Audit report, Coastal Plain Regional Library, Tifton, Georgia, year ended June 30, 1994

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STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET ATLANTA. GEORGIA 30334

AUDIT REPORT COASTAL PLAIN REGIONAL LIBRARY
TIFTON, GEORGIA YEAR ENDED JUNE 30, 1994

COASTAL PLAIN REGIONAL LIBRARY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXIIlBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALLFUNDTYPESANDACCOUNTGROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

GOVERNMENTAL FUND TYPES

3

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - ACTUAL AND BUDGET

GOVERNMENTAL FUND TYPES

4

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

13

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

14

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

15

2 ANALYSIS OF CASH AND CASH EQUIVALENTS

16

3 ACCOUNTS RECEIVABLE

17

SCHEDULE OF REVENUE

4

STATE

18

5

LOCAL AND OTHER

19

6 SCHEDULE OF EXPENDITURES BY OBJECT

GOVERNMENTAL FUND TYPES

20

7 MEMBERSHIP OF LIBRARY BOARD

21

8 SCHEDULE OF SALARIES AND TRAVEL

22

COASTAL PLAIN REGIONAL LIBRARY -TABLE OF CONTENTS-
SECTION II COMPLIANCE COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS
SECTION ill INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS SCHEDULE OF PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

SECTION I FINANCIAL

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~epartmeut of ~uhits
254 WASHINGTON STREET. S.W. ROOM 214
~thmbt, &>enrgia 30334-8400
December I 6, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board
INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
Ladies and Gentlemen:
We have audited the general purpose financial statements (Exhibits A through D) of the Coastal Plain Regional Library, as of and for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility of the Library's 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 and the standards for
financial and compliance audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose financial statements, the Library's financial statements have been prepared using a certain accounting practice and policy which, in our opinion, vary in some respects from generally accepted accounting principles. This variance is described as follows:
* The general purpose financial statements of the Library did not contain a General Fixed Assets Account Group to account for property, equipment and inexhaustible collections and books owned by the Library which should be included to conform to generally accepted accounting principles.
94ARL-44

The aggregate effects on the general purpose financial statements of this variance or omission has not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements of the matter referred to in the third paragraph, the general purpose financial statements present fairly, in all material respects, the financial position ofthe Coastal Plain Regional Library as ofJune 30, 1994, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose offorming an opinion on the general purpose financial statements ofthe Coastal Plain Regional Library taken as a whole. The combining statements (Exhibits E and F) and the financial schedules (Schedules I through 8 which includes the Schedule ofFederal Financial Assistance), as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Coastal Plain Regional Library. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.
A copy ofthis report has been filed as a pennanent record in the office ofthe State Auditor and made available to the press of the State, as provided for by Official Code ofGeorgia Annotated Section 50-6-24.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:cm 94ARL-44

COASTAL PLAIN REGIONAL LIBRARY - 1-

COASTAL PLAIN REGIONAL LIBRARY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30. 1994

EXHIBIT "A"

ASSETS Cash and Cash Equivalents Accounts Receivable Amount to be Provided in Future Years
for Payment of Compensated Absences
Total Assets

GOVERNMENTAL FUND TYPES

----------------------------

SPECIAL

GENERAL

REVENUE

FUND

FUND

------------- -------------

ACCOUNT GROUP
------------GENERAL
LONG-TERM
DEBT
-------------

TOTAL (Memorandum
Only)
-------------

$ 36,112.27 $ 76,027.46

$ 112,139.73

2,309.70

85.72

2,395.42

$ 16,054.56

16,054.56

------------- ------------- ------------- -------------

$ 38,421.97 $ 76,113.18 $ 16,054.56$ 130,589.71

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Expired Grant Balances Payable Deferred Revenues Compensated Absences
Total Liabilities
FUND EQUITY
Fund Balances Unreserved Undesignated

$ 18,565.02 $ 3,943.46

$ 22,508.48

183.02

183.02

71,986.70

71,986.70

$ 16,054.56

16,054.56

------------- ------------- ------------- -------------

$ 18,565.02 $ 76,113.18 $ 16,054.56 $ 110,732.76
------------- ------------- ------------- -------------

$ 19,856.95 $

0.00

$ 19,856.95

Total Liabilities and Fund Equity $ 38,421.97 $ 76,113.18 $ 16,054.56$ 130,589.71
============= ============= ============= -----=----==-

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

COASTAL PLAIN REGIONAL LIBRARY COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

EXHIBIT "B"

REVENUES
--------
State Funds Federal Funds Local and Other Funds
Total Revenues
EXPENDITURES
------------
Current Program Services Technical Services Administration Maintenance and Operations
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1
-------------------
FUND BALANCE JUNE 30

GOVERNMENTAL FUND TYPES

----------------------------

SPECIAL

GENERAL

REVENUE

FUND

FUND

------------- -------------

TOTAL (Memorandum
Only)
-------------

$ 303,793.17 $ 32,B30.28 $ 336,623.45

25.24

27,983.57

28,008.81

271,526.07

271,526.07

------------- ------------- -------------

$ 575,344.48 $ 60,813.85 $ 636,158.33
------------- ------------- -------------

$ 55,140.14 $ 23,941.55 $ 79,081.69

603.36

603.36

505,215.66

42.02 505,257.68

19,575.60

19,575.60

7,745.94

36,830.28

44,576.22

------------- ------------- -------------

$ 588,280.70 $ 60,813.85 $ 649,094.55
------------- ------------- -------------

$ -12,936.22 $

0.00 $ -12,936.22

32,793.17

0.00

32,793.17

------------- ------------- -------------

$ 19,856.95 $

0.00 $ 19,856.95

============= =============

The notes to the general purpose financial statements are an integral part of this statement.
- 3-

COASTAL PLAIN REGIONAL LIBRARY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ACTUAL AND BUDGET - GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

EXHIBIT "C"

REVENUES
State Funds Federal Funds Local and Other Funds
Total Revenues
EXPENDITURES
Current Program Services Technical Services Circulation Administration Maintenance and Operations
Capital Outlay
Total Expenditures
Excess of Revenues over (under) Expenditures FUND BALANCE JULY 1, 1993
ADJUSTMENTS
Prior Year (Net)
FUND BALANCE JUNE 30, 1994

ACTUAL PER
EXHIBIT "B"

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

$ 336,623.45 $ 345,235.00 $ -8,611.55

28,008.81

27,613.00

395.81

271,526.07

50,045.00 221,481.07

------------- ------------- -------------

$ 636,158.33 $ 422,893.00 $ 213,265.33
------------- ------------- -------------

$ 79,081.69 $ 15,556.59 $ -63,525.10

603.36

-603.36

500.00

500.00

505,257.68 333,907.88 -171,349.80

19,575.60

17,908.00

-1,667.60

44,576.22

2,000.00 -42,576.22

------------- ------------- -------------

$ 649,094.55 $ 369,872.47 $ -279,222.08
------------- ------------- -------------

$ -12,936.22 $ 53,020.53 $ -65,956.75

32,793.17

31,807.79

985.38

0.00

111.34

-111.34

$ 19,856.95$ 84,939.66 $ -65,082.71
============= ============= =============

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

COASTAL PLAIN REGIONAL LIBRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Coastal Plain Regional 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. With the exception ofthe departures from generally accepted
accounting principles disclosed in the following paragraphs, the financial statements ofthe Library have been
prepared in conformity with generally accepted accounting principles as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.
The more significant ofthe Library's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, "Defining the Financial Reporting Entity". Based upon the application of the above criteria, the Coastal Plain Regional Library is determined to be a joint venture.
The Library Board consists of eight members; one member appointed by Carrie Dorsey Peny Memorial Library Board, one member appointed by the Cook County Library Board, one member appointed by the Irwin County Library Board, four members appointed by the Tifton-Tift County Library Board, and, one member appointed by the Victoria Evans Memorial Library Board. The 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 ofGeorgia for State and Federal funding. Membership in the Library and participation in library services is at the discretion of each participating governmental agency. The Board has the power to designate management, the power to retain unreserved fund balances of local funds for continued operations and is the lowest level of oversight responsibility for the Library's operations.
The Coastal Plain Regional Library is located in Tifton, Georgia, and serves Berrien, Cook, Irwin, Tift, and Turner Counties.
FUND ACCOUNTING
The Library uses funds and an account group to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a 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 expendable available financial resources.

- 5-

COASTAL PLAIN REGIONAL LIBRARY

EXIilBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General Fixed Assets which includes the Library's inexhaustible collections and books, are recorded as expenditures in the various funds at the time of purchase. A General Fixed Assets Account Group is not
presently maintained by the Library. To conform to generally accepted accounting principles, a General Fixed Assets Account Group should be maintained for reporting the cost of assets acquired by governmental fund
types.
The general purpose financial statements account for all State, Federal, Local and Other funds under control ofthe Library, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - used to account for all or most of the Library's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Library except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a Library.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. The primary type of special revenue fund consists of proceeds received from State and Federal sources to accomplish specific objectives and are required to be accounted for separately.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for material compensated absences.
BASIS OF ACCOUNTING
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities are generally included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure of available spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
- 6-

COASTAL PLAIN REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Those revenues considered susceptible to accrual are intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
BUDGET
Coastal Plain Regional Library has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure ofthe aggregate budget. The budget process begins when the Library administration prepares and submits a proposed budget to the Board for approval. After approval of the proposed budget by the Board, copies are sent to all local funding agencies. After funding approval is received from all local funding agencies, the Board will make any necessary adjustments and adopt the budget. This final budget is then submitted to the Georgia Department of Education, Division of Public Library Services, as a part ofthe Library's Annual Application for State Aid.
The Library prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements.
CASH AND CASH EQUIVALENTS
COMPOSITION OF CASH DEPOSITS Cash consists of deposits (including certificates of deposit, savings and N.O.W. accounts) in authorized
financial institutions. Georgia Laws authorize the Library to deposit its funds in one or more solvent banks,
insured Federal savings and loan associations, or insured State chartered building and loan associations.
RECEIVABLES
Receivables consist ofgrant reimbursements due from Federal, State or other grantors for expenditures made but not reimbursed, allotted funds from participating local governments, and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Library relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been
- 7-

COASTAL PLAIN REGIONAL LIBRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements.
INTERFUND TRANSACTIONS
The Library has the following type ofinterfund transactions:
Reimbursements ofexpenditures initially made from a fund that are properly applicable to another fund are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
MEMORANDUM ONLY - TOTAL COLUMNS
Total columns on the general purpose financial statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles, nor is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation ofthis data.
Note 2: 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 ofinsurance, or by collateral in an amount of not less than 110 percent ofthe public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of 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 ofGeorgia,
(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 ofthe State of Georgia,
(4) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities of the State of Georgia,

- 8-

COASTAL PLAIN REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 2: DEPOSITS

(5) Bonds ofany public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose,

(6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws ofthe State of Georgia, and

(7) Bonds, bills, notes, certificates ofindebtedness, 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 Banlc, 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, 1994, the bank balances were $133,927.04. The amounts ofthe total bank balances are classified into three categories of credit risk:

Category 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Library or by the Library's agent in the Library's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Library's name.
Category 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Library's name.)

The Library's deposits are classified by risk category at June 30, 1994, as follows:
Risk Category 1 2 3 Total

Bank Balance
$ 119,856.33 0.00
14,070.71
$ 133.927,04

- 9-

COASTAL PLAIN REGIONAL LIBRARY

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 3: GENERAL LONG-TERM DEBT

The changes in General Long-Term Debt during the fiscal year ended June 30, 1994, were as follows:

Compensated Absences

Balance July 1, 1993

$ 17,877.52

Additions Annual Leave Earned and Utilized (Net) Salaries and Wa~s Salary - Related Fringe Benefits (*)

-2,963.85 1,140.89

Balance June 30, 1994

$ 16 054.56

(*) Includes related fringe benefits applicable to compensated absences at July 1, 1993.

Note 4: SIGNIFICANT COMMITMENTS

At June 30, 1994, the Library had encumbrances in the amount of $71,986.70 for the unperformed portion of purchase orders, contracts and other commitments for goods and services associated with the Lottery Programs. The Georgia Department ofEducation has funding available to the Library in an amount equal to
these encumbrances. The revenues and expenditures associated with these encumbrances will be recognized
in the subsequent fiscal year. Encumbrances outstanding do not constitute expenditures or liabilities in the current year because these commitments will be honored during the subsequent year. These encumbrances are identified by Lottery Program as follows:

Media Center and Library Equipment

$ 71,986.70

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

Note 5: CONTINGENT LIABILITIES

Amounts received or receivable principally from the Federal government are subject to audit and review by
grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed under grant terms. The Library believes that such disallowances, if any, will be
immaterial to its overall financial position.

Note 6: ACCUMULATED EMPLOYEES LEAVE

Regular full-time employees earn annual leave ranging from .84 to 1.25 days each month depending upon the employee's length of continuous Library service with a maximum accumulation of fifteen days. Employees are paid at their daily rate ofpay for unused accumulated annual leave up to the maximum of fifteen days upon retirement or termination of employment. See Note 1 - Compensated Absences

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COASTAL PLAIN REGIONAL LIBRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 7: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
TRS PLAN DESCRIPTION All full-time 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 public employee retirement system (PERS).
TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement after 30 years of service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number ofyears of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement benefits also include disability and death benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employee contributions occurs, but the member's contributions are refunded with interest.
The Library's payroll for employees covered by TRS for the year ended June 30, 1994, was $330,223.81; total payroll was $392,278.21.
TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Library who are covered by TRS are required to pay 6% of their gross earnings to TRS. The Library makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. At June 30, 1994, the TRS Library employer contribution rate was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.
Total contributions made during fiscal year 1994 amounted to $58,813.13, of which $38,999.61 was made by the Library and $19,813.52 was made by employees. These contributions represented 11.81% (Library) and 6% (employees) of covered payroll.

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COASTAL PLAIN REGIONAL LIBRARY

EXlllBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 7: RETIREMENT PLANS

TRS FUNDING STATUS AND PROGRESS The amount of the total pension benefit obligation is based on a standardized measurement established by Statement No. 5 ofthe Governmental Accounting Standards Board (GASB) that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date, and is adjusted for the effects of projected salary increases. A standardized measure of the pension benefit obligation was adopted by the GASB to enable readers of PERS financial statements to assess that PERS funding status on a going-concern basis,
assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among
other PERS and among other employers.

Total unfunded pension benefit obligation ofTRS as of June 30, 1993, was as follows_:

Total pension benefit obligation

$13,912,014,000.00

Net assets available for benefits, at cost

12,821,722,000.00

Unfunded pension benefit obligation

$ 1.090.292.000.00

The measurement ofthe total pension benefit obligation is based on an actuarial valuation as ofJune 30, 1993. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers.

Total contributions from all employers to TRS for fiscal year ended June 30, 1994, were $521,550,000.00. The Library's contribution for the year ended June 30, 1994, of$38,999.61 was actuarially determined and represented .0074% of total contributions made by all participating employers.

Ten year historical trend information is presented in the 1994 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due.

Note 8: SURETY BONDS

Mr. Donald J. Nickerson, Library Director through October 25, 1994, was bonded in the amount of $100,000.00 with the Western Surety Company, Sioux Falls, South Dakota, their Bond No. 68216022.

The acting Library Director, Mr. Gary F. Frizzell, effective October 25, 1994, is bonded in the amount of $100,000.00 with the Western Surety Company, Sioux Falls, South Dakota, their Bond No. 60330907, on which premium was paid through April 16, 1995.

- 12 -

COASTAL PLAIN REGIONAL LIBRARY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 1994

EXHIBIT "E"

ASSETS Cash and Cash Equivalents Accounts Receivable
Total Assets

LOTTERY
PROGRAM
-------------

LIBRARY SERVICES AND

CONSTRUCT! ON ACT

----------------------------

TITLE I

TITLE VI

PUBLIC

LIBRARY

LIBRARY

LITERACY

SERVICES

PROGRAM

------------- -------------

TOTALS
-------------

$ 75,839.44 $

188.02 $

0.00 $ 76,027.46

85.72

85.72

------------- ------------- ------------- -------------

$ 75,839.44 $

273.74 $

0.00 $ 76,113.18

LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable Expired Grant Balances Payable Deferred Revenue
Total Liabilities FUND EQUITY
Fund Balances Unreserved Undesignated

$

3,669.72 $

273.74

183.02

71,986.70

------------- -------------

$ 75,839.44 $

273.74

0.00

0.00 $

$

3,943.46

183.02

71,986.70

-------------

$ 76,113.18

0.00

0.00

Total Liabilities and Fund Equity $ 75,839.44 $

273.74 $

0.00 $ 76,113.18

============= ============= ============= =============

See notes to the general purpose financial statements. - 13 -

COASTAL PLAIN REGIONAL LIBRARY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDEO JUNE 30. 1994

EXHIBIT "F"

LOTTERY PROGRAM

LIBRARY SERVICES AND CONSTRUCTION ACT

TITLE I PUBLIC LIBRARY SERVICES

TITLE VI LIBRARY
LITERACY PROGRAM

TOTALS

REVENUES
--------

State Funds Federal Funds

$ 32,830.28

$ 32,830.28

$ 17,634.72 $ 10,348.85

27,983.57

------------- ------------- ------------- -------------

Total Revenues

$ 32,830.28 $ 17,634.72 $ 10,348.85 $ 60,813.85
------------- ------------- ------------- -------------

EXPENDITURES
------------

Current Program Services Administration
Capital Outlay

$ 13,592.70 $ 10,348.85 $ 23,941.55

42.02

42.02

$ 32,830.28

4,000.00

36,830.28

------------- ------------- ------------- -------------

Total Expenditures

$ 32,830.28 $ 17,634.72 $ 10,348.85 $ 60,813.85
------------- ------------- ------------- -------------

Excess of Revenues over (under) Expenditures $

0.00 $

0.00 $

0.00 $

0.00

FUND BALANCE JULY 1
-------------------

0.00

0.00

0.00

0.00

------------- ------------- ------------- -------------

FUND BALANCE JUNE 30

$

0.00 $

0.00 $

0.00 $

0.00

============= ============= ============= =============

See notes to the general purpose financial statements. - 14 -

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30, 1994

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
--------------
Education, U. S. Department of Direct Library Services and Construction Act Title VI - Library Literacy Program 1993 Grant Through Georgia Department of Education Library Services and Construction Act Title I - Public Library Services 1992 Carry-Over 1993 Carry-Over 1992 Developmental Grant Carry-Over Title III - Library Services and Construction Act Interlibrary Cooperation and Resource Sharing

CFDA NUMBER
84.167
84.034 84.034 84.034
84.035

AWARDS
IN PERIOD
-------------

FEDERAL FUNDS RECEIVED IN PERIOD (NET OF REFUNDS)
-------------

FEDERAL REVENUE IN PERIOD
-------------

EXPENDITlRES IN PERIOD
-------------

$ 12,829.00$ 10,348.85$ 10,348.85

$ 19,000.00

398.00 13,549.00 4,000.00

13,634.72 4,000.00

13,634.72 4,000.00

25.24

11.92

25.24

(1)

------------- ------------- ------------- -------------

Total Federal Financial Assistance

$ 19,025.24$ 30,787.92$ 28,008.81 $ 27,983.57
======= ========== ============ ============

The Library had no major programs as defined by the Single Audit Act 1984. (1) Expenditures on this program were not maintained by fund source.

See notes to the general purpose financial statements. - 15 -

COASTAL PLAIN REGIONAL LIBRARY ANALYSIS OF CASH AND CASH EQUIVALENTS
JUNE 30. 1994

SCHEDULE "2"

INTEREST BEARING ACCOUNTS

The Citizens Bank of Tifton, Tifton, Georgia
Certificate of Deposit No. 7933 N.O.W. Account (2.50%)

(3.80%)

Trust Company of South Georgia, N.A., Albany, Georgia
Certificate of Deposit No. 5509445 (3.45%) Money Market Account (2.63%)

OTHER

Petty Cash

$ 10,000.00 82,233.40 18,000.00 1,856.33$ 112,089.73
50.00
$ 112,139.73

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

COASTAL PLAIN REGIONAL LIBRARY ACCOUNTS RECEIVABLE JUNE 30. 1994

SCHEDULE "3"

Education, Georgia Department of Federal Programs Library Services and Construction Act Title I - Public Library Services Title III - Interlibrary Cooperation and Resource Sharing
Local Sources Public Libraries Tifton-Tift County Victoria Evans Memorial Other Recovery of Questioned Costs Travel Overpayment

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE FUND

TOTAL

$

$

13.32

1,022.92 762.64
510.82

85.72 $

85.72 13.32

1,022.92 762.64
510.82

$

2,309.70$

85.72 $ 2,395.42

See notes to the general purpose financial statements. - 17 -

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1994

SCHEDULE "4"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Public U brari es Salaries and Travel Library Materials Maintenance and Operations Lottery Program Media Center and Library Equipment

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 204,547.17 52,923.00 46,323.00
$

$ 204,547.17 52,923.00 46,323.00

32,830.28

32,830.28

$ 303,793.17 $ 32,830.28$ 336,623.45

See notes to the general purpose financial statements.
- 18 -

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF LOCAL AND OTHER REVENUE
YEAR ENDED JUNE 30, 1994
LOCAL SOURCES County Boards of Education Cook Tift
Public Libraries Carrie Dorsey Perry Memorial Library (Berrien County) Cook County Irwin County Tifton-Tift County Victoria Evans Memorial Library (Turner County)
OTHER SOURCES Donations Fines and Fees Interest Earned Lost and Damaged Books Photocopy Sales Recovery of Current Year Questioned Cost Travel Overpayments Reimbursements For Salaries and Employee Benefits Tifton-Tift County Library For Supplies Other

SCHEDULE "5"
GOVERNMENTAL FUND TYPE GENERAL FUND
$ 2,210.00 1,200.00
8,280.00 8,280.00 5,356.92 14,800.00 5,848.00
816.39 216.10 1,686.34 1,077.22 274.90 510.82
219,091.10 1,353.28 525.00
$ 271,526.07

See notes to the general purpose financial statements. - 19 -

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF EXPENDITURES BY OBJECT
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30. 1994

SCHEDULE "6"

EXPENDITURES
------------
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Property Services Supplies Library Books and Materials Utilities Communications and Insurance Other Expenditures
Nonoperating Costs Equipment
Total Expenditures

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

------------- ------------- -------------

$ 373,455.52 $ 103,134.07 6,443.69 94.76 12,767.83 3,482.29 55,140.14 8,518.14 12,708.16 4,790.16

18,822.69 $ 1,319.70
488.71 492.02
2,500.85 359.60

392,278.21 104,453.77
6,932.40 586.78
12,767.83 5,983.14 55,499.74 8,518.14 12,708.16 4,790.16

7,745.94

36,830.28

44,576.22

------------- ------------- -------------

$ 588,280.70$ 60,813.85$ 649,094.55
============= ============= =============

See notes to the general purpose financial statements. - 20 -

COASTAL PLAIN REGIONAL LIBRARY MEMBERSHIP OF LIBRARY BOARD YEAR ENDED JUNE 30. 1994
BOARD MEMBER ADDRESS
Mrs. Pat Stephens, Chairman(*) Route 7, Box 468 Tifton, Georgia 31794 Mr. Tommy Bargeron(*) P. 0. Box 847 Tifton, Georgia 31793 Mr. Tom Call 1010 North Ridge Avenue Tifton, Georgia 31794 Mrs. Pat Cleary(*) 515 South Beech Street Ocilla, Georgia 31774 Mrs. Helene Fleming(*) Route 1, Box 1175 Tifton, Georgia 31794 Mrs. Brenda lnglehart (*) 1107 Lower Brookfield Road Tifton, Georgia 31794 Mr. Jerry Joiner(*) Route 1, Box 179 Adel, Georgia 31620 Mrs. Marie Mitchell (*) 715 Mclendon Street Ashburn, Georgia 31794 Mrs. Joni Tygart (*) Route 3, Box 360 Nashville, Georgia 31639
(*) Denotes Board Members Serving as of June 30, 1994
See notes to the general purpose financial statements.
- 21 -

SCHEDULE "7"

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF SALARIES ANO TRAVEL
YEAR ENDED JUNE 30. 1994

SCHEDULE 811 11

PERSONNEL
---------
Bacon, Bal 1, Batten, Britt, Calhoun, Cohen, Cooper, Ezekiel, Frizzell, Gibbs, Goldner, Goldner, Goodwin, Griffin, Griffin, Griffis, Hester, Hi 11 , Holtzclaw, Jin, Jordan, Laycock, Lewis, McDaniel, Mccurley, McMillian, Merritt, Moorman, Na 11 s, Nalls, Newberry, Nickerson, Suggs, Tolar, Tyson, Walker,

Bernice P. Karen L. Michelle C. Christie M. Inez Wanda J. Dena Yvonne Kim Gary F.
Sara s.
Katheline L. Matthew R. Barbara Fadella Salina Kathy E. Sandra M. Caryl Martha Greer Guojia Brian O. Dorothy S. Bernice W. Janette K. Donna S. Annis Angela R. Deborah A. Ashley M. Teresa S. Joan W. Donald J. Angela Diane Patricia F. Janice P. Barbara V.

Accruals June 30, 1993 June 30, 1994

POSITION
--------

SALARIES

TRAVEL

------------- -------------

Head of Reference Department Clerk Student Assistant Secretary Library Assistant Library Assistant Reference Librarian Assistant Literacy Coordinator Associate Director Library Assistant Student Assistant Head Librarian Head of Circulation Library Assistant Student Assistant Extension Librarian Student Assistant Student Assistant Library Assistant Head of Technical Services Student Assistant Literacy Coordinator Library Assistant Student Assistant Technical Services Librarian Assistant of Technical Services Student Assistant Secretary Student Assistant Head of Children's Department Bookkeeper Director Student Assistant Circulation Assistant Bookmobile Driver Library Assistant

$ 20,299.26

5,067.28

2,206.82

15,503.04 $

59.78

9,665.04

6,210.39

31,449.60

153.37

1,278.00

192.00

37,827.12

1,245.50

2,366.00

3,756.09

150.00

16,170.24

7,784.69

1,232.50

37,484.40

980.04

3,867.51

376.13

1,246.44

19,347.02

5,129.47

3,951.99

296.71

1,477.88

1,898.69

2,917.10

15,948.00

1,913.59

13,186.14

3,396.83

17,027.33

30,577.72

42,184.32

4,092.26

7,289.65

7,577.63

5,033.85

9,480.45

------------- -------------

$ 392,278.21 $ 7,019.66

-337.12
249.86
------------- -------------

$ 392,278.21 $ 6,932.40
============= =============

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

SECTION II COMPLIANCE

CLAUDE L. VICKERS STATE AUDIIDR (404) 656-2174
TAX RATIO (404) 656-0494

~cpartmcnt .of ~uhits
254 WASHINGIDN STREET, S.W. ROOM 214
~thmta, ~enrgia 30334-8400
December 16, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board
COMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements ofthe Coastal Plain Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated December 16, 1994. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to Coastal Plain Regional Library is the responsibility of the Library's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Library's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.
The results of our tests indicate that, with respect to the items tested, the Coastal Plain Regional Library complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Library had not complied, in all material respects, with those provisions.

94CRL-10

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~
Claude L. Vickers State Auditor
CLV:cm 94CRL-I0

CLAUDE L. VICKERS STATE AUDITOR (404) 6562174
TAX RATIO (404) 6560494

~eparfmeuf nf J\uhifs
254 WASHINGTON STREET, SW ROOM 214
J\tlmtbt, &;eorgia 30334-8400
December 16, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 6562006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board

SINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS

Ladies and Gentlemen:

We have audited the general purpose financial statements ofthe Coastal Plain Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated December 16, 1994. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.

We have applied procedures to test the Coastal Plain Regional Library's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1994:

( 1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-Up/Resolution

(4) Federal Financial Reports

(8) Administrative Requirements

Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits ofState and Local Governments" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective ofwhich is the expression ofan opinion on the Coastal Plain Regional Library's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion.

94CRL-50

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Coastal Plain Regional Library had not
complied, in all material respects, with those requirements. However, the results of our procedures disclosed
an immaterial instance of noncompliance with those requirements, which is described in the Schedule of Findings and Improper or Questioned Costs.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
L~
Claude L. Vickers State Auditor
CLV:cm 94CRL-50

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~.epartm.ent nf ~uhits
254 WASHINGTON STREET. S.W. ROOM 214
J\thmbt, ~eorgia 30334-8400
December 16, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board
SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Coastal Plain Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated December 16, 1994. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
In connection with our audit ofthe fiscal year 1994 general purpose financial statements ofthe Coastal Plain Regional Library and with our consideration of the Library's internal control structure used to administer Federal financial assistance programs, as required by Office ofManagement and Budget (0MB) Circular A-
128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128,
we have performed auditing procedures on the selected transactions to test compliance with the requirements governing:
Types of Services Allowed or Unallowed
Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Coastal Plain Regional Library's compliance with these requirements. Accordingly, we do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Coastal Plain Regional Library had not complied, in all material respects, with those requirements.
94CRL-120

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
t:~
Claude L. Vickers State Auditor
CLV:cm 94CRL-120

SECTION ill INTERNAL CONTROL

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

:!}epartmeut nf J\uhits
254 WASHINGTON STREET. S.W. ROOM 214
~tlanbt, <inrgia 30334-8400
December 16, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board
REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Ladies and Gentlemen:
We have audited the general purpose financial statements of the Coastal Plain Regional Library as ofand for the year ended June 30, 1994, and have issued our report thereon dated December 16, 1994. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements_
We conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standard, issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
In planning and performing our audit ofthe general purpose financial statements of the Coastal Plain Regional Library for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose ofexpressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure.
The management of the Coastal Plain Regional Library is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not
94ICL-3

be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.

For the purposes of this report, we have classified the significant internal control structure policies and procedures in the following categories:

(I) Cash and Cash Equivalents

(5) Employee Compensation

(2) Revenue/Receivables/Receipts

(6) General Ledger

(3) Procurement

(7) General Fixed Assets

(4) Expenditures/Liabilities/ Disbursements

For all ofthe internal control categories listed above, we obtained an understanding ofthe design of relevant
policies and procedures and whether they have been placed in operation, and we assessed control risk.

We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions ofmanagement in the general purpose financial statements.

As descnbed in the Schedule ofFindings and Improper or Questioned Costs, reportable conditions were noted in the following control categories:

(I) Accounting Controls (Overall)

(2) Expenditures/Liabilities/Disbursements

(3) General Fixed Assets

A material weakness is a reportable condition in which the design or operation of one or more ofthe specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.

Our consideration of the internal control structure would not necessarily disclose all matters in the internal
control structure that might be reportable conditions and, accordingly, would not necessarily disclose all
reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that all ofthe reportable conditions disclosed above are also considered to be material weaknesses.

94ICL-3

These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit of the Coastal Plain Regional Library's financial statements and this report does not affect our report thereon dated December 16, 1994.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~dk,
Claude L. Vickers State Auditor
CLV:cm 94ICL-3

CLAUDE L. VICKERS STATE AUDIIDR (404) 656-2174
TAX RATIO (404) 656-0494

~epttrhneut nf J\uh-its
254 WASHINGTON STREET, S. W. ROOM 214
~thmta, &ieorBia 30334-8400
December 16, 1994

FINANCIAL AUDITS (404) 656-2180
PROGRAM AUDITS (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Coastal Plain Regional Library Board
SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS
Ladies and Gentlemen:
We have audited the general purpose financial statements ofthe Coastal Plain Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated December 16, 1994. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Coastal Plain Regional Library complied with laws and regulations, noncompliance with which would be material to a Federal financial assistance program.
In planning and performing our audit for the year ended June 30, 1994, we considered the Library's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Library's general purpose financial statements and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated December 16, 1994.
The management of the Coastal Plain Regional Library is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The
94ICL-15

objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness ofthe design and operation of policies and procedures may deteriorate.

For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following control categories:

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

(I) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (5) Allowable Costs/Cost Principles

(I) Types of Services Allowed or Unallowed
(2) Eligibility
(3) Reporting
(4) Applicable Special Tests and Provisions

(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution

(5) Other Requirement Claims for Advances and Reimbursements

(8) Administrative Requirements

For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk.

During the year ended June 30, 1994, the Coastal Plain Regional Library had no major Federal financial assistance programs and expended 63% ofits total Federal financial assistance under the following nonmajor Federal financial assistance program:

Library Services and Construction Act Title I - Public Library Services

We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with general requirements, and specific requirements, as

94ICL-15

described above that are applicable to the aforementioned nonmajor program. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion.
We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation ofthe internal control structure that, in our judgment, could adversely affect the Library's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations.
As described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category:
Administrative Requirements
A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.
Our consideration of the internal control structure policies and procedures used in administering Federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition described above is also considered to be a material weakness.
This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~
Claude L. Vickers State Auditor
CLV:cm 94ICL-15

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Inadequate Drug-Free Workplace Policy Federal Financial Assistance Audit Control Number 7372-93-03 Finding Resolved
According to provisions ofP. L. 100-690, all grantees that have been approved or awarded a direct Federal grant are required to establish a drug-free workplace policy containing certain information. The audit report for the year ended June 30, 1993, reported that the Library's drug-free workplace policy did not include notification that employees convicted of drug related offenses occurring within the workplace, are required to notify the Library within five days of conviction. During the year under review, the Library amended their drug-free workplace policy to include all drug-free workplace compliance requirements.
PRIOR YEAR/CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7372-93-01
The audit report for the year ended June 30, 1993, stated that the Library did not provide for adequate separation ofemployee duties in the performance ofaccounting functions and related procedures for all funds. For the year under review, our audit noted no improvement regarding separation of employee duties. This deficiency was a result ofmanagement's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff.
(Note: All Federal financial assistance programs listed in the Schedule of Federal Financial Assistance, Schedule II l II of this report are affected by this finding.)
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7372-93-02
The audit report for the year ended June 30, 1993, noted that the Library did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Library did not establish a General Fixed Assets Account

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR/CURRENT YEAR
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7372-93-02
Group within the fonnal accounting records. This condition results in the general purpose financial statements of the Library being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Library to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings, equipment, and inexhaustible collections and books owned by the Library and should include but may not be limited to date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group.
CURRENT YEAR
EXPENDITURES/LIABILITIES/DISBURSEMENTS Inadequate Documentation ofTravel Expenditures Financial Statements Reportable Condition - Material Weakness Nonmaterial Noncompliance Amount: $510.82 Audit Control Number 73 72-94-0 I Finding Resolved
For the year under review, an examination of the Library's travel expenditures were performed to test the validity and accuracy of the expenditure transactions. The expenditures examined revealed the following deficiencies:
(a) The Library's Director, Mr. Donald J. Nickerson, did not submit individual travel expense reports for reimbursement. Instead, credit cards issued on behalf of the Library were used to charge most travel expenses.
(b) Several items appeared on the Library's credit card statement for employee meals incurred by employees not on travel status for which there was no documentation that the meal was an integral part of a conference or meeting.
(c) Several travel reimbursement expense statements, submitted by the Director, included mileage for trips for which the Library vehicle log indicated that the Library vehicle had been used instead ofthe Director's personal vehicle.

COASTAL PLAIN REGIONAL LIBRARY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
CURRENT YEAR
EXPENDITURES/LIABILITIES/DISBURSEMENTS Inadequate Documentation ofTravel Expenditures Financial Statements Reportable Condition - Material Weakness Nonmaterial Noncompliance Amount: $510.82 Audit Control Number 7372-94-01 Finding Resolved
(d) On two occasions, the Director claimed reimbursement for meals while attending conferences; however, the registration fee for the conferences included the cost of the meals.
These deficiencies resulted from the failure ofthe Library's management to comply with travel regulations set forth by the State Department ofEducation.
Internal controls should be implemented by the Library to ensure that all travel expenditures are reviewed for proper documentation and compliance with travel regulations prior to payment. In addition, each individual receiving travel reimbursement should file an individual travel expense report. Subsequent to June 30, 1994, reimbursement of the aforementioned deficiencies totaling $510.82 was secured and deposited into the Library's General Fun<,l. This amount is reflected as accounts receivable on the Combined Balance Sheet Exhibit "A" of this report.
AUDIT FOLLOW-UP/RESOLUTION Audit Distribution Requirements Federal Financial Assistance Nonmaterial Noncompliance Audit Control Number 7372-94-02
The Library failed to submit a copy of the 1993 audit report on a timely basis to the U. S. Department of Education form whom the Library received Library Services and Construction Act - Title VI, Library Literacy Program funds (CFDA 84.167). Paragraph 13fofOMB Circular A-128 requires that the recipients of Federal financial assistance submit copies of single audit reports to those agencies providing Federal financial assistance. Management stated they were unaware ofthis audit distribution requirement.
Procedures should be implemented to ensure that reports are submitted to grantor agencies in accordance with audit distribution requirements.

SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

COASTAL PLAIN REGIONAL LIBRARY PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30, 1994
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7372-93-01
We concur with this finding. The problem remains that funds are not available to hire additional staff to achieve the degree of accounting controls desired by the Department of Audits. However, after reviewing a copy ofdeficiencies in this area, the Board has taken steps to involve an existing staff member to specifically address these deficiencies. Currently, accounting functions are separated among three employees. This action should result in an improvement in the area ofinternal controls for FY95.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7372-93-02
We concur with this finding. While the Board recognizes the importance of an inventory, there has not been a mechanism provided to us for establishing a General Fixed Assets Account Group within the formal accounting records on GENESIS. We understand that software is being developed for this purpose. We have recently received a memorandum with information about how an inventory can be accomplished manually that will meet the requirements ofthe Department of Audits. The Board will review these procedures at its next meeting to determine whether or not an acceptable inventory can be completed by existing staff
AUDIT FOLLOW-UP/RESOLUTION Audit Distribution Requirements Federal Financial Assistance Nonmaterial Noncompliance Audit Control Number 7372-94-02
We concur with this finding. Apparently, this was an oversight on the part of the Library Director who has since resigned. A copy of the FY93 audit report was sent to the grantor agency on December 13, 1994, immediately upon discovery of the oversight. The Board and management are now fully aware of audit distribution requirements and will be alert to the need for this in the future.
Note: The Coastal Plain Regional Library has elected not to provide comments for inclusion in this report other than the above.