MANAGEMENT REPORT SECRETARY OF STATE AN ORGANIZATIONAL UNIT OF TIIE STATE OF GEORGIA YEAR ENDED JUNE 30, 1999 
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS 
254 WASHINGTON STREET 
ATLANTA, GEORGIA 30334-8400 
 
 SECRETARY OF STATE MANAGEMENT REPORT - TABLE OF CONTENTS - 
 
LEITER OF TRANSMITIAL 
 
SECTION! 
 
SELECTED FINANCIAL INFORMATION 
 
EXHIBITS 
 
A ANALYSIS OF CHANGES IN FUND BALANCE 
 
BUDGETFUND 
 
1 
 
SCHEDULES OF FUNDS AVAILABLE AND EXPENDITURES 
 
COMPARED TO BUDGET 
 
BUDGETFUND 
 
B 
 
"A" SECRETARY OF STATE 
 
2 
 
C 
 
"B" REAL ESTATE COMMISSION 
 
3 
 
D RECONCILIATION OF SALARIES 
 
4 
 
SECTION IT 
CURRENT YEAR FINDINGS AND QUESTIONED COSTS 
SCHEDULE OF FINDINGS AND QUESTIONED COSTS 
 
 RussELL W. H1NTON 
STATE AUDITOR 
(404) 656-2174 
 
DEPARTMENT OF AUDITS AND ACCOUNTS 
254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 
January 10, 2000 
 
Honorable Roy E. Barnes, Governor Members ofthe General Assembly of Georgia 
and Honorable Cathy Cox Secretary of State 
 
Ladies and Gentlemen: 
 
As part ofour audit of the statutory basis financial statements of the State of Georgia presented in the State of Georgia Report ofthe State Auditor, the general purpose financial statements of the State of Georgia presented in the State ofGeorgia Comprehensive Annual Financial Report, and the issuance of a Statewide Single Audit Report pursuant to the Single Audit Act Amendments, as of and for the year ended June 30, 1999, we have performed certain audit procedures at the Secretary of State. Accordingly, the financial statements and compliance activities of the Secretary of State were examined to the extent considered necessary in order to express an opinion as to the fair presentation of the financial statements contained in the foregoing documents and to issue reports on compliance and internal control as required by the Single Audit Act Amendments of 1996. 
 
This Management Report contains information pertinent to the financial and compliance activities of the Secretary of State as of and for the year ended June 30, 1999. The particular information provided is enumerated in the Table of Contents. 
 
This report is intended solely for the information and use ofmanagement ofthe Secretary of State and is not ~tended to be and should not be used by anyone other than these specified parties. 
 
. w.~:::is ---..~ .ectfully submitted, 
 
R sell W. Hinton 
 
 
 
State Auditor 
 
RWH:gp 
 
 SECTION! SELECTED FINANCIAL INFORMATION 
 
 SECRETARY OF STATE ANALYSIS OF CHANGES IN FUND BALANCE 
BUDGET FUND YEAR ENDED JUNE 30, 1999 
 
EXHIBIT"A" 
 
FUND BALANCE - JULY 1, 1998 
Reserved Surplus 
ADDITIONS 
Adjustments to Prior Year's Accounts Payable Excess of Funds Available over Expenditures 
Exhibit "B" Exhibit "C" Reimbursement of Prior Year's Expenditures 
DEDUCTIONS 
Unreserved Fund Balance (Surplus) Returned to Office of Treasury and Fiscal Services Year Ended June 30, 1998 
Adjustment to Prior Year's Accounts Receivable Reserved Fund Balance Carried Over from 
Prior Year as Funds Available 
 
"A" SECRETARY 
OF STATE 
 
"B" 
REAL ESTATE COMMISSION 
 
TOTAL 
 
$ 194,435.46 1,229,111.85 $ 
$ 1,423,547.31 $ 
 
$ 194,435.46 99,932.92 1,329,044.77 
99,932.92 $ 1,523,480.23 
 
$ 47,214.54 
1,588,820.51 $ 
902.16 
$ 1,636,937.21 $ 
 
$ 47,214.54 
 
127,663.83 505.00 
 
1,588,820.51 127,663.83 1,407.16 
 
128,168.83 $ 1,765,106.04 
 
$ 1,229,111.85 $ 15,766.93 
194.435.46 
$ 1,439,314.24 $ 
 
99,932.92 $ 1,329,044.77 15,766.93 
194,435.46 
99,932.92 $ 1,539,247.16 
 
FUND BALANCE - JUNE 30. 1999 
 
$ 1,621,170.28 $ 128,168.83 $ 1,749,339.11 
 
SUMMARY OF FUND BALANCE 
Reserved State Funds Federal Financial Assistance Other Funds 
Surplus 
 
$ 807,761.98 30,883.18 80,475.27 
$ 919,120.43 702,049.85 $ 
 
$ 807,761.98 30,883.18 80,475.27 
 
$ 919,120.43 
 
128,168.83 
 
830,218.68 
 
$ 1,621,170.28 $ 128,168.83 $ 1,749,339.11 -1 - 
 
 SECRETARY OF STATE SCHEDULE OF FUNDS AVAILABLE AND EXPENDITURES 
COMPARED TO BUDGET BUDGET FUND 
"A" SECRETARY OF STATE YEAR ENDED JUNE 30, 1999 
 
EXHIBIT"B" 
 
FUNDS AVAILABLE REVENUES 
State Appropriation Federal Revenues Other Revenues Retained 
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance 
 
BUDGET 
 
ACTUAL 
 
VARIANCEFAVORABLE {UNFAVORABLE) 
 
$ 30,175,496.00 $ 
0.00 2,655,594.00 
 
30,175,496.00 $ 
114,459.73 2,685,793.09 
 
$ 32,831,090.00 $ 32,975,748.82 $ 
 
0.00 114,459.73 
30,199.09 
144,658.82 
 
0.00 
 
194,435.46 
 
194,435.46 
 
EXPENDITURES 
Personal Services Regular Operating Expenses Travel Motor Vehicle Purchases Equipment Computer Charges Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Election Expenses Year 2000 Project 
Excess of Funds Available over Expenditures 
 
- - - - - ' - - - $ 32,831,090.00 $ 33,170,184.28 $ 
 
339,094.28 
 
$ 18,411,311.00 $ 
3,546,478.00 250,464.00 171,490.00 269,520.00 
3,496,336.00 2,474,252.00 
933,400.00 2,114,814.00 
597,500.00 565,525.00 
 
17,891,158.73 $ 
3,448,054.66 232,518.32 171,489.64 269,520.18 
3,523,777.46 2,443,230.65 
931,008.68 2,041,015.20 
553,987.16 75,603.09 
 
520,152.27 98,423.34 17,945.68 0.36 -0.18 -27,441.46 31,021.35 2,391.32 73,798.80 43,512.84 
489,921.91 
 
---------- $ 32,831,090.00 $ 31,581,363.77 $ 
 
1,249,726.23 
 
$ 1,588,820.51 $ =====1=,5=88='=82=0=.5=1 
 
-2- 
 
 SECRETARY OF STATE SCHEDULE OF FUNDS AVAILABLE AND EXPENDITURES 
COMPARED TO BUDGET BUDGET FUND 
"B" REAL ESTATE COMMISSION YEAR ENDED JUNE 30, 1999 
 
EXHIBIT"C 
 
FUNDS AVAILABLE 
REVENUES 
State Appropriation Other Revenues Retained 
 
BUDGET 
 
ACTUAL 
 
VARIANCEFAVORABLE (UNFAVORABLE) 
 
$ 2,352,080.00 $ 2,352,080.00 $ 
 
29,489.00 
 
29,838.66 
 
0.00 349.66 
 
EXPENDITURES 
Personal Services Regular Operating Expenses Travel Motor Vehicle Purchases Equipment Computer Charges Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Year 2000 Project 
 
- - - - - - $ 2,381,569.00 $ 2,381,918.66 $ 
 
349.66 
 
$ 1,383,094.00 $ 176,623.00 15,000.00 29,000.00 7,639.00 
. 181,400.00 170,085.00 187,000.00 133,000.00 98?28.00 
 
1,354,400.75 $ 138,474.59 13,231.37 27,390.86 2,717.04 170,809.83 170,085.00 153,451.83 124,965.94 98?27.62 
 
28,693.25 38,148.41 
1,768.63 1,609.14 4,921.96 10,590.17 
0.00 33,548.17 
8,034.06 0.38 
 
$ 2,381,569.00 $ 
 
__ 2,254,254.83 $ 
 
127,314.17 _.;.;;;;.;..:.;...;..;..;__ 
 
Excess of Funds Available over Expenditures 
 
$ 127,663.83 $ ===1=2:::::::!7,=66=3=.8=3 
 
-3- 
 
 SECRETARY OF STATE RECONCILIATION OF SALARIES 
YEAR ENDED JUNE 30, 1999 
 
Totals per Annual Supplement 
 
Adjustments Anderson, Ashe, Black, Bolton, Camp, Carr, Chambers, Crawford, Dowell, Durham, Elijay, Fox, Gonzalez, Harris, Hartwell-Lee, Hicks, Hodges, Hudgins, Jackson, Jarrell, Jones, Kiaukaras, Mack, McGruder, Nowicki, Perez, Piccinini, Salvadore, Smelund, Talley-McRae, Thompson, Turner, Turpin, Tyner, Underwood, Walker, Williams, Wingate, Yankey, 
 
Vaughn I. RobertL. Alice A. Frazier L. Ryan D. KipleyD. Virginia L. Judith R. Peggy$. Delano Nancy I. Elizabeth R. Leah M. Susan Karen Y. Catherine N. Angela L. KimberlyJ. MiyaM. Gregory K. Tonia R. Sheri L. Cheryl J. Taffie N. Eugene F. Kimberly K. Gabriele L. Clydie M. William S. Helen L. Cynthia L. Rosemary Jennifer L. Marvin JeanW. Marye. Patrice Meredith Joan C. 
 
-4- 
 
EXHIBIT"D 
SALARIES 
$ 14,084,439.83 
340.00 120.75 372.96 374.50 432.00 128.00 480.00 644.00 445.92 280.00 990.00 560.00 150.00 136.50 576.00 420.00 476.00 213.50 450.64 620.00 67.50 682.00 960.50 532.00 392.00 220.00 380.00 608.00 60.00 315.00 456.00 616.00 192.50 416.25 304.00 350.63 488.75 352.00 518.00 
$ 14,100,561.73 
 
 SECTION II CURRENT YEAR FINDINGS AND QUESTIONED COSTS 
 
 SECRETARY OF STATE SCHEDULE OF FINDINGS AND QUESTIONED COSTS 
YEAR ENDED JUNE 30, 1999 
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS 
CASH AND CASH EQUIVALENTS Inadequacies in Bank Reconciliation Procedures Finding Control Number: FS-478-99-01 
The Secretary of State's accounting .procedures were not sufficient to provide for adequate controls over the bank reconciliation process. Engagement procedures and interviews with personnel revealed that bank reconciliations were not performed in a timely manner for the Operating, Payroll, and the Revenue Collections accounts. The June 1999 bank statements for the three accounts identified were not reconciled until December 1999. 
While management of the Secretary of State has asserted that financial records are complete and accurate, failure to reconcile bank statements in a timely manner could result in errors in financial reporting or fraud occurring with regard to cash that would go undetected until this reconciliation process was completed. 
During fiscal year 1999, the Secretary of State's office experienced high turnover in the accounting department, resulting in a shifting and reprioritizing of duties, and as a consequence, bank statements were not reconciled in a timely manner. 
Management of the Secretary ofState's office should establish the necessary procedures to ensure that bank reconciliations are reconciled on a monthly basis to ensure timely detection of errors and/or fraud, thus assuring the accuracy and completeness oftheir financial records.