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

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REPORT.ON AUDrr

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- OF. THE FINANCIAL STATEMENTS :,
i=oR THE.FISCAL- YEAR ENDE.D JUNE'3- 0, 2002,.--

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CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY -TABLE OF CONTENTS-

Page

SECTION!

FINANCIAL

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

EXHIBITS

GENERAL-PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALL FUND TYPES

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 ACTIJAL

(NON-GAAP BASIS)

GENERAL AND SPECIAL REVENUE FUNDS

7

D NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS

8

ADDmONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

18

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

20

SCHEDULES

I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

22

2 SCHEDULE OF STATE REVENUE

24

3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

25

ALLOTMENTS AND EXPENDffiJRES

GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS (QBE)

4

BY PROGRAM

26

5

BY SITE

27

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA 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 WITH GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE wmI
0MB CIRCULAR A-133
SECTION ID 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! FINANCIAL

Rt 1",;;1-11 \\1 H1vror,,.
STATE AUDITOR
(404; 656 2174

DEPARTl\.1ENT OF AUDITS AND ACCOUNTS
~54 Wc.1-.hrngton Street S W Suue :! 14 A1lan1a Georgia 30334-8400
March 17, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Educallon
and Supenntendent and Members of the City ofTnon Board of Educallon
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 accompanymg general-purpose financial statements ofthe City ofTnon Board of Educallon, as of and for the year ended June 30, 2002, as hsted m the table of contents These general-purpose financial statements are the respons1b1hty ofthe City ofTnon Board ofEducation's management Our respons1b1hty 1s to express an op1ruon on these general-purpose financial statements based on our audit
We conducted our audit m accordance with aud1tmg standards generally accepted in the Umted States ofAmenca and the standards apphcable to financial audits contamed m Government Aud1tmg Standards, issued by the Comptroller General ofthe Umted States Those standards reqmre that we plan and perform the audit to obtam reasonable assurance about whether the financial statements are free ofmatenal misstatement. An audit mcludes exammmg, on a test basis, eVIdence supporting the amounts and disclosures m the financial statements. An audit also mcludes assessmg the accountmg pnnc1ples used and s1gmficant estimates made by management, as well as evaluatmg the overall fmanc1al statement presentation. We beheve that our audit proVIdes a reasonable basis for our op1mon
As descnbed m the notes to the general-purpose financial statements, the Board of Education's financial statements have been prepared usmg certam account.mg practices and pohc1es wluch, m our opm1on, vary m some respects from generally accepted accounting pnnc1ples These vanances are descnbed as follows.

2002ARL-13
L

* The general-purpose financial statements of the Board of Education did not contain a General F1l\ed Assets Account Group to account for property and equipment owned by the Board of Education which should be included to conform to generally accepted accounting pnnc1plcs
* School activity accounts maintained at the ind1v1dual schools arc not included in the
general-purpose financial statements To conform to generally accepted accounting pnnc1ples, these accounts should be included in the general-purpose financial statements
* The Board of Education did not recogmze as expenditures, in the year ended June 30, 2002, a portion of salanes and the corresponding employer's cost of related benefits earned for contractual services completed pnor to June 30, 2002 Also funds received, subsequent to June 30, 2002, from the Georgia Department ofEducallon for the State's share of these unrecorded salanes and related benefits were not recorded as revenue in the year under review Conversely, the s1m1lar expenditures and related revenues for contractual services completed pnor to June 30, 2001. were improperly recorded in the year ended June 30, 2002 To conform to generally accepted accountmg pnnc1ples, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed
* The Board of Educallon did not record revenues and expenditures associated with
Federal donated commodities in its general-purpose financial statements To conform to generally accepted accounting pnnc1ples, these amounts should be recorded in the general-purpose financial statements
The aggregate effects on the general-purpose financial statements of these vanances or om1ss1ons have not been determined, but are believed to be matenal
In our opin10n, 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 matenal respects, the financial position ofthe City ofTnon Board ofEducauon as of June 30, 2002, and the results of its operations for the year then ended, in conformity with accounting pnnc1ples generally accepted in the Umted States of Amenca
In accordance with Government Auditing Standards, we have also issued our report dated March 17, 2003, on our consideration of the City ofTnon Board of Education's internal control over financial reporting and our tests of1ts compliance with certain proV1s10ns oflaws, regulations, contracts and grants That report 1s an integral part of an audit performed m accordance with Goverriment Auditing Standards and should be read in conJunclion with tins report in cons1denng the results of our audit
2002ARL-13

Our audit was performed for the purpose of formmg an opm1on on the general-purpose financial statements ofthe Cny ofTnon Board ofEducation taken as a whole The accompanymg comb1rung statements (Exh1b1ts E and F) and the financial schedules (Schedules I through 5), which mcludes the Schedule of Expenditures of Federal Awards as reqmred by U. S Office of Management and Budget Circular A-133, Audits ofStates, Local Governments, and Non-Profit Orgam=atwns. are presented for purposes of add1!ional analysis and are not a required part of the general-purpose
financial statements. Such mforma!Jon has been subjected to the aud1tmg procedures apphed m the
audit of the general-purpose fmanc1al statements and m our op1ruon, except for the effects of the matters referred to m the tlurd paragraph, such mformahon 1s fauly stated, mall matenal respects, m relation to the general-purpose financial statements taken as a whole.
A copy ofth1s report has been filed as a permanent record m the office ofthe State Auditor and made available to the press ofthe State, as proVlded for by Official Code ofGeorgia Annotated Sect10n 506-24
Respectfully subrrutted,
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RWH:gp 2002ARL-13

State Auditor

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY

CITY OF TRION BOARD OF EDUCATION CHATTOOGA COUNTY COMBINED BALANCE SHEET ALL FUND TYPES
JUNE 30 2002

ASSETS
Cash and Cash Equivalents
Investments
Accounts Rece,vable
lnventones Food Donated Commodities Purchased Food

GENERAL FUND

GOVERNMENTAL SPECIAL REVENUE FUND

$

1,126,15559 $

235,102 54

180,763 69

3,197 00

6,355 62 2 914 27

Total Assets
UABILmES AND FUND EQUITY
LIABILITIES
Accounts Payable Salanes Payable Expired Grant Balances Payable Deferred Revenue
Total UabdrtJes
FUND EQUITY
Fund Balances Reserved
For Debi Ser.nee
For Inventor1es Food Donated Commodllles Purchased Food
For SPLOST Pl'Oj8Cts Unreserved
Designated for Self-Insurance Designated for Equipment Purchases Undeslgnated
Total Fund Equrty

$

113001919 20 s~_.:;.24_7.i:56=9;;:;43_

$

24,739 07 $

38,78164

61,579 60

53,91064

7 07514

$

24 739 07 $

16134702

$

$

4,157 70

1,278.022 51

$

1,282.180 21 $

6,355 62 2,914 27
10,000 00 66,952 52 86,22241

Total l.Jab1lrues and Fund Equity

$

113061919 28 $ --.:2;;4,:.7,::56;;::9::.4;::3::.,

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

EXHIBIT "A"

FUND TYPES CAPITAL
PROJECTS FUND

$

323,248 22 $

56,53498

111,21955

DEBT SERVICE
FUND

TOTALS

(Memorandum On~l

JUNE 30, 2002

JUNE 30, 2001

676,961 23 $ 2,361,467 58 $ 2,282,647 53

56,534 98

295,180 24

337,936 06

6,35562 2 914 27

4,133 09 3 892 51

$

49100275 $

676,961 23 $ 2,722,452 69 $ 2,628,60919

$

30,378 74

$

30 378 74

$

93,899 45 $

47,79563

61,579 60

54,824 62

53,910 64

39,202 97

7 07514

$

216,464 83 $

141,823 22

$

676,961 23 $

676,961 23 $

882,48918

$

460,624 01

6,355 62 2,914 27 460,624 01

4,133 09 3,892 51 299,911 78

000

000

4,157 70 10,000 00 1,344,975 03

4,789 70 10,000 00 1,281,569 71

$

460624 01 $

676 961 23 $ 2,505,987 86 $ 2,486,785 97

$

49100275 $

676 961 23 $ 2,722,452 69 $ 2,628,609 19

-3-

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES
YEAR ENDED JUNE 30. 2002

RE\IENUES
State Funds Federal Funds Taxes Other Funds
Total Revenues
EXPENDITURES
Current lnstructJon Support Services Pupil SeMces Improvement of Instructional Services Educ:abonal Media SeMces General Admlnls1rabon School Admln1strabon Business Admm1stra1Jon Maintenance and Operabon of Plant Student Transportabon SeMces Central Support SeMces Food SeMceS Operalion Community SeMces Operabons
Capital Outlay Debt SeMce
Pnncipal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1
Adjustments Adjustments to Pnor Year Revenue
Food Inventory - Net Change m Period Donated Commodrtles Purchased Food

GENERAL FUND

SPECIAL REVENUE
FUND

$ 5,869,546 14 $
1,114,263 69 166 676 67

386.051 44 467,444 55
335,86319

$ 7.150,486 50 $ 1,189,35918

$ 5,254,592 76 $
185,095 88 177,278 99 169,810 40 130,149 08 429,332.23 115,31959 619,72611
811 89 4,592 50
33,668 39

620,56814 534 31
47,050 09 4,528 00
25,288 89 8,324 03
470,80110

$ 7,099,977 80 $ 1,177.094 56

$

50,508 70 $

1,231,671 51

12,284 62
n,113 so

2,222 53 -978 24

FUND BALANCE JUNE 30

$ 11ze21180 21 s _ _ _e_s1_222_..4._1...

The notes to the general-purpose finanaal statements are an Integral part of this statement

-4-

EXHIBIT "B"

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTALS
(Memorandum Only)
YEAR ENDED JUNE 30, 2002 JUNE 30, 2001

$ 6,255,597 58 $ 6,236, 172 11

467,444 55

260,931 66

$

276,341 91 $

3TT,044 93

1,767,650 53

1,764,481 38

13,058 25

35 040 89

550,63900

50342342

$

269 400 16 s

412,085 82 s 9,041,331 66 $ 8,605,00BTT

s

16,83695

$ 5,891,997 85 $ 5,416,48721

89,516 22

165,630 19 224,329 08 174,138 40 130,149 06 454,62112 115,319 59 628,05014
611 89 4,592 50 470,60110 33,668 39 89,51622

162,271 29 272,041 38 170,710 15 109,948 19 362,088 18 128,263 89 486,886 20
2,49462 7,56000 430,36610
21,102 n
141,78721

$

324,000 00

3199500

324,00000 31,99500

324,00000 44 79300

$

106 353 17 $

355 995 00 s 8,739,420 53 $ 8,086,890 19

$

183,046 99 $

56,090 82 $

301,911 13 s

718,118 58

299,911 78

882,48918

2,486,785 97

1,m.11203

-22,334 76

-261,018 n

-283,953 53
2,222 53 -978 24

-3,86960 -175 64

s

460 624 01 $

676.961 23 $ 2.505.987 86 $ 2.486.785 97

-5-

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY COMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - INON-GAAP BASIS} GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30 2002

EXHIBIT -c

REVENUES
State Funds Federal Funds Taxes Other Funds
Tolal Revenues
EXPENDITURES
Currant
lnstrucllon
Support Servlcea p~ Services Improvement of lnstructJonel Services Educabonal Media Services
General Admmlstrabon School Admlnlstrabon Busl,-. Admlnlstrallon Maintenance and Operation of Plant
Student Traneportallon Services Central Support Services
Food SeMces Operabon Community Services Operations
Total Expenditures
Excess of Revenues o - (under) Expendiluraa
FUND BALANCE JULY l 2001
Food Inventory - Net Change n Penod Donated Commod,_ Purehaled Food

GENERAL FUND

BUDGET

ACTUAL

s $ 5,710,191 00

5 869 546 14

1,120,18064 90 000 00

1,114,263 69 166 676 67

$ 6,920,371 64 $ 7,150,486 50

$ 5,453,650 73 $ 5.254,592 76

178,58518 193,540 56 170,929 03 140,280 9S 445,339 54 118,201 44 583,154.27
4,00000
7,56000

165,095 88 177,278 99 169,610 40 130,149 06 429,332.23 115,319 59 619,72611
611 89 4,592 50

33,668 39

$ 7,295~41 70 $ 7,099,977 80

s -374,870 06 $

60,508 70

1,042,745 81

1,231,671 51

FUND BALANCE JUNE 30 2Q02

$ 66787575 $ 1,282,18021

SPECIAL REVENUE FUND

BUDGET

ACTUAL

$ 339,999 53 $ 295,888 99

386,051 44 467 444 55

325,410 00

335 86319

$ 961,298 52 $ 1,189,35918

$ 458,113 04 $ 620,568 14

17,500 00 4,330 00 14,851 48 4,760 00

534 31 47,050 09
4,528 00
25,288 89

8,740 00

8,324 03

451,812 00

470,80110

$ 960,106 52 $ 1,177,094 56

$ 1,19200 $

12,264 62

110,269 02

72,713 50

2,222 53 -978 24

s s_ 111 1451 02

_.86_.222_.._4_1_

The notea to the general-purpose llnancial statamenll are an Integral part of ttus statement -7-

CID' OF TRION BOARD OF EDUCATION - CHATIOOGA COUNTY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30. 2002

EXHIBIT "D"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY
The City ofTnon Board of Education (School D1stnct) was established under the Jaws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Supenntendent appomted by the Board The School D1stnct 1s orgaruzed as a separate legal entity. Accordmgly, the School D1stnct 1s a pnmary government and consists of all the organ12at1ons that compose its legal entity.
FUND ACCOUNTING
The School D:tstnct uses funds to report on its financial position and the results of its operations. Fund accounting 1s designed to demonstrate legal compliance and to aid financial management by segregatmg transactions related to certam governmental functions or activities A fund 1s a separate accountmg entity with a self-balancmg set of accounts.
General Fixed Assets are recorded as expenditures m the various funds at the time of purchase A General Fixed Assets Account Group IS not presently maintained by the School D1stnct. To conform to generally accepted accounting pnnciples, a General Fixed Assets Account Group should be maintained for reportmg the cost of assets acqwred by governmental fund types.
Although "school activity accounts" are maintained at the mdividual schools, neither the assets, liabilities and fund eqwty, nor the revenues, expenditures and changes m fund balances of these accounts are reflected m these financial statements To conform to generally accepted accounting pnnc1ples, these accounts should be recorded m the general-purpose financial statements
The general-purpose financial statements account for all State, Federal, Taxes and Other funds under control of the School D1stnct, m compliance with generally accepted accounting pnnc1ples applicable to governmental uruts, unless otherwise disclosed m these notes. Funds presented m tlus report are as follows:
GOVERNMENTAL FUND TYPES - are used to account for all or most of the School D1stnct's educational activities. Governmental Fund Types mclude:
GENERAL FUND - the fund used to account for all financial resources of the School D1stnct except those required to be accounted form 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 restncted to expenditures for specified purposes. These funds are received pnmarily from the Georgia Department of Education and from the Federal government to accomphsh specific educational objectives
CAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acqws1tlon or construction of major capital facihtles.
- 8-

CIIT OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY
NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term pnnc1pal, mterest and paymg agent fees
BASIS OF ACCOUNTING
The accounting and financial reportmg treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for usmg a current financial resources measurement focus With tlus measurement focus, only current assets and current habihtles generally are mcluded on the balance sheet Operating statements ofthese funds present mcreases (1 e., revenues and other financmg sources) and decreases (1.e., expenditures and other financmg uses) m net current assets. Their reported fund balance 1s considered a measure of available spendable resources.
L1ab1ht1es wluch are expected to be financed from avwlable spendable resources are reported as hab1lit1es m the governmental funds
Governmental funds are accounted for using the modified accrual basis ofaccountmg under wluch.
Revenues are recogruzed when susceptible to accrual (1 e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determmed and "avwlable" means collectible witlun the current penod or soon enough thereafter to be used to pay habihtles of the current penod. The School D1stnct considers receivables collected withm sixty days after yearend to be avwlable. Property taxes, sales taxes and mterest are considered to be susceptible to accrual. Nonexchange transactions, m wluch the School Distnct gives (or receJves) value without directly rece1V!Ilg (or givmg) equal value m exchange, mclude property taxes, local option sales taxes, mtergovernmental grants and donations. Revenue for property taxes 1s recogruzed m the fiscal year for wluch the taxes are levied Revenue from sales taxes 1s recogiuzed m the fiscal year the resources are received or susceptible to accrual. Revenue from grants and donations 1s recogruzed m the fiscal year m which all ehgibihty reqwrements have been satisfied.
Expenditures are generally recogruzed when the related fund habihty 1s mcurred.
A departure from the above defirutlons is the accounting treatment afforded the final two payments on General Fund teachers' and bus dnvers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts Durmg fiscal year 2002, a substantial number ofpersonnel ofthe School District were employed for a one hundred and runety day penod beginning m August 2001 and endmg m early June 2002. Personnel contracts for this employment penod specify that compensation be paid m twelve equal monthly payments beginnmg m September 2001 and ending m August 2002. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the School D1stnct m the same twelve months. As of June 30, 2002, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 2002, had not been made. Payments for these two months were made and recorded as expenditures by the School D1stnct subsequent to June 30, 2002. Also, the State's portion ofthe compensation pwd m July and August 2002 was receJved and recorded as revenue m the fiscal year subsequent to June 30, 2002
-9-

CITY OF TRJ0'-1 BOARD OF EDUCATION - CHATTOOGA COU~TY NOTES TO THE GH,ERAL-PCRPOSI:: FNANCIAL STATEMEl\'T~
JL'KE 30, 2002

[XHIBIT"D"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Conversely, the similar expenditures and related revenues for contractual serY1ces completed pnor to June 30, 2001, were recorded in the year ended June 30, 2002 Generally accepted accounting pnnc1ples reqmre that revenues be recorded when avrulable and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed
BUDGET
The City ofTnon Board of Education's budget 1s a complete financial plan for the School D1stnct's fiscal year and 1s based upon estimates of expenditures together with probable fundmg sources There 1s no statutory proh1b1t1on regarding overexpend1ture of the budget at any level The budget for all governmental funds 1s 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 pnnc1ples
The budget process begins when the School D1stnct's admin1strauon prepares a tentative budget for the Board's approval After approval ofth1s tentative budget by the Board, such budget 1s adverused at least once ma newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after adverlisement, the Board receives comments on the tentative budget, makes reVIs1ons as necessary and adopts a final school budget This final budget 1s then submitted, m accordance with prov1s10ns of the Quahty Basic Education Act, OCGA Section 20-2-167(c), to the Georgia Department of Education The Board may mcrease or decrease the budget at any time dunng the year All unexpended budget authonty lapses at fiscal year-end
CASH AND CASH EQUIVALENTS
COMPOSIDON OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments With ongmal matuntles of three months or less from the date of acqms1t1on m authonzed financial mst1tut1ons Georgia Laws OCGA 45-8-14 authonze the School D1stnct to deposit its funds m one or more solvent banks or msured Federal savmgs and loan associations
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the School D1stnct m nonpart1c1patmg mterest-eammg contracts (such as certificates of deposit) and repurchase agreements are reported at cost PartJc1paung mterest-eammg contracts and money market mvestrnents with a matunty at purchase ofone year or less are reported at amoruzed cost. Both part1c1pat1ng mterest-earnmg contracts and money market mvestrnents With a matunty at purchase greater than one year are reported at frur value The Official Code of Georgia Annotated Section 36-83-4 authonzes the School D1stnct to mvest its funds and m selectmg among options for mvestrnent or among mstltuuonal bids for deposits, the lughest rate ofretum shall be the obJectlve, given eqmvalent conditions of safety and hqmd1ty Funds may be invested m the followmg
- IO -

CITY OF TRlON BOARD OF EDUCATIO'l - CHATIOOGA COlT~TY NOTES TO THE GE1'ER.",L-PURPOSE FINAI\CIAL STATEVJENTS JU1'E 30, 2002

EXHIBIT "D"

Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(I) Obhgat1ons issued by the State of Georgia or by other states,

(2) Obhgauons issued by the Umted States government,

(3) Obhgat1ons fully insured or guaranteed by the Umted States government or a Umted States government agency,

(4) Obhgauons of any corporation of the Umted States government,

(5) Pnme banker's acceptances,

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

(7) Repurchase agreements, and

(8) Obligations of other poht1cal subd1V1s10ns 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 mformatlon available. Receivables are recorded when either the asset or revenue recogmhon cntena has been met Receivables recorded on the general-purpose financial statements do not mclude any arnollllts wluch would necessitate the need for an allowance for 11llcollect1ble receivables

PROPERTY TAXES

The City of Tnon fixed the property tax levy for the 200 I tax digest year (calendar year) on September 28, 2001 (levy date) Taxes were due on December 20, 2001 (hen date). Taxes collected w1tlun the current fiscal year or w1tlun 60 days after year-end on the 2001 tax digest are reported as revenue m fiscal year 2002 The City ofTnon City Clerk bills and collects the property taxes for the School D1stnct and remits of taxes collected to the School D1stnct Property tax revenues dunng the fiscal year ended Jlllle 30, 2002 for mamtenance and operations amounted to $440,925 94

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

School Operations

~mills

CITY OF TRION BOARD OF EDUCATION - CHATIOOGA COU"ITY NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SALES TAXES
Local Option Sales Tax revenue dunng the fiscal year amounted to $673,337 75 and was recorded m the General Fund Local Option Sales Tax 1s to be used for the mamtenance and operation of the School D1stnct.
Special Purpose Local Option Sales Tax revenue dunng the year amounted to $653,386.81 and 1s to be used for capital outlay for educational purposes or debt service Tins sales tax was authonzed by local referendum and the sales tax must be re-authonzed at least every five years
Dunng the year under review, the Georgia Department ofRevenue notified the School Distnct that 11 had made an error m the Special Purpose Local Option Sales Tax (SPLOST) allocat10n between the Chattooga County Board of Education and the City of Tnon Board of Education. The School D1stnct retlimed $378,604.71, oftlus amount, $283,953 53 was deterrnmed to be SPLOSTrevenues received in pnor fiscal years. An adjustment to fund balance for pnor year revenues 1s reflected on Exlub1t "B".
The City ofTnon (City Government) sold general obligation bonds to proVJde advance funding for Cap1taJ Outlay Projects associated with issuance of a Special Purpose Local Option Sales Tax (SPLOST). In fiscal year 2002, the School D1stnct proVJded $355,995 00 of SPLOST proceeds to the City Government for debt service on said general obligation debt.
INVENTORIES
FOOD INVENTORIES Inventones of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods mventones are reported on the Combined Balance Sheet at cost (first-in, first-out). The School D1stnct uses the purchases method to account for inventones ofpurchased foods whereby expenditures are recorded at the time of purchase. Both the donated food commodities mventory and the purchased foods mventory reported on the balance sheet are equally offset by reservations of fund balance wluch md1cates that they do not constitute "available spendable resources" even though they are a component of net current assets The Federally assigned value of donated commodity items received and consumed has not been reflected as revenues and expenditures m the general-purpose financial statements To conform to generally accepted accounting pnnc1ples, these amounts should be recorded m the general-purpose financial statements.
INTERFUND TRANSACTIONS
The School D1stnct has the followmg type of interfund transactions
Reimbursements ofexpenditures m1t1ally made from a fund that are properly applicable to another fund arc recorded as expenditures m the re1mbursmg fund and as reductions of expenchtures m the fund that 1s reimbursed
- 12 -

CITI' OF TRION BOARD OF EDUCATION - CHATIOOGA COUNTY
NOTES TO THE GENERAL-PURPOSE FINANCIAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

Note I 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 fac1htate financial analysis. Data in these columns do not present financial position or results ofoperations in confomuty with generally accepted accounting pnnc1ples. Neither are such data comparable to a consolidation. Interfund ehminatlons have not been made in the aggregation of this data
Note 2 DEPOSITS AND INVESTMENTS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 proVJdes that there shall not be on deposit at any time in any depository for a time longer than ten days a sum ofmoney winch 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 secunt1es pledged shall be equal to not less than 110 percent ofthe pubhc funds bemg secured after the deduct.Jon ofthe amount ofdeposit msurance
Ifa depository elects the pooled method (OCGA 45-8-13.1) the aggregate ofthe market value ofthe secuntles pledged to secure a pool ofpubhc funds shall be not less than 110 percent ofthe daily pool balance OCGA Section 45-8-11 (b) proVJdes an officer holdmg pubhc funds may, in Ins discretion,
waive the requirement for secunty in the case ofoperating funds placed m demand deposit checkmg accounts
Acceptable secunty for deposits consists of any one ofor any combination of the followmg
(I) Surety bond signed by a surety company duly qualified and authonzed to transact busmess w1thm the State of Georgia,
(2) Insurance on accounts proVJded by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other chrect obhgat1ons of the Umted States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of mdebtedness or other obhgat.Jons of the counties or muruc1pal1t1es of the State of Georgia,
(5) Bonds of any pubhc authonty created by the laws ofthe State of Georgia, providing that the statute that created the authonty authonzed 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

- 13 -

CITY OF TRIO~ BOARD OF EDUCATION - CHATTOOGA COlNTY NOTES TO THE GENERAL-PURPOSE FINANCTAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

Note 2 DEPOSITS AND INVESTMENTS

(7) Bonds, bills, notes, certificates of indebtedness, or other obhgatlons of a subs1d1ary corporation of the Uruted States government, which are fully guaranteed by the Uruted States government both as to pnnc1pal and mterest or debt obhgat1ons 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 Assoc1at1on, and the Federal Na!!onal Mortgage Association

CATEGORIZATION OF DEPOSITS At June 30, 2002, the bank balances were $2,909,425 70. The amounts ofthe total bank balances are classified mto three categones of credit nsk:

Category I - Cash that is msured (e.g, Federal depository msurance) or collaterahzed with secun!Jes held by the School D1stnct or by the School D1stnct's agent m the School D1stnct's name.
Category 2 - Cash collateral12ed With secunties held by the pledging financial institution's trust department or agent m the School District's name
Category 3 - Uncollateral!Zed deposits. (Tlus includes any bank balance that 1s collateral1zed with secun!Jes held by the pledgmg financial instJtulion, or by its trust department or agent but not m the School D1stnct's name )

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

Risk Category

Bank Balance

1

$ 876,961 19

2

1,511,715 00

3

520,749 51

Total

S 2 909,425 70

CATEGORIZATION OF INVESTMENTS At June 30, 2002, the carrying value ofthe School Distnct's total mvestments was $56,534 98 wluch 1s matenally the same as fair value. Tlus mvestment consisted en!!rely offunds mvested m the Local Government Investment Pool adnurustered by the State of Georgia, Office of Treasury and Fiscal Services which are not required to be categonzed smce the School Distnct did not own any specific identlfiable secuntles m the pool. The mvestment pol.icy ofthe State ofGeorgia, Office ofTreasury

- 14 -

CITY OF TRION BOARD OF EDUCATION - CHATIOOGA COUNTY
NOTES TO THE GENERAL-PURPOSE flliANQAL STATEMENTS
JUNE 30, 2002

EXHIBIT"D"

Note 2 DEPOSITS AND INVESTMENTS
and Fiscal Services for the Local Government Investment Pool (Pnmary L1qmd1ty Portfoho) does not provide for mvestment m denvatlves or s1m1lar mvestments. A descnptlon of the Pnmary L1qmchty Portfoho 1s as follows
The Pnmary L1qwd1ty Portfoho consists of Georgia Fund 1, which 1s a combmat1on local and state government mvestrnent pool, and Fund 6 Georgia Fund 1 1s a stable net asset value mvestment pool winch follows Standard and Poor's cntena for AAAm rated money market funds. The pool 1s not registered with the SEC as an mvestment company but does operate Georgia Fund 1 m a marmer consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and 1s considered to be a Rule 2a7 hke pool The pool"s pnmary objectives are safety of capital, mvestment mcome, hqmchty and d1vers1fica!lon wlnle mamtammg pnnctpal ($1 .00 per share value). Net asset value ts calculated weekly to ensure stab1hty. The pool chstnbutes eammgs (net of management fees) on a monthly basis and values part1c1pant's shares sold and redeemed based on $1.00 per share Pooled cash and cash eqmvalents and mvestments are reported at cost winch approxunates fair value. The pool does not issue any legally bmchng guarantees to support the value ofthe shares Part1c1pation m the pool 1s voluntary and deposits consist of funds from local governments, operating and trust funds of Georgia"s state agencies, colleges and universities; and current operatmg funds of the State of Georgia's General Fund
Investments m Georgia Fund 1 and Fund 6 are directed toward short-term mstnunents such as U. S Treasury obhgatlons, secuntles issued or guaranteed as to pnnc1pal and mterest by the U S Government or any of its agencies or mstnunental1t1es, banker's acceptances and repurchase agreements The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average matunty for Georgia Fund 1 on June 30, 2002, was 0.12 years The average mvestment duration for Fund 6 on June 30, 2002, was 0.75 years
Note 3 NON-MONETARY TRANSACTIONS
The School D1stnct receives food commochtles from the Uruted States Department of Agnculture (USDA) for school breakfast and lunch programs. See Note 1 - Inventories
Note 4 RISK MANAGEMENT
The School D1stnct 1s exposed to various nsks of loss related to torts, theft of, damage to, and destruction of assets, errors or onuss1ons, job related illness or inJuries to employees; acts of God and unemployment compensation
The School D1stnct has obtamed commercial IIlSurance for nsk ofloss associated With torts, assets, errors or onuss1ons and Job related illness or m1unes to employees. The School Distnct has neither s1gruficantly reduced coverage for these nsks nor mcurred losses (settlements) winch exceeded the School D1stnct's IIlSurance coverage m any of the past three years.

- 15 -

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

EXHIBIT "D"

Note 4 RISK MANAGEMENT

The School D1stnct has elected to self-msure for all losses related to acts of God, except flood
coverage. The School D1stnct has not expenenced any losses related to this nsk m the past three years.

The School D1stnct 1s self-msured with regard to unemployment compensation claims In
connection with th.ts program, a self-Jnsurance reserve has been established withtn the General Ftmd
by the School D1stnct. The School D1stnct accounts for cl31IDS withm the General Fund with expenditure and habihty bemg reported when 1t 1s probable that a loss has occurred, and the amount of that loss can be reasonably estunated

Changes m the unemployment compensatJ.on claims hab1hty dunng the last two fiscal years are as follows.

Begmmng of Year L1ab1hty

Claims and Changes m
Estimates

Claims Paid

End of Year L1ab1hty

2001 2002

$

000 $

000 $

Q00 $

000

$

000 $

632 00 $

6J2,00 $

Q 00

The School D1stnct has purchased surety bonds to proVJde additional insurance coverage as follows

Position Covered

Amount

Supenntendent AJI Other Employees

$ 5,000.00 $ 50,000.00

Note 5 ON-BEHALF PAYMENTS

The School Distnct has recogmzed revenues and expenditures m the amount of $74,993.63 for health insurance and retJ.rement contnbutJ.ons pB.ld on the School D1stnct's behalfby the followmg State Agencies.

Georgia Department of Education PB.Id to the Georgia Department of Community Health For Health Insurance of Non-Certified Personnel In the amount of $66,098 63

Office of Treasury and Fiscal SerVJces

PB.Id to the Pubhc School Employees RetJ.rement System

For Pubhc School Employees RetJ.rement (PSERS) Employer's Cost

In the amount of $8,895.00



- 16 -

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

EXHIBIT"D"

Note 6 CO1'ffINGENT LIABILITIES

Amounts received or receivable pnnc1pally from the Federal government are subJect to audit and review by grantor agencies. This could result m requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms The School D1stnct believes that such d1sallowances, 1f any, will be 1mmatenal to its overall financial position

Note 7 RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (fRS)

TRS PLAN DESCRIPTION Substantially all teachers, adm1rustrabve and clencal personnel employed by local school d1stncts are covered by the Teachers Retirement System of Georgia (TRS), wluch 1s a cost-shanng multiple employer defined benefit pension plan. TRS proVIdes serVIce retirement, d1sab1hty retirement and sUTVJvors benefits for its members m accordance with State statute The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtamed from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe School D1stnct who are covered byTRS are required by State statute to contnbute 5% oftheu gross earnmgs to TRS. The School D1stnct makes monthly employer contnbuhons to
TRS at rates adopted by the TRS Board ofTrustees m accordance with State statute and as advised
by their mdependent actuary The required employer contribution rate 1s 9.24% and employer contnbutlons for the current fiscal year and the precedmg two fiscal years are as follows.

Fiscal Year

Percentage Contnbuted

Reqwred Contribution

2002 2001 2000

100% 100% 100%

$ 463,892 94 $ 521,259.24 $ 481,675.38

- 17 -

CITY OF TRION BOARD OF EDUCAJJON CHATTOOGA COUNTY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 2002

ASSETS
Cash and Cash Equ,valents
Accounts Receivable
lnventones Food Donated CommodrtJes Purchased Food

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

s

96,931 49 $

51,564 81

6,35562 2 914 27

Total Assets

$

1os1201 30 $~--5_1._564_...0_,_

LIABILITIES AND FUND EQUJTY
LIABILITIES
Accounts Payable Salanes Payable Expired Grant Balances Payable Deferred Revenue
Total l.JablllUes
FUNOEQUIJY
Fund Balances Reserved For lnventones Food Donated Commodtt1es Purchased Food Unreserved Designated for Equipment Purchases Undes1gnated
Total Fund Equity

$

1.231 63 $

13,637 85

18.747 34

37,242 16

68480

$

19 978 97 $

51 564 81

$

6,35562

2,914 27

10,000 00

66,952 52 $

000

$

86,222 41 $

000

Total l.JablirtJes and Fund Equity
See notes to the general-purpose financial statements
18 -

$

10e1201 38 $-~.:.5~1,;:564~8~1~

EXHIBIT "E"

FEDERAL PROGRAMS

TOTALS

JUNE 30, 2002

JUNE 30, 2001

$

86,606 24 $

235,102 54 S

181,702 21

3,197 00

3,197 00

9,164 00

6,35562 2 914 27

4,133 09 3 892 51

$

89 803 24 $

s_ _ 247 569 43

1_98_._0_01...0.1._

s

23,91216 $

38,781 64 $

32,564 34

5,59010

61,57960

54,411 00

53,225 84

53,91064

39,202 97

7 07514

7 07514

$

89 803 24 $

161 347 02 $

126 178 31

$

6,35562 $

4,133 09

2,914 27

3,892 51

10,000 00

10,00000

$

000

66,952 52

54687 90

$

000 $

86 222 41 $

72 713 50

$

89 803 24 $

241 569 43 s___1_00_,,8_9_1_0_1_

-19 -

CITY OF IBION BOARD OF EDUCATION - CHATTOOGA COUNTY COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30. 2002

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current lnstrucllon
Support SeMces
Puptl Services Improvement of Instructional Services
EducaUonal Media SeMces
School Adm1rnstratlon Maintenance and Operallon of Plant Food Services Operation
Total Expendllures
Excess of Revenues over (under) Expenddures
FUND BALANCE JULY 1
Food lnvemory - Net Change 1n Penod Dona1ed Commod1hes Purchased Food
FUND BALANCE JUNE 30

SCHOOL FOOD
SERVICES FUND

LOTTERY PROGRAMS

s

s 35,376 00

350,675 44

111,826 53

335,86319

$

483,065 72 s

350 67544

$

342,756 16

$

470 80110

7,919 28

$

470 80110 $

350 67544

s

s 12,264 62

000

72,713 50

000

2,222 53 -97824

$

86122241 $ _ _ _ _ _0~00;;;..

See notes to the genera~purpose financial statemems -20-

EXHIBIT"F"

FEDERAL PROGRAMS

TOTALS

YEAR ENDED

JUNE 30, 2002

JUNE 30, 2001

$

386,051 44 $

354,721 80

$

355,618 02

467,444 55

280,931 88

335 86319

309,629 69

$

355,618 02 $ 1,189,35918 $_~94~5=,2=83~3=5'-

$

277,811 98 $

620,56814 $

386,507 85

53431 47,050 09
4,528 00 25,288 89
404 75

53431 47,050 09 4,528 00 25,288 89
8,324 03 470 80110

71,047 71 4,391 00 18,691 97 20,947 32 430.36610

$

355,618 02 $ 1.177,094 56 $

931,951 95

$

000 $

12,264 62 $

13,331 40

000

72,713 50

63,427 54

2,222 53 -978 24

-3,869 60 -175 84

s____o__oo_, s

ss 222 41 s___1_2._1.1.3__so_

-21 -

CITY OF IBION BOARD OF EQUCAT/ON - CHATTOOGA COUNTY SCHEDULE OF EXPEND)JURES OF FEDERAL AWARDS
YEAR ENDED JUNE 3Q 2002

SCHEDULE "1"

FUNDING AGENCY PROGRAM'GRANT
Agrlwllre u s Department of
ChJld Nutrition Cluster
Pass-Through From Georgia Department of EducabOn
Food and NutntJon Program FoodServic:es School Breakfast Program Nallonal School Llmcll Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

10 553 10555

NIA

$

NIA

14,583 55 97 242 98 $

(2) 470 80110 (3)

Total Child Nutrition QJster

$

111,828 53 $

470,80110

Other Programs

Pou-Through From Georgia Department of EdLation

Food and Nutntion Program

Food DtstrtbutK>n Program

10 550

NIA

TOIBI U S Depal1!nent of l'qicu!ture

$

11182e53 $

470 80110

Educabon, U S Departmant of Speaal Edix:atlon Cluster Pass-Through From Georg,a Department of Ed'""'11on
-lndr.llduals with D111ablilles EdLation Ad Part B - Special Education Flow ltYough
Total Spacial Education C ~

84 027 84173

NIA

$

NIA

$

102,67416 $ 9135 00
111,60916 $

102,67416 9135 00
111,60916

Other Programs

Pass-Through From Georgia Departnwrt of E<lJcallon

Compraharmlve School Reform Demonsntlon Prcjed 84 332

NIA

Elemeriary and Secondary Education Ad

TIiie I

Grants to LOcal Eduadlonlll Agenaes

84010

NIA

Title II

Eilenhowet Pkf ion1'1 De..elopmmtt

84.281

NI/I.

TIiie VI

lnnovalMI Education Program S1ra1agles

84.298

NIA

TIiie X

Cllar1e,Schoob

84.282

NIA

Vocatlonal Educanon Bask; Grara 10 States

High School Program

Bas,c Grant

84 048

NIA

52,000 00
42,933 00 17,500 00 4,52800 115,924 66
10 923 00

52,00000
42,93300 17,500 00 4,52600 11592466
10 923 00

Total U S Departmant of Education

$

355,818 02 $

355,818 02

Total Fodetal Flnanclal Asslltance NIA Not AVllllabla

$

s_ _ 467 444 55

.:;828=4:.:1.::9.:.12,_

- 22-

CITY OF TRION BOARD Of EDUCATION -CHATTOOGA coutsTY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS VEAR ENDED JUNE 30 2002
Notes to lhe Sdledule of Emend1tures of Federal Awards
(1) Commodities valued in the amount of $27,352 00 were recel'Jed during the a,mm1 fiscal year and were oat recorded in the Schoo! Dlstrid's finanaal statements
(2) Expenditures for the School Breakfast Program were not mamtaJned separately and are ulduded m the 2002 Nabonal School Lunch Program
13) Expenclmires for 1his program lnc:li.oe Sla1e encl/or 01her Funds Expenchtures are not maintained by fund source
Major Programs are k!entJfiad by an asterisk Ii r, frori of the CFDA mnnber
The School D!s1ricl did no1 provide Federal As6astance 1o any Subredplen1
The accompanying scoom,le of expenclrtures of F - awanls lndudes the Federal grari aclM1y of the City of Trion Board of Education and ls presen1Bd on the moddlad acaual basis of aa:ountng which Is 1he bas,. of ac:coun1lng used In the prasen1811on of the genoral-l)l>pos financ1al . - -

SCHEDULE 1

See . - 1 0 the genoral-purpoee flnanaal lla1emen13

-23-

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY
SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30 2002

SCHEDULE "2"

AGENCY/FUNDING
GRANTS Education, Georgie Department of Quelrty Basic Education D1red lnstrudlonal Cost Kindergorten Program Primary Grades (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Eorty Intervention (4-5) Program Middle School (6-8) Program High School General Educabon (9-12) Program Vocab0n81 Laboratory (9-12) Program Students wrth Dlsobiltles Gilled Sludenl - Category VI AllematJYe EducatKm Program English SpeakeB of Other Languages (ESOL) 20 Days Addrtional lnslrud!on Media Cen1ef Program Staff end ProfeSSlonal Developmen1 lndred Cost Colegoncal Grants Sparatty Nura,ng5efvlcea Prlndpal SUpplomenta Vocabonal Supervisors Mid-lerm AdJUS1ment Hold-Honnloss Education Equal1Z8bon Funding Grant Food Services VocabonalEducabon Other State Programs Health ln,..-ance Preschool Handicapped Program Lottery Programs Asslotrve Technology Com~ mthe Classroom
Office of School Read.-a Pre-Kindergarten Program
Office of Treasury and Fiacal Serw:ea Public School EJ11ptoyaea Reta&1.ant
CONTRACTS Educa11on, Georgia Dapartment of After School Programs Georgia' Read,ng Chaionge Road119 F1111t Program

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 432,020 00 896,802 00 440,347 00 60,990 00 728,923 00 622,587 00 261,628 00 365,337 00 118,869 00 57,535 00 21,974 00 40,87000 129,325 00 21,505 00 953,268 00

$ 432 020 00 896 802 00 440,347 00 60,990 00 728,923 00 622,587 00 261,628 00 365,337 00 118,86900 57,535 00 21,974 00 40,87000 129,325 00 21,505 00 953,268 00

35,889 00 42,655 00 4,963 00
9,209 00 29,086 00 498,071 00
$ 2,166 00

35,378 00

35,88900 42,65500
4,963 00 9,20900 29,086 00 498,071 00 35,376 00 2,166 00

66,09883 14,327 00

66,098 83 14,327 00

4,077 20 35,682 00

4,077 20 35,682 00

310,916 24

310,91624

8,895 00

8,895 00

9,175 00 -14,968 49 12,000 00

9,175 00 -14,968 49 12,000 00

$ 518691546 1~ $ 386,051 44 $ 6,255,597 58

Seo notos to the gonoral-purpose ftnandal ala1ementa

- 24 -

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

SCHEDULE "3"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS(2)

AMOUNT EXPENDED IN CURRENT YEAR (3) (4)

AMOUNT EXPENDED IN PRIOR YEARS (3) (4)

PROJECT STATUS

Adding to, renovating repemng mprovlng end equipping exist.mg school ooldmgs and other bu1ldrngs, facllrues and grounds useful or desirable 1n connection therewrth, ec:qulnng1nstrucbonalancl adm"11Strabve technology mprovements for emtmg schools and acqumng any necessary property lherelore, both real and peTM"'81

$ 2 000,000 DO S 2,000,000 00 S 106,353 14 S 1,755,046 39 Ongoing

Rehabilitating, repamng, renovating, extendng and lmprow,g Trion High
School, Tnon Middle School and Tnon Elementary School and related facllrtlea useful or desoable In connection therewith, lncludng Wllhoul lnnrtation acqUISitlon and construdlon of dasaroom addmons, roof replacements and repairs, meclhanx:al system repan and replacements, addibonal parking and palllllQ, unprovements lo
.-11c and physical educatlOn
facllrues and upgraded and Improved aecuntysyalems, syalem-wlde technology addlllona and unprovements, and purchasing school furnishings, equtpment and fixtures

3,550,000 DO 3,550,000 DO

S 515501000 DO S 515501000 00 S 1061353 14 S 1.7551046 39

(1) The School DIS!nd's original coal _male as apeclfiod m the resolubon ca~ng for the lmpoalllon of the Local Option Sales Tax

(2) The School Dialr1ct's cumsnt esbmale of 10181 cost for the pn,jeds Includes au coal from projed Inception lo completion

(3) The voters of the Crty of Tnon approved the mposltlon of s 1% Hies lax to fuw:t the above projects and retire associated debt Amcx.na _,clod for these projects may ll1ciude sales tax proceeds, state, local property taxes and/or other funds over the hie of the projects

(4) In addmon to the expenditures shown above, the School Olslrid has "1CUTT9d lrrterest lo prtMde advance funding for the above profOCIS as foUows

Pnor Years

S 79,090 DO

Current Year Total

31,99500
S 11108500

See notes lo the generai-9<'Poae flnsndal statements

- 25-

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY
GENERAL FUND gUALITY BASIC EDUCATION PROGRAM (OBEJ
BY ALLOTMENTS AND EXPENDITURES - PROGRAM
YEAR ENDER JUNE 30 2002

SCHEDULE "4"

DESCRIPTION
Direct Instructional Programs
Kindergarten Program Pnmary Grades (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades-Ea~y lnte,venbon (4-5)
Program Mlddle School (6-8) Program High School General Education (9-12) Program Vocabonal Labora1ory(9-12) Program Students with Dlsablllt,es
Gategory II Category Ill
Gatagory IV Gifted Student Cetagory VI
Alternative Education Program Engiah Speakers of Other Languages (ESOL)
TOTAL DIRECT INSTRUCTIONAL PROGRAMS
Medl8 Center Program Staff ond Profesalonal Development

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

SALARIES

OPERATIONS

TOTAL

s

s s 465,393 00

436,319 10

6,642 54 $

443 161 64

966,079 00 1,022,670 06

26,164 46

1,046,634 52

474,364 00

475,265 65

12,206 42

487,472 27

65,701 00 765,232 00 670 681 00 281,839 00
393,558 00
128,051 00
81,980 00
23 671 00

87,569 03 897,935 76 684 501 87 247,064 55
106,790 25 329,534 65
10,374 67 136,856 95
59,032 79 27 814 64

1,173 67 27,682 10 30,20514 26,050 16
3 TT9 83 6 271 49 1,19960 2,22610
680 00

68,762 90 925,817 86 914,707 01 273 134 71
110,569 68 335 806 34
11,574 27 139,083 05
59,892 79 27 814 64

$

4,316,649 00 $ 4,701.TT0 27 $ 144,861 51 $ 4,846,831 78

139,315 00 23186 00

143,46918 13 962 48

24,465 00
9 403 52

167,934 18
23,366 00

TOTAL QBE FORMULA FUNDS

$

4,479,030 00 $ 4 8591201 93 $ 178,730 03 $ S.037,931 96

(1) Comprised of Slate Funds plua Local FM! Mm Share

See note.a to the generel-pl.al)OH ftnandll statements

- 28 -

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

SCHEDULE "5"

!If Tnon Elementary School Tnon Middle School Tnon High School Central Office (Attemative Educahon Program)
TOTAL
(1) Compnsed of State Funds plus Local Five Mill Share

ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1)

ELIGIBLE QBE PROGRAM COSTS

$

2,170,790 00 $

2,327.628 90

976,734 00

1,119,87168

1,107.045 00

1,339,238 39

61,980 00

59 892 81

$

4,316,549 oo s~--4-_.846..._,s_a_1_18_

See notes to the genera~purpose financial statements - 27 -

SECTIONII COMPLIANCE AND INTERNAL CONTROL REPORTS

R1J'-i',l:.LI \\'. H1r,,.To..,.
STATE AU(llTOri <041 6!>6], 74

DEPARTI\IENT OF AUDITS AND ACCOUNTS
::!54 \\J,h111gton ~,reel ~ \\ Su11c ~14 At\JntJ Georg1J 10334-H4(Kl
March 17, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Supenntendent and Members of the City of Tnon Board of Educallon
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 ofTnon Board ofEducation as of and for the year ended June 30, 2002, and have issued our report thereon dated March 17, 2003 Tlus report was quahfied for vanous departures from generally accepted accountmg pnnc1ples, as 1denllfied m the auditor's report on the general-purpose financial statements We conducted our audit m accordance with aud1tmg standards generally accepted m the Uruted States of Amenca and the standards applicable to financial audits contamed m Government Aud1tmg Standards, issued by the Comptroller General of the Uruted States
Comphance
As part ofobtammg reasonable assurance about whether City ofTnon Board ofEducation's financial statements are free of matenal misstatement, we performed tests of its comphance with certain proV1s10ns oflaws, regulations, contracts and grants, noncompliance with wluch could have a direct and matenal effect on the determmation of financial statement amounts. However, prov1dmg an op1ruon on compliance with those prov1s1ons was not an objective ofour audit, and accordmgly, we do not express such an opiruon The results ofour tests disclosed no mstances ofnoncompliance that are reqmred to be reported under Government Aud1tmg Standards.
Internal Control Over Fmancial Reporl!ng
In plarmmg and performmg our audit, we considered City ofTnon Board ofEducatJon's mtemal control over financial reportmg m order to determme our aud1tmg procedures for the purpose of expressmg our op1mon on the financial statements and not to provide assurance on the mtemal
2002YB-41

control over financial reporting However, we noted a certain matter involving the internal control over financial reporting and Its operation that we consider to be a reportable cond1t10n Reportable conditions involve matters coming to our attention relating to s1gruficant defic1enc1es in the design or operation ofthe internal control over financial reporting that, in ourJudgment, could adversely affect City of Tnon Board of Educallon's ab1hty to record, process, surnmanze and report financial data consistent with assertions of management in the financial statements The reportable condition 1s descnbed in the accompanying Schedule ofFindings and Questioned Costs as item FS-7911-02-01
A matenal weakness 1s 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 nsk that misstatements in amounts that would be matenal in relation to the financial statements bemg audited may occur and not be detected within a tunely penod by employees m the normal course ofperformmg their assigned functions Our consideration of the internal control over financial reportmg would not necessanly disclose all matters in the internal control that might be reportable conditions and, accordingly,
would not necessanly disclose all reportable conditions that are also considered to be matenal
weaknesses. However, we consider item FS-7911-02-01 to be a rnatenal weakness
Tins report is intended solely for the information and use ofthe management, members ofthe City of Tnon Board ofEducation, Federal awarding agencies and pass-through entitles and 1s not intended to be and should not be used by anyone other than these specified parties.
Respectfully subrmtted,

RWH:gp 2002YB-41

Rusell W. Hinton Stat Auditor

R, S.S>.LI W. H,~ ""
STAT[ AUDITOR
f404i t,Sf, 2174

0EPARTl\1ENT OF AUDITS AND ACCOUNTS
~.54 \\'J,hmgion ~trcL'I ~ \V Suuc ::! 14 AtlJntJ, Georgi~ lOl14-84C>O
March 17, 2003

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the State Board of Education
and Supenntendent and Members of the City ofTnon Board of Education
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH 0MB CIRCULAR A-133
Ladies and Gentlemen
Compliance
We have audited the compliance of City ofTnon Board ofEducabon With the types of comphance reqmrements descnbed m the U.S Office of Management and Budget (0MB) Circular A-133 Compliance Supplement that are applicable to each ofits maJOr FederaJ programs for the year ended June 30, 2002. City of Tnon Board of Education's maJor Federal programs are identified m the Summary of Auditor's Results Section of the accompanymg Schedule ofFmdmgs and Questioned Costs Compliance With the reqmrements of laws, regulations, contracts and grants applicable to each of its maJor FederaJ programs 1s the respons1b1llty of City of Tnon Board of Education's management. Our responsibility 1s to express an opllllon on City of Tnon Board of Education's compliance based on our audit.
We conducted our audit of comphance m accordance With auditmg standards generaJly accepted m the Umted States ofAmenca, the standards applicable to fmanc1al audits contamed m Government Aud1tmg Standards, issued by the Comptroller GeneraJ ofthe Umted States, and 0MB Circular A133, Audits of States, Local Governments, and Non-Profit Orgamzatwns Those standards and 0MB Circular A-133 reqmre that we plan and perform the audit to obtam reasonable assurance about whether noncompliance With the types ofcompliance reqmrements referred to above that could have a direct and matenal effect on a maJor Federal program occurred. An audit mcludes examllllilg, on a test basis, evidence about the City of Tnon Board of Education's compliance with those requirements and performmg such other procedures as we considered necessary m the cJTCumstances We believe that our audit provides a reasonable basis for our opm1on. Our audit does not provide a legal determmatlon on City ofTnon Board of Education's compliance With those requirements
2002SA-10
.

ln our opm10n, the City of Tnon Board of Educat10n complied, m all matenal respects. with the reqmrements referred to above that are applicable to each of1ts maJor Federal programs for the year ended June 30, 2002
Internal Control Over Compliance
The management of City ofTnon Board ofEducation 1s responsible for establishmg and mamtauung effective mtemal control over compliance with requirements of laws, regulations, contracts and
grants applicable to Federal programs In plannmg and performmg our audit, we considered City of
Tnon Board of Education's mtemal control over comphance with requirements that could have a direct and matenal effect on a ma1or Federal program m order to determme our auditing procedures for the purpose of expressmg our op1ruon on comphance and to test and report on mternal control over comphance m accordance with 0MB Circular A-133
Our consideration ofthe mtemal control over comphance would not necessanly disclose all matters m the mtemal control that might be matenal weaknesses A matenal weakness 1s a condition m wluch the design or operation ofone or more ofthe mtemal control components does not reduce to a relatively low level of nsk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be matenal m relation to a maJor Federal program bemg audited may occur and not be detected withm a timely penod by employees m the normal course ofperformmg therr assigned functions. We noted no matters mvolvmg the mtemal control over comphance and its operation that we consider to be matenal weaknesses
This report 1s intended solely for the mformatlon and use ofthe management, members ofthe C1tyof Tnon Board ofEducatlon, Federal awardmg agencies and pass-through entitles and IS not mtended to be and should not be used by anyone other than these specified parties
Respectfully subrrutted,
~-.....\.b4~

RWHgp 2002SA-10

State Auditor

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

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRlOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2002

PRlOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-79 I 1-00-0 I FS-7911-01-01

Further Action Not Warranted Unresolved - No Correcllve Action Implemented

CORRECTIVE ACTION/RESPONSES

GENERAL FIXED ASSETS Failure to Maintain General FIXed Assets Account Group Fmdmg Control Number FS-7911-01-01

Due to current staffing hm1tallons and budgetary cons1derat1ons prolubttmg the Iunng of add11Jonal adml.Dlstrallve staff, the School D1stnct has decided not to pursue the recordmg of general fixed assets on the financial statements.

SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30. 2002
I SUMMARY OF AUDITOR'S RESULTS
Type of Report Issued on the Financial Statements The auditor's op1mon on the City of Tnon Board of Education's financial statements was qualified for vanous departures from generally accepted accountmg pnnc1ples
2 Reportable Cond1t1ons m Internal Control Disclosed by the Audit of the Fmancial Statements The audit report for the City of Tnon Board of Education disclosed a financial statement reportable condition related to the followmg control category.
General Fixed Assets
The reportable condition descnbed above 1s considered to be a matenal weakness
3 Noncompliance Matenal to the Fmanc1al Statements The audit ofthe City ofTnon Board ofEducation disclosed no mstances ofnoncompliance that were deemed to be matenal to the financial statements.
4 Reportable Conditions m Internal Control Over Ma1or Programs The audit report for the City of Tnon Board of Education did not disclose any reportable cond1t1ons m mternal control over maJor programs
5 Type of Report Issued on Compliance for Ma)Or Programs The auditor"s op1mon on the City ofTnon Board of Education"s report on compliance with requrrements applicable to maJor programs was unqualified.
6. Audit Fmdings Requ1red to be Reported by Section 510(a) ofOMB C1rcular A-133 The City ofTnon Board of Education's audit did not disclose audit findmgs requrred to be reported by section .510(a) ofOMB Circular A-133
7 Ma)Or Programs Federal awards audited as maJor programs are as follows 10 553 Food and Nutntlon Program - Food Services - School Breakfast Program IO 555 Food and Nutntlon 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 Aud1tee The City ofTnon Board of Education qualified as a low nsk auditee as defined by Section .530 ofOMB Cucular A-133.
-I-

CITY OF TRION BOARD OF EDUCATION - CHATTOOGA COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR EJ\'DED JUNE 30. 2002
II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS GENERAL FIXED ASSETS Failure to Mamtam General Fixed Assets Account Group Reportable Condition - Matenal Weakness Repeated From Pnor Year Fmdmg Control Number FS-7911-02-01 The City ofTnon Board ofEducation did not mamtam a system-wide General Fixed Assets Account Group w1thm the formal accountmg records as required by generally accepted accountmg pnnc1ples This condition results m the general-purpose financial statements of the School D1stnct bemg mcomplete and not m accordance with generally accepted accounting pnnc1ples Appropnate action should be taken by the School D1stnct to estabhsh accountmg controls and procedures to provide for mamtenance ofa General Fixed Assets Account Group. These subs1d1ary records should mclude an mventory of land, bu1ldmgs and eqwpment owned by the School D1stnct and should mclude, but may not be hm1ted to, date acqmred, acqms1t1on cost, estimated replacement cost, location and descnptlon Detailed records should be mamtained of all additions and deletions to the General Fixed Assets Account Group Management's Response Due to current staffing hmitahons and budgetary considerations proh1bitmg the hmng ofadditional achrumstrat1ve staff, the School D1stnct has decided not to pursue the recording of general fixed assets on the fmanc1al statements. ID FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported
-2-