Audit report, Georgia Building Authority (markets), year ended June 30, 1994

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AUDIT REPORT GEORGIA BUILDING AUTHORITY (MARKETS)
YEAR ENDED JUNE 30, 1994

GEORGIA BUILDING AUTHORITY (MARKETS) - TABLE OF CONTENTS -

INDEPENDENT AUDITOR'S REPORT

EXHIBITS

FINANCIAL STATEMENTS

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUPS

B

STATEMENT OF REVENUES AND EXPENDITURES

ALL FUND TYPES

C

STATEMENT OF CHANGES IN FUND BALANCE

ALL FUND TYPES

D

NOTES TO FINANCIAL STATEMENTS

SUPPLEMENTARY INFORMATION

SCHEDULES

1

CASH AND CASH EQUIVALENTS

2

INVESTMENTS

3

LAND AND BUILDINGS

4

RESERVED FUND BALANCES

Page
2 3 4 5
11
12 13 14

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C!Iertifieo Juhlic Accountimts 400 1lfirat llinion i!Ruillling
25(l 11fost :Jllonre lie 14eon Auenue
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Qelepftone 404 377-9500 1lf11rsimile 4ll4 377-5501
INDEPENDENT AUDITOR'S REPORT
Members of the Georgia Building Authority (Markets):
We have audited the accompanying component unit financial statements of the Georgia Building Authority (Markets) as of June 30, 1994, and for the year then ended. These financial statements are the responsibility of the Georgia Building Authority (Markets) management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards. 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.
Generally accepted accounting principles require that the Authority account for fixed assets in the General Fixed Assets Account Group with the recording of the historical cost of land, buildings, fixtures, equipment and vehicles. The Georgia Building Authority (Markets) records only land and buildings. Because the Authority does not maintain subsidiary cost records on fixed assets other than land and buildings, the total value of fixed assets could not be determined.
In our opinion, except for the effect on the financial statements of the omission described in the preceding paragraph, the financial statements referred to above present fairly, in all material respects, the financial position of the Georgia Building Authority (Markets) as of June 30, 1994, and the results of its operations for the year then ended, on the basis of accounting described in Note
1.
Our audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental information listed as supporting schedules in the table of contents is presented for the purposes of additional analysis and is not a required part of the financial statements of the Georgia Building Authority (Markets). Such information has been subjected to the auditing procedures applied in the audit of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.
August 25, 1994

FINANCIAL STATEMENTS 1

GEORGIA BUILDING AUTHORITY (MARKETS) COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUPS June 30, 1994

EXHIBIT "A"

GOVERNMENTAL

FUND TYPE ACCOUNT GROUP

GENERAL

CAPITAL

FIXED

PROJECTS

ASSETS

TOTALS (Memorandum Only) JUNE 30, 1994 JUNE 30, 1993

ASSETS

Cash and cash

equivalents (See Schedule) $ 8,722 $

Investments

(See Schedule)

380,889

$

8,722

380,889

$

1,378

382,182

Interest receivable Land and buildings
(See Schedule)

4,663

18,463,409

4,663 18,463,409

6,818 18,463,409

TOTAL ASSETS

$ 394,274 $18,463,409 $18,857,683

$18,853,787

LIABILITIES AND FUND EQUITY
Liabilities:
Equity: Investment in General Fixed Assets Fund Balances: Reserved (See Schedule) Unreserved: Designated Undesignated

$
$ 316,691 77,583

$ $18,463,409

$ $18,463,409
316,691 77,583

Total Equity
TOTAL LIABILITIES AND EQUITY

$ 394,274 $ 394,274

$18,463,409 $18,463,409

$18,857,683 $18,857,683

$
$18,463,409 316,691 73,687
$18,853,787 $18,853,787

The accompanying notes are an integral part of these financial statements.
2

GEORGIA BUILDING AUTHORITY (MARKETS)
STATEMENT OF REVENUES AND EXPENDITURES CAPITAL PROJECTS FUND
YEAR ENDED JUNE 30, 1994

EXHIBIT "B"

Revenues: Interest on investments
Expenditures: Audit fee Insurance Operating expense
Total Expenditures
Excess of Revenues Over Expenditures

TOTALS YEAR ENDED June 30, 1994 June 30, 1993

s 10,787
$ 2,313 4,508 70
s 6,891
s 3,896

s 18,188
$ 2,148 4,508 1,044
s 7,700
s 10,488

The accompanying notes are an integral part of these financial statements. 3

GEORGIA BUILDING AUTHORITY (MARKETS)
STATEMENT OF CHANGES IN FUND BALANCE CAPITAL PROJECTS FUND
YEAR ENDED JUNE 30, 1994

EXHIBIT "C"

TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30, 1993

Fund Balance, July 1
Excess of Revenues Over Expenditures
Fund Balance, June 30

$ 390,378
3,896
s 394,274

$ 379,890
10,488
s 390,378

The accompanying notes are an integral part of these financial statements. 4

GEORGIA BUILDING AUTHORITY (MARKETS) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY The Georgia Building Authority (Markets), hereafter referred to as the Authority,
is a body corporate and politic created and existing by and under the Constitution and laws of the State of Georgia.
The Authority is duly authorized by law to acquire real and personal property of every kind; make contracts and agreements as necessary for the purposes of the Authority; and build, construct, improve, equip, and lease places where farmers may bring to sell or exhibit, and buyers may come to buy any product of husbandry or agriculture. The Authority may also make and enter into contracts, leases, and all other instruments necessary and convenient with respect to the use of any such structure, building or facilities; receive grants from the United States of America or any agency or instrumentality thereof; and to repair, maintain, and collect rentals for the use of any project constructed and equipped by it.
Under the terms of certain lease agreements, the Authority has agreed to transfer to the lessee title to certain fixed assets at the expiration of the lease terms, assuming proper and punctual compliance with the terms of the lease by the lessee. These transfers, if made, would have no effect on the fund balance of the Authority.
FUNDS AND ACCOUNT GROUPS INCLUDED IN FINANCIAL STATEMENTS The Georgia Building Authority (Markets) uses funds and account groups to report
on its financial position and the results of its operations determined in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group, on the other hand, is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect net expendable available financial resources. Funds and account groups presented in this report are as follows:
GOVERNMENTAL FUND TYPE CAPITAL PROJECTS FUND - This fund accounts for financial resources to be
used for the acquisition or construction of major capital facilities or facility repairs and renovations. This fund also pays for the necessary costs of administering the affairs of the Authority.
ACCOUNT GROUP GENERAL FIXED ASSETS - The account group used to account for fixed assets
used in governmental fund type operations. Fixed assets purchased are recorded at historical cost. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. No depreciation has been provided on general fixed assets.

5

GEORGIA BUILDING AUTHORITY (MARKETS) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING MEASUREMENT FOCUS The accounting and financial reporting treatment applied to a fund is determined
by its measurement focus. Governmental funds and expendable trust funds should be accounted for using the current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues) and decreases (i.e., expenditures) in net current assets.
GOVERNMENTAL FUND TYPES CAPITAL PROJECTS FUND The financial statements are maintained in accordance with the modified accrual
basis of accounting. Under the modified accrual basis of accounting, 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. The modified accrual basis of accounting calls for expenditures, other than accrued interest of general long-term debt, to be recorded when the related fund liability is incurred.
CASH AND CASH EQUIVALENTS cash and Cash Equivalents include currency on hand, demand deposits with banks and
other financial institutions, and cash management pools that have the generalcharacteristics of demand deposit accounts in that the Authority may deposit additional cash at any time and also effectively may withdraw cash at any time without prior notice or penalty. Cash and Cash Equivalents also inc]udz short term, highly liquid investments with maturity dates within three months of the date acquired.
INVESTMENTS Investments are defined as those financial instruments with terms in excess of
three months from the date of purchase and certain other securities held for the production of revenue. Investments are stated at cost.
The investment policy of the State of Georgia as provided in Official Code of Georgia Annotated (O.C.G.A.) Section 50-17-51, is to maximize the protection of State funds on deposit while accruing an advantageous yield on those funds in excess of those required for current operating expenditures. The State Depository Board may permit any department, board, bureau or other agency to invest funds collected directly by such organization in short term time deposit agreements, provided that the interest income of those funds is remitted to the Director of the Office of Treasury and Fiscal Services as revenues of the State of Georgia. As a matter of general practice, however, demand funds of any department, board, bureau or other agency in excess of current operating expenses are required to be deposited with the Director of the Office of Treasury and Fiscal Services for the purpose of pooled investment.

6

GEORGIA BUILDING AUTHORITY (MARKETS) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "D"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
RESERVED FUND BALANCES Reserves represent those portions of fund equity not appropriable for expenditures
or legally segregated for a specific future use. The following is a brief description of the Capital Projects Fund reserves reflected in this report:
REVOLVING FUND RESERVE This reserve represents funds appropriated for emergency repairs and
replacements.
DEPARTMENT OF AGRICULTURE PROJECTS This reserve represents funds appropriated for various repair and
renovation projects for the Department of Agriculture.
MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the Combined Statements are captioned "Memorandum Only" to
indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations or changes in financial position 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.
COMPARATIVE DATA Comparative total data for the prior year have been presented in the accompanying
financial statements in order to provide an understanding of changes in the Authority's financial position and operations. However, comparative data have not been presented in all statements because their inclusion would make certain statements unduly complex and difficult to understand.
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia cannot be placed in a depository paying
interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral any one or more of the following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
(l) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia.
(2) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia.

7

GEORGIA BUILDING AUTHORITY (MARKETS) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

(3) Bonds of any public authority created by the laws of the State of Georgia, providing that the.statute that created the authority authorized the use of the bonds for this purpose.

(4) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.

(5) Bonds, bills, certificates of indebtedness, notes, or.other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.

( 6) Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation.

As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies of the State of Georgia the option of exempting demand deposits from the collateral requirements.

CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all
bank balances which include demand deposits and/or interest bearing accounts. These bank balances are categorized below in order to provide infor~atic~ about the extent to which such deposits are exposed to custodial credit risk.

Category 1 -

Amounts covered by depository insurance or collateralized with securities (at market value) held by the Authority or by its agent in the Authority's name.

Category 2 -

Amounts collateralized with securities (at market value) held by the financial institution's trust department or agent in the Authority's name.

8

GEORGIA BUILDING AUTHORITY (MARKETS) NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "D"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

Category 3 -

Amounts collateralized with securities (at market value) held by the financial institution or by its trust department or agent, but not in the Authority's name, and amounts uncollateralized.

Carrying Amount

Bank Balance

Risk Categories

1

2

3

Cash Deposits

$8,722

$8,722

$8,722 $

$

CATEGORIZATION OF INVESTMENTS For purposes of analysis of custodial credit risk, investments consist of
U.S. Government securities and repurchase agreements. Investments are stated at cost and are summarized and classified as to custodial credit risk within the categories described below:

Category 1 -

Insured or registered, or securities held by the Authority or its agent in the Authority's name.

Category 2 -

Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Authority's name.

Category 3 -

Uninsured or unregistered, with securities held by the counterparty, or by its trust depar~ment or agent but not in the Authority's name.

Type of Investment

Risk Categories

1

2

3

Carrying Market Amount Value

U.S. Government

Securities

$

$380,889 =$=== $380,889 $385,552

9

SUPPLEMENTARY INFORMATION 10

GEORGIA BUILDING AUTHORITY (MARKETS) CASH AND CASH EQUIVALENTS JUNE 30, 1994
NONINTEREST BEARING ACCOUNTS Wachovia Bank of Georgia
Atlanta, Georgia

SCHEDULE "l" $8,722

11

GEORGIA BUILDING AUTHORITY (MARKETS) INVESTMENTS
JUNE 30, 1994

SCHEDULE "2"

INVESTMENT TYPE U.S. Treasury Bills U.S. Treasury Bills U.S. Treasury Bills U.S. Treasury Bills U.S. Treasury Bills U.S. Treasury Bills

PURCHASE DATE August 26, 1993 January 13, 1994 March 10, 1994 April 7, 1994 May 5, 1994 June 2, 1994

MATURITY DATE August 25, 1994 January 12, 1995 March 9, 1995 April 6, 1995 May 4, 1995 June 1, 1995

AMOUNT $19,355
24,161 84,379 229,250
9,504 14,240

S38o,aa9

12

GEORGIA BUILDING AUTHORITY (MARKETS) LAND AND BUILDINGS JUNE 30, 1994
Clayton County, Georgia Muscogee County, Georgia Augusta, Georgia Thomasville, Georgia Savannah, Georgia

SCHEDULE "3"
$15,211,488 1,576,780 774,724 555,539 344,878
$18,463,409

13

.

GEORGIA BUILDING AUTHORITY (MARKETS) RESERVED FUND BALANCE JUNE 30, 1994
DESCRIPTION Revolving Fund Department of Agriculture Projects

SCHEDULE "4"
$200,000 116,691
$316,691

14