Audit report, Sara Hightower Regional Library, Rome, Georgia, year ended June 30, 1994

GA
A800
.Rl
STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET ATLANTA. GEORGIA 30334

AUDIT REPORT SARA HIGHTOWER REGIONAL LIBRARY
ROME, GEORGIA YEAR ENDED JUNE 30, 1994

SARA HIGHTOWER REGIONAL LIBRARY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

GENERAL PURPOSE FINANCIAL STATEMENTS

COMBINED STATEMENTS - OVERVIEW

A

COMBINED BALANCE SHEET

ALLFUNDTYPESANDACCOUNTGROUP

2

B

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES

GOVERNMENTAL FUND TYPES

3

C

COMBINED STATEMENT OF REVENUES, EXPENDITURES AND

CHANGES IN FUND BALANCES - ACTUAL AND BUDGET

GOVERNMENTAL FUND TYPES

4

D NOTES TO THE FINANCIAL STATEMENTS

5

ADDITIONAL FINANCIAL INFORMATION

COMBINING STATEMENTS

SPECIAL REVENUE FUND

E

COMBINING BALANCE SHEET

12

F

COMBINING STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES

13

SCHEDULES

1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE

14

2 ANALYSIS OF CASH AND CASH EQUNALENTS

15

3 ACCOUNTS RECEIVABLE

16

SCHEDULE OF REVENUE

4

STATE

17

5

LOCAL AND OTHER

18

6 SCHEDULE OF EXPENDITURES BY OBJECT

GOVERNMENTAL FUND TYPES

19

7 MEMBERSHIP AND TRAVEL OF LIBRARY BOARD

20

8 SCHEDULE OF SALARIES AND TRAVEL

21

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

SECTION I FINANCIAL

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

~epa:rtmeut nf J\uhits
254 WASHINGTON STREET, S. W. ROOM 214
~tlanht, ~eorgia 30334-B400
January 19, 1995

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

Honorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Sara Hightower Regional Library Board
INDEPENDENT AUDITOR'S COMBINED REPORT ON 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 Sara Hightower Regional Library, as ofand for the year ended June 30, 1994, as listed in the table of contents. These financial statements are the responsibility ofthe Library's management. Our responsibility is to express an opinion on these general purpose 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 ofManagement and Budget Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
As described in the notes to the general purpose financial statements, the Library's financial statements have been prepared using a certain accounting practice and policy which, in our opinion, 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.
94ARL-44

The aggregate effects on the general purpose financial statements of this variance or omission have not been determined, but are believed to be material.
In our opinion, except for the effect 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 Sara Hightower Regional Library as of June 30, 1994, and the results ofits operations for the year then ended, in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose offorming an opinion on the general purpose financial statements ofthe Sara Hightower Regional Library taken as a whole. The combining statements (Exhibits E and F) and the financial schedules (Schedules I through 8 which includes the Schedule ofFederal Financial Assistance), as listed in the table of contents, are presented for purposes ofadditional analysis and are not a required part ofthe financial statements ofthe Sara Hightower 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 financial statements taken as a whole.
A copy ofthis report has been filed as a permanent record in the office ofthe State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24.
7~
Claude L. Vickers State Auditor
CLV:cm 94ARL-44

SARA HIGHTOWER REGIONAL LIBRARY - 1-

SARA HIGHTOWER REGIONAL LIBRARY COMBINED BALANCE SHEET
ALL FUND TYPES AND ACCOUNT GROUP JUNE 30 1 1994

EXHIBIT "A"

ASSETS
Cash and Cash Equivaients Accounts Receivable Amount to be Provided in Future Years
For Payment of Compensated Absences

GOVERNMENTAL FUND TYPES

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

SPECIAL

GENERAL

REVENUE

FUND

FUND

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

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

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

$ 192,745.39 $ 33,548.72

$ 226,294.11

5,137.71

5,633.97

10,771.68

$ 31,588.13

31,588.13

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

Total Assets

$ 197,883.10$ 39,182.69 $ 31,588.13 $ 268,653.92
============= ============= ============= =============

LIABILITIES AND FUND EQUITY
---------------------------
LIABILITIES
-----------
Accounts Payable Compensated Absences
Total Liabilities
FUND EQUITY
-----------
Fund Balances Reserved For Continuation of Federal Programs Unreserved Designated for Books and Materials Children's Summer Program Friends of Library Program Literacy Program Special Needs Center Talking Book Center Undesignated
Total Fund Equity

$ 51,295.85 $ 39,181.83

$ 90,477.68

$ 31,588.13

31,588.13

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

$ 51,295.85 $ 39,181.83 $ 31,588.13 $ 122,065.81
------------- ------------- ------------- -------------

$

0.86

$ 4,360.94.

497.95

6,010.00

123.50

672.59

380.83

134,541.44

0.00

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

$ 146,587.25 $

0.86

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

$

0.86

4,360.94 497.95
6,010.00 123.50 672.59 380.83
134,541.44
-------------
$ 146,588.11
-------------

Total Liabilities and Fund Equity $ 197,883.10$ 39,182.69 $ 31,588.13 $ 268,653.92
============= ============= ============= =============
The notes to the general purpose financial statements are an integral part of this statement. - 2-

SARA HIGHTOWER REGIONAL LIBRARY COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1994

EXHIBIT "B"

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

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL (Memorandum
Only)

$ 409,046.94 $ 87,500.00 $ 496,546.94

114,705.89 114,705.89

1,204,279.30

1,204,279.30

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

$1,613,326.24$ 202,205.89 $1,815,532.13

$ 694,173.27 $ 126,309.00 $ 820,482.27

104,687.29

104,687.29

339,938.42

339,938.42

218,937.24

75,896.03

294,833.27

226,210.68

226,210.68

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

$ 1,583,946.90 $ 202,205.03 $ 1,786,151.93
------------- ------------- -------------

$ 29,379.34 $

0.86 $ 29,380.20

117,207.91

0.00 117,207.91

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

$ 146,587.25$

0.86 $ 146,588.11

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

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

EXHIBIT "C"

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

ACTUAL PER
EXHIBIT "B"

BUDGET

VARIANCE FAVORABLE (UNFAVORABLE)

$ 496,546.94 $ 506,527.02 $ 114,705.89 120,390.84
1,204,279.30 1,176,677.09

-9,980.08 -5,684.95 27,602.21

$1,815,532.13 $1,803,594.95$ 11,937.18

$ 820,482.27 $ 841,694.57 $ 21,212.30

104,687.29

108,049.12

3,361.83

339,938.42

351,079.68

11,141.26

294,833.27

305,639.90

10,806.63

226,210.68

223,580.44

-2,630.24

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

$ 1,786,151.93 $ 1,830,043.71 $ 43,891.78
------------- ------------- -------------

$ 29,380.20 $ -26,448.76 $ 55,828.96

117,207.91

123,008.96

-5,801.05

-211.00

211.00

$ 146,588.11$ 96,349.20$ 50,238.91
============= ============= =============

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

SARA HIGHTOWER REGIONAL LIBRARY

EXHIBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Sara Hightower Regional Library operates pursuant to Official Code ofGeorgia Annotated Sections 20-540 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 the following paragraphs, the financial statements of the Library have been prepared in conformity with generally accepted accounting principles as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.
The more significant of the Library's accounting policies are described below.
REPORTING ENTITY
In evaluating how to define the government WJ,it 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 Sara Hightower Regional Library is determined to be a jointly governed organization.
The Library Board consists of 16 members; the 11 members of the Floyd County Library Board and 5 members appointed from the Polk 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 re.ceives 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 Sara Hightower Regional Library is located in Rome, Georgia, and serves Floyd and Polk 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.
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.
- 5-

SARA IIlGHTOWER REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements account for all State, Federal, Local and Other funds under control ofthe Library, in compliance with generally accepted accounting principles applicable to governmental units, unless otherwise disclosed in these notes. Funds and the account group presented in this report are as follows:
GOVERNMENTAL FUND TYPES - used to account for all or most of the Library's general activities. Governmental Fund Types include:
GENERAL FUND - the fund used to account for all financial resources of the Library except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services traditionally provided by a Library.
SPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. The primary type of special revenue fund consists of proceeds received from State and Federal sources to accomplish specific objectives and are required to be accounted for separately.
ACCOUNT GROUP
GENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for material compensated absences 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 of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. Their reported fund balance is considered a measure ofavailable spendable resources.
Liabilities which are expected to be financed from available spendable resources are reported as liabilities in the governmental funds. Other liabilities which are not expected to be financed from available spendable resources, are reported in the General Long-Term Debt Account Group.
Governmental funds are accounted for using the modified accrual basis of accounting under which:
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.
Expenditures are generally recognized when the related fund liability is incurred.
- 6-

SARA IDGHTOWER REGIONAL LIBRARY

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS

JUNE 30, 1994

Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUDGET
Sara Hightower Regional Library has a legally authorized nonappropriated budget which is formally approved by the Board at the aggregate level. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure ofthe aggregate budget. The budget process begins when the Library administration prepares and submits a proposed budget to the Board for approval. After approval of the proposed budget by the Board, copies are sent to all local funding agencies. After funding approval is received from all local funding agencies, the Board will make any necessary adjustments and adopt the budget. This final budget is then submitted to the Georgia Department of Education, Division of Public Library Services, as a part of the Library's Annual Application for State Aid.
The Library prepares its budget on the modified accrual basis, which is the same basis on which it presents its financial statements.
CASH AND CASH EQUIVALENTS
COMPOSITION OF CASH DEPOSITS Cash consists of deposits (including 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 consistofgrant reimbursements due from Federal, State or other grantors 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 financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
COMPENSATED ABSENCES
Compensated absences represent obligations of the Library relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion ofthis obligation as this amount is deemed immaterial to the financial statements.
INTERFUND TRANSACTIONS
The Library has the following type ofinterfund transactions:

- 7-

SARA IIlGHTOWER REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 COLUMN
Total columns on the 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 of this data.
Note 2: DEPOSITS
COLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral in an amount of not less than 110 percent ofthe public funds being secured after the deduction ofthe amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts.
Acceptable security for deposits consists ofany one of or any combination ofthe 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 ofindebtedness or other direct obligations of the United States or of the State ofGeorgia,
(4) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities of the 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 of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws ofthe State of Georgia, and

- 8-

SARA IIlGHTOWER REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 2: DEPOSITS

(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, 1994, the bank balances were $243,034.03. The bank balances were entirely covered by Federal depository insurance or by collateral held by the Library or the Library's agent in the Library's name.

Note 3: RISK MANAGEMENT

The Library has established a limited risk management program for Unemployment Compensation. Estimated claims are budgeted by management based upon experience. During fiscal year 1994, no claims were paid.

Note 4: GENERAL LONG-TERM DEBT

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

Balance July I, 1993
Additions Leave Earned and Utilized (Net)
Balance June 30, 1994

Compensated Absences
$ 36,465.24
-4 877.11
$ 31,588.13

Note 5: CONTINGENT LIABILITIES

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

Note 6: ACCUMULATED EMPLOYEES LEAVE

The Library's professional personnel earn annual leave based upon the number of years of employment and professional training up to a maximum of 30 days. Annual leave is maintained on the calendar year basis and all unused annual leave at December 31 each year is forfeited. Employees who terminate employment will be paid for accumulated unused annual leave in the year of termination.

- 9-

SARA IDGHTOWER REGIONAL LIBRARY

EXIDBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 7: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS)
TRS PLAN DESCRIPTION All full-time librarians and clerical personnel employed by regional and county libraries are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS).
TRS provides service retirement, disability retirement and survivors benefits for its members. A member is eligible for service retirement after 30 years of service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service and attainment of age 55, at a reduced benefit. Retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement benefits also include disability and death benefits. A disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement,
whichever is greater. The death benefit is the amount that would be payable to the member's beneficiary had
the member retired on the date of death on either a service retirement allowance or a disability retirement allowance, whichever is larger. The benefit is based on the member's creditable service (minimum of 10 years of service) and compensation up to the time of disability or death.
Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employee contributions occurs, but the member's contributions are refunded with interest.
The Library's payroll for employees covered by TRS for the year ended June 30, 1994, was $830,398.93; total payroll was $897,266.18.
TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Library who are covered by TRS are required to pay 6% of their gross earnings to TRS. The Library makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. At June 30, 1994, the TRS Library employer contribution rate was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%.
Total contributions made during fiscal year 1994 amounted to $147,894.20, ofwhich $98,070.21 was made by the Library and $49,823.99 was made by employees. These contributions represented 11.81% (Library) and 6% (employees) of covered payroll.

- 10 -

SARA IIlGHTOWER REGIONAL LIBRARY

EXIIlBIT "D"

NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS

JUNE 30, 1994

Note 7: RETIREMENT PLANS

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

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

Total pension benefit obligation
~
Net assets available for benefits, at cost

$13,912,014,000.00 12,821,722,000.00

Unfunded pension benefit obligation

$ 1,090.292,000.00

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

Total contributions from all employers to TRS for fiscal year ended June 30, 1994, were $521,550,000.00. The Library's contribution for the year ended June 30, 1994, of$98,070.21 was actuarially determined and represented .019% of total contributions made by all participating employers.

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

Note 8: SURETY BONDS

The Library Director, Ms. Eliza.beth A. Collins, and all employees of Sara Hightower Regional Library are bonded in the amount of$10,000.00 with the Harleysville - Atlantic Insurance Company, Greensboro, North Carolina, their Bond No. MPA SA 06 35, on which premium was paid through June 30, 1995.

- 11 -

ASSETS
Cash and Cash Equivalents Accounts Receivable

SARA HIGHTOWER REGIONAL LIBRARY COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30. 1994

EXHIBIT "E"

LOTTERY PROGRAM

LIBRARY SERVICES AND CONSTRUCTION ACT

TITLE I PUBLIC LIBRARY SERVICES

TITLE VI LIBRARY LITERACY PROGRAM

TECHNOLOGY RELATED
ASSISTANCE FOR INDIVIDUALS
WITH DISABILITIES
ACT
TITLE I TECHNOLOGY ASSISTANCE
PROGRAM

TOTAL

$ 3B,3B6.18 $

0.00 $

258.95 $

$ 5,633.97

38,645.13
5,633.97

Total Assets

$ 38,386.18$

0.00 $

258.95 $

5,633.97$ 44,279.10

============ ========= ========-= ==-============ c:=a:z===:za:s==

LIABILITIES ANO FUND EQUITY

LIABILITIES

Cash Overdraft Accounts Payable

$ 38,386.18

Total Liabilities

$ 38,386.18

FUND EQUITY

Fund Balances

Reserved

For Continuation of Federal Programs

Unreserved

Undesignated

$

0.00 $

Total Fund Equity

$

0.00 $

$

5,096.41 $ 5,096.41

$

258.09

537.56

39,181.83

$

258.09 $

5,633.97$ 44,278.24

$ 0.00
0.00 $

0.86 0.00 $
0.86 $

$

0.86

0.00

0.00

,0.00 $

0.86

Total Liabilities and Fund Equity$ 38,3B6.18 $

0.00 $

258.95 $

5,633.97 $ 44,279.10

========== ============ =========== ============ =---------==-

See notes to the general purpose financial statements. - 12 -

SARA HIGHTOWER REGIONAL LIBRARY COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
SPECIAL REVENUE FUND YEAR ENDED JUNE 30. 1994

EXHIBIT "F"

LOTTERY PROGRAM

LIBRARY SERVICES AND CONSTRUCTION ACT

TITLE I PUBLIC LIBRARY SERVICES

TITLE VI LIBRARY LITERACY PROGRAM

TECHNOLOGY RELATED
ASSISTANCE FOR INDIVIDUALS
WITH DISABILITIES
ACT
TITLE I TECHNOLOGY ASSISTANCE
PROGRAM

TOTAL

REVENUES

State Funds Federal Funds

$ 87,500.00 $ 23,795.00$ 33,563.00$

$ 87,500.00 57,347.89 114,705.89

Total Revenues

$ 87,500.00$ 23,795.00$ 33,563.00$ 57,347.89 $ 202,205.89

EXPENDITURES

Current Program Services Adninistration

$ 17,500.00$ 19,961.00 $ 33,562.14 $

70,000.00

3,834.00

55,285.86$ 126;309.00

2,062.03

75,896.03

Total Expenditures

$ 87,500.00$ 23,795.00$ 33,562.14 $ 57,347.89 $ 202,205.03

Excess of Revenues over (under) Expenditures $ FUND BALANCE JULY 1, 1993

0.00 $ 0.00

0.00 $ 0.00

0.86 $ 0.00

0.00 $

0.86

0.00

0.00

FUND BALANCE JUNE 30, 1994

$

0.00 $

0.00 $

0.86 $

0.00 $

0.86

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

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

SARA HIGHTOWER REGIONAL LIBRARY SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED JUNE 30. 1994

SCHEDULE "l"

FUNDING AGENCY PROGRAM/GRANT
--------------
Education, U. S. Department of Direct Library Services and Construction Act Title VI - Library Literacy Program 1992 Grant 1993 Grant Through Georgia Department of Education Library Services and Construction Act Title I - Public Library Services 1992 Develoi:xnental Grant 1993 Basic Grant 1993 Institution Grant Through Georgia Department of Ha.man Resources Technology Related Assistance for Individuals with Disabilities Act Title I - Technology Assistance Program Tools for Life

CFDA NUMBER
84.167 84.167
84.034 84.034 84.034
84.224

FEDERAL FUNDS

RECEIVED IN

FEDERAL

AWARDS

PERIOD (NET REVENUE EXPENDITIRES

IN PERIOD OF REFUNDS) IN PERIOD

IN PERIOD

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

$ 9,519.00$ 9,519.00$ 9,519.00

$ 34,992.00

24,044.00

24,044.00

24,043.14

4,000.00 16,000.00 3,834.00

4,000.00 15,961.00 3,834.00

4,000.00 15,961.00 3,834.00

4,000.00 15,961.00 3,834.00

51,530.00

56,669.56

57,347.89

57,347.89

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

Total Federal Financial Assistance

$ 110,356.00$ 114,027.56$ 114,705.89$ 114,705.03
----------- ------=z-- =---=--=-::e a:====-=====s==

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

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

SARA HIGHTOWER REGIONAL LIBRARY ANALYSIS OF CASH AND CASH EQUIVALENTS
JUNE 30 1 1994
INTEREST BEARING ACCOUNTS
First Rome Bank, Rome, Georgia
N.O.W. Account (2.84%) OTHER
Petty Cash

SCHEDULE "2"
$ 226,004.11 290.00
$ 226,294.11
===========z=

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

SARA HIGHTOWER REGIONAL LIBRARY ACCOUNTS RECEIVABLE JUNE 30, 1994

SCHEDULE "3"

Coosa Valley Technical Institute Library Adult Literacy Program Use of Telephone
Human Resources, Georgia Department of Federal Program Tools for Life Program

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE
FUND

TOTAL

$ 5,074.71 63.00

$ 5,074.71 63.00

$ 5,633.97

5,633.97

$ 5,137.71 $ 5,633.97$ 10,771.68
============= ---------==- ========c=


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

SARA HIGHTOWER REGIONAL LIBRARY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1994

SCHEDULE "4"

AGENCY/FUNDING
GRANTS Education, Georgia Department of Public Libraries Salaries and Travel Library Materials Talking Book Centers Maintenance and Operations Lottery Program Media Center and Library Equipment

GOVERNMENTAL FUND TYPES

GENERAL FUND

SPECIAL REVENUE FUND

TOTAL

$ 178,265.94 69,967.00 94,447.00 66,367.00
$

$ 87,500.00

178,265.94 69,967.00 94,447.00 66,367.00
87,500.00

$ 409,046.94$ 87,500.00$ 496,546.94
============= ============= =============

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

SARA HIGHTOWER REGIONAL LIBRARY SCHEDULE OF LOCAL AND OTHER REVENUE
YEAR ENDED JUNE 30. 1994
LOCAL SOURCES Boards of Education Floyd County Polk County Rome, City of
City Governments Cave Springs Cedartown Rockmart Rome
County Governments Boards of Commissioners Floyd Polk
OTHER SOURCES Donations Books and Materials Children's Summer Program Literacy Program Special Needs Program Talking Book Center Fines and Fees Interest Earned Library Adult Literacy Program Coosa Valley Technical Program Lost and Damaged Books Rent Sales Photocopy Services Laminating Fees Library Assets Video Services

SCHEDULE "5"
GOVERNMENTAL FUND TYPES
GENERAL FUND
$ 7,000.00 7,000.00 7,000.00
4,896.54 22,818.06 24,004.75 400,000.00
575,523.00 68,540.50
7,450.86 655.00 20.00 792.00
2,003.26 31,603.18
6,153.02 9,980.00 1,908.07 3,454.04 14,440.87 2,128.65 3,885.00 3,022.50
$1,204,279.30

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

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

SCHEDULE "6"

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

GENERAL FUND

SPECIAL REVENUE FUND

TOTAL

$ 852,749.91 $ 238,603.02 10,152.00 2,231.32 109,601.47 31,401.08 147,966.83 113,135.31 34,583.62 2,967.35

44,516.27$ 12,160.20 3,644.68 14,575.72
450.00 17,179.74 4,750.19
1,353.76 2,760.00

897,266.18 250,763.22 13,796.68 16,807.04 110,051.47 48,580.82 152,717.02 113,135.31 35,937.38
5,727.35

40,554.99

100,814.47

141,369.46

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

$1,583,946.90$ 202,205.03 $1,786,151.93
============= ============= =============

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

SARA HIGHTOWER REGIONAL LIBRARY MEMBERSHIP ANO TRAVEL OF LIBRARY BOARD
YEAR ENDED JUNE 30. 1994
BOARD MEMBER ADDRESS
Mr. Robert Steinbruegge, Chairman(*) 6 Lenox Circle Rome, Georgia 30161 Mr. Larry B. Atwell (*) 508 East Second Street Rome, Georgia 30161 Mr. Bobby Burch(*) 106 Peachtree Road Rockmart, Georgia 30153 Mr. James J. Carter, Jr. (*) 612 South College Street Cedartown, Georgia 30125 Mr. Paul Carter(*) 319 East 3rd Avenue Rome, Georgia 30161 Dr. Jackie Collins(*) 171 Chatillon Roadi N. E. Rome, Georgia 30101 Mr. Jim Davis(*) 1355 Horseleg Creek Road, S. W. Rome, Georgia 30165 Mrs. Emmalee Highnote(*) P.O. Box 266 Cave Spring, Georgia 30124 Mr. Steve F. Holder(*) 820 Jones Avenue Rockmart, Georgia 30153 Mr. Warren Jones(*) 10 Belmont Drive Rome, Georgia 30165 Mr. Dick Machan(*) 303 Columbia Avenue Cedartown, Georgia 30125 Ms. Callie Martin(*) 1401 East 1st Street Rome, Georgia 30161 Mr. Kenneth McElwee (*) P. O. Box 268 Cedartown, Georgia 30125 Mr. Robert Noble(*) 421 Cunningham Road Rome, Georgia 30161 Mr. Sam Vincent (*) 306 Ridgedale Drive Silver Creek, Georgia 30173 Mr. Leon Wade(*) 22 Westwood Circle Rome, Georgia 30161
(*) Denotes Board Members Serving as as of June 30, 1994
See notes to the general purpose financial statements. - 20 -

SCHEDULE "7"

$

59.24

$=========5=9=.2==4

SARA HIGHTOWER REGIONAL LIBRARY SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30. 1994

SCHEDULE "8" Page 1

PERSONNEL
Anderson, Amos, Appley, Barnett, Bi 11 ingley, Black, Blalock, Bouchard, Bridges, Broome, Caldwell, Carlson, Childers, Cleveland, Collins, Davidson, Doyle, Duncan, Early, Early, Evans, Evans, Fancher, Farmer, Fordham, Foster, Frazier, Gentry, Gibbons, Gilbert, Greeson, Harmison, Heller-Orr, Hightower, Johnson, Johnson, Johnston, Johnston, Keith, Kendrick, Kinzer, Lackey, Lockley, Machan, Maloof, Mcconnell , Mi 11 s, Moore, Morris, Owen, Parise, Patterson,

POSITION

SALARIES

TRAVEL

Susan F. Patricia Cook Janet A. Albert M. Gwen M. Faye Leslie D. Harvey Jane C. Sandra J. Melanie E. Susan M. Martha B. Sharon Carruth Elizabeth A. Joann P. James D. Martha S. Jo Ann Judy D. Barbara P. James David Janet Sue Gary Thomas Jason Glen Mary A. Edna Sue Teresa A. Mary B. Anne E. Virginia M. Jennifer J. Jo Carolyn C. Alice V. Cathy Morgan Patricia A. Victoria Shirley T. Jeannie P. Jacqueline D. Diane E. Mi 11 ie Sandra J. Carrol F. Betty N. Diana C. Brent Burlene H.
Wiley C.
Angela Ann Cheree

Literacy Library Assistant

$

P/T Reference Library Specialist

Branch Library Assistant

Building Superintendent

Special Collections Assistant

Library Aide

Library Aide

Video Technician

Circulation Library Assistant

Library Aide

Adult Services Library Specialist

Library Specialist I

Audio Visual Assistant

Children's Department Assistant

Director

Branch Manager

Reference Librarian

Technical Services Assistant

Extension/Library Assistant

Circulation Assistant

Children's Library Specialist

Reference Specialist

Library Aide

Library Aide

Library Aide

Circulation Assistant

Talking Book Supervisor

Children's Library Assistant

Video Assistant

Bookmobile Supervisor

P/T Office Assistant

Library Assistant

LekoTek Coordinator

Talking Book Assistant

Library Assistant

Branch Library Aide

Branch Manager

Video .Library Assistant

Technical Services Supervisor

Library Aide

Special Collections Specialist

Audio Visual Supervisor

Reference Specialist

Branch Manager

Literacy Director

Special Collections Assistant

Secretary

Library Aide

Talking Book Specialist

Associate Director

Video Intern

Library Assistant

1,683.50 4,450.33 13,131.54 25,182.66 $ 11,733.88 3,132.55 4,127.33 15,578.03 7,288.73 14,674.18 27,199.32 15,047.34 14,688.84 15,065.16 47,102.80 18,829.74 38,062.80 19,227.18
715.75 12,681.24 26,167.32 24,890.10
986.00 140.81 580.13 12,295.80 15,486.18 702.31 17,843.76 15,144.03 5,372.00 11,908.50 1,324.58 15,827.88 12,681.24 10,268.66 9,357.72 4,066.60 21,210.60 248.63 26,477.94 20,431.74 17,203.86 19,695.36 18,916.91 490.00 17,827.14 2,868.82 10,970.61 44,087.80 909.28 5,912.14

77 .40
61.06 881.17
55.38 154.86 1,528.81 224.70 763.65
6.50
218.50 181.54
467.15 6.50
94.50 13.60
54.50 380.83 786.25 100.80 395.92 470.38
37.80 1,116.96

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

SARA HIGHTOWER REGIONAL LIBRARY SCHEDULE OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30. 1994

SCHEDULE "8" Page 2

PERSONNEL
---------
Penn, Prewett, Redmond, Reeber, Reid, Rouse, Schrader, Sexton-Cooley, Shealy, Skeen, Suffridge, Thomas, Treadway, Wallace, Weaver, Wheeler, Whelchel, Wilkerson, Will i ams on, Winston, Yoder,
Accruals June 30, 1993 June 30, 1994

POSITION
--------

Zina A.

Technical Services Assistant

Jeff Douglas

Library Aide

Amy Brumbelow

Library Aide

Patricia R.

Library Aide

James Phil

Talking Book Assistant

Christina West fa 11 Library Assistant

Sherri el

Library Aide

Susan D.

Circulation Librarian

Melissa E.

Library Aide

Joyce A.

Bookkeeper

Dale E.

Video Intern

Angela Lee

Library Aide

Eleanor

Talking Book Aide

Deana M.

Literacy Ai de

Whitney M.

Library Aide

Mary Ann

Library Assistant

Leila Elizabeth Library Aide

Sandra F.

Library Assistant

Katherine

Library Aide

Shirley E.

Audio Visual/Reference Assistant

Jeremy C.

Library Aide

SALARIES

TRAVEL

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

$ 15,607.98 $ 5,960.58 238.00 1,946.50 14,731.48 4,098.61 63.75
29,398.80 433.50
24,572.52 10,982.13
4,917.89 7,803.41 17,913.92 2,560.50 13,985.16 5,197.94 19,221.84 2,998.39 11,932.68
803.25

93.36
1,929.90 120.87 6.50
3,590.29
6.50

$ 897,266.18$ 13,826.18

0.00

-54.50

0.00

25.00

$ 897,266.18$ 13,796.68
============= =============

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

SECTION IT COMPLIANCE

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

~:eparftn:eut nf ~uhits
254 WASHINGTON STREET. S. W ROOM 214
J\tbmfo:, urght 30334-8400
January 19, 1995

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

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Sara Hightower 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 of the Sara Hightower Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated January 19, 1995. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose :financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to Sara Hightower Regional Library is the responsibility of the Library's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Library's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the general purpose financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion.
The results of our tests indicate that, with respect to the items tested, the Sara Hightower Regional Library complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Library had not complied, in all material respects, with those provisions.

94CRL-10

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:cm 94CRL-10

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

~.epartm.eut of J\unit$
254 WASHINGTON STREET. S.W. ROOM 214
J\tlant&, Oieorgia 30334-8400
January 19, 1995

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

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

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

Ladies and Gentlemen:

We have audited the general purpose financial statements ofthe Sara Hightower Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated January 19, 1995_ 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 Sara Hightower Regional Library's compliance with the following requirements applicable to each of its Federal financial assistance programs, which are listed in the Schedule ofFederal Financial Assistance, for the year ended June 30, 1994:

(I) Political Activity

(5) Allowable Costs/Cost Principles

(2) Civil Rights

(6) Drug-Free Workplace Act

(3) Cash Management

(7) Audit Follow-Up/Resolution

(4) Federal Financial Reports

(8) Administrative Requirements

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

94CRL-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 of this report. With respect to items not tested, nothing came to our attention that caused us to believe that Sara Hightower 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:cm 94CRL-40

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

~epnrtnteut nf J\uhits
254 WASHINGTON STREET, S.W. ROOM 214
~tlmtbt, <ieorBia 30334-8400
January 19, 1995

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

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Sara Hightower Regional Library Board

SINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS

Ladies and Gentlemen:

We have audited the general purpose financial statements of the Sara Hightower Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated January 19, 1995. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.

In connection with our audit ofthe fiscal year 1994 general purpose financial statements ofthe Sara Hightower Regional Library and with our consideration of the Library's internal control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, "Audits ofState and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1994. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governmg:

(I) 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 Sara Hightower Regional Library's compliance with these requirements. Accordingly, we do not express such an opinion.

With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Sara Hightower Regional Library had not complied, in all material respects, with those requirements.

94CRL-120

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

SECTION ID INTERNAL CONTROL

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

~epzcrhttettf nf ~uh-its
254 WASHINGTON STREET, S.W ROOM 214
J\thmta, ~.enrgia 30334-8400
January 19, 1995

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

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board of Education
and Director and Members ofthe Sara Hightower 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 Sara Hightower Regional Library as ofand for the year ended June 30, 1994, and have issued our report thereon dated January 19, 1995. 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 Standar~ issued by the Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
In planning and performing our audit of the general purpose financial statements of the Sara Hightower Regional Library for the year ended June 30, 1994, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure.
The management of the Sara Hightower 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
94ICL-3

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

(I) Cash and Cash Equivalents

(5) Employee Compensation

(2) Revenue/Receivables/Receipts

(6) General Ledger

(3) Procurement

(7) General Fixed Assets

(4) Expenditures/Liabilities/ Disbursements

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

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

(I) Accounting Controls (Overall)

(2) General Fixed Assets

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

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

These conditions were considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Sara Hightower Regional Library's financial statements and this report does not affect our report thereon dated January 19, 1995.

94ICL-3

This report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record.
Respectfully submitted,
~~
Claude L. Vickers State Auditor
CLV:cm 94ICL-3

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

~.epartm.eut of J\uhits
254 WASHINGTON STREET, SW. ROOM 214
!-ihmbt, eorgia 30334-8400
January 19, 1995

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

Honorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation
and Director and Members ofthe Sara Hightower 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 Sara Hightower Regional Library as of and for the year ended June 30, 1994, and have issued our report thereon dated January 19, 1995. This report was qualified for a departure from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements.
We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (0MB) Circular A-128, "Audits of State and Local Governments". Those standards and 0MB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Sara Hightower Regional Library complied with laws and regulations, noncompliance with which would be material to a Federal financial assistance program.
In planning and performing our audit for the year ended June 30, 1994, we considered the Library's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the Library's financial statements and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration ofintemal 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 19, 1995.
The management of the Sara Hightower Regional Library is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The
94ICL-15

objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances ofnoncompliance 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 ofchanges in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate.

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

GENERAL REQUIREMENTS

SPECIFIC REQUIREMENTS

(I) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports

(1) Types of Services Allowed or Unallowed
(2) Eligibility
(3) Matching, Level ofEffort, and/or Earmarking

(5) Allowable Costs/Cost Principles

(4) Reporting

(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution (8) Administrative Requirements

(5) Applicable Special Tests and Provisions
(6) Other Requirement Claims for Advances and Reimbursements

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

During the year ended June 30, 1994, the Sara Hightower Regional Library had no major Federal financial assistance programs and expended 50% ofits total Federal financial assistance under the following nonmajor Federal financial assistance program:

Technology Related Assistance for Individuals with Disabilities Act Title I - Technology Assistance Program Tools for Life

We performed tests of controls, as required by 0MB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to

94ICL-15

preventing or detecting material noncompliance with general requirements, and specific requirements, as 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 ofperforming 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 pwpose. This restriction is not intended to limit the distribution ofthis report which is a matter of public record.
Respectfully submitted, ~

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Claude L. Vickers State Auditor

SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS

SARA IDGHTOWER REGIONAL LIBRARY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994
PRIOR YEAR/CURRENT YEAR
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS - Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 6572-93-01
The audit report for the year ended June 30, 1993, stated that the Library did not provide for adequate separation ofemployee duties in the performance ofaccounting functions and related procedures. For the year under review, our audit noted no improvement regarding adequate separation of employee duties for all funds.
(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 6572-93-02
The audit report for the year ended June 30, 1993, noted that the Library did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. Actions are being taken by the Library to implement and maintain a General Fixed Assets Account Group. While the account group is not complete, the Library has made improvements toward that end. Continued effort should be maintained in establishing a General Fixed Assets Account Group.

SECTIONV PERTINENT VIEWS OF RESPONSIBLE OFFICIALS

SARA IDGHTOWER REGIONAL LIBRARY PERTINENT VIEWS OF RESPONSIBLE OFFICIALS
YEAR ENDED JUNE 30, 1994
ACCOUNTING CONTROLS (OVERALL) - Financial Statements ADMINISTRATIVE REQUIREMENTS -Federal Financial Assistance Inadequate Separation ofDuties Reportable Condition - Material Weakness Audit Control Number 6572-93-01
The Library has separated the duties ofaccounting functions and related procedures as much as a limited staff
allows. With such stafflimitations this finding cannot be totally resolved.
GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Accounts Group Financial Statements Reportable Condition -Material Weakness Audit Control Number 6572-93-02
An inventory of all assets of the Library has been completed. Placing Bar Codes on the equipment is 75%
complete and should be completed by the end of the fiscal year. This should not be a finding in the FY95 Audit.