTMENT

$

273,284.10 $

718,874.10

$

992,158.20 $

388,016.10

644,418.00

278,905.50

239,641.20

263.772.90

$ 2,806.911.90 $

277,130.11 $ 800,211.42 1,077,341.53 $ 509,751.31 799,661.93 390,318.80 245,098.88 308.519.69
3,330,692.14 $

6,840.00 $ 28,000.00 34,840.00 $ 25,690.00 35,750.00 38,888.00 10,726.00 33.988.00 179,882.00 $

283,970.11 828,211.42 1,112,181.53 $ 535,441.31 835,411.93 429,206.80 255,824.88 342.507.69 3,510.574.14

0.00 0.00 0.00 . 0.00 0.00 0.00

$

480,704.40

$

50.681.59
207,429.75 $
168,399.77 45.189.21 18,919.50

$
1,900.00 10,650.00

50,681.59 209,329.75 179,049.77
45.189.21 18,919.50

$

480,704.40 $

490,619.82 $

12,550.00 $

503,169.82

0.00

17,292.60

57,165.05

2,250.00

59,415.05

0.00

$

497,997.00 $

547,784.87 $

14,800.00 $ _--==5=62:.,5:.8:4:..:8.7..



$

90,468.90 $

117,319.06 $

1,000.00 $ _ _1~ 18,~ 319.~ 06

0.00

$ 3,395,377.80 $

3.995,796.07 $

195,682.00 $ 4,191,478.07

$

94,221.00 $
26,535.00

-=== 137,523.57

$

$ _ _ 34,400.00

137,523.57 34,400.00

0.00 0.00

$

120,756.00 $

137,523.57 $

34,400.00 $ _ _1:.7:..1..,:9..=2:3:.:5:.7:..

$ 3.516,133.80 $

4.133,319.64 $

$ 230,082.00

4,363,401.64 $===========0.=00~

$

11,776.00

24,498.00

36,274.00

$

11,779.95 $

11,779.95

24.499.40

24,499.40

$

36,279.35 $

36,279.35 $=====......0.;00~

- 31 -


SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

RUSSELL W. HINTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
March 16,2001

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 Social Circle 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 of City of Social Circle Board of Education as of and for the year ended June 30,2000, and have issued our report thereon dated March 16,2001. 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 of the United States.
Compliance
As part of obtaining reasonable assurance about whether City ofSocial Circle Board ofEducation's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions oflaws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial 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 ofour tests disclosed no instances ofnoncompliance that are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered City of Social Circle 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
2000YB-40

control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its operation that we consider to be a reportable condition. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control over financial reporting that, in ourjudgment, could adversely affect City of Social Circle Board ofEducation's ability to record, process, summarize and report financial data consistent with assertions ofmanagement in the financial statements. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as item FS-7861-00-
01.
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 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, the reportable condition described above is also considered to be a material weakness.
This report is intended solely for the information and use of management, members of the City of Social Circle Board of Education, 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:gp 2000YB-40

R ssell W. Hinton tate Auditor

RUSSELL W. HtNTON
STATE AUDITOR
(404) 6562174

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
March 16,2001

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 Social Circle Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-B3
Ladies and Gentlemen:
Compliance
We have audited the compliance of City of Social Circle Board of Education with the types of
u.s. compliance requirements described in the Office ofManagement and Budget (OMB) Circular
A-133 Compliance Supplement that are applicable to each ofits major Federal programs for the year
ended June 30, 2000. City of Social Circle Board of Education's major Federal programs are identified in the accompanying Schedule ofFindings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of City of Social Circle Board of Education's management. Our responsibility is to express an opinion on City of Social Circle Board of Education's compliance based on our audit.
We conducted our audit ofcompliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-B3, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-B3 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 ofSocial Circle Board ofEducation'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 Social Circle Board of Education's compliance with those requirements.
2000SA-lO

In our opinion, the City of Social Circle Board ofEducation 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, 2000.
Internal Control Over Compliance
The management of City of Social Circle 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 Social Circle 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-l33.
Our consideration ofthe 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 ofone or more ofthe internal control components does not reduce to a relatively low level of risk 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 Social Circle Board of Education, 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:gp
2000SA-IO

LV.

ussell W. Hinton



State Auditor


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


CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7861-97-02 FS-7861-98-02 FS-7861-99-01

Previously Reported Corrective Action Implemented Further Action Not Warranted Unresolved - See Corrective ActionlResponses

CORRECTIVE ACTIONIRESPONSES

GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7861-99-01

The City ofSocial Circle Board ofEducation does not presently maintain aGeneral Fixed Assets Account Group but is exploring the possibility of doing so with respect to current staff and budget limitations.



SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF SOCIAL CIRCLE BOARD OF EDUCATION - WALTON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000

I SUMMARY OF AUDITOR'S RESULTS

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

2. Reportable Conditions in Internal Control Disclosed by the Audit ofthe Financial Statements The audit report for the City of Social Circle 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 Social Circle 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 of Social Circle Board of Education 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 ofSocial Circle Board ofEducation's report on compliance with requirements applicable to major programs was unqualified.

6. Audit Findings Required to be Reported by Section .510@) ofOMB Circular A-133 The City ofSocial Circle Board ofEducation's audit did not disclose audit findings required to be reported by section .51O(a) ofOMB Circular A-133.

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

me 8.

"A" Program Dollar Threshold

The dollar threshold for type "A" programs was $300,000.00.

9. Low Risk Auditee The City of Social Circle Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education.

- 1-

CITY OF SOCIAL CIRCLE BOARD OF EDUCAnON - WALTON COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2000
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-7861-00-01 The City of Social Circle Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements 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. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.

-2-