BARTRAM TRAIL REGIONAL LIBRARY WASHINGTON# GEORGIA REPORT ON AUDIT OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30# 2006 STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS Russell W. Hinton State Auditor BARTRAM TRAIL REGIONAL LIBRARY - TABLE OF CONTENTS - SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION REQUIRED SUPPLEMENTARY INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS EXHIBITS BASIC FINANCIAL STATEMENTS DISTRICT-WIDE FINANCIAL STATEMENTS A STATEMENT OF NET ASSETS 1 B STATEMENT OF ACTIVITIES 2 FUND FINANCIAL STATEMENTS C BALANCE SHEET GOVERNMENTAL FUND 3 D RECONCILIATION OF THE GOVERNMENTAL FUND BALANCE SHEET TO THE STATEMENT OF NET ASSETS 4 E STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUND 5 F RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES 6 G NOTES TO THE BASIC FINANCIAL STATEMENTS 7 SCHEDULES REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL GENERAL FUND 15 BARTRAM TRAIL REGIONAL LIBRARY - TABLE OF CONTENTS - SECTION I FINANCIAL SCHEDULES SUPPLEMENTARY INFORMATION SCHEDULES OF REVENUE 2 STATE 16 3 FEDERAL 17 4 LOCAL 18 5 SCHEDULE OF SALARIES AND TRAVEL 19 SECTION II AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS SECTION I FINANCIAL Russell W. Hinton STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 May 14, 2007 Honorable Sonny Perdue, Governor Members of the General Assembly Members of the Board of Regents of the University System of Georgia and Director and Members of the Bartram Trail Regional Library Board INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION Ladies and Gentlemen: We have audited the accompanying financial statements of the governmental activities, and the major fund (Exhibits A through G) of the Bartram Trail Regional Library as of and for the year ended June 30, 2006, which collectively comprise the Library's basic financial statements as listed in the table ofcontents. These financial statements are the responsibility ofthe Bartram Trail Regional Library's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica. 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 opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position ofthe governmental activities and the major fund ofthe Bartram Trail Regional Library, as of June 30, 2006, and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. 2006ARL-41 Management's Discussion and Analysis and the Schedule ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual, as presented on pages i through v and page 15 are not a required part ofthe basic financial statements but are supplementary information required by the accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Bartram Trail Regional Library's basic financial statements. The accompanying supplementary information which consist of Schedules 2 through 5, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe basic financial statements, and in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. . Respectfully submitted, ~....JQ ~~ Russell W. Hinton, CPA, CGFM State Auditor RWH:gp 2006ARL-41 BARTRAM TRAIL REGIONAL LIBRARY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2006 Management's discussion and analysis of the financial performance of the Bartram Trail Regional Library (the "Library") is intended to provide readers of the Library's financial statements with an overview of the Library's financial activities for the fiscal year ending June 30, 2006. Please read it in conjunction with the Library's financial statements, which follow this section. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the Library's basic financial statements. The Library's basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This report also contains other supplemental information in addition to the basic financial statements themselves. Government-wide Financial Statements and Financial Analysis. The Government-wide financial statements are designed to provide readers with a broad overview of the Library's finances, in a manner similar to a private-sector business. The statement of net assets presents information on all of the Library's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the Library is improving or deteriorating. Such change may result from many factors, including those not under the Library's control, such as the facility conditions, required programs, funding reductions, and other causes. The statement of activities presents information showing how the Library's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods. Net assets increase when revenues exceed expenses. Increase to assets without a corresponding increase to liabilities results in increased net assets, which indicates an improved financial position. Net assets may serve over time as a useful indicator of the Library's financial position. At the close of fiscal year 2006, the Library's net assets totaled $486,846. Fund Financial Statements: A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Library uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. All of the funds of the Library are considered governmental funds. BARTRAM TRAIL REGIONAL LIBRARY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2006 Governmental Funds: are used to account for essentially the same functions reported as governmental activities in the Government-wide financial statements. However, unlike the Government-wide financial statements, these fund statements are reported using the modified accrual basis of accounting, which measures cash and all other financial assets that can be readily converted to cash. Such information may be useful in evaluating a government's near-term financing requirements. The General Fund is the Library's primary operating fund. It accounts for all financial resources of the Library. Notes to the Basic Financial Statements: The notes provide additional information that is essential to a full understanding of the data provided in the Government-wide and fund financial statements. The perspective of the Statement of Net Assets is of the Library as a whole. Table 1 provides a summary of the Library's net assets for fiscal year 2006 compared to fiscal year 2005. Table 1 Net Assets Governmental Activities Fiscal Fiscal Year 2006 Year 2005 Assets Current Assets Capital Assets, Net Total Assets $ 313,653 $ 294,299 178,387 187,506 $ 492,040 $ 481,805 Liabilities Accounts Payable $ 5 194 $ 15,559 Net Assets Invested in Capital Assets, Net of Related Debt Unrestricted Total Net Assets $ 178,387 $ 187,506 308,459 278,740 $ 486,846 $ 466,2~6 The net assets of a governmental entity may serve as an indicator of the entity's financial position. The "Summary Schedule" above shows an increase in net assets for the year ending June 30, 2006. Table 2 shows the changes in net assets for fiscal year 2006 compared to the changes for fiscal year 2005. 11 BARTRAM TRAIL REGIONAL LIBRARY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2006 Table 2 Change in Net Assets Revenues Program Revenues: Charges for Services Operating Grants and Contributions Governmental Activities Fiscal Fiscal Year 2006 Year 2005 $ 24,211 $ 21,555 281,386 321,566 Total Program Revenues $_ _3~05~,~59_7 $_~3_43~,_12_1 General Revenues: Allotments from Participating Governments Investment Earnings Miscellaneous $ 317,973 $ 241,685 2,992 2,262 10,652 23,189 Total General Revenues Total Revenues Program Expenses Current Services Public Services Technical Services Support Services Maintenance and Operations Information Technology $_~3~3~1,6~1~7 $_ _6=3~7~,2~1~4 $_~2~67~,~13~6 $_~6~1o~,2=5~7 $ 229,185 $ 213,596 79,566 76,301 232,665 246,703 63,153 46,608 12,045 14,350 Total Expenses Increase in Net Assets Financial Analysis of the Library's Funds $_~6=1=6,-"-'61'-'-4 $====2="0.==60==0 $_---"5-"--97-"-'-,""-"55'-=8 $====12,,,,..6==9===9 State funding comprised 43.3% of the Library's total revenue for fiscal year 2006. Local Funds for Regional Services were $317,973 in fiscal year 2006. This represents only an increase of $76,288 over the previous year. Local Funds comprise 49.9% of Library revenues. Federal Revenues comprise 0.9% of Library revenues. Other revenues are those that are self-generated. Fines, fees for lost books, donations, investment earnings and other miscellaneous revenue totaled $37,855 in fiscal year 2006, as compared to $47,006 in fiscal year 2005. This is largely due to decreased in cash donations. Self-generated revenues comprised 5.9% of Library revenues in fiscal year 2006. lll BARTRAM TRAIL REGIONAL LIBRARY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2006 The net change in fund balance for the Library's General Fund was an increase from the prior year in the amount of $7,901. This increase was due to actual expenditures being less than the approved budget while revenues remained essentially as anticipated. The Library managed to decrease personnel costs by multi-tasking staff and by leaving some vacant positions unfilled. Additional savings were accomplished by reducing general operating expenditures. The Library did not have to use fund balance to cover actual expenditures as originally budgeted. There was a decrease in the level of the State Revenue Funds from the prior year. State Funds were $320,405 in fiscal year 2005, and $275,736 in fiscal year 2006. The State Revenue Funds include state grants to be used in specific amounts for Personnel, Materials, and System Support Services (formerly Maintenance and Operations), as well as Federal funds designated for special projects. The Library expends all State and Federal Funds by year-end or other designated funding period, since these funds must be returned if not used. Economic Factors and Next Year's Budget The Library's financial position for next year is expected to remain stable. State Grant Funds are expected to increase due to State Legislative approvals for increases in salaries and materials. Local funding agencies are expected to match at least the level of funding from the previous year. Preliminary budget information forecasts approximately a 5.0% increase for fiscal year 2007. There are no currently known facts, decisions, or conditions that are expected to have a significant effect on the Library's financial position (net assets) or results of operations (revenues, expenses, and other changes in net assets). Capital Assets At the end of 2006, the Library had $178,387 in capital assets net of accumulated depreciation. This included equipment and Library collections. Additions to capital assets during 2006 included only additions to the Library collections. Table 3 Capital Assets at June 30 Governmental Activities Fiscal Fiscal Year 2006 Year 2005 Equipment Library Collections Total Assets Less: Accumulated Depreciation $ 127,900 1,007,173 $ 1,135,073 956,686 $ 127,900 1,002,106 $ 1,130,006 942,500 Capital Assets - Net $=====1==78-,3=8==7 $=====1==87=".5"=0'="6 iv BARTRAM TRAIL REGIONAL LIBRARY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2006 Budgetary Highlights The Library Board approves an annual budget in April for the following fiscal year that begins in July. The adopted budget included expenditures of $553,484 and was not significantly amended during the year. Actual expenditures for personnel services were less than budgeted due to unfilled positions throughout the year. The net change in fund balance was $29,719, which was carried forward to fiscal year 2007 for materials and operational expenditures. Contacting the Library's Financial Manager The financial statements are designed to provide a general overview of the Library's finances. Questions concerning any of the information provided should be addressed to the Executive Director, Bartram Trail Regional Library, 204 East Liberty Street, Washington, Georgia. V BARTRAM TRAIL REGIONAL LIBRARY BARTRAM TRAIL REGIONAL LIBRARY STATEMENT OF NET ASSETS JUNE 30, 2006 ASSETS Cash and Cash Equivalents Accounts Receivable Local Capital Assets Equipment Library Collections Less: Accumulated Depreciation Total Assets LIABILITIES Accounts Payable NET ASSETS Invested in Capital Assets, Net of Related Debt Unrestricted Total Net Assets Total Liabilities and Net Assets EXHIBIT"A" GOVERNMENTAL ACTIVITIES $ 235,710 77,943 127,900 1,007,173 -956,686 $====49=2...,,0=40= $ 5194 $ 178,387 308,459 $ 486 846 $====4=9=2=0=40= The notes to the basic financial statements are an integral part of this statement. - 1- BARTRAM TRAIL REGIONAL LIBRARY STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2006 EXHIBIT"B" EXPENSES PROGRAM REVENUES OPERATING CHARGES FOR GRANTS AND SERVICES CONTRIBUTIONS NET (EXPENSES) REVENUES AND CHANGES IN NET ASSETS GOVERNMENTAL ACTIVITIES Current Services Public Services Technical Services Support Services Maintenance and Operations Information Technology Total Governmental Activities $ 229,185 $ 79,566 232,665 63,153 12 045 616 614 $ 24,211 $ 24 211 $ 255,872 $ 25,514 50,898 -79,566 -232,665 -37,639 -12 045 281 386 $ _ _ _ _-3;.1:..c1.!.;,0C..:.1.:...7 General Revenues Allotments from Participating Governments Investment Earnings Miscellaneous $ 317,973 2,992 10 652 Total General Revenues $ _ _ _.,::3:.:::3..:.,1_::.61.:.,.7_ Change in Net Assets $ 20,600 Net Assets - Beginning of Year 466246 Net Assets - End of Year $ ===~4~86~84;,;;6:,. The notes to the basic financial statements are an integral part of this statement. -2- BARTRAM TRAIL REGIONAL LIBRARY BALANCE SHEET GOVERNMENTAL FUND JUNE 30, 2006 ASSETS Cash and Cash Equivalents Accounts Receivable Local Total Assets LIABILITIES AND FUND BALANCE LIABILITIES Accounts Payable FUND BALANCE Unreserved Undesignated Reported in: General Fund Total Liabilities and Fund Balance EXHIBIT"C" GENERAL FUND $ 235,710 77 943 $ ===3=13=!::,6=5=3 $ 5,194 308,459 $ ===3=13==,6=5=3 The notes to the basic financial statements are an integral part of this statement. -3- BARTRAM TRAIL REGIONAL LIBRARY RECONCILIATION OF THE GOVERNMENTAL FUND BALANCE SHEET TO THE STATEMENT OF NET ASSETS JUNE 30, 2006 EXHIBIT"D" Total Fund Balance - Governmental Fund (Exhibit "C") Amounts reported for Governmental Activities in the Statement of Net Assets are different because: Capital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of: Equipment $ Library Collections Accumulated Depreciation Total Capital Assets $ 127,900 1,007,173 -956,686 308,459 178 387 Net Assets of Governmental Activities (Exhibit "A") $ ===48=6=,8=4=6 The notes to the basic financial statements are an integral part of this statement. -4- BARTRAM TRAIL REGIONAL LIBRARY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUND YEAR ENDED JUNE 30, 2006 EXHIBIT"E" REVENUES Local Funds State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues EXPENDITURES Current Public Services Technical Services Support Services Maintenance and Operations Information Technology Total Expenditures Net Change in Fund Balance Fund Balance - Beginning Fund Balance - Ending GENERAL FUND $ 317,973 275,736 5,650 24,211 2,992 10,652 $ 637 214 $ 220,066 79,566 232,665 63,153 12 045 $ 607 495 $ 29,719 278 740 $ ==3=0=8'=45=9= The notes to the basic financial statements are an integral part of this statement. -5- BARTRAM TRAIL REGIONAL LIBRARY RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES JUNE 30, 2006 EXHIBIT"F" Total Net Change in Fund Balance - Governmental Fund (Exhibit "E") Amounts reported for Governmental Activities in the Statement of Activities are different because: Capital Outlays are reported as expenditures in Governmental Funds. However, in the Statement of Activities, the cost of Capital Assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are: Capital Outlay Depreciation Expense Excess of Depreciation Expense over Capital Outlay $ $ 23,871 -32,990 29,719 -9119 Change in Net Assets of Governmental Activities (Exhibit "B") $ ===2=0=,6=0=0 The notes to the basic financial statements are an integral part of this statement. -6- BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT "G" Note 1: DESCRIPTION OF LIBRARY AND REPORTING ENTITY REPORTING ENTITY The Bartram Trail Regional Library (Library) operates pursuant to Official Code of Georgia Annotated Sections 20-5-40 through 20-5-59 to provide public library services with costs shared by participating local governmental agencies and grants from the State of Georgia. The Library Board consists of nine members; three members appointed by Mary Willis Library, three members appointed by Taliaferro County Library and three members appointed by ThomsonMcDuffie County Library. The Library Board is without authority to determine the amount of its funding, except by submission of budget requests to local governmental units from which the Library receives support and to the State of Georgia for State and Federal flow through funding. Membership in the Library and participation in library services is at the discretion of each participating governmental agency. The Library Board has the power to designate management, the power to retain unreserved fund balances oflocal and other funds for continued operations and is the lowest level of oversight responsibility for the Library's operations. The Bartram Trail Regional Library is therefore determined to be a joint venture. Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION The Library's basic financial statements are collectively comprised of the Library-wide financial statements, fund financial statements and notes to the basic financial statements ofthe Bartram Trail Regional Library. Library-wide Statements: The Statement ofNet Assets and the Statement ofActivities display information about the financial activities ofthe overall Library. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through intergovernmental revenues and other nonexchange transactions. The Statement ofActivities presents a comparison between direct expenses and program revenues for each function of the Library's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the Library related to the administration and support ofthe Library's programs, such as office and maintenance personnel and accounting) are not allocated to programs. Program revenues include (a) charges paid by the recipients ofgoods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues are presented as general revenues. -7- BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT "G" Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fund Financial Statements: The fund financial statements provide information about the Library's funds. Eliminations have been made to minimize the double counting of internal activities. The emphasis of fund financial statements is on major governmental funds. The Library reports the following major governmental fund: General Fund is the Library's primary operating fund. It accounts for all financial resources of the Library. BASIS OF ACCOUNTING The basis ofaccounting determines when transactions are reported on the financial statements. The Library-wide governmental financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the Library gives (or receives) value without directly receiving (or giving) equal value in exchange, include grants and donations. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. The Library 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. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis ofaccounting. Under this method, revenues are recognized when measurable and available. The Library considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. Interest is considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of acquisitions under capital leases are reported as other financing sources. The Library funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the Library's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. -8- BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT "G" Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CASH AND CASH EQUIVALENTS COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the Library to deposit its funds in one or more solvent banks or insured Federal savings and loan associations. RECEIVABLES Receivables consist ofamounts due from 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 basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. CAPITAL ASSETS Capital assets purchased, including capital outlay costs, are recorded as expenditures in the fund financial statements at the time ofpurchase. On the Library-wide financial statements, all purchased capital assets are valued at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at estimated fair market value on the date donated. Disposals are deleted at depreciated recorded cost. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. Depreciation is computed using the straight-line method. Capitalization thresholds and estimated useful lives of capital assets reported in the Library-wide statements are as follows: Capitalization Policy Estimated Useful Life Equipment Library Collections $ 5,000 5 to 20 years All 10 years Depreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives. -9- BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT"G" Note 3: DEPOSITS COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa 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 110 percent ofthe daily pool balance. Acceptable security for deposits consists of any one of or any combination of the following: (1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, (2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, (3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, (4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, (5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, (6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and (7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest 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. CATEGORIZATION OF DEPOSITS At June 30, 2006, the bank balances were $281,127. The amounts of the total bank balances are classified into four categories of custodial credit risk: Category 1 - Cash that is insured (e.g., Federal Deposit Insurance) or collateralized with securities held by the Library or by the Library's agent in the Library's name. - 10 - BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT "G" Note 3: DEPOSITS Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Library's name. Category 3 - Cash collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Library's name. Category 4 - Uncollateralized. The Library's deposits are classified by custodial credit risk category at June 30, 2006, as follows: Custodial Credit Risk Category Bank Balance 1 $ 252,394 2 28,733 3 0 4 0 Total Note 4: CAPITAL ASSETS $===2==8=='1,'==12==7 The following is a summary of changes in the Capital Assets during the fiscal year: Governmental Activities Capital Assets Being Depreciated Equipment Library Collections Less Accumulated Depreciation for: Equipment Library Collections Governmental Activity Capital Assets - Net Balances July 1, 2005 Increases Decreases Balances June 30, 2006 $ 127,900 1,002,106 $ 23,871 $ $ 127,900 18,804 1,007,173 111,578 830,922 $ 187,5Q6 $ 3,167 29,823 -2,119 $ 18,804 Q $ 114,745 841 941 118,381 Current year depreciation expense by function is as follows: Public Services Note 5: RISK MANAGEMENT $===32-,9-9==0 The Library 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; acts of God and unemployment compensation. - 11 - BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT "G" Note 5: RISK MANAGEMENT The Library has obtained commercial insurance for risk ofloss associated with torts, assets, errors or omissions and job related illness or injuries to employees. The Library has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Library's insurance coverage in any of the past three years. The Library has elected to self-insure for all losses related to acts of God. The Library has not experienced any losses related to this risk in the past three years. The Library is self-insured with regard to unemployment compensation claims. The Library accounts for claims within the General Fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated. The Library has not experienced any unemployment compensation claims during the last two years. The Library has purchased a surety bond to provide additional insurance coverage as follows: Position Covered Amount All Employees $ 50,000 Note 6: OPERATING LEASES Bartram Trail Regional Library has entered into various leases for copiers. These leases are considered for accounting purposes to be operating leases. Lease expenditures for the year ended June 30, 2006, for governmental funds amounted to $3,664. Future minimum lease payments for these leases are as follows: Year Ending Governmental Funds 2007 2008 $ 3,240 1 890 Total Note 7: RETIREMENT PLANS $====5-,1==3==0 TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS PLAN DESCRIPTION Substantially all librarians and clerical personnel employed by regional and county libraries 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 - 12 - BARTRAM TRAIL REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2006 EXHIBIT"G" Note 7: RETIREMENT PLANS 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 ofthe Library who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Library 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 9.24% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows: Fiscal Year Percentage Contributed Required Contribution 2006 2005 2004 100% 100% 100% $ 26,593 $ 29,753 $ 29,223 Note 8: AFFILIATED LIBRARIES DISCLOSURE The Thomson-McDuffie County Library, Taliaferro County Library and Mary Willis Library are legally separate, tax exempt organizations who participate in shared activities with the Bartram Trail Regional Library. These affiliated libraries do not meet the criteria for reporting as either a component unit or related entity of the Bartram Trail Regional Library. - 13 - (This page left intentionally blank) BARTRAM TRAIL REGIONAL LIBRARY GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL YEAR ENDED JUNE 30, 2006 SCHEDULE "1" REVENUES Local Funds State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues EXPENDITURES Current Public Services Technical Services Support Services Maintenance and Operations Information Technology Total Expenditures Net Change in Fund Balance Fund Balance - Beginning NONAPPROPRIATED BUDGETS ORIGINAL FINAL ACTUAL AMOUNTS $ 247,562 $ 247,562 $ 317,973 275,324 275,324 275,736 5,650 23,001 23,001 24,211 2,074 2,074 2,992 5 523 5 523 10 652 $ 553484 $ 553 484 $ 637 214 $ 162,696 $ 162,696 $ 220,066 79,779 79,779 79,566 236,791 236,791 232,665 64,768 64,768 63,153 9,450 9450 12 045 $ 553 484 $ 553 484 $ 607 495 $ 0 $ 0 $ 29,719 0 0 278 740 Fund Balance - Ending $======0$======0$===3=0=8~4=59= Notes to the Schedule of Revenues. Expenditures and Changes in Fund Balances Budget and Actual The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. See notes to the basic financial statements. - 15 - BARTRAM TRAIL REGIONAL LIBRARY . SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2006 AGENCY/FUNDING GRANTS Board of Regents of the University System of Georgia Office of Public Library Services Salaries Library Materials Maintenance and Operations SCHEDULE "2" GOVERNMENTAL FUND TYPE GENERAL FUND $ 233,849 16,373 25 514 $ ====2=75::!,,7=3==6 See notes to the basic financial statements. - 16 - BARTRAM TRAIL REGIONAL LIBRARY SCHEDULE OF FEDERAL REVENUE YEAR ENDED JUNE 30, 2006 AGENCY/FUNDING GRANT Museum and Library Services, Institute of Through Board of Regents of the University System of Georgia Library Services and Technology Act State Vacation Reading Program SCHEDULE "3" GOVERNMENTAL FUND TYPE GENERAL FUND $ =======5=6...,5..,.0 See notes to the basic financial statements. -17- BARTRAM TRAIL REGIONAL LIBRARY SCHEDULE OF LOCAL REVENUE YEAR ENDED JUNE 30, 2006 LOCAL SOURCES Boards of Education McDuffie County Taliaferro County Wilkes County City Governments Crawfordville Sharon Thomson Washington County Governments Boards of Commissioners McDuffie Taliaferro Wilkes SCHEDULE "4" GOVERNMENTAL FUND TYPE GENERAL FUND $ 28,286 2,500 6,000 3,300 100 53,084 81,638 54,119 10,414 78 532 $ =====3=17=97=3 See notes to the basic financial statements. - 18 - NAME Barnes, Betty Brooke, Amada Buckner, Donna M. Denard, Judy H. Dent, Carrie Dowda, Margaret L. Dubois, Sharon M. Freeman-Moss, Sonya Frick, Dorothy W. Gheesling, Lynda Harber, Patty S. Harrington, Donna C. Harris, Suzan R. Haughey, Courtney Holbert, Steve Holder, Tracy Howard, Jan H. James, Whitney Montgomery, Jo Poss Moore, James Palmer, Debbie Russell, Delaney Shoemaker, Jessie W. Stover, Celeste A. Wolfe, Dianne Wolter, Barbara Totals per Report BARTRAM TRAIL REGIONAL LIBRARY SCHEDULE OF SALARIES AND TRAVEL YEAR ENDED JUNE 30, 2006 SCHEDULE "5" TITLE CATEGORY Janitor Student Assistant Student Assistant Circulation Assistant Student Assistant Student Assistant Branch Manager Student Assistant Library Assistant Library Assistant Tech. Svcs. Librarian Public Service Coordinator Branch Librarian Student Assistant Student Assistant Circulation Assistant Administrative Assistant Student Assistant Administrative Assistant Tech/Circulation Assistant Janitor Student Assistant Bookmobile Driver Director Bookmobile Assistant Branch Manager SALARIES TRAVEL $ 71 1,639 31 20,994 $ 675 1,588 3,798 2,153 6,503 5,650 62,579 15,065 55,016 367 967 6,338 25,447 291 14,870 15,747 1,693 1,594 22,392 56,112 2,704 3 869 193 50 25 27 542 1,679 85 171 320 1,227 30 $ 328, 153 $ =======4='=3=4=9 See notes to the basic financial statements. - 19 - SECTION II AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS BARTRAM TRAIL REGIONAL LIBRARY AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2006 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS FS-7572-05-01 Previously Reported Corrective Action Implemented PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.