Audit report, state of Georgia, Carroll Technical Institute, Carrollton, Georgia, year ended June 30, 1997

GA
A.?>oo
.KI
Vb
AUDIT REPORT STATE OF GEORGIA CARROLL TECHNICAL INSTITUTE CARROLLTON, GEORGIA YEAR ENDED JUNE 30, 1997
~----------
STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334-8400

CARROLL TECHNICAL INSTITUTE - TABLE OF CONTENTS -

SECTION I

FINANCIAL

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

EXHIBITS

FINANCIAL STATEMENTS

A COMBINED BALANCE SHEET (STATUTORY BASIS)

ALL FUND TYPES AND ACCOUNT GROUPS

2

B STATEMENT OF CHANGES IN FUND BALANCE (STATUTORY BASIS)

GOVERNMENTAL FUND TYPE

5

C STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES

BUDGET FUND

6

STATEMENTS OF FUNDS AVAILABLE AND EXPENDITURES

COMPARED TO BUDGET

BUDGET FUND

D

"A" DEPARTMENT OF TECHNICAL AND ADULT EDUCATION

10

E

"B" LOTTERY FOR EDUCATION

11

F NOTES TO THE FINANCIAL STATEMENTS

12

SUPPLEMENTARY INFORMATION

G COMBINING BALANCE SHEET (STATUTORY BASIS)

BUDGET FUND

26

H COMBINING STATEMENT OF CHANGES IN FUND BALANCE

(STATUTORY BASIS)

BUDGET FUND

27

I COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES

BUDGET FUND

28

SCHEDULE

RECONCILIATION OF SALARIES AND TRAVEL

31

SECTION II CURRENT YEAR FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

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

DEPARTMENT OF AUDITS AND ACCOUNTS
254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400
August 26, 1997

Honorable Zell Miller, Governor Members ofthe General Assembly of Georgia Members of the State Board of Technical and Adult Education Members of the Local Board of Directors
and Honorable Janet Ayers, President Carroll Technical Institute
INDEPENDENT AUDITOR'S COMBINED REPORT ON FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have audited the accompanying financial statements (Exhibits A through F) of Carroll Technical Institute as of and for the year ended June 30, 1997. These financial statements are the responsibility of the Institute's management. Our responsibility is to express an opinion on these financial statements based on our audit.
Except as discussed in the following paragraph, we conducted our audit in accordance with generally accepted auditing standards. 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 [mandal 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.
We did not observe the taking of resale inventory at June 30, 1997, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures.
As described in Note 1, these financial statements were prepared on a prescribed basis of accounting that demonstrates compliance with the budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles.
In our opinion, except for the effect of such adjustments, if any, on the Budget Fund as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the resale inventory as described in the third paragraph, the financial statements referred to above present fairly, in all material
97ARL-3TX

respects, the fmancial position (statutory basis) of Carroll Technical Institute as of June 30, 1997, and the results of its operations (statutory basis) for the year then ended, on the basis of accounting described in Note 1.
Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary information (Exhibits G through I and Schedule 1) is presented for purposes ofadditional analysis and is not a required part ofthe financial statements of Carroll Technical Institute. Such information has been subjected to the auditing procedures applied in the audit ofthe fmancial statements and, in our opinion, except for the effects ofthe matter referred to in the third paragraph, such information is fairly presented in all material respects in relation to the fmancial statements taken as a whole.
Respectfully submitted,

CLV:gp 97ARL-3TX

Claude L. Vickers State Auditor

FINANCIAL STATEMENTS - 1-

CARROLL TECHNICAL INSTITUTE COMBINED BALANCE SHEET (STATUTORY BASIS)
ALL FUND TYPES AND ACCOUNT GROUPS JUNE 3D. 1997

EXHIBIT "A"

ACCOUNT GROUPS

GENERAL

GENERAL

FIXED

LONG-TERM

ASSETS

DEBT

TOTALS (Memorandum Only) JUNE 30,1997 JUNE 30,1996

$ 514,318.70 $ 657,835.59

$

28,629.12 $

88,918.43

67,415.25

100,963.32

$

96,044.37 $ 189,881.75

$ 176,032.80 $ 158,381.24

$ 4,537,927.07

$ 4,537,927.07 $ 4,111 ,984.63

$ 341,925.91 $ 341 ,925.91 $ 315,326.09

$ 4,537,927.07 $ 341,925.91 $ 5,666,248.85 $ 5,433,409.30

$
$ 341,925.91 $ 341,925.91 $

399,844.81 $ 23,819.40 7,247.57

722,806.18 2,403.74 0.00

58,848.10 93,756.86 341,925.91

39,954.00 81,766.72 315,326.09

925,442.65 $ 1,162,256.73

$ 4,537,927.07

$ 4,537,927.07 $ 4,111,984.63

338.86 2,617.10 61,940.88 134,530.46 1,335.33
0.00

4,843.85 2,289.13 61,940.88 81,933.18 1,135.28
45.31

$ 4,537,927.07

2,018.99 97.51

5,614.23 1,366.08

$ 4,740,806.20 $ 4,271,152.57

$ 4,537,927.07 $ 341,925.91 $ 5,666,248.85 $ 5,433,409.30

-3-

TIUS PAGE LEFT BLAHK

CARROLL TECHNICAL INSTITUTE STATEMENT OF CHANGES IN FUND BALANCE (STATUTORY BASIS)
GOVERNMENTAL FUND TYPE YEAR ENDED JUNE 30.1997

EXHIBIT"B"

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

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30,1997

EXHIBIT"C"

FUNDS AVAILABLE
REVENUES
STATE APPROPRIATIONS Allotment from Georgia Department of Technical and Adult Education - Administrative Central Office
FEDERAL REVENUES
OTHER REVENUES RETAINED Allotment from Georgia Department of Technical and Adult Education - Administrative Central Office Construction Reserve Trust Fund Contracts Coweta County Board of Education Adult Literacy - Special Project Georgia Department of Human Resources Georgia Child Care Council PEACH Project Georgia Department of Labor Commission on Women Keds Funds, Non-Traditional Employment and Training Agreement Georgia Institute of Technology Satellite Technology Program Georgia Statewide Academic and Medical System Programs Interactive Network Office of School Readiness Adult and Child Care Food Program Fees Application Graduation Registration/Continuing Education Testing Other Interest Earned Reimbursements from Various Sources Rents Sales and Services (Net) Tuition Vending Other Sources
Total Other Revenues Retained
Total Revenues
CARRY-OVER FROM PRIOR YEAR
Transfer from Reserved Fund Balance Live Work Projects Prior Year Local Funds
Total Carry-Over from Prior Year
Total Funds Available

TOTALS YEAR ENDED JUNE 30,1997 JUNE 30,1996

$ 6,470,326,00 $ 6,101,211,00 $ 1,068,272.08 $ 1,227,882.04

$

0.00 $ 339,388.00

6,000.00
0.00 21,015,85

6,000.00
10,382.59 49,140.70

23,807.50

24,422.68

14,700.00

5,714.35

0.00

3,626.11

8,824.06

0.00

26,517.00 0.00
366,715.56 19,304.74 69,134.72 38,874.35 0.00 18,023.06
247,326.60 1,166,468.08
757.72 8,093.95

36,873.29 2,877.02
189,139.05 16,135.00 52,304.92 33,564.27
5,993.97 23,212.32 157,085.91 1,086,264.89
0.00 656.22

$ 2,035,563.19 $ 2,042,781.29

$ 9,574,161.27 $ 9,371,874.33

$ 81,933.18 $ 64,514.06

0.00

3,441.35

$ 81,933.18 $ 67,955.41

$ 9,656,094.45 $ 9,439,829.74

The notes to the financial statements are an integral part of this statement. -6-

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30. 1997

EXHIBIT"C"

EXPENDITURES
PERSONAL SERVICES-INSTITUTIONS
Salaries and Wages Employer's Contributions for:
F.I.C.A. Retirement Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
OPERATING EXPENSES-INSTITUTIONS
Other Costs Motor Vehicle Expenses Supplies and Materials Repairs and Maintenance Utilities Rents (Other than Real Estate) Insurance and Bonding Other Operating Expenses Extraordinary Expenditures Publications and Printing Equipment Purchases Non-Inventory
Travel Motor Vehicle Equipment Purchases Equipment
Equipment Purchases LeaselPurchase of Equipment Rental of Equipment Computer Charges Software Real Estate Rentals Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Contracts
ADULT LITERACY GRANTS
Personal Services Salaries and Wages Employer's Contributions for: F.I.C.A. Retirement Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
Other Costs Supplies and Materials Repairs and Maintenance Utilities
The notes to the financial statements are an integral part of this statement.
-7-

TOTALS YEAR ENDED JUNE 30.1997 JUNE 30,1996

$ 4,868,015.12 $ 4,386,080.64

109,895.13 544,943.58 555,552.12
27,098.00 6,076.00 9,176.00

96,115.96 488,534.21 504,314.77
27,977.00 1,908.00 6,281.00

$ 6,120,755.95 $ 5,511,211.58

$

17,565.79 $

10,087.10

572,300.56

572,542.56

171,143.42

201,348.72

265,090.81

197,137.03

81.54

359.00

12,735.00

4,149.00

200,903.99

167,009.89

0.00

10,317.50

70,369.50

99,886.86

104,953.74 57,694.35 0.00

87,363.26 50,302.66 21,555.00

509,333.77 0.00
2,229.90

345,884.16 47,045.95 627.06

46,495.54 0.00
110,398.54

88,308.79 3,120.00
67,543.90

58,584.50 126,855.88

35,312.06 96,195.82

$ 2,326,736.83 $ 2,106,096.32

$ 481,356.57 $ 505,135.42

14,986.08 27,129.70 27,224.87
1,176.00 294.00 444.00

15,477.88 22,907.61 22,873.15
1,110.00 84.00
270.00

63,873.54 2,136.81 4,141.91

80,407.01 75.00
3,414.98

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30,1997

EXHIBIT"C"

EXPENDITURES
ADULT LITERACY GRANTS
Other Costs other Operating Expenses Publications and Printing Equipment Purchases Non-Inventory
Travel Real Estate Rentals Equipment
Equipment Purchases Computer Charges
Software Telecommunications Per Diem, Fees and Contracts
Per Diem and Fees Contracts
JOB TRAINING PARTNERSHIP ACT
Personal Services Salaries and Wages Employer's Contributions for: F.I.CA Retirement Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
other Costs Supplies and Materials Utilities Other Operating Expenses Publications and Printing Equipment Purchases Non-Inventory
Travel Real Estate Rentals Telecommunications Per Diem, Fees and Contracts
Per Diem and Fees Contracts
EQUIPMENT-TECHNICAL INSTITUTES
Other Costs Equipment Purchases Non-Inventory
Equipment Equipment Purchases

TOTALS YEAR ENDED JUNE 30,1997 JUNE 30,1996

$

18,610.44 $

27,091.48

794.75

0.00

2,509.13 10,211.55
750.00

0.00 11,540.06
0.00

19,861.54

45,948.41

0.00 1,500.00

3,453.00 138.80

4,879.70 3,135.00

1,150.40 701.25

$ 685,015.59 $ 741,778.45

$ 140,128.72 $ 184,319.00

2,836.40 17,062.70 17,390.13
538.00 294.00 444.00

5,834.79 21,708.87 21,967.42
925.00 70.00
225.00

6,255.50 0.00
65,557.28 0.00

4,423.15 1,964.71 197,053.83
153.36

3,200.17 4,447.91
0.00 2,341.92

0.00 2,955.94 1,327.50 1,246.77

498.00 2,700.00

1,706.00 0.00

$ 263,694.73 $ 445,881.34

$

19,906.14 $

0.00

97,437.86

189,826.59

$ 117,344.00 $ 189,826.59

The notes to the financial statements are an integral part of this statement.
-8-

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 3D. 1997

EXHIBIT"C"

The notes to the financial statements are an integral part of this statement. -9-

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
COMPARED TO BUDGET BUDGET FUND
"A" DEPARTMENT OF TECHNICAL AND ADULT EDUCATION YEAR ENDED JUNE 30,1997

EXHIBIT"D"

FUNDS AVAILABLE REVENUES
State Appropriations Federal Revenues Other Revenues Retained
CARRY-OVER FROM PRIOR YEAR Transfer from Reserved Fund Balance

BUDGET

ACTUAL

VARIANCEFAVORABLE (UNFAVORABLE)

$ 6,352,982.00 $ 6,352,982.00 $

1,028,980.00

1,068,272.08

2,462,310.00

2,035,563.19

$ 9,844,272.00 $ 9,456,817.27 $

0.00 39,292.08 -426,746.81
-387,454.73

0.00

81,933.18

81,933.18

EXPENDITURES
Personal Services-Institutions Operating Expenses-Institutions Adult Literacy Grants Job Training Partnership Act

$ 9,844,272.00 $ 9,538,750.45 $ - - - --3-0-5,"52-1-.55-

$ 6,192,664.00 $ 6,120,755.95 $

2,530,854.00

2,326,736.83

785,273.00

685,015.59

335,481.00

263,694.73

71,908.05 204,117.17 100,257.41
71,786.27

Excess of Funds Available over Expenditures

$ 9,844,272.00 $ 9,396,203.10 $ - - - -4-4-8,"06-8-.9-0
$ 142,547.35 $ ===1:::4=2..,.,5=4=7.:=3::.5

The notes to the financial statements are an integral part of this statement. - 10 -

CARROLL TECHNICAL INSTITUTE STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
COMPARED TO BUDGET BUDGET FUND
"B" LOTTERY FOR EDUCATION YEAR ENDED JUNE 30,1997

EXHIBIT"E"

FUNDS AVAILABLE REVENUES
State Appropriations

BUDGET

ACTUAL

VARIANCEFAVORABLE (UNFAVORABLE)

$ 117,344,00 $ 117,344,00 $

0_,0_0

EXPENDITURES Equipment-Technical Institutes

$ 117,344.00 $ 117,344,00 $

...:.O...:.,O~O

Excess of Funds Available over Expenditures

$

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

The notes to the financial statements are an integral part of this statement. - 11 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30,1997

EXHIBIT "F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY Carroll Technical Institute is one of thirty (30) State supported member institutes of postsecondary education in Georgia which comprise the Georgia Department ofTechnical and Adult Education, an organizational unit of the State of Georgia. The accompanying financial statements reflect the operations of Carroll Technical Institute as a separate reporting entity.
The Institute's Local Board of Directors is composed of eleven (11) members serving staggered three-year terms who are appointed by the State Board of Technical and Adult Education. Appropriation of State funds is made to the Georgia Department of Technical and Adult Education by the General Assembly of Georgia. The Department's Administrative Central Office determines the amount of State appropriations to be received by Carroll Technical Institute. The Institute does not have authority to retain unexpended State appropriations (surplus) for any given fiscal year. Accordingly, Carroll Technical Institute is considered an organizational unit ofthe Georgia Department of Technical and Adult Education for financial reporting purposes because of the significance of its legal, operational, and financial relationships as defined in Section 2100 of the Governmental Accounting Standards Board Codification of Governmental Accounting and Financial Reporting Standards.
FUND ACCOUNTING Carroll Technical Institute uses funds and account groups to report on its financial position and the results of its operations determined in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia. A fund is an independent fiscal and accounting entity with a selfbalancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds are maintained consistent with legal and managerial requirements. Account groups are a reporting device used to account for certain assets and liabilities of the governmental funds not recorded directly in those funds.
Funds and account groups presented in the accompanying financial statements are as follows:
GOVERNMENTAL FUND TYPE
BUDGET FUND - The fund used to account for activities and functions as set forth in the Amended Appropriations Act of 1996-1997. This fund also includes operations from various institutional services provided to students, faculty, and/or staff which are funded by fees charged to participants that are directly related to, but not necessarily equal to, the cost of service. The Budget Fund is similar in nature to a General Fund as defined in generally accepted accounting principles in that the Budget Fund is used to account for all activities except those required to be accounted for in some other fund.
FIDUCIARY FUND TYPE
AGENCY FUNDS - The funds used to account for assets held for use by other funds, governments, or individuals.
- 12 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
FUND ACCOUNTING
ACCOUNT GROUPS
GENERAL FIXED ASSETS - The account group used to account for fixed assets used in governmental fund type operations. Fixed assets purchased are recorded at cost or at estimated historical cost ifhistorical cost is not practically detenninable. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. No depreciation has been provided on general fixed assets.
The costs of nonnal maintenance and repairs that do not add to the value of assets or materially extend assets' lives are not included in the General Fixed Assets Account Group. Material improvements adding to the value or useful life of assets are included in the General Fixed Assets Account Group.
GENERAL LONG-TERM DEBT - The account group used to report the noncurrent portions of certain governmentallong-tenn liabilities, such as claims, judgments, and compensated absences, which will be paid from future resources.
BASIS OF ACCOUNTING MEASUREMENT FOCUS
The accounting and financial reporting treatment applied to a fund is detennined by its measurement focus. Governmental funds should be accounted for using the flow of current financial resources measurement focus. With this measurement focus, operating statements present increases and decreases in net current assets and unreserved fund balance is a measure of available spendable resources. In accordance with accounting practices prescribed or pennitted by statutes and regulations of the State of Georgia, the Budget Fund returns its unreserved fund balance (surplus) to the Administrative Central Office ofthe Department of Technical and Adult Education for remittance to the Office of Treasury and Fiscal Services in the subsequent fiscal year.
GOVERNMENTAL FUND TYPE BUDGET FUND
Except as disclosed in the following paragraphs, units of government of the State of Georgia record their Budget Fund revenues and expenditures in accordance with the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they are "measurable and available"). "Measurable" means the amount of the transaction can be detennined and "available" means collectible within the current period or soon enough thereafter to pay liabilities of the current period. Revenues that are accrued include primarily State appropriations, Federal grants and entitlements, and certain amounts earned under operating agreements with other parties. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest on generallong-tenn debt which is recognized when due, and certain compensated absences, claims and judgments which are recognized when the obligations are expected to be liquidated with expendable available financial resources.

- 13 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING GOVERNMENTAL FUND TYPE BUDGET FUND
Contractual obligations for goods and services which have not been received at the end of the fiscal year are recognized as expenditures and liabilities in the accompanying financial statements. This accounting practice causes expenditure-driven grant revenues to be accrued based, in part, on the unexecuted portion of contracts for goods and services. The recognition of encumbrances as expenditures and liabilities is in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but is not consistent with generally accepted accounting principles, which provide for the recording of encumbrances as a reservation of fund balance. Further, revenue recognition for expenditure-driven grants should be based upon expenditures determined in accordance with generally accepted accounting principles.

Prior period adjustments and certain other items are reported as additions to and deductions from fund balance

of the Budget Fund in the accompanying financial statements. This presentation is in accordance with

accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but differs

from generally accepted accounting principles in that immaterial adjustments should be reported as current

period revenues and expenditures.

.

FIDUCIARY FUND TYPE AGENCY FUNDS
Agency Funds are custodial in nature and do not measure results of operations or have a measurement focus. The modified accrual basis of accounting is utilized for recognizing assets and liabilities.

BUDGET The Georgia Department of Technical and Adult Education - Administrative Central Office receives State appropriation allotments and certain Federal funds for the various technical institutes throughout the State. The appropriated budget is adopted at the departmental level and represents appropriations provided by the Amended Appropriations Act of 1996-1997. The budget allocation and disbursement of these funds is made to the various technical institutes by the Administrative Central Office. In addition, the technical institutes receive certain Federal funds and other funds directly and include these funds in the budget filed with the Administrative Central Office.

CASH AND CASH EQillVALENTS Cash and Cash Equivalents include currency on hand and demand deposits with banks.

ACCOUNTS RECEIVABLE Accounts receivable consist of reimbursements due from Federal, State, local, and private grants and contracts, and other receivables disclosed from information available.

- 14-

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES Expendable supplies are recorded as expenditures at the time of purchase and are not reflected on the Combined Balance Sheet (Statutory Basis).

Inventories of goods for resale are recorded as assets at cost at the time of purchase. The Institute uses the fIrst-in, fIrst-out method in costing-out inventories based on sales.

RESERVED FUND BALANCE Reserves represent those portions of fund equity not appropriable for expenditure or legally segregated for a specifIc future use. The following is a brief description of the reserves reflected in the accompanying fInancial statements:

FEDERAL FINANCIAL ASSISTANCE REFUND TO GEORGIA DEPARTMENT OF TECHNICAL AND ADULT EDUCATION ADMINISTRATIVE CENTRAL OFFICE
Carroll Technical Institute receives Federal funds for the Adult Education Act and the Carl D. Perkins Vocational and Applied Technology Education Act and the Job Training Partnership Act through the Georgia Department of Technical and Adult Education - Administrative Central Office. As provided by the respective budget allocation to the Institute, these funds were required to be expended by June 30, 1997. At June 30, 1997, the following programs had unexpended Federal funds which should be refunded to the Administrative Central Office:

Adult Education Act Adult Education
Carl D. Perkins Vocational and Applied Technology Education Act Vocational Education - Sex Equity Vocational Education - Single Parent
Job Training Partnership Act

$

29.93

288.61 1.05
19.27

$

338.86

EXPIRED GRANT BALANCES Expired grant balances represent the unexpended balance ofFederal financial assistance, other than through the Georgia Department of Technical and Adult Education - Administrative Central Office, remaining after the expiration of the Federal program/project. This amount is refundable to the applicable grantor.

INVENTORIES Reported inventories (resale), under the consumption method, are offset by a portion of State funds reserved to provide working capital for managing a reasonable level of inventories for resale.

- 15 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
RESERVED FUND BALANCE
LIVE WORK PROJECTS In accordance with the Official Code of Georgia Annotated Section 20-4-14(c), the accumulated balance of unexpended funds derived from student live work projects. This amount is restricted to expenditures for live work projects or for the benefit of instructional programs at the technical institute in subsequent fiscal years.
STATE GRANTS AND CONTRACTS
The unexpended balance ofstate grants and contracts, other than through the Administrative Central Office, remaining after the expiration of the program/contract. This amount is refundable to the applicable grantors.
UNRESERVED FUND BALANCE In accordance with accounting practices prescribed or permitted by statutes and regulations ofthe State of Georgia, the Budget Fund's unreserved fund balance is returned to the Georgia Department of Technical and Adult Education - Administrative Central Office for remittance to the Office of Treasury and Fiscal Services in the subsequent fiscal year as surplus, as follows:
REGULAR - An amount ofunexpended regular appropriations designated for reappropriation by the State in subsequent years.
LOTTERY FOR EDUCATION - An amount of unexpended lottery appropriations designated for future reappropriation by the State for Lottery for Education.
COMPENSATED ABSENCES Compensated absences represent obligations of the Institute relating to employees' rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulated annual and compensatory leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the Budget Fund for the current portion ofthis obligation as this amount will not be liquidated with expendable available financial resources. Funds are provided in the allotment of State funds each year to the Institute to cover the cost of annual leave paid to terminated employees.
The liability for compensated absences at year-end is reported in the General Long-Term Debt Account Group for governmental funds.
MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the Combined Balance Sheet (Statutory Basis) are captioned "Memorandum Only" because they do not represent consolidated fmancial information and are presented only to facilitate financial analysis. The columns do not present information that reflects financial position in conformity with generally accepted
- 16 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
MEMORANDUM ONLY - TOTAL COLUMNS accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
COMPARATIVE DATA Comparative total data for the prior year have been presented in selected sections of the accompanying financial statements in order to provide an understanding of the changes in the Institute's financial position and operations. Comparative totals have not been included on statements where their inclusion would not provide enhanced understanding of the Institute's fmancial position and operations or would cause the statements to be unduly complex and difficult to understand. Also, certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year's presentation.
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds belonging to the State of Georgia cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral anyone or more of the following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
(l) Bonds, bills, certificates of indebtedness, notes, or other direct obligations of the United States or of the State of Georgia.
(2) Bonds, bills, certificates of indebtedness, notes, or other obligations of the counties or municipalities of the State of Georgia.
(3) Bonds of any 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.
(4) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.
(5) Bonds, bills, certificates of indebtedness, notes, 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 FederalNational Mortgage Association.
(6) Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation.

- 17 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS

STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has adopted policies which allow agencies of the State of Georgia (which include technical institutes) the option of exempting demand deposits from the collateral requirements.

CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. The bank balances as of June 30, 1997, are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk:

Category 1 - Amounts covered by depository insurance or collateralized with securities (at market value) held by the Institute or by its agent in the Institute's name.

Category 2 - Amounts collateralized with securities (at market value) held by the pledging financial institution's trust department or agent in the Institute's name.

Category 3 - Amounts collateralized with securities (at market value) held by the pledging financial institution, or by its trust department or agent but not in the Institute's name, and amounts uncollateralized.

Cash Deposits

Carrying Amount

Bank Balances

Risk Categories

2

3

$ 513 56870 $ 872512.44 $ 200,000,00 $,===!Q~.QQ{;Q $ 672512.44

NOTE 3: CHANGES IN GENERAL FIXED ASSETS

In accordance with the statutory definition of moveable personal property as defined in Official Code of Georgia Annotated Section 50-16-161, only those items with an acquisition cost of$1 ,000.00 or greater are reflected in the General Fixed Assets Account Group.

The following is a summary of changes of equipment for the General Fixed Assets Account Group during the fiscal year:

Balance July 1, 1996

$ 4,111,984.63

Additions Deductions

463,678.42 37,735.98

Balance June 30, 1997

$ 4.537,927.07

- 18 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 4: GENERAL LONG-TERM DEBT

CHANGES IN GENERAL LONG-TERM DEBT During the year ended June 30, 1997, the following changes occurred in the compensated absences liability reported in the General Long-Term Debt Account Group:

Balance July 1, 1996

$ 315,326.09

Additions Annual Leave Earned and Utilized (Net) Salaries and Wages Salary-Related Fringe Benefits

25,649.55 950.27

Balance June 30, 1997

$ 341.925.91

NOTE 5: RISK MANAGEMENT

Public Entity Risk Pool The State Personnel Board - Merit System of Personnel Administration administers for the State of Georgia a program of health benefits for the employees of units of government ofthe State of Georgia, units of county governments, and local education agencies located with the State of Georgia. This plan is funded by participants covered in the plan, by employers' contributions paid by the various units of government participating in the plan, and appropriations made by the General Assembly of Georgia. The State Personnel Board - Merit System of Personnel Administration has contracted with Blue Cross Blue Shield of Georgia to process claims in accordance with the State Employees' Health Benefit Plan as established by the State Personnel Board.

Other Risk Management The Department of Administrative Services (DOAS) has the responsibility for the State of Georgia ofmaking and carrying out decisions that will minimize the adverse effects of accidental losses that involve State government assets. The State believes it is more economical to manage its risks internally and set aside assets for claim settlement. Accordingly, DOAS processes claims for risk of loss to which the State is exposed, including general liability, property and casualty, workers' compensation, unemployment compensation, and law enforcement officers' indemnification. Limited amounts of commercial insurance are purchased applicable to property, employee and automobile liability, fidelity and certain other risks. The Institute, as an organizational unit of the Georgia Department of Technical and Adult Education, is part of the State of Georgia reporting entity, and as such, is covered by the State of Georgia risk management program administered by DOAS. Premiums for the risk management program are charged to the various state organizations by DOAS to provide claims servicing and claims payment.

- 19-

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 6: .DEFERRED COMPENSATION PLAN
The State of Georgia offers its employees a deferred compensation plan in accordance with Internal Revenue Code Section 457. The plan, available to employees of the State of Georgia and county health departments, permits such employees to defer a portion of their salary until future years. Participation in the plan is optional. Participants choose the option or options in which they wish to participate. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property or rights ofthe State of Georgia subject only to the claims of the State's general creditors. Participant's rights under the plan are equal to those of a general creditor of the State of Georgia in an amount equal to the fair market value of the deferred account of each participant. Financial information relative to the plan will be presented in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1997.
A change in the Internal Revenue Code Section 457, effective August 20, 1996, requires that by January 1, 1999, all existing eligible deferred compensation plans must be held in trust for the exclusive benefit of participants and their beneficiaries. The State of Georgia's plan will be converted effective July 1, 1998.
NOTE 7: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA
Plan Description Carroll Technical Institute participates in the Teachers Retirement System of Georgia (TRS), a cost-sharing multiple-employer public employee retirement system (PERS) established by the General Assembly of Georgia for the purpose of providing retirement allowances and other benefits for teachers of the State of Georgia.
TRS provides service retirement, disability retirement, and survivor's benefits for its members. A member is eligible for service retirement after the member (1) has attained the age of 60 years and has at least ten years of creditable service, or (2) has at least 25 years of creditable service. For those members with 30 years of service or those age 60 with at least ten years of service, normal retirement benefits 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. Early retirement benefits are reduced by the lesser of 1/12 of7% for each month the member is below age 60, or by 7% for each year or fraction thereof by which the member has less than 30 years of service. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death.
Retirement benefits also include death and disability benefits whereby the 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 benefit is based on member's creditable service (minimum of 10 years of service) and compensation up to the date of death or up to the time of disability.
- 20-

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT"F"

NOTE 7: RETIREMENT PLANS
TEACHERS RETIREMENT SYSTEM OF GEORGIA
Plan Description Members become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting of employer contributions occurs, but the member's contributions are refunded with interest.
Funding Policy Employees of the Institute who are covered by TRS are required to pay 5% of their gross earnings to TRS. The Institute makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. For fiscal year 1997, the employer contribution rate was 11.81% for covered employees. The interest rate assumption (rate of return on investments) was 7.50%. The Institute's payroll for the year ended June 30,1997, for employees covered by TRS was $4,014,115.03. The Institute's total payroll for all employees was $5,489,500.41.
Total contributions to the plan made during fiscal year 1997 amounted to $674,779.23, of which $474,066.99 was made by the Institute and $200,712.24 was made by employees. These contributions represented 11.81 % (Institute) and 5% (employees) of covered payroll.
Total contributions from all employers to TRS for the year ended June 30, 1997, were $652,928,555.00. The Institute's contribution for the year ended June 30, 1997, of $474,066.99 was actuarially determined and represented .0726% of total contributions made by all participating employers.
Actuarial and Trend Information Actuarial and historical trend information is presented in the TRS June 30, 1997, financial report which can be obtained through TRS.
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA
Plan Description Carroll Technical Institute participates in the Employees' Retirement System of Georgia (ERS), a singleemployer defined benefit pension plan established by the General Assembly of Georgia for the purpose of providing retirement allowances for employees of the State of Georgia.
The benefit structure of ERS is defined by State statute and was significantly modified on July 1, 1982. Unless elected otherwise, an employee who currently maintains membership with ERS based upon State employment that started prior to July 1, 1982, is an "old plan" member subject to the plan provisions in effect prior to July 1, 1982. All other members are "new plan" members subject to the modified plan provisions.

- 21 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 7: RETffiEMENTPLANS
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA
Plan Description Under both the old plan and new plan, members become vested after 10 years of creditable service. A member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 65. If 10 years of service is completed and age 60 is reached, the member may retire with a reduced benefit. Additionally, there are certain provisions allowing for retirement after 30 years of service regardless of age.
Retirement benefits paid to members are based upon a formula which considers the monthly average of the member's highest eight consecutive calendar quarters of salary, the number of years of creditable service, and the member's age at retirement. Postretirement cost-of-living adjustments are also made to member's benefits. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension at reduced rates to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
Funding Policy As established by State statute, all full-time employees of the State of Georgia and its political subdivisions, who are not members of other state retirement systems, are eligible to participate in the ERS. Both employer and employee contributions are established by State statute. The Institute's payroll for the year ended June 30, 1997, for employees covered by ERS was $715,474.61. The Institute's total payroll for all employees was $5,489,500.41.
Under the old plan, member contributions consist of 4% of annual compensation up to $4,200.00 and 6% of annual compensation in excess of $4,200.00. Ofthese member contributions, the employee pays the first 1.25% and the Institute pays the remainder on behalf of the employee. Under the new plan, member contributions consist solely of 1.25% of annual compensation paid by employee. The Institute also is required to contribute at a specified percentage of active member payroll determined annually by actuarial valuation. For the year ended June 30, 1997, the ERS employer contribution rate for the Institute amounted to 14.89% of covered payroll and included the amounts contributed on behalfofthe employee under the old plan referred to above. Employer contributions are also made on amounts paid for accumulated leave to retiring employees.
Total contributions to the plan made during fiscal year 1997 amounted to $115,477.61, of which $106,534.17 was made by the Institute and $8,943.44 was made by employees. These contributions met the requirements of the plan.
Actuarial and Trend Information Actuarial and historical trend information is presented in the ERS June 30, 1997, financial report which may be obtained through ERS.

- 22-

CARROLL TECHNICAL INSTITUTE . NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 7: RETIREMENT PLANS
GEORGIA DEFINED CONTRIBUTION PLAN
Plan Description Carroll Technical Institute participates in the Georgia Defined Contribution Plan (GDCP) which is a singleemployer defined contribution plan established by the General Assembly of Georgia for the purpose of providing retirement coverage for State employees who are temporary, seasonal, and part-time and are not members of a public retirement or pension system. GDCP is administered by the Board of Trustees of the Employees' Retirement System of Georgia.
Benefits A member may retire and elect to receive periodic payments after attainment of age 65. The payment will be based upon mortality tables and interest assumptions to be adopted by the Board of Trustees. If a member has less than $ 3,500.00 credited to his/her account, the Board of Trustees has the option of requiring a lump sum distribution to the member in lieu of making periodic payments. Upon the death of a member, a lump sum distribution equaling the amount credited to his/her account will be paid to the member's designated beneficiary. Benefit provisions are established by State statute.
The Employees' Retirement System of Georgia issues a financial report each fiscal year which may be obtained through ERS.
Contributions and Vesting Member contributions are seven and one-half percent (7.5%) of gross salary. There are no employer contributions. Contribution rates are established by State statute. Earnings are credited to each member's account in a manner established by the Board of Trustees. Upon termination of employment, the amount of the member's account is refundable upon request by the member. The Institute's payroll for the year ended June 30, 1997, for employees covered by GDCP was $496,996.36. The Institute's total payroll for all employees was $5,489,500.41.
Total contributions made by employees during fiscal year 1997 amounted to $37,275.63 which represents 7.5% of covered payroll. These contributions met the requirements of the plan.
NOTE 8: LEAVE POLICIES
Employees earn annual leave ranging from one and one-quarter days to one and three-quarter days each month depending upon the employees' length ofcontinuous State service with a maximum accumulation of forty-five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment. See Note 1 - Compensated Absences
Employees earn one and one-quarter days of sick leave each month with a maximum accumulation of ninety days. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment.
- 23 -

CARROLL TECHNICAL INSTITUTE NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 1997

EXHIBIT "F"

NOTE 8: LEAVE POLICIES
Certain employees who retire with one hundred and twenty days or more of forfeited annual and sick leave are entitled to additional service credit in the Employees' Retirement System of Georgia.
NOTE 9: NONMONETARY TRANSACTIONS
The Georgia State Financing and Investment Commission (GSFIC), a unit ofState government, is responsible for the issuance of state debt and for the investment and accounting for proceeds derived from the issuance of state debt. In addition, GSFICis authorized to acquire and construct projects for the benefit of units of State government or to contract with units of State government for the construction or acquisition of capital outlay projects. During the fiscal year ended June 30, 1997, the Georgia State Financing and Investment Commission paid $769,824.18 to various vendors for approved projects for the benefit of Carroll Technical Institute.
NOTE 10: CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. This could result in refunds to the grantor agency for any expenditures which are disallowed under grant terms. The amount ofexpenditures which may be disallowed by the grantor cannot be determined at this time although the Institute expects such amounts, if any, to be immaterial to its overall financial position.
Litigation, claims and assessments filed against Carroll Technical Institute (as an organizational unit of the Department of Technical and Adult Education), if any, are generally considered to be actions against the State of Georgia. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1997.

- 24-

SUPPLEMENTARY INFORMATION - 25-

CARROLL TECHNICAL INSTITUTE COMBINING BALANCE SHEET (STATUTORY BASIS)
BUDGET FUND JUNE 30.1997

EXHIBIT "Gil

ASSETS Cash and Cash Equivalents Accounts Receivable
Federal Financial Assistance Other
Inventories

"A" DEPARTMENT OF
TECHNICAL AND ADULT EDUCATION

"B" LOTIERYFOR
EDUCATION

TOTAL

$

360,625.97 $

60,264.87 $ 420,890.84

$

28,629.12

67,086.25

$

95,715.37

$

176,032.80

$

28,629.12

67,086.25

$

95,715.37

$ 176,032.80

Total Assets

$

632,374.14 $

60,264.87 $ 692,639.01

LIABILITIES AND FUND EQUITY

Liabilities

Accounts Payable

$

Salaries Payable

Payroll Withholdings

Deferred Revenue

Tuition and Fees

Total Liabilities

$

Fund Equity

Fund Balance

Reserved

Federal Financial Assistance

For Refund to Georgia Department of Technical and

Adult Education - Administrative Central Office

$

For Expired Grant Balances

Inventories

Live Work Projects

State Grants and Contracts

Unreserved

Designated

SurplUS

Regular

Lottery for Education

Total Fund Equity

$

339,677.45 $ 23,819.40 7,247.57
58,848.10
429,592.52 $

60,167.36 $ 60,167.36 $

399,844.81 23,819.40 7,247.57
58,848.10
489,759.88

338.86 2,617.10 61,940.88 134,530.46 1,335.33
2,018.99 $
202,781.62 $

$

338.86

2,617.10

61,940.88

134,530.46

1,335.33

97.51 97.51 $

2,018.99 97.51
202,879.13

Total Liabilities and Fund EqUity

$

632,374.14 $

60,264.87 $ 692,639.01

See notes to the financial statements.

- 26 -

CARROLL TECHNICAL INSTITUTE COMBINING STATEMENT OF CHANGES IN FUND BALANCE (STATUTORY BASIS)
BUDGET FUND YEAR ENDED JUNE 30, 1997

EXHIBIT"H"

"A"
DEPARTMENT OF TECHNICAL AND ADULT EDUCATION

uB" LOTTERY FOR
EDUCATION

FUND BALANCE - JULY 1

Reserved Unreserved
Designated Surplus

$

152,187.63

$

5,614.23 $

\366.08

$

157,801.86 $

1,366.08 $

ADDITIONS

Adjustments to Prior Year's Accounts Payable Excess of Funds Available over Expenditures
Exhibit "I"

$

820.35 $

142,547.35

97.51 $ 0.00

$

143,367.70 $

97.51 $

DEDUCTIONS

Unreserved Fund Balance (Surplus)

Returned to Georgia Department of Technical and

Adult Education - Administrative Central Office

Year Ended June 30,1996

$

Adjustments to Prior Year's Accounts Receivable

Refunds to Grantors

Georgia Department of Technical and Adult

Education - Administrative Central Office

Federal Financial Assistance

Georgia Institute of Technology

Satellite Technology Program

Reserved Fund Balance Carried Over from

Prior Year as Funds Available

5,614,23 $ 5,951.37

1,366,08 $

4,843.85 45.31
81,933.18

$

98,387.94 $

1,366.08 $

FUND BALANCE - JUNE 30

(To Exhibit "G")

$

202,781.62 $

97.51 $

TOTAL
152,187.63 6,980.31
159,167.94
917.86 142,547.35
143A65.21
6,980,31 5,951.37
4,843.85 45.31
81,933.18 99,754.02
202,879.13

See notes to the financial statements.

- 27 -

CARROLL TECHNICAL INSTITUTE COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 3D. 1997

EXHIBIT"'"

CARROLL TECHNICAL INSTITUTE COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30. 1997

EXHIBIT "I"

EXPENDITURES
PERSONAL SERVICES-INSTITUTIONS
Employer's Contributions for: Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
OPERATING EXPENSES-INSTITUTIONS
Other Costs Motor Vehicle Expenses Supplies and Materials Repairs and Maintenance Utilities Rents (Other than Real Estate) Insurance and Bonding Other Operating Expenses Publications and Printing Equipment Purchases Non-Inventory
Travel Equipment
Equipment Purchases Rental of Equipment Computer Charges Software Telecommunications Per Diem, Fees and Contracts Per Diem and Fees Contracts
ADULT LITERACY GRANTS
Personal Services Salaries and Wages Employer'S Contributions for: F.I.C.A. Retirement Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
Other Costs Supplies and Materials Repairs and Maintenance Utilities Other Operating Expenses Publications and Printing Equipment Purchases Non-Inventory
Travel Real Estate Rentals
See notes to the financial statements.

"A"
DEPARTMENT OF TECHNICAL AND ADULT EDUCATION

"B" LOTTERY FOR
EDUCATION

TOTAL

$

555,552.12

27,098.00

6,076.00

9,176.00

$

6,120,755.95

$

17,565.79

572,300.56

171,143.42

265,090.81

81.54

12,735.00

200,903.99

70,369.50

104,953.74 57,694.35

509,333.77 2,229.90

46,495.54 110,398.54

58,584.50 126,855.88

$

2,326,736.83

$

481,356.57

14,986.08 27,129.70 27,224.87
1,176.00 294.00 444.00

63,873.54 2,136.81 4,141.91 18,610.44 794.75

2,509.13 10,211.55
750.00

- 29 -

$ 555,552.12 27,098.00 6,076.00 9,176.00
$ 6,120,755.95

$

17,565.79

572,300.56

171,143.42

265,090.81

81.54

12,735.00

200,903.99

70,369.50

104,953.74 57,694.35

509,333.77 2,229.90

46,495.54 110,398.54

58,584.50 126,855.88

$ 2,326,736.83

$ 481,356.57
14,986.08 27,129.70 27,224.87
1,176.00 294.00 444.00
63,873.54 2,136.81 4,141.91 18,610.44 794.75
2,509.13 10,211.55
750.00

CARROLL TECHNICAL INSTITUTE COMBINING STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30,1997

EXHIBIT "I"

EXPENDITURES
ADULT LITERACY GRANTS
Equipment Equipment Purchases
Telecommunications Per Diem, Fees and Contracts
Per Diem and Fees Contracts
JOB TRAINING PARTNERSHIP ACT
Personal Services Salaries and Wages Employer's Contributions for: F.I.CA Retirement Health Insurance Liability Insurance Unemployment Compensation Insurance Workers' Compensation Insurance
Other Costs Supplies and Materials Other Operating Expenses Equipment Purchases Non-Inventory
Travel Telecommunications Per Diem, Fees and Contracts
Per Diem and Fees Contracts
EQUIPMENT-TECHNICAL INSTITUTES
Other Costs Equipment Purchases Non-Inventory Equipment Equipment Purchases
Total Expenditures
Excess of Funds Available over Expenditures

"An
DEPARTMENT OF TECHNICAL AND ADULT EDUCATION

"Bft LOTIERYFOR
EDUCATION

TOTAL

$

19,861.54

1,500.00

4,879.70 3,135.00

$

685,015.59

$

140,128.72

2,836.40 17,062.70 17,390.13
538.00 294.00 444.00

6,255.50 65,557.28

3,200.17 4,447.91 2,341.92

498.00 2,700.00

$

263,694.73

$

19,861.54

1,500.00

4,879.70 3,135.00

$ 685,015.59

$ 140,128.72
2,836.40 17,062.70 17,390.13
538.00 294.00 444.00
6,255.50 65,557.28
3,200.17 4,447.91 2,341.92
498.00 2,700.00
$ 263,694.73

$

19,906.14 $

19,906.14

97,437.86

97,437.86

$ 117,344.00 $ 117,344.00

$

9,396,203.10 $ 117,344.00 $ 9,513,547.10

142,547.35

0.00

142,547.35

$

9,538,750.45 $ 117,344.00 $ 9,656,094.45

See notes to the financial statements.

- 30 -

CARROLL TECHNICAL INSTITUTE RECONCILIATION OF SALARIES AND TRAVEL
YEAR ENDED JUNE 30,1997

SCHEDULE "1"

Totals per Annual Supplement Accruals June 30, 1997 June 30, 1996
Totals per Report
SUMMARY BY OBJECT CLASS BUDGET FUND Personal Services-Institutions Operating Expenses-Institutions Adult Literacy Grants Job Training Partnership Act

SALARIES $ 5,468,084.75 $

TRAVEL 72,353.81

23,819.40 -2,403.74

$ 5,489,500.41 $ =====7=2,=35=3=.8==1

$ 4,868,015.12 $
481,356.57 140,128.72

57,694.35 10,211.55 4,447.91

$ 5,489,500.41 $ =====7=2,=35=3=.8==1

See notes to the financial statements.

- 31 -

SECTIONll CURRENT YEAR FINDINGS AND QUESTIONED COSTS

CARROLL TECHNICAL INSTITUTE SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 1997
FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
ACCOUNTING CONTROLS (OVERALL) Inadequate Separation of Duties Audit Control Number FS-826-97-01
For the year under review, our examination determined that Carroll Technical Institute did not provide for adequate separation of employee duties in the performance of accounting functions and related procedures for all funds. This deficiency was a result of management's decision to limit the number of administrative staff made responsible for accounting functions. Management should periodically review this decision to determine if employee duties can be reassigned to achieve a higher degree of internal control with existing staff.
GENERAL LEDGER Detail Listing of Accounts Payable not Reconciled with General Ledger Audit Control Number FS-826-97-02
For the year under review, the detail listing of accounts payable (FACS Report 2060) was not reconciled with the general ledger. This condition occurred because management failed to ensure that the subsidiary ledgers agreed to the general ledger. Procedures should be implemented by the Technical Institute to ensure that subsidiary records are reconciled to the general ledger.
GENERAL FIXED ASSETSIPROPERTY MANAGEMENT Inadequate Safekeeping of Assets Audit Control Number FS-826-97-03
For the year under review, our examination included a review ofthe internal accounting controls utilized by Carroll Technical Institute in maintaining their State Property System and testing the system for compliance with applicable laws and regulations. Several inappropriate conditions were found to exist that pertain to State laws and regulations and these matters have been identified in detail within the Federal Awards Findings and Questioned Costs, fmding FA-826-97-01.
The Institute is required to maintain equipment inventories in accordance with provisions ofthe State Property Management System Manual. The discrepancies identified were caused by the Institute's failure to follow guidelines for maintaining equipment inventories.
The Institute should establish the necessary internal controls to ensure that equipment inventories are maintained in accordance with the State Property Management System Manual.
- 1-

CARROLL TECHNICAL INSTITUTE SCHEDULE OF FINDINGS AND OUESTIONED COSTS
YEAR ENDED JUNE 30, 1997
FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS
EQUIPMENT AND REAL PROPERTY MANAGEMENT Inadequate Safekeeping ofAssets Audit Control Number FA-826-97-01
For the year under review, our examination included a review of the internal accounting controls utilized by Carroll Technical Institute in maintaining their property management system. This review also included testing the system for compliance with Federal laws and regulations. Seventy-five (75) equipment items were selected to test the accuracy of the Institute's property management records. These items had a value of $303,769.05 out ofa population of$4,326,698.02 and were selected for the purpose oflocating the equipment as reflected by the inventory records. The following deficiencies were noted:
(1) One (1) item totaling $3,500.00 could not be located.
(2) Thirty-four (34) items were located other than the location indicated in the equipment inventory records.
(3) Thirty-one (31) items on the inventory listing had no serial number and/or inadequate descriptions.
(4) Three (3) equipment items were located but displayed no decal.
(5) One (1) equipment item had two different numbered decals on it and was listed on the inventory listing twice.
The Institute is required to maintain equipment inventories in accordance with provisions of OMB's Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments (Common Rule). The discrepancy identified above was caused by the Institute's failure to follow guidelines for maintaining equipment inventories, including physically locating items periodically.
The Institute should establish the necessary internal controls to ensure that equipment inventories are maintained in accordance with provisions of OMB's Common Rule.
Federal Programs/Awards Affected:
U. S. Department of Education Adult Literacy - CFDA No. 84.002 Vocational Education - Basic Grants to States - CFDA No. 84.048
U. S. Department of Health and Human Services Job Opportunities and Skills Training - CFDA No. 93.561
-2-