Ohoopee Regional Library, Vidalia, Georgia, report on audit of the financial statements for the fiscal year ended June 30, 2005

OHOOPEE REGIONAL LIBRARY
VIDALIA, GEORGIA REPORT ON AUDIT OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2005
STATE OF GEORGIA
DEPARTMENT OF AUDITS AND ACCOUNTS
Russell W. Hinton State Auditor

OHOOPEE REGIONAL LIBRARY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

EXHIBITS

BASIC FINANCIAL STATEMENTS

DISTRICT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET ASSETS

1

B

STATEMENT OF ACTIVITIES

2

FUND FINANCIAL STATEMENTS

C

BALANCE SHEET

GOVERNMENTAL FUNDS

3

D

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET ASSETS

4

E

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES

GOVERNMENTAL FUNDS

5

F

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT

OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES TO THE STATEMENT OF ACTIVITIES

7

G

NOTES TO THE BASIC FINANCIAL STATEMENTS

8

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES - BUDGET AND ACTUAL

GENERAL FUND

19

SUPPLEMENTARY INFORMATION

SCHEDULES OF REVENUE

2

STATE

20

3

FEDERAL

21

4

LOCAL

22

5 SCHEDULE OF SALARIES AND TRAVEL

23

OHOOPEE REGIONAL LIBRARY - TABLE OF CONTENTS -
SECTION II AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
SECTION III FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS
SECTION IV MANAGEMENT'S RESPONSES SCHEDULE OF MANAGEMENT'S RESPONSES

SECTION I FINANCIAL

Russell W. Hinton
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
August 8, 2006

Honorable Sonny Perdue, Governor Members of the General Assembly Members of the Board of Regents of the University System of Georgia
and Director and Members of the Ohoopee Regional Library Board
INDEPENDENT AUDITOR'S COMBINED REPORT ON BASIC FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have audited the accompanying financial statements of the governmental activities and each major fund (Exhibits A through G) of the Ohoopee Regional Library as of and for the year ended June 30, 2005, which collectively comprise the Library's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the Ohoopee Regional Library's management. Our responsibility is to express opinions on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States ofAmerica. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the Ohoopee Regional Library, as of June 30, 2005, and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America.

2005ARL-41X

The Ohoopee Regional Library has not presented Management's Discussion and Analysis that accounting principles generally accepted in the United States has determined is necessary to supplement, although not to be part of, the basic financial statements.
As discussed in Note 2 to the basic financial statements, during fiscal year 2005, the Library began using the straight-line method of depreciation for buildings and improvements. This change is in accordance with generally accepted accounting principles.
The Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual, as presented on page 19 is not a required part of the basic financial statements but is supplementary information required by the accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods ofmeasurement and presentation ofthe required supplementary information. However, we did not audit the information and express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Ohoopee Regional Library's basic financial statements. The accompanying supplementary information which consist ofSchedules 2 through 5, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit ofthe basic financial statements, and in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.
Respectfully submitted,
~W.~~ Russell W. Hinton State Auditor
RWH:as 2005ARL-41X

OHOOPEE REGIONAL LIBRARY

OHOOPEE REGIONAL LIBRARY STATEMENT OF NET ASSETS
JUNE 30, 2005
ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Local Capital Assets
Land Special Collections Buildings and Improvements Equipment Library Collections Less: Accumulated Depreciation
Total Assets
LIABILITIES Accounts Payable Long-Term Liabilities
Due in More Than One Year Total Liabilities NET ASSETS
Invested in Capital Assets, Net of Related Debt Restricted for
Permanent Fund Unrestricted
Total Net Assets
Total Liabilities and Net Assets

EXHIBIT"A"

GOVERNMENTAL ACTIVITIES

$

185,034

9,500

13,842

85,000 663,540 963,630
32,439 1,596,618 -1,695,706

$ =======1,=85=3=,8=97=

$

3,047

19 533

$

22 580

$

1,645,521

1,760 184 036

$

1 831 317

$ ======1=,8=5-3,1=89=7=

The notes to the basic financial statements are an integral part of this statement.
-1-

OHOOPEE REGIONAL LIBRARY STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2005

EXHIBIT"B"

EXPENSES

PROGRAM REVENUES

OPERATING

CHARGES FOR

GRANTS AND

SERVICES

CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET ASSETS

GOVERNMENTAL ACTIVITIES

Current Services Public Services Technical Services Support Services Maintenance and Operations

$ 316,488 $ 69,378 138,447 34879

24,072 $

296,769 $ 29051

4,353 -69,378 -138,447
-5 828

Total Governmental Activities

559,192 $

24 072 $

325,820 $ _ _ _-'-2'-'0-'-9,"'-30-'-0'-

General Revenues Allotments from Participating Governments Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous

$

179,894

112,654 2,489 10 005

Total General Revenues

$ _ _ _....,3a;:;0.:.,5.=.04..:.:2=-

Change in Net Assets

$

95,742

Net Assets - Beginning of Year (Restated)

1735575

Net Assets - End of Year

$ =====1=8=3=1=31=7=

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

OHOOPEE REGIONAL LIBRARY BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2005

EXHIBIT"C"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Local
Total Assets
LIABILITIES AND FUND BALANCES LIABILITIES
Accounts Payable FUND BALANCES
Reserved for: Permanent Fund
Unreserved Undesignated Reported in: General Fund Permanent Fund Total Fund Balances
Total Liabilities and Fund Balances

GENERAL FUND

PERMANENT FUND

TOTAL

$

183,751 $

8,347

13842

1,283 $ 1,153

185,034 9,500
13 842

$

205,940 $

2 436 $ ===20=8=,3=76=

$

3 047

$

3 047

$

$

202,893

$

202,893 $

1,760 $

1,760

676 2436 $

202,893 676
205,329

$

205,940 $

2 436 $ ===2=08==,3=7=6=

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

OHOOPEE REGIONAL LIBRARY RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS JUNE 30, 2005

EXHIBIT"D"

Total Fund Balances - Governmental Funds (Exhibit "C")

$

Amounts reported for Governmental Activities in the Statement of Net Assets are different because:

Capital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of:

Land Special Collections Buildings and Improvements Equipment Library Collections Accumulated Depreciation
Total Capital Assets

$ 85,000 663,540 963,630 32,439
1,596,618 -1,695,706

Long-Term Liabilities are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-Term Liabilities at year-end consist of:

Compensated Absences

205,329
1,645,521 -19,533

Net Assets of Governmental Activities (Exhibit "A")

$ ==1=,8=3=1=,3=17=

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

OHOOPEE REGIONAL LIBRARY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2005

EXHIBIT"E"

REVENUES
Local Funds State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
EXPENDITURES
Current Public Services Technical Services Support Services Maintenance and Operations
Total Expenditures
Net Change in Fund Balance
Fund Balance - Beginning
Fund Balance - Ending

GENERAL FUND

PERMANENT FUND

TOTAL

$

179,894

324,877

943

24,072

2,472 $

12,260

$

544,518 $

$ 17 17 $

179,894 324,877
943 24,072
2,489 12,260
544,535

$

274,556 $

67,434

146,361

32,882

$

521,233 $

$

23,285 $

179,608

0 $
0 $ 17 $ 2 419

274,556 67,434 146,361 32,882
521,233
23,302
182,027

$

202,893 $

2 436 $ ==2=0=5=,3=29=

The notes to the basic financial statements are an integral part of this statement. -5-

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OHOOPEE REGIONAL LIBRARY RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2005

EXHIBIT"F"

Total Net Change in Fund Balance - Governmental Funds (Exhibit "E")

Amounts reported for Governmental Activities in the Statement of Activities are different because:

Capital Outlays are reported as expenditures in Governmental Funds. However, in the Statement of Activities, the cost of Capital Assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are:

Capital Outlay

$

Depreciation Expense

Excess of Depreciation Expense over Capital Outlay

In the Statement of Activities, only the gain on the sale of the library collections is reported, whereas the Governmental Funds did not recognize any activity from the disposal since there was no monetary exchange involved. Thus, the change in net assets differs from the change in fund balances by the cost of the library collections disposed.

Donated Capital Assets are not reported in Governmental Funds. However, in the Statement of Activities, the donated value is shown as Grants and Contributions not Restricted to Specific Programs.

Compensated Absences decreases reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in Governmental Funds.

$
42,009 -80,665

23,302
-38,656 -2,255
112,654 697

Change in Net Assets of Governmental Activities (Exhibit "B")

$ ===9=5=7=42=

The notes to the basic financial statements are an integral part of this statement. -7-

OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 1: DESCRIPTION OF LIBRARY AND REPORTING ENTITY
REPORTING ENTITY
The Ohoopee Regional Library (Library) operates pursuant to Official Code of Georgia Annotated Sections 20-5-40 through 20-5-59 to provide public library services with costs shared by participating local governmental agencies and grants from the State of Georgia.
The Library Board is comprised of 13 members which are also trustees ofthe member library which appointed them. The Library Board membership consists of8 members appointed from the Toombs County Library Board, 3 members appointed from the Tattnall County Library Board and 2 members appointed from the Montgomery County Library Board. The Library Board is without authority to determine the amount of its funding, except by submission ofbudget requests to local governmental units from which the Library receives support and to the State ofGeorgia for State and Federal flow through funding. Membership in the Library and participation in library services is at the discretion of each participating governmental agency. The Library Board has the power to designate management, the power to retain unreserved fund balances of local and other funds for continued operations and is the lowest level of oversight responsibility for the Library's operations.
While the Toombs County Library Board appoints a majority of the Ohoopee Regional Library's Board, the Toombs County Library Board is neither able to impose its will upon the Library nor is there a financial benefit/burden relationship between the two boards as defined by Governmental Accounting Standards Board. The Ohoopee Regional Library is therefore considered to be a related organization of the Toombs County Library Board.
Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Library's basic financial statements are collectively comprised of the Library-wide financial statements, fund financial statements and notes to the basic financial statements of the Ohoopee Regional Library.
Library-wide Statements: The Statement ofNet Assets and the Statement ofActivities display information about the financial activities of the overall Library. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through intergovernmental revenues and other nonexchange transactions.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the Library's governmental activities.

-8-

OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the Library related to the administration and support of the Library's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include (a) charges paid by the recipients ofgoods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the Library's funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements for each category (governmental) are presented. The emphasis of fund financial statements is on major governmental funds.
The Library reports the following major governmental funds:
General Fund is the Library's primary operating fund. It accounts for all financial resources of the Library, except those resources required to be accounted for in another fund.
Permanent Fund - Ohoopee Regional Library Book Fund is the fund used to account for an endowment ofwhich the corpus is to be invested and preserved intact with the resultant income to be used exclusively for the purchase of library books.
BASIS OF ACCOUNTING
The basis ofaccounting determines when transactions are reported on the financial statements. The Library-wide governmental financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the Library gives (or receives) value without directly receiving (or giving) equal value in exchange, include grants and donations. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The Library uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT"G"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis ofaccounting. Under this method, revenues are recognized when measurable and available. The Library considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. Interest is considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds.
The Library funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the Library's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
RESTATEMENT OF PRIOR YEAR NET ASSETS
In prior fiscal years, the Ohoopee Regional Library computed depreciation for buildings and improvements based on estimated appraisal values. Net Assets - Beginning have been decreased in the amount of $286,203 for a prior year adjustment to Capital Assets for Buildings, net of depreciation. During the current fiscal year, the Library began using the straight-line method of depreciation for buildings and improvements. This change is in accordance with generally accepted accounting principles.
CASH AND CASH EQUIVALENTS
COMPOSITION OF DEPOSITS Cash and cash equivalents consist ofcash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Georgia Laws OCGA 45-8-14 authorize the Library to deposit its funds in one or more solvent banks or insured Federal savings and loan associations.
INVESTMENTS
COMPOSITION OF INVESTMENTS Investments made by the Library in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Library to invest its funds. In selecting among options for

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT"G"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
investment or among institutional bids for deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following:
(1) Obligations issued by the State of Georgia or by other states,
(2) Obligations issued by the United States government,
(3) Obligations fully insured or guaranteed by the United States government or a United States government agency,
(4) Obligations of any corporation of the United States government,
(5) Prime banker's acceptances,
(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services,
(7) Repurchase agreements, and
(8) Obligations of other political subdivisions of the State of Georgia.
RECEIVABLES
Receivables consist ofamounts due from grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
CAPITAL ASSETS
Capital assets purchased, including capital outlay costs, are recorded as expenditures in the fund financial statements at the time ofpurchase. On the Library-wide financial statements, all purchased capital assets are valued at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at estimated fair market value on the date donated. Disposals are deleted at depreciated recorded cost. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives ofthe assets is not capitalized. Depreciation is computed using the straight-line method.

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT"G"

Note 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Capitalization thresholds and estimated useful lives of capital assets reported in the Library-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land Special Collections - Ladson Genealogical Buildings and Improvements Equipment Library Collections

Any Amount

Any Amount

$

50,000

$

5,000

Any Amount

NIA NIA 60 years 4 to 25 years 10 years

Depreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives.

Note 3: DEPOSITS

COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate ofthe face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit insurance. Ifa depository elects the pooled method (OCGA 45-8-13 .1) the aggregate ofthe market value ofthe securities pledged to secure a pool ofpublic funds shall be not less than 110 percent ofthe daily pool balance.

Acceptable security for deposits consists of any one of or any combination of the following:

(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,

(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,

(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,

(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,

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

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 3: DEPOSITS

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

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

CATEGORIZATION OF DEPOSITS At June 30, 2005, the bank balances were $221,736. The amounts of the total bank balances are classified into four categories of custodial credit risk:

Category 1 - Cash that is insured (e.g., Federal Deposit Insurance) or collateralized with securities held by the Library or by the Library's agent in the Library's name.
Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Library's name.
Category 3 - Cash collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Library's name.
Category 4 - Uncollateralized.

The Library's deposits are classified by custodial credit risk category at June 30, 2005, as follows:

Custodial Credit Risk Category

Bank Balance

1

$ 110,928

2

110,808

3

0

4

0

Total

Note 4: CAPITAL ASSETS

The following is a summary of changes in the Capital Assets during the fiscal year:

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 4: CAPITAL ASSETS

Balances July l, 2004 (Restated)

Increases

Decreases

Balances June 30, 2005

Governmental Activities Capital Assets, Not Being Depreciated:
Land Special Collections

$

85,000

653,609 $

Total Capital Assets Not Being Depreciated $ 738,609 $

12,186 $ 12,186 $

$ 2,255
2,255 $

85,000 663,540
748,540

Capital Assets Being Depreciated Buildings and Improvements Equipment Library Collections

$ 963,630 22,581 $
1,475,252

9,858 132,619 $

$ 11,253

963,630 32,439
1,596,618

Less Accumulated Depreciation for: Buildings and Improvements Equipment Library Collections

367,352 15,054
1,243,888

Total Capital Assets, Being Depreciated, Net $ 835,169 $

25,923 1,997
52,745
61,812 $

11,253

393,275 17,051
1,285,380

0 $ 896,981

Governmental Activity Capital Assets - Net $ 1.573.778 $

73.998 $

2,255 $ l.645.521

Current year depreciation expense by function is as follows:

Public Services Technical Services Support Services Maintenance and Operations

$

74,780

1,944

1,944

1 997

$

80,665

Note 5: RESTRICTED ASSETS

Endowments in which donors have stipulated as a condition ofthe gift instrument, that the principal is to be maintained inviolate and in perpetuity, and invested for the purpose ofproducing present and future income, which may be expended are reported as restricted assets in the Statement of Net Assets because their use is limited by applicable contractual agreements. Restricted assets at June 30, 2005, were as follows:

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 5: RESTRICTED ASSETS

Permanent Fund

Restricted Cash and Cash Equivalents: Ohoopee Regional Library Book Fund
Restricted Investments Ohoopee Regional Library Book Fund

$

995

$

765

Note 6: 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; acts of God and unemployment compensation.

The Library has obtained commercial insurance for risk ofloss associated with torts, assets and job related illness or injuries to employees. The Library has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Library's insurance coverage in any of the past three years.

The Library has elected to self-insure for all losses related to acts of God. 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.

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

The Library has purchased a surety bond to provide additional insurance coverage as follows:

Position Covered

Amount

All Employees

$ 100,000

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT "G"

Note 7: LONG-TERM DEBT

COMPENSATED ABSENCES Compensated absences represent obligations ofthe Library relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. The Library uses the vesting method to compute compensated absences.

The changes in Long-Term Debt during the fiscal year ended June 30, 2005, were as follows:

Governmental Fund
Compensated Absences (1)

Balance July 1, 2004

$

20,230

Additions Annual Leave Earned

23,597

Deductions Annual Leave Utilized

24,294

Balance June 30, 2005

$====19-,5=3==3

(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements.

Note 8: RETIREMENT PLANS

TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)

TRS PLAN DESCRIPTION Substantially all librarians and clerical personnel employed by regional and county libraries are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts.

TRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Library who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Library makes monthly employer contributions to TRS at rates

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OHOOPEE REGIONAL LIBRARY NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2005

EXHIBIT"G"

Note 8: RETIREMENT PLANS

adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 9.24% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2005 2004 2003

100% 100% 100%

$ 28,323 $ 27,591 $ 26,838

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OHOOPEE REGIONAL LIBRARY GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2005

SCHEDULE "1"

REVENUES
Local Funds State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous
Total Revenues
EXPENDITURES
Current Public Services Technical Services Support Services Maintenance and Operations
Total Expenditures
Net Change in Fund Balance
Fund Balance - Beginning

NONAPPROPRIATED BUDGETS

ORIGINAL

FINAL

ACTUAL AMOUNTS

$

124,600 $

124,600 $

179,894

317,066

317,066

324,877

943

12,350

12,350

24,072

1,525

1,525

2,472

2 400

2 400

12 260

$

457 941 $

457 941 $

544 518

$

222,415 $

222,415 $

274,556

67,479

67,479

67,434

155,300

155,300

146,361

26,906

26,906

32,882

$

472 100 $

472 100 $

521,233

$

-14, 159 $

-14, 159 $

23,285

179 608

179 608

179 608

Fund Balance - Ending

$

165 449 $

165 449 $ ===20=2"'=,8=93=

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

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OHOOPEE REGIONAL LIBRARY SCHEDULE OF STATE REVENUE
YEAR ENDED JUNE 30, 2005
AGENCY/FUNDING
GRANTS Board of Regents of the University System of Georgia Office of Public Library Services Salaries Travel Library Materials Maintenance and Operations

SCHEDULE "2"

GOVERNMENTAL FUND TYPE GENERAL FUND

$

271,426

1,500

22,900

29 051

$

324 877

See notes to the basic financial statements.

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OHOOPEE REGIONAL LIBRARY SCHEDULE OF FEDERAL REVENUE
YEAR ENDED JUNE 30, 2005
AGENCY/FUNDING GRANT Museum and Library Services, Institute of Through Board of Regents of the University System of Georgia Library Services and Technology Act State Library Program

SCHEDULE "3"
GOVERNMENTAL FUND TYPE GENERAL FUND
$ =======94=3=

See notes to the basic financial statements.

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OHOOPEE REGIONAL LIBRARY SCHEDULE OF LOCAL REVENUE
YEAR ENDED JUNE 30, 2005
LOCAL SOURCES City Governments Lyons Vidalia County Governments Board of Commissioners Toombs Public Libraries Glennville City Public Library Montgomery County Public Library Tattnall County Public Library

SCHEDULE "4"

GOVERNMENTAL FUND TYPE GENERAL FUND

$

4,000

67,000

46,500
27,379 14,784 20 231

$ ====1=7=9=8=94=

See notes to the basic financial statements.

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OHOOPEE REGIONAL LIBRARY SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30, 2005

SCHEDULE "5"

NAME
Bell, Cabbage, Claxton, Ervin, Fennell, Garcia, Gres, Kent, Jin, Jones, Longtin, McKinney, Moses, Moxley, Moxley, Nimmons, Oglesby, Peeler, Prayor, Pullen, Sandford, Smith, Smith, Thompson, Thompson, Tomlinson, Trull, Wilson,

Taneka M Mary Anne Anna M Barbara J Debra Betty J Dusty S Shameeka D Guojia WilliamM Jessica L Martha J Katherine L BettyW Clinton J Nancy J KimberlyV Dana L Sekivia A Rhonda D India K Lori Gail Mildred 0 Carolyn M SallyJ Jeff A
Melba F
Patty R

Accruals June 30, 2004 June 30, 2005

Totals per Report

TITLE CATEGORY
Branch Clerk Substitute Branch Clerk Custodian Substitute Branch Clerk Branch Manager Custodian Director Branch Clerk Technical Services Librarian Circulation Clerk Custodian Branch Clerk Substitute Branch Clerk Administrative Assistant Branch Clerk Branch Clerk Branch Manager Assistant Director Circulation Clerk Branch Clerk Branch Manager Branch Clerk Branch Clerk Branch Manager Circulation Supervisor Public Services Librarian Bookmobile Coordinator Branch Manager

SALARIES

$

861

165

174

846

9,331

1,772

64,877 $

811

54,511

4,587

752

32

247

20,129

5,184

6,398

36

53,268

111

61

14,329

102

4,358

4,870

13,434

50,118

13,832

13 246

$

338,442 $

TRAVEL
1,268 60
105 472
337 219 66 2,527 -364 135

$

338,442 $ ====2==,2=9=8

See notes to the basic financial statements.

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

OHOOPEE REGIONAL LIBRARY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2005

PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS

FINDING CONTROL NUMBER AND STATUS

FS-7932-04-01 FS-7932-04-02

Partially Resolved - See Corrective Action/Reponses Previously Reported Corrective Action Implemented

CORRECTIVE ACTION/RESPONSES

ACCOUNTING CONTROLS (OVERALL) Inadequate General Controls Finding Control Number: FS-7932-04-01

Access controls are assigned to administrative staff according to duties and responsibilities. The limited number of staff makes it impossible to further separate or restrict access.

SECTION III FINDINGS AND QUESTIONED COSTS

OHOOPEE REGIONAL LIBRARY SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2005
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
ACCOUNTING CONTROLS (OVERALL) Inadequate General Controls Finding Control Number: FS-7932-05-01
An examination of the internal accounting control procedures revealed that the Library did not maintain adequate access controls over the Financial Accounting System. Access controls over the Financial Accounting System would not prevent unauthorized users from accessing critical accounting information.
Access controls, both manual and automated, are the basis for achieving security over the financial system. The deficiency noted was a result of management's decision not to assign access rights in line with established separation ofduties. Management should ensure that the access controls over the accounting information system limit access to the financial system to only employees with a need for access for the performance of their job duties.
EXPENDITURES/LIABILITIES/DISBURSEMENTS Inadequate Internal Control Procedures Finding Control Number: FS-7932-05-02
Based on a review of thirty-four operating expenditures, the following deficiencies were noted:
One voucher was not properly approved before payment. Three vouchers lacked adequate documentation for receipt of goods. Three vouchers for employee travel reimbursement were not supported by a travel
reimbursement form as required by Georgia Public Library Service's Policy. One employee who traveled by personal vehicle and requested reimbursement did not record the actual odometer readings on an expense statement or sign the statement attesting that the information presented was accurate. Another employee charged an actual gas purchase to the Library rather than claiming mileage reimbursement.
These deficiencies were a result of management's failure to ensure established controls were functioning as designed and management's decision to allow travel reimbursements which were not in accordance with Georgia Public Library Service's policy. Management should implement procedures to ensure that appropriate accounting controls are utilized and that employee travel reimbursements are made in accordance with Georgia Public Library Service's policy.
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OHOOPEE REGIONAL LIBRARY SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2005
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS CAPITAL ASSETS Failure to Adequately Maintain Capital Assets Finding Control Number: PS-7932-05-03 A review of the Library's Capital Assets policies and procedures and the related Capital Assets records noted deficiencies as discussed below:
The Capital Assets records as presented for audit did not contain depreciation expense or accumulated depreciation. Library provided only net book value for buildings and equipment. Consolidated Capital Assets records were not maintained.
For the year under review, the Library acquired an asset meeting capitalization thresholds by lease. This asset was not added to the Capital Assets records. The Library could not provide a lease agreement or an amortization table. The associated debt is not recorded in the Library-wide Statements.
These deficiencies were a result ofmanagement's failure to establish adequate controls related to the Capital Assets. The Library should reassess internal control procedures for Capital Assets to ensure that Capital Assets records provide all necessary information for inclusion ofCapital Assets activity in the Library-wide Statements and that Capital Assets acquired through a capital lease are recorded in accordance with generally accepted accounting principles.
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SECTION IV MANAGEMENT'S RESPONSES

OHOOPEE REGIONAL LIBRARY SCHEDULE OF MANAGEMENT'S RESPONSES
YEAR ENDED JUNE 30, 2005
Finding Control Number: FS-7932-05-01
We have requested of management its views concerning this finding, its conclusions, its recommendations and the planned corrective actions. We have not received management's views as of the release of this audit report.
Finding Control Number: FS-7932-05-02
We have requested of management its views concerning this finding, its conclusions, its recommendations and the planned corrective actions. We have not received management's views as of the release of this audit report.
Finding Control Number: FS-7932-05-03
We have requested of management its views concerning this finding, its conclusions, its recommendations and the planned corrective actions. We have not received management's views as of the release of this audit report.