Audit report, Lake Blackshear Regional Library, Americus, Georgia, year ended June 30, 1996

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AUDIT REPORT LAKE BLACKSHEAR REGIONAL LIBRARY
AMERICUS, GEORGIA YEAR ENDED JUNE 30, 1996

LAKE BLACKSHEAR REGIONAL LffiRARY ~ TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINEDSTATEMENTS-OVERVffiW

A

COMBINED BALANCE SHEET

ALL FUND TYPES AND ACCOUNT GROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

ALL GOVERNMENTAL FUND TYPES

3

C

STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - BUDGET AND ACTUAL

GENERAL AND SPECIAL REVENUE FUNDS

4

D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

14

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

15

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

16

2 CASH AND CASH EQUIVALENTS

17

3 ACCOUNTS RECEIVABLE

18

SCHEDULE OF REVENUE

4

STATE

19

5

OTHER

20

SCHEDULE OF EXPENDITURES BY OBJECT

6

GOVERNMENTAL FUND TYPES

21

7

LOTTERY PROGRAM

22

LAKE BLACKSHEAR REGIONAL LffiRARY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

ADDITIONAL FINANCIAL INFORMATION

SCHEDULES

8 MEMBERSHIP OF LIBRARY BOARD

23

9 SCHEDULE OF SALARIES AND TRAVEL

25

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 III
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

LAKE BLACKSHEAR REGIONAL LIBRARY ~ TABLE OF CONTENTS ~
SECTION V PERTINENT VIEWS OF RESPONSIBLE OFFICIALS PERTINENT VIEWS OF RESPONSffiLE OFFICIALS

SECTION I FINANCIAL

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members of the Lake Blackshear 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 Lake Blackshear
Regional Library, as ofand for the year ended June 30, 1996, 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 OMB 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, varies 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.
96ARL-44

The aggregate effects on the general purpose financial statements C?f this omission have not been determined, but are believed to be material.
In our opinion, except for the effects on the general purpose financial statements ofthe matter referred to in the third paragraph, the general purpose financial statements present fairly, in all material respects, the financial position ofthe Lake Blackshear Regional Library as ofJune 30, 1996, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued a report dated January 31, 1997, on our consideration of the Library's internal control structure and a report dated January 31, 1997, on its compliance with laws and regulations.
Our audit was conducted for the purpose offorming an opinion on the general purpose financial statements ofthe Lake Blackshear Regional Library taken as a whole. The combining statements (Exhibits E and F) and the financial schedules (Schedules 1 through 9 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 Lake Blackshear 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 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,
d.~~
Claude L. Vickers State Auditor
CLV:dt 96ARL-44

LAKE BLACKSHEAR REGIONAL LffiRARY - 1-

LAKE BLACKSHEAR REGIONAL LIBRARY COMBINED BALANCE SHEET
All FUND TYPES AND ACCOUNT GROUP JUNE 30,1996

EXHIBIT "A"

ASSETS
Cash and Cash Equivalents
Accounts Receivable
Amount to be Provided in Future Years For Payment of: Capital lease Agreements Compensated Absences

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

$

72,978,40 $

3,497.64

1,748.78

ACCOUNT GROUP
GENERAL lONG-TERM
DEBT

TOTALS (Memorandum Only) JUNE 30,1996 JUNE 30, 1995

$

76,476.04 $

82,356.07

1,748.78

28,598.69

$

1,568.37

33,917.52

1,568.37 33,917.52

3,454.46 30,891.74

Total Assets

$

74.727.18 $

3.497,64 $

35,485.89 $ 113.710.71 $ 1451300.96

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft

Accounts Payable

$

Expired Grant Balances Payable

Capital lease Agreements

Compensated Absences

Total Uabilities

$

FUND EQUITY

Fund Balances

Reserved

For local Adult literacy

$

Unreserved

Undesignated

Total Fund Equity

$

26,037.93 $
26,037.93 $
11,430.10 37,259.15 $ 48,689.25 $

3,497.64 $
3,497.64 $

$
1,568.37 33,917.52
35,485.89 $

$ 26,037.93
3,497.64 1,568.37 33,917.52
65,021.46 $

26,635.39 9,448.92 6,353.95 3,454.46
30,891.74
76,784.46

$

11,430.10 $

6,069.87

0.00

371259.15

62,446.63

0.00

$

48,689.25 $

68,516.50

Total liabilities and Fund Equity $

74.727.18 $

3.497.64 $

35,485.89 $ 113,710.71 $ 145,300.96

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

LAKE BLACKSHEAR REGIONAL LIBRARY

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

.

ALL GOVERNMENTAL FUND TYPES

YEAR ENDED JUNE 30. 1996

EXHIBITMBM

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Program Services Technical Services Circulation Administration Maintenance and Operations
Capital Outlay
Debt Service
Principal Interest
Total Expenditures
Excess of Revenues over (under) Expenditures
FUND BALANCE JULY 1

GENERAL FUND

SPECIAL REVENUE
FUND

TOTALS (Memorandum Only)
YEAR ENDED
JUNE 30,1996 JUNE 30,1995

$ 309,116.31 $ 349,359.42
$ 658,475.73 $

10,000,00 $ 28,708,83
38,708.83 $

319,116.31 $ 28,708,83
349,359.42
697,184.56 $

379,680.22 43,349,52 331,129.69
754,159.43

$ 246,718.78 $ 75,372.20 152,647.38 140,468.88 eo,8n.9O

1,886.09 331.75

$ 678,302.98 $

$

-19,827.25 $

68,516.50

28,708.83 $ 10,000.00
38,708.83 $ 0.00 $ 0.00

275,427.61 $ 75,372.20 162,647.38 140,468.88 eo,8n.9O
1,886.09 331.75
717,011.81 $
-19,827.25 $
68,516.50

274,201.62 55,809.54 235,830.52 145,184.07 59,802.65 36,524.61
8,318.44 920.38
816,591.83
-62,432.40
130,948.90

FUND BALANCE JUNE 30

$

48,689.25 $

0.00 $

48,689.25 $

6.8.,-.51.6...5..0.

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

LAKE BLACKSHEAR REGIONAL LIBRARY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL GENERAL AND SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30,1996

EXHIBIT"C"

REVENUES
State Funds Federal Funds Other Funds
Total Revenues
EXPENDITURES
Current Program Services Technical Services Circulation Administration Maintenance and Operations
Debt Service
TotalExpend~ures
Excess of Revenues over (under) Expend~ures
FUND BALANCE JULY 1. 1995
Adjustments

GENERAL FUND

BUDGET

ACTUAL

$ 308,207,00 $ 342,081.00
$ 650,288.00 $

309,116,31 349,359.42 658,475,73

SPEC~LREVENUEFUND

BUDGET

ACTUAL

$ 10,000,00 $ 10,000.00

61,242,26

28,708.83

$ 71,242.26 $ 38,708.83

$ 230,510.60 $ 246,718.78

73,164.20

75,372.20

158,369.05

152,647.38

123,m.2O

140,468.88

58,300,00

6O,8n.90

2,217.84

$ 644,121.05 $ 678,302,98

$

6,166.95 $ -19,827.25

73,676.26

68,516.50

-2,556,99

$ 29,242.26 $ 28,708,83

10,000.00

10,000.00

$ 39,242.26 $ $ 32,000,00 $
-26,793,53

38,708,83 0.00 0.00

FUND BALANCE JUNE 30..1996

$ n,286.22 $ 48,689.25

$

5,206.47 $ _=-===,,0=.00=

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

LAKE BLACKSHEAR REGIONAL LffiRARY

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 3D. 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Lake Blackshear Regional Library operates pursuant to Official Code of Georgia Annotated Sections 205-40 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 of the departure from generally accepted accounting principles disclosed in these notes, the financial statements of the Library have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all fund types and account groups of the Library. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.
The more significant of the Library's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the governmental 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 ofthe above criteria, the Lake Blackshear Regional Library is determined to be a joint venture.
The Library Board consists of38 members; 9 members appointed by Crisp County Library Board, 9 members appointed by Dooly County Library Board, 8 members appointed by Schley County Library Board and 12 members appointed by Sumter County 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 Lake Blackshear Regional Library is located in Americus, Georgia, and serves Crisp, Dooly, Schley and Sumter 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.

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LAKE BLACKSHEAR REGIONAL LIDRARY

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

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 and Other funds under control ofthe Library, in compliance with generally accepted accounting principles applicable to goverrimental 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 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 and capital lease obligations not appropriately accounted for and recorded in other fund types.
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 ofthese funds present increases (i.e., revenues) and decreases (i.e., expenditures) 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.

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LAKE BLACKSHEAR REGIONAL LffiRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Governmental funds are accounted for using the modified accrual basis of accounting under which:
Revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Those revenues considered susceptible to accrual are intergovernmental grants and investment income.
Expenditures are generally recognized when the related fund liability is incurred.
BUDGET
The Lake Blackshear Regional Library's budget is a complete financial plan for the Library's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Library at the aggregate level. The budget for governmental funds was prepared in accordance with generally accepted accounting principles.
The budget process begins when the Library's administration prepares a tentative aggregated budget for the Board's approval. After approval of this tentative budget by the Board, copies are sent to all local funding agencies. After funding approval is received from all local funding agencies, the Board makes revisions as necessary and adopts the budget. The budget is then submitted to the Georgia Department of Education, Division ofPublic Library Services as a part of the Library's annual application for State aid. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year end.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits (including 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 of grant reimbursements due from State grantors for expenditures made but not reimbursed, and allotted funds from a participating local government. 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.

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LAKE BLACKSHEAR REGIONAL LffiRARY

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 recorded in the individual funds for the current portion ofthis obligation as this amount is deemed immaterial to the general purpose financial statements.
INTERFUND TRANSACTION
The Library has the following type ofinterfund transaction:
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 ofGeorgia 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. The aggregate of the face value of such surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent of the public funds being secured after the deduction of the 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 ofoperating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists of anyone of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

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LAKE BLACKSHEAR REGIONAL LffiRARY

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 2: DEPOSITS
(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 ofthe State of Georgia,
(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 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 and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
CATEGORIZATION OF DEPOSITS At June 30, 1996, the bank balances were $96,015.11. The bank balances were entirely covered by Federal depository insurance.
Note 3: RISK MANAGEMENT
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; natural disaster; and unemployment compensation.
The Library has obtained commercial insurance for risk of loss associated with torts, assets, and job related illnesses 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 natural disasters. In addition, the Library has elected to self-insure for errors or omissions, which includes, among other risks, risks for sexual harassment and discrimination. The Library has not experienced any losses related to these risks in the past three years.

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LAKE BLACKSHEAR REGIONAL LmRARY

EXHIBIT liD"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 3: RISK MANAGEMENT

The Library is self-insured with regard to unemployment compensation claims. The Library accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The Library has not experienced any unemployment compensation claims during the last two years.

Note 4: GENERAL LONG-TERM DEBT

CAPITAL LEASES The Lake Blackshear Regional Library has entered into various lease agreements as lessee for copiers. These lease agreements qualifY as capital leases for accounting purposes and, therefore, have been recorded at the present value ofthe future minimum lease payments as ofthe date of their inception.

The changes in General Long-Term Debt during the fiscal year ended June 30, 1996, were as follows:

Capital Leases

Compensated Absences

Balance July 1, 1995

$ 3,454.46 $ 30,891.74

Additions Leave Earned and Utilized (Net)

3,025.78

Deductions Payments

1.886.09

Balance. June 30, 1996

$ 1.568.37 $ 33,917.52

At June 30, 1996, payments due, by fiscal year which includes principal and interest for these items, are as follows:

Fiscal Year Ended June 30

Capital Leases

1997

$ 1,663.38

Deduct: Imputed Interest

95.01

Net Present Value ofFuture Minimum Lease Payments

$ 1 568.37

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LAKE BLACKSHEAR REGIONAL LIDRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30.1996

Note 5: ON-BEHALFPAYMENTS
The Library has recognized revenues and expenditures in the amount of $26,708.63 for salaries and employers contribution paid on the Library's behalf as follows:
Dooly County Board of Commissioners For Salary and Employer's Contributions ofLibrary Personnel In the amount of $26,708.63
Note 6: 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 7: ACCUMULATED EMPLOYEES' LEAVE
Employees ofthe Library earn leave at a rate determined by the length of employment with the Library. The Library's leave policy provides that employees will be paid, at the current pay rate, for accumulated personal leave up to a maximum of 30 days upon retirement or termination of employment. See Note 1 Compensated Absences
Note 8: 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 in accordance with State statute. 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 montWy for life. Options are available for distribution ofthe member's montWy 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
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LAKE BLACKSHEAR REGIONAL LmRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30. 1996

Note 8: RETIREMENT PLANS

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, 1996, was $317,647.76; total payroll was $403,814.87.

TRS CONTRmUTIONS REQUIRED AND MADE Employees of the Library who are covered by TRS are required by State statute to pay 5% of their gross earnings to TRS. The Library makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. At June 30, 1996, the TRS Library employer contribution rate was 11.81%. The interest rate assumption (rate ofretum on investments) was 7.50%.

Total contributions made during fiscal year 1996 amounted to $53,396.66, of which $37,514.20 was made by the Library and $15,882.46 was made by employees. These contributions represented 11.81% (Library) and 5% (employees) of covered payroll.

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, 1995, was as follows:

Total pension benefit obligation

$ 17,442,607,000.00

Net assets available for benefits, at cost

15,857,066,000.00

Unfunded pension benefit obligation

$ 1.585.541.000.00

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LAKE BLACKSHEAR REGIONAL LffiRARY

EXHIBIT "0"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1996

Nme8: RETmEMENTPLANS
The measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1995. 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, 1996, were $607,275,000.00. The Library's contribution for the year ended June 30, 1996, of$37,514.20 was actuarially determined and represented .0062% oftotal contributions made by all participating employers.
Ten year historical trend information is presented in the 1996 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 9: SURETY BOND
The Library Director, Ms. Jane B. Hendrix, is bonded in the amount of $10,000.00 with the United States Fidelity and Guarantee Company, Baltimore, Maryland, their Bond No. 02-0170-11639-89-2, on which premium is paid through July 1, 1999.

- 13 -

LAKE BLACKSHEAR REGIONAL LIBRARY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30.1996

EXHIBIT-E-

ASSETS Cash and Cash Equivalents Accounts Receivable

LOTTERY PROGRAM

LIBRARY SERVICES AND

CONSTRUCTION ACT

TITLE I

TITLE VI

PUBLIC

LIBRARY

LIBRARY

LITERACY

SERVICES

PROGRAM

TOTALS JUNE 30,1996 JUNE 30,1995

$

0.00 $

0.00 $

3,497.64 $

3,497.64 $

0.00

26,793.53

Total Assets

$ _ _....;O_.OO_$ _ _......;;O~..O.O $

3,497.64 $

3,497.64 $ 26,;,:,7,;,,;93;,;;,;,;;..53.

LIABILITIES AND FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable Expired Grant Balances Payable

Total Liabilities

FUND EQUITY

Fund Balance

Unreserved

Undesignated

$

Total Liabilities and Fund Equity $

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

$

0.00 $ 26,635.39

158.14

$

3,497.64

3,497.64

$

3,497.64 $

3,497.64 $

26,793.53

0.00 $

0.00 $

0.00 $

0.00

0..0..0.. $

3,497.64 $

3,497.64 $ 26,;,:,,;,,;.79.3..5..3..

See notes to the general purpose financial statements.

-14 -

LAKE BLACKSHEAR REGIONAL LIBRARY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30,1996

EXHIBIT oF"

REVENUES

LOTTERY PROGRAM

LIBRARY SERVICES AND

CONSTRUCTION ACT

TITLE I

TITLE VI

PUBLIC

LIBRARY

LIBRARY

LITERACY

SERVICES

PROGRAM

TOTALS YEAR ENDED JUNE 30,1996 JUNE 30,1995

State Funds Federal Funds

$ 10,000,00 $

17,000.00 $

$ 11,708.83

10,000,00 $ 28,708,83

84,375,00 42,384,33

Total Revenues

$ 10,000,00 $ 17,000,00 $ 11,708,83 $

38,708,83 $ 126,759,33

EXPENDITURES

Current Program Services Circulation Administration

$ $ 10,000.00

17,000,00 $

11,708,83 $

28,708,83 $ 10,000,00

42,384,33 83,275,00
1,100.00

Total Expenditures

$ 10,000,00 $ 17,000,00 $ 11,708,83 $

38,708,83 $ 126,759.33

Excess of Revenues over (under) Expenditures $

0,00 $

0.00 $

0,00 $

0,00 $

0.00

FUND BALANCE JULY 1

0.00

0.00

0,00

0,00

0,00

FUND BALANCE JUNE 30

$

0..0..0.. $

0,00 $

0.,0.0.. $

0,00 $

0.,0.0..

See notes to the general purpose financial statements.

-15-

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30, 1996

SCHEDULE "1"

FUNDING AGENCY PROGRAM/GRANT
Education, U. S. Department of Direct Ubrary Services and Construction Act Title VI - Ubrary Literacy Program 1995 Grant Through Georgia Department of Education Library Services and Construction Act Title I - Public Ubrary Services 1995 Carry-Over

CFDA NUMBER

FEDERAL REVENUE IN PERIOD

EXPENDITURES IN PERIOD

84.167 $

11,708.83 $

11,708.83

84.034

17,000.00

17,000,00

Total U. S, Department of Education

$

28,708.83 $===28=,7:=0=8=.8=::3

The Library had no major programs as defined by the Single Audit Act of 1984.

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

LAKE BLACKSHEAR REGIONAL LIBRARY CASH AND CASH EaUIVALENTS JUNE 30,1996

SCHEDULE ''2''

INTEREST BEARING ACCOUNTS
Citizens Bank of Americus, Americus, Georgia
N.O.W. Account (1.50%)
Sumter Bank and Trust Company, Americus, Georgia
Money Market Account (Variable)
OTHER
Petty Cash

$ 54,049.74 22,216.30 $ 76,266.04 210.00

$ 76.476.04

See notes to the general purpose financial statements.

- 17 -

LAKE BLACKSHEAR REGIONAL LIBRARY ACCOUNTS RECEIVABLE JUNE 30, 1996
Education, Georgia Department of Reimbursement - Georgia Online Database Transactions
Local Support Schley, Board of Commissioners Unadilla, City of
Various Sources Interest Earned

SCHEDULE "3"

GOVERNMENTAL FUND TYPE GENERAL FUND

$

10.89

480.00 1,203.44

54.45

$====1:=,7=4=:8=.7=8

See notes to the general purpose financial statements.

- 18 -

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30.1996

SCHEDULE "4"

AGENCYIFUNDING
GRANTS Education, Georgia Department of Public Libraries Salaries and Travel Library Materials Maintenance and Operations Lottery Program Technology Installation
OTHER Education, Georgia Department of Reimbursement - Georgia Online Database Transactions

GOVERNMENTAL FUND TYPES

SPECIAL

GENERAL

REVENUE

FUND

FUND

TOTAL

$ 229,239.42 42,733.00 37,133.00

$ 229,239.42 42,733.00 37,133.00

10,000.00

10,000.00

10.89

10.89

$ 309,116.31 $

10,000.00 $ 319,116.31

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

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF OTHER REVENUE YEAR ENDED JUNE 30, 1996

SCHEDULE "5"

LOCAL SOURCES City Governments Americus Byromville Cordele Ellaville Unadilla County Governments Boards of Commissioners Crisp Dooly Schley Sumter
OTHER SOURCES Donations Fines and Fees Interest Earned Lost and Damaged Books Reimbursements for Salaries and Benefits Dooly County Board of Commissioners Sales and Services Photocopy Sales Other

GOVERNMENTAL FUND TYPE GENERAL FUND

$

85,110.00

1,541.46

30,390.00

5,182.00

7,220.64

24,060.00 9,540.00
13,695.00 95,166.00

26,147.84 6,497.42 2,243.54 344.65
26,708.63
14,660.56 851.68

. $ ===3=4=9,=35=9=.4=::2

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

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF EXPENDITURES BY OBJECT
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1996

SCHEDULE "6"

EXPENDITURES
Operating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Property Services Supplies Ubrary Books and Materials Utilities Communications and Insurance Dues and Fees Other Expenditures
Nonoperating Costs Principal and Interest Equipment

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 397,514,87 $
100,432.32 6,531.24 65.60
24,156.13 15,405.16 43,311.26 36,580.57 37,272.32
996.67 1,553.79

6,300.00 $
845.71 99.00 38.02
3,287.76 6,369.68
2,912.14
976.72

403,814.87 101,278.03
6,630.24 103.62
24,156.13 18,692.92 49,680.94 36,580.57 40,184.46
996.67 2,530.51

2,217,84 12,265.21

17,879.80

2,217.84 30,145.01

Total Expenditures

$ 678,302.98 $

38,708.83 $ 717,011.81

See notes to the general purpose financial statements. - 21 -

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF EXPENDITURES BY OBJECT
LOTTERY PROGRAM YEAR ENDED JUNE 30, 1996
EXPENDITURES Operating Costs Communications and Insurance Nonoperating Costs Equipment
Total Expenditures

SCHEDULE '7"

TECHNOLOG't INSTALLATION

$

2,820.20

7,179.80

$ ======10=,=00=:0=.0:=0

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

LAKE BLACKSHEAR REGIONAL LIBRARY MEMBERSHIP OF LIBRARY BOARD YEAR ENDED JUNE 30, 1996

BOARD MEMBER ADDRESS
Mr. Michael Hickerson, Chairman (*) clo DooIy County Board of Education Vienna, Georgia 31092
Ms. Andrea Brooks (*) 105 West Patterson Street ArrIericus, Georgia 31709
Ms. Gwendolyn Butler (*) 323 East Forsyth Street Americus, Georgia 31709
Mr. Everett Byrd (*) 212 Lorraine Avenue ArrIericus, Georgia 31709
Mr. Fred Causey (*) 500 Third Street Vienna, Georgia 31092
Mr. Charles Chambers (*) P. O. Box 27 Ellaville, Georgia 31806
Ms. Willie Mae Chaney (*) P. O. Box 71 Vienna, Georgia 31092
Ms. Mary Ann Davis (*) P. O. Box 397 Vienna, Georgia 31092
Ms. Gabrella Dimry (*) 811 West 21 st Avenue Cordele, Georgia 31015
Mr. Trae Dorough (*) P. O. Box 280 Cordele, Georgia 31015
Ms. Diane Exum (*) P. O. Box 231 Leslie, Georgia 31764
Mr. Thomas Gipson 406 South 15th Street Cordele, Georgia 31015
Ms. Lillian Goff (*) 1990 Royal Road Cordele, Georgia 31015
Mr. George Greene (*) P. O. Box 753 Cordele, Georgia 31015
(*) Denotes Board Members Serving as of June 30,1996
See notes to the general purpose financial statements.

- 23 -

SCHEDULE -8*
Mr, John Greene (*) Route 1, Box 179 E Ellaville, Georgia 31806
Ms. Endine Hart (*) P. O. Box 44 Ellaville, Georgia 31806
Ms. Charlie Mae Hill (*) 302 Brookdale Americus, Georgia 31709
Mr. Robert Hill 302 Brookdale Americus, Georgia 31709
Ms. Ma~orie Hobgood (*) 458 Young Mill Road Americus, Georgia 31709
Ms. Grada Horne (*) P. O. Box 97 Pinehurst, Georgia 31070
Mr. Floyd HUdgins 711 24th Avenue East Cordele, Georgia 31015
Mr. Herbert Ingram (*) 1303 Canary Street Cordele, Georgia 31015
Ms. Margaret Kennedy 617 20th Avenue East Cordele, Georgia 31015
Mr. William B. King(*) 901 Moore Drive Americus, Georgia 31709
Ms. Madelyn Laidler (*) Lilly, Georgia 31051
Mr. Lulean Laster (*) 508 North Mayo Street Americus, Georgia 31709
Ms. Brenda Mansfield (*) 1219 Lafayette Street Americus, Georgia 31709
Ms. Imogene McLendon (*) Route 2, Box 74 Ellaville, Georgia 31806

LAKE BLACKSHEAR REGIONAL LIBRARY MEMBERSHIP OF LIBRARY BOARD YEAR ENDED JUNE 30.1996

BOARD MEMBER ADDRESS
Ms. Bettye Miller (*) P. O. Box 73 Ellaville, Georgia 31806
Ms. Dorothy Morgan (*) Arabi, Georgia 31712
Ms. Ida Rose Oliver (*) 61417th Avenue West Cordele, Georgia 31015
Ms. Marion Page (*) P. O. Box 207 Byromville, Georgia 31007
Ms. Joyce A. Peavey (*) P. O. Box 987 Unadilla, Georgia 31091
Ms. Joan Perkins (*)
P. O. Box 179
Ellaville, Georgia 31806
Dr. Richard Reese (*) 103 Glenwood Road Americus, Georgia 31709
Ms. Betty Snipes (*) P. O. Box 433 Ellaville, Georgia 31806
Ms. Sarah Summers (*) 571 Cemetery Road . Cordele, Georgia 31015
Ms. Elaine Taylor (*) 302 Church Street Vienna, Georgia 31092
Ms. Ellen Watson (*) RFD Briarwood Circle Americus, Georgia 31709
Ms. Iris Weed (*) 109 O'Hara Road Americus, Georgia 31709
Ms. Virginia Whaley (*) P. O. Box 88 Ellaville, Georgia 31806
Ms. Gladys Wright (*) 1101 South 12th Street Cordele, Georgia 31015

(*) Denotes Board Members Serving as of June 30, 1996
see notes to the general purpose financial statements.

- 24 -

SCHEDULE "S"

LAKE BLACKSHEAR REGIONAL LIBRARY SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30,1996

SCHEDULE "9"

PERSONNEL

POSITION

SALARIES

TRAVEL

Bates, Becker, Brogdon, Bruce, Deriso, Flynn, Guttenberg, Harris, Hendrix, Hibberd, Hopkins, Hurd, Ingram, Isbell, Johnson, Joyner, Laney, Mathis, McDaniel, Michelli, Miles, Mills, Morgan, Nelson, Oates, Tondee, Wishum,

Harriet S, Lawrence T. Debra A Jeanine S, Jean F. Amanda KayC. EllaD. Jane B. Deidre D. Shirley J. David G. MaryA Anne M. EmmaS. WendyT. Rachel Dianne Trudi F. Mary C. Judith Barbara G. Frances Brenda F. Andrea D. SaraW. HelenW.

Reference Librarian

$

Assistant Director

Clerk

Clerk

Bookmobile Manager

Program Planner - Literacy

Clerk

Clerk

Director

Library Manager

Clerk

Literacy Evaluator

Library Manager

Librarian, Head of Adult Services

Administrative Literacy Assistant

Clerk

Clerk

Clerk

Clerk

Librarian

Clerk

Library Manager

Literacy Clerk

Librarian, Head of Children Services

Clerk

Library Manager

Administrative Assistant

10,236,86 44,236.40 $ 12,778,56
4,320,68 18,320.10 4,900.00 4,561.23 14,253.72 47,836.40 5,631.48 21,637.38 1,400.00 1,226.13 29,655.00 3,500.00 3,868.84 4,045.86 1,986.00 9,945.36 40,599.80 12,477.36 14,035.08 1,050.00 30,526.40
156.57 12,278.16 26,945.10

899,12 26,80 37.00
1,946.49
858.02 32.00
1,356.79 121.26 939.57 20.50

Total Cash Basis

$ 382,408.47 $

6,237.55

Accruals June 30, 1995 June 30, 1996

-327.81 720.50

Adjustment Dooly County Board of Commissioners On-behalf Payments

21,406.40

$

403,814.87 $===6:.l:::,6=3=0.=2.4...

See notes to the general purpose financial statements. - 25-

SECTION IT COMPLIANCE

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members of the Lake Blackshear 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 Lake Blackshear Regional Library as of and for the year ended June 30, 1996, and have issued our report thereon dated January 31, 1997. 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 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.
Compliance with laws, regulations, contracts, and grants applicable to Lake Blackshear Regional Library is the responsibility ofthe 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 ofour tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards.

96CRL-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:dt 96CRL-IO

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

254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

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

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

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Lake Blackshear Regional Library as of and for the year ended June 30, 1996, and have issued our report thereon dated January 31, 1997. 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 Lake Blackshear 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, 1996:

(1) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-UplResolution

(4) Federal Financial Reports

(8) Administrative Requirements

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

96CRL-40

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 ofthis report. With respect to items not tested, nothing came to our attention that caused us to believe that Lake Blackshear Regional Library had not complied, in all material respects, with those requirements.
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:dt 96CRL-40

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board ofEducation
and Director and Members of the Lake Blackshear 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 ofthe Lake Blackshear Regional Library as of and for the year ended June 30, 1996, and have issued our report thereon dated January 31, 1997. 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 of the fiscal year 1996 general purpose financial statements of the Lake Blackshear Regional Library and with our consideration of the Library's control structure used to administer Federal financial assistance programs, as required by Office ofManagement and Budget (OMB) Circular A128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1996. As required by OMB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governmg:

(1) Types of Services Allowed or Unallowed

(2) Eligibility

Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Lake Blackshear Regional Library's compliance with these requirements. Accordingly, we do not express such an opinion.

96CRL-120

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 Lake Blackshear Regional Library had not complied, in all material respects, with those requirements.
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:dt 96CRL-120

SECTfONIII INTERNAL CONTROL

CLAUDE L. VICKERS
STATE AUDITOR (404) 6562174

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board ofEducation
and Director and Members of the Lake Blackshear 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 ofthe Lake Blackshear Regional Library as of and for the year ended June 30, 1996, and have issued our report thereon dated January 31, 1997. 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.
The management of the Lake Blackshear 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 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.

96ICL-3

In planning and peIfonning our audit of the general purpose financial statements of the Lake Blackshear Regional Library for the year ended June 30, 1996, we obtained an understanding of the internal control structure. With respect to the internal control structure, we obtained an un~erstanding of the design. of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk in order to determine our auditing procedures for the purpose ofexpressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. Accordingly, we do not express such an opinion.

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 of the 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 of management in the general purpose financial statements.

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

(1) Accounting Controls (Overall)

(2) General Fixed Assets

A material weakness is a reportable condition in which the design or operation of one or more of the 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 peIfonning 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 the reportable conditions disclosed above are also considered to be material weaknesses.

These conditions were considered in detennining the nature, timing, and extent of the procedures to be performed in our audit ofthe Lake Blackshear Regional Library's financial statements and this report does not affect our report thereon dated January 31, 1997.

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:dt 96ICL-3

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

DEPARTMENT OF AUDITS
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400
January 31, 1997

Honorable Zell Miller, Governor Members of the General Assembly Members of the State Board ofEducation
and Director and Members of the Lake Blackshear 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 of the Lake Blackshear Regional Library as of and for the year ended June 30, 1996, and have issued our report thereon dated January 31, 1997. 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 (OMB) Circular A.:.128, "Audits ofState and Local Governments". Those standards and OMB 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.
In planning and performing our audit for the year ended June 30, 1996, 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 OMB 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 January 31, 1997.
The management of the Lake Blackshear 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
96ICL-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

(1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports (5) Allowable Costs/Cost Principles (6) Drug-Free Workplace Act

(1) Types of Services Allowed or Unallowed
(2) Eligibility
(3) Reporting
(4) Qther Requirement Claims for Advances and Reimbursements

(7) Audit Follow-UplResolution

(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, 1996, the Lake Blackshear Regional Library had no major Federal financial assistance programs and expended 59% of its 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 QMB 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

961CL-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.
RZ~

CLV:dt 96ICL-15

Claude L. Vickers State Auditor

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

LAKE BLACKSHEAR REGIONAL LffiRARY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30. 1996
PRIOR YEAR
AUDIT FOLLOW-UP/RESOLUTION Time and Attendance Records Not Utilized Federal Financial Assistance Finding Resolved Audit Control Number 7292-95-01
The audit report for the year ended June 30, 1995, stated that $4,884.90 in salary expenditures were not supported by time and attendance records as required by Chapter 41, ofthe Financial Management for Georgia Local Units of Administration (FMGLUA). Subsequent to the year under review, the United States Department ofEducation (USDOE) - Office of Inspector General reviewed the $4,884.90 in questioned cost and determined that a refund was not required due to the amount of the finding being below USDOE's threshold for fund recovery. Audit procedures performed during the year under review revealed that the Library had implemented appropriate procedures to maintain documentation of time and attendance records supporting salary expenditures as required.
PRIOR YEAR/CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7292-93-01
The audit report for the year ended June 30, 1995, stated that the Library did not provide for adequate separation of employee duties in the performance of accounting functions and related procedures for all funds. For the year under review, no improvements regarding separation of employee's duties were noted. 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 "1" 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 7292-93-02
The audit report for the year ended June 30, 1995, noted that the management of the Lake Blackshear Regional Library had chosen not to 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,
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LAKE BLACKSHEAR REGIONAL LmRARY SCHEDULE OF FINDINGS AND IMPROPER OR OUESTIONED COSTS
YEAR ENDED JUNE 30. 1996
PRIOR YEAR/CURRENT YEAR GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7292-93-02 the Library did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements ofthe 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 ofa General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, 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.
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SECTION V PERTINENT VIEWS OF RESPONSffiLE OFFICIALS

LAKE BLACKSHEAR REGIONAL LmRARY PERTINENT VIEWS OF RESPONSmLE OFFICIALS
YEAR ENDED JUNE 30. 1996
AUDIT FOLLOW-UPIRESOLUTION Time and Attendance Records Not Utilized Federal Financial Assistance Finding Resolved Audit Control Number 7292-95-01
We concur with this finding. Time and attendance records were kept on each employee but these could not be found. All salary charges are based on actual hours worked through the use of a time clock for most employees and time sheets for those employees in outlying locations. The United States Department of Education was contacted about this finding and determined that a refund was not required.
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 7292-93~01
We concur with this finding. However, due to current budgetary constraints, the Library is unable to hire the additional staff required to clear this finding. The Library feels it has provided for the most appropriate assignment ofduties with the personnel available to perform the accounting functions. With staff limitations, this finding cannot be totally resolved.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 7292-93-02
We concur with this recommendation. Due to current staffing limitations and budgetary considerations prohibiting the hiring of additional administrative staff, the Library has decided not to pursue the recording of general fixed assets on the financial statements.