{"response":{"docs":[{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2020-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2020 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2021-02-25"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2020 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2020-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2020-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"HousHtOoUnSCTOoNunty Board of Education \r\nPerry, Georgia \r\nHouston County Board of Education \r\nFiscal Year 2020 Audit Report \r\nYear Ended June 30, 2020 (Including Independent Auditor's Report) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nGOVERNMENT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\nG NOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\n4 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND \r\n5 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SEAD - OPEB \r\n6 SCHEDULE OF CONTRIBUTIONS  TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\nPage \r\ni \r\n1 2 3 4 5 6 8 \r\n37 38 39 40 41 42 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nPage \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n7 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 43 \r\n \r\n8 SCHEDULE OF CONTRIBUTIONS  SCHOOL OPEB FUND \r\n \r\n44 \r\n \r\n9 SCHEDULE OF CONTRIBUTIONS  SEAD  OPEB \r\n \r\n45 \r\n \r\n10 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n46 \r\n \r\n11 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES - BUDGET AND ACTUAL \r\n \r\nGENERAL FUND \r\n \r\n47 \r\n \r\nSUPPLEMENTARY INFORMATION \r\n \r\n12 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\n \r\n48 \r\n \r\n13 SCHEDULE OF STATE REVENUE \r\n \r\n49 \r\n \r\n14 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\n51 \r\n \r\nSECTION II \r\nCOMPLIANCE AND INTERNAL CONTROL REPORTS \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n SECTION I FINANCIAL \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 4-101 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities and each major fund of the Houston County Board of Education (School District), as of and for the year ended June 30, 2020, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\n \r\n We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the School District as of June 30, 2020, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nEmphasis of Matter \r\nAs described in Note 2 to the financial statements, in 2020, the Houston County Board of Education early adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 84, Fiduciary Activities. The cumulative effect of GASB Statement No. 84 is described in the restatement note in the Notes to the Basic Financial Statements. Our opinions are not modified with respect to this matter. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements. \r\nThe accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional \r\n \r\n procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. \r\nOther Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated February 25, 2021 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\n \r\nFebruary 25, 2021 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\nINTRODUCTION \r\nThe discussion and analysis of Houston County Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2020. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFINANCIAL HIGHLIGHTS \r\nKey financial highlights for 2020 are as follows: \r\nOn the government-wide financial statements: \r\n On the government-wide financial statements, net position increased $21.7, with the effect of the restatement, million which represents a 219.3 percent increase from 2019. This total increase was due to governmental activities since the School District has no business-type activities. \r\n The School District had $363.1 million in expenses related to governmental activities. Revenues totaled $384.8 million. Program specific revenues in the form of charges for services and sales, grants, and contributions accounted for $225.7 million or 58.7 percent of the total revenues and were used to offset these expenditures. General revenues of $159.1 million or 41.3 percent of all revenues were adequate to provide for these programs. \r\n The current ratio, which measures the Board's ability to transform current assets into cash and to pay its short-term liabilities, was 6.16 for the fiscal year ended June 30, 2020. Generally, a ratio greater than 2.0 is considered very financially stable. \r\nOn the fund financial statements: \r\n Among major funds, the general fund had $349.0 million in revenues and other financing sources, and $338.6 million in expenditures and other financing uses. The general fund's fund balance increased to $101.1 million. \r\nOVERVIEW OF THE FINANCIAL STATEMENTS \r\nThis annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the Houston County Board of Education. These include the government-wide and fund financial statements. \r\nThe government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\nThe fund financial statements focus on individual parts, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the short-term as well as what remains for future spending. \r\nThe fund financial statements reflect the School District's most significant funds. For the year ending June 30, 2020, the general fund, the capital projects fund, and the debt service fund represent the most significant funds. \r\nThe financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. \r\nGovernment-Wide Statements \r\nThe government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. \r\nThe two government-wide statements report the School District's net position and how it has changed. Net position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in net position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities  All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, student and principal accounts, and various others. \r\nFund Financial Statements \r\nThe School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, capital projects fund, and debt service fund. \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\n \r\nGovernmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general governmental operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements. \r\nFINANCIAL ANALYSIS OF THE BOARD AS A WHOLE \r\n \r\nRecall that the Statement of Net Position provides the perspective of the Board as a whole. Table 1 provides a summary of the Board's net position for 2020 compared to fiscal year 2019. \r\n \r\nAssets Current and Other Assets Capital Assets, Net \r\nTotal Assets \r\nDeferred Outflows of Resources \r\nLiabilities Current and Other Liabilities Long-Term Liabilities \r\nTotal Liabilities \r\nDeferred Inflows of Resources \r\nNet Position Net Invested in Capital Assets Restricted Unrestricted (Deficit) \r\nTotal Net Position \r\n \r\nTable 1 Net Position (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 (1) \r\n \r\n$ \r\n \r\n143,102 $ \r\n \r\n145,054 \r\n \r\n360,243 \r\n \r\n330,664 \r\n \r\n503,345 \r\n \r\n475,718 \r\n \r\n100,470 \r\n \r\n68,445 \r\n \r\n23,207 503,911 \r\n527,118 \r\n64,889 \r\n \r\n22,917 471,556 \r\n494,473 \r\n60,288 \r\n \r\n343,768 67,752 \r\n(399,712) \r\n \r\n307,326 80,585 \r\n(398,509) \r\n \r\n$ \r\n \r\n11,808 $ \r\n \r\n(10,598) \r\n \r\n(1) Fiscal year 2019 balances do not reflect the effects of the Restatement of Net Position. See Note 14 in the Notes to the Basic Financial Statements for additional information. \r\n \r\nTotal net position increased $22.4 million, without the effect of the restatement, to $11.8 million. This increase was mainly attributable to increased investment in capital assets, partially offset by increases in our net pension liability. As shown on table 2, the School District's operations also increased. \r\n \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\n \r\nTable 2 shows the changes in net position for fiscal year 2020 compared to the changes in net position for fiscal year 2019. \r\n \r\nTable 2 Changes in Net Position \r\n(In Thousands) \r\n \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 (1) \r\n \r\n$ \r\n \r\n8,459 \r\n \r\n$ \r\n \r\n212,570 \r\n \r\n4,694 \r\n \r\n8,687 196,368 \r\n2,829 \r\n \r\nTotal Program Revenues \r\n \r\n225,723 \r\n \r\n207,884 \r\n \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted Investment Earnings Miscellaneous \r\n \r\n51,109 8,543 \r\n29,222 \r\n29,190 1,785 \r\n32,706 1,238 5,270 \r\n \r\n52,225 3,456 \r\n26,276 \r\n26,280 1,380 \r\n28,351 2,103 6,871 \r\n \r\nTotal General Revenues \r\n \r\n159,063 \r\n \r\n146,942 \r\n \r\nTotal Revenues \r\n \r\n384,786 \r\n \r\n354,826 \r\n \r\nProgram Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n234,487 \r\n16,477 7,172 2,277 4,803 1,479 \r\n23,096 2,670 \r\n24,470 14,046 \r\n5,220 720 \r\n2,065 930 \r\n22,830 338 \r\n \r\n204,893 \r\n14,089 6,049 2,593 4,315 1,723 \r\n20,118 2,624 \r\n23,158 14,686 \r\n4,597 1,129 \r\n2,361 1,128 20,678 \r\n625 \r\n \r\nTotal Expenses \r\n \r\n363,080 \r\n \r\n324,766 \r\n \r\nIncrease in Net Position \r\n \r\n$ \r\n \r\n21,706 \r\n \r\n$ \r\n \r\n30,060 \r\n \r\n(1) Fiscal year 2019 balances do not reflect the effects of the Restatement of Net Position. See Note 14 in the Notes to the Basic Financial Statements for additional information. \r\n \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 Figure A shows the funding sources for the revenues. 56.9 percent of the School District's revenues are derived from state grants. Property taxes make up 15.5 percent of the total funding, while an additional 15.6 percent is earned from the School District's sales taxes. \r\nAs shown in Figure B, instruction comprised 64.6 percent of governmental program expenses. administration and other services (2.8 percent) consist of the central office, business and warehouse, and other central operations of the School District. \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\nGovernmental Activities \r\n \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2020 with fiscal year 2019. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(In Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 (1) \r\n \r\nNet Cost of Services \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 (1) \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n$ 234,487 \r\n16,477 7,172 2,277 4,803 1,479 \r\n23,096 2,670 \r\n24,470 14,046 \r\n5,220 720 \r\n2,065 930 \r\n22,830 338 \r\n \r\n$ 204,893 $ \r\n14,089 6,049 2,593 4,315 1,723 \r\n20,118 2,624 \r\n23,158 14,686 \r\n4,597 1,129 \r\n2,361 1,128 20,678 \r\n625 \r\n \r\n73,651 \r\n \r\n$ \r\n \r\n8,321 3,788 \r\n146 494 615 14,919 1,949 14,019 11,528 3,925 \r\n65 \r\n \r\n915 (198) 2,882 338 \r\n \r\n59,964 \r\n5,559 3,067 \r\n300 261 1,010 12,281 1,999 13,926 11,922 3,660 220 \r\n802 1,129 \r\n157 625 \r\n \r\nTotal Expenses \r\n \r\n$ 363,080 \r\n \r\n$ 324,766 $ 137,357 \r\n \r\n$ 116,882 \r\n \r\n(1) Fiscal year 2019 balances do not reflect the effects of the Restatement of Net Position. See Note 14 in the Notes to the Basic Financial Statements for additional information. \r\n \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 31.4 percent of Instruction activities are supported through taxes and other general revenues, and for all governmental activities, general revenue support is 37.8 percent. \r\n \r\nThe School District's Funds \r\n \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $384.6 million and expenditures and other financing uses of $390.7 million. There was a decrease in the fund balance totaling $6.1 million for the governmental funds as a whole. The general fund increased by $10.4 million due mainly to increases in mid-term funding, local taxes and careful planning of expenditures. The capital projects fund had a decrease of $16.4 million and debt service fund had a decrease of $0.1 million to meet the subsequent year's debt requirements. The capital projects fund decrease was attributable to the increased construction and renovation expenditures that were funded by the proceeds of the Educational Special Purpose Local Option Sales Tax (ESPLOST) and the issuance of \r\n \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 general obligation bonds during fiscal year 2017. These funds will continue to be depleted as the School District completes the projects in the current capital outlay plan. The decrease in the debt service fund was attributable to the lower amount of ESPLOST proceeds needed to pay next fiscal year's interest and principal payments due on the outstanding debt associated with the previously issued general obligation bonds. The increase in the fund balance of the general fund for the year reflects that the School District was able to meet current costs as planned and budgeted. \r\nGeneral Fund Budgeting Highlights \r\nThe School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund. During the course of fiscal year 2020, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. For the general fund, the final budgeted revenues and other financing sources of $352.7 million was greater than the original budgeted amount of $344.7 million by $8.0 million. The overall difference was mainly due to additional state and federal grant awards of $4.2 million and $1.2 million, respectively, increased property taxes of $1.5 million and additional local revenues. The actual revenues and other financing sources of $349.0 million was lower than the budgeted amount by $3.7 million due mainly to the elimination of intra-fund transfers and an increase in sales taxes. The final budgeted expenditures and other financing uses of $344.6 million was less than the original budgeted amount of $344.8 million by $0.2 million. This difference was due mainly to adjusting the budget to reflect the revised needs. The actual expenditures and other financing uses of $338.6 million was $6.0 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. The differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes as current and prior year revenues for report purposes rather than reporting as deferred revenue in the current budgeted amounts. \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\n \r\nCapital Assets and Debt Administration Capital Assets \r\n \r\nAt the end of fiscal year 2020, the School District had $360.2 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2020 balances compared with fiscal year 2019 balances. \r\n \r\nTable 4 Capital Assets at June 30 (Net of Depreciation, In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 \r\n \r\nLand Construction In Progress Buildings and Building Improvements Equipment Land Improvements Intangible Assets \r\n \r\n$ \r\n \r\n15,637 $ 12,625 \r\n \r\n22,059 \r\n \r\n29,361 \r\n \r\n299,256 \r\n \r\n269,269 \r\n \r\n8,723 \r\n \r\n9,158 \r\n \r\n13,489 \r\n \r\n9,029 \r\n \r\n1,078 \r\n \r\n1,222 \r\n \r\nTotal \r\n \r\n$ 360,242 $ 330,664 \r\n \r\nThe overall capital assets increased in fiscal year 2020 by $29.6 million due to the construction and renovation expenses from the 2012 and 2017 ESPLOST capital outlay projects during the current year, partially offset by the fiscal year 2020 depreciation of $14.6 million. \r\nDebt \r\nAt June 30, 2020, the School District had $18.6 million in bonds outstanding with $6.1 million due within one year, $4.9 million in compensated absences earned as of the end of the year, and $2.0 million in unamortized bond premiums with $0.6 million due with one year. In addition, the School District reported long-term liabilities for its proportionate share of the net pension and net OPEB liabilities. Reporting these liabilities is required by GASB Statements No. 68 and No. 75. The School District's portion of these liabilities is actuarially determined based on employer contributions during the fiscal year ended June 30, 2019. The School District's contributions made during the current fiscal year are reported as deferred outflows of resources and will be recognized as a reduction of the liabilities in the subsequent fiscal year. \r\n \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 \r\n \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2020, compared to fiscal year 2019 balances. \r\n \r\nTable 5 Debt at June 30 (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2020 \r\n \r\n2019 \r\n \r\nGeneral Obligation Bonds Capital Leases Compensated Absences Unamortized Bond Premiums Net Pension Liability Net OPEB Liability \r\n \r\n$ \r\n \r\n18,555 \r\n \r\n$ \r\n \r\n- \r\n \r\n4,904 \r\n \r\n1,968 \r\n \r\n295,466 \r\n \r\n182,945 \r\n \r\n24,500 287 \r\n3,520 2,598 253,401 187,250 \r\n \r\nTotal \r\n \r\n$ \r\n \r\n503,838 \r\n \r\n$ \r\n \r\n471,556 \r\n \r\nAt June 30, 2020, the School District's overall legal bonding authority was $412.2 million based on the assessed value of taxable property as of December 31, 2019. The School District's bonds have assigned ratings of Aa1 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. The current year payment was well below the $6.7 million threshold. \r\nCURRENT ISSUES \r\nThe Houston County School District consists of 39 campuses located in Houston County, a fast-growing area with a population of approximately 160,131. Enrollment during the 2019-2020 School Year was approximately 30,221 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 14th in population, 15th in economics, and 16th in income. The 2020 School District millage ranks 166th out of 180 districts in Georgia. \r\nIn the past, the State of Georgia experienced serious financial hardship, and as a result, more pressure was being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2.0 million in 2003 to a high of $23.8 million in 2010. Those austerity reductions totaled $158.4 million and the overall reduction of state funding, including other grants and programs, was approximately $317.6 million between the fiscal years 2003 - 2018. For the first time in sixteen years, the fiscal year 2019 state allotments did not include an austerity reduction. Austerity reductions were not included in the initial fiscal year 2020 allotments either. However, with the economic downturn related to the COVID 19 pandemic, austerity reductions of $17.6 million or approximately ten percent of the State's system allotments were enacted for fiscal year 2021, with $2.7 million recognizable in fiscal year 2020. \r\nOther changes related to the pandemic were enacted by the School District to start the 2020  2021 school year. Distance Learning opportunities and on-line classes were added to the School District's offerings to ensure a viable curriculum and educational opportunities are available for all students in Houston County. While Houston County's class sizes remain below the state maximum \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2020 recommendations, any additional reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. Houston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2019 economic impact on the State of Georgia of $3.38 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the County include the Board of Education, Houston County Hospital Authority, Perdue Farms, Frito-Lay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 65.2 percent work in the County. Houston is Georgia's sixty-fifth largest County in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990-2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and was projected to grow to 155,469 in 2018. This growth results in school system enrollment increases between 198 to 487 students for the past five years. Houston has three municipalities: Centerville with an estimated population of 7,884; Perry with 17,894; and Warner Robins with 77,617. The County also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. \r\nContacting the School District's Financial Management \r\nThis financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nx \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2020 \r\nASSETS \r\nCash and Cash Equivalents Investments Accounts Receivable, Net \r\nTaxes State Government Federal Government Other Net Other Postemployment Benefits Asset Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) \r\nTotal Assets \r\nDEFERRED OUTFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Outflows of Resources \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Payroll Withholding Payable Interest Payable Claims Incurred but not Reported (IBNR) Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities \r\nDue Within One Year Due in More Than One Year \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Outflows of Resources \r\nNET POSITION \r\nNet Investment in Capital Assets Restricted for \r\nContinuation of Federal Programs Debt Service Capital Projects Net OPEB Asset Property Tax Rollback Unrestricted (Deficit) \r\nTotal Net Position \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\nEXHIBIT \"A\" \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\n$ \r\n \r\n102,357,184.36 \r\n \r\n310,015.20 \r\n \r\n9,805,662.59 22,792,497.80 \r\n3,370,045.26 22,960.73 73,086.00 \r\n4,371,356.82 37,695,884.59 322,546,605.91 \r\n \r\n503,345,299.26 \r\n \r\n86,432,562.58 14,037,203.00 \r\n100,469,765.58 \r\n \r\n233,868.38 19,500,504.15 \r\n1,027,289.15 309,250.00 \r\n1,102,430.38 1,033,485.12 295,466,240.00 183,017,696.00 \r\n6,691,680.84 18,735,547.43 \r\n527,117,991.45 \r\n \r\n16,468,693.00 48,420,239.00 \r\n64,888,932.00 \r\n \r\n343,768,014.28 \r\n8,032,075.55 6,241,952.37 9,747,260.41 \r\n73,086.00 43,657,914.92 (399,712,162.14) \r\n \r\n$ \r\n \r\n11,808,141.39 \r\n \r\n- 1 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES \r\nFOR THE YEAR ENDED JUNE 30, 2020 \r\n \r\nEXHIBIT \"B\" \r\n \r\nEXPENSES \r\n \r\nCHARGES FOR SERVICES \r\n \r\nPROGRAM REVENUES OPERATING GRANTS AND \r\nCONTRIBUTIONS \r\n \r\nCAPITAL GRANTS AND CONTRIBUTIONS \r\n \r\nNET (EXPENSES) REVENUES \r\nAND CHANGES IN NET ASSETS \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n$ 234,486,949.21 $ 2,885,828.89 $ 154,345,557.45 $ 3,604,417.24 $ \r\n \r\n16,477,379.54 7,172,164.69 2,277,054.85 4,803,123.51 1,478,510.68 \r\n23,096,069.98 2,670,247.83 \r\n24,469,434.87 14,046,139.61 \r\n5,219,650.80 720,126.86 \r\n \r\n5,416.13 85,928.54 - \r\n \r\n8,156,972.01 3,384,288.59 2,130,862.05 4,179,679.01 \r\n858,705.01 8,036,769.62 \r\n666,981.07 10,373,757.95 \r\n2,152,250.16 1,210,157.84 \r\n655,666.46 \r\n \r\n129,511.24 4,991.07 140,099.13 53,908.10 70,908.25 279,660.00 84,377.95 - \r\n \r\n2,065,383.20 929,852.51 \r\n22,830,381.29 337,620.08 \r\n \r\n1,150,097.09 1,127,872.51 3,203,835.52 \r\n- \r\n \r\n16,418,702.53 - \r\n \r\n325,738.72 - \r\n \r\n(73,651,145.63) \r\n(8,320,407.53) (3,787,876.10) \r\n(146,192.80) (493,933.26) (614,814.60) (14,919,201.23) (1,949,358.66) (14,019,352.54) (11,528,300.91) (3,925,115.01) \r\n(64,460.40) \r\n(915,286.11) 198,020.00 (2,882,104.52) (337,620.08) \r\n \r\nTotal Governmental Activities \r\n \r\n$ 363,080,089.51 $ 8,458,978.68 $ 212,570,349.75 $ 4,693,611.70 \r\n \r\n(137,357,149.38) \r\n \r\nGeneral Revenues Taxes Property Taxes For Maintenance and Operations Alternative Ad valorem Tax Forest Land Protection Tax Railroad Cars Title Ad Valorem Tax Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Services For Capital Projects Intangible Recording Tax Real Estate Transfer Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\n \r\n51,109,232.72 28,618.64 93,669.32 33,862.18 \r\n8,386,843.65 \r\n29,221,748.91 \r\n6,800,000.00 22,391,075.99 \r\n1,362,088.31 422,458.08 \r\n32,705,964.00 1,237,961.42 5,269,687.38 \r\n \r\nTotal General Revenues \r\n \r\n159,063,210.60 \r\n \r\nChange in Net Position \r\n \r\n21,706,061.22 \r\n \r\nNet Position - Beginning of Year (Restated) \r\n \r\n(9,897,919.83) \r\n \r\nNet Position - Ending of Year \r\n \r\n$ \r\n \r\n11,808,141.39 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 2 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION BALANCE SHEET \r\nGOVERNMENTAL FUNDS JUNE 30, 2020 \r\n \r\nEXHIBIT \"C\" \r\n \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Other Inventories \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ \r\n \r\n87,018,547.51 $ \r\n \r\n310,015.20 \r\n \r\n6,038,456.38 22,792,497.80 \r\n3,370,045.26 22,960.73 \r\n4,371,356.82 \r\n \r\n8,787,434.48 $ - \r\n3,767,206.21 - \r\n \r\n6,551,202.37 $ - \r\n- \r\n \r\n102,357,184.36 310,015.20 \r\n9,805,662.59 22,792,497.80 \r\n3,370,045.26 22,960.73 \r\n4,371,356.82 \r\n \r\nTotal Assets \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Payroll Withholding Payable Retainages Payable \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nUnavailable Revenue - Property Taxes Unavailable Revenue - Sales Taxes \r\nTotal Deferred Inflows of Resources \r\nFUND BALANCES \r\nNonspendable Restricted Assigned Unassigned \r\nTotal Fund Balances \r\n \r\n$ 123,923,879.70 $ 12,554,640.69 $ 6,551,202.37 $ 143,029,722.76 \r\n \r\n$ \r\n \r\n233,868.38 $ \r\n \r\n19,500,504.15 \r\n \r\n1,027,289.15 \r\n \r\n- \r\n \r\n20,761,661.68 \r\n \r\n- $ 1,033,485.12 \r\n1,033,485.12 \r\n \r\n- $ - \r\n- \r\n \r\n233,868.38 19,500,504.15 \r\n1,027,289.15 1,033,485.12 \r\n21,795,146.80 \r\n \r\n776,738.32 1,326,616.58 \r\n2,103,354.90 \r\n \r\n1,326,616.60 \r\n1,326,616.60 \r\n \r\n- \r\n \r\n776,738.32 \r\n \r\n- \r\n \r\n2,653,233.18 \r\n \r\n- \r\n \r\n3,429,971.50 \r\n \r\n4,371,356.82 50,429,275.14 \r\n8,173,263.04 38,084,968.12 \r\n101,058,863.12 \r\n \r\n8,420,643.81 1,773,895.16 \r\n- \r\n10,194,538.97 \r\n \r\n6,551,202.37 \r\n- \r\n6,551,202.37 \r\n \r\n4,371,356.82 65,401,121.32 \r\n9,947,158.20 38,084,968.12 \r\n117,804,604.46 \r\n \r\nTotal Liabilities, Deferred Inflows of Resources and Fund Balances \r\n \r\n$ 123,923,879.70 $ \r\n \r\n12,554,640.69 $ 6,551,202.37 $ 143,029,722.76 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 3 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\nTO THE STATEMENT OF NET POSITION JUNE 30, 2020 \r\n \r\nEXHIBIT \"D\" \r\n \r\nTotal fund balances - governmental funds (Exhibit \"C\") \r\nAmounts reported for Governmental Activities in the Statement of Net Position are different because: \r\nCapital assets used in governmental activities are not financial resources and therefore are not reported in the funds. These assets consist of: \r\nLand Construction in progress Land improvements Buildings Equipment Intangible assets Accumulated depreciation \r\nSome liabilities, including net pension obligations, are not due and payable in the current period, and, therefore, are not reported in the funds. \r\nNet pension liability Net OPEB asset Net OPEB liability \r\nDeferred outflows and inflows of resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds. \r\nRelated to pensions Related to OPEB \r\nTaxes that are not available to pay for current period expenditures are deferred in the funds. \r\nProperty Taxes Sales Taxes \r\nLong-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term liabilities at year-end consist of: \r\nBonds payable Accrued interest payable Compensated absences payable Unamortized bond premiums Claims and judgements payable \r\nTotal Long-term Liabilities \r\n \r\n$ \r\n \r\n117,804,604.46 \r\n \r\n$ 15,636,562.11 22,059,322.48 19,148,195.07 \r\n484,505,557.07 31,478,884.33 1,437,220.47 \r\n(214,023,251.03) \r\n \r\n360,242,490.50 \r\n \r\n$ (295,466,240.00) 73,086.00 \r\n(183,017,696.00) \r\n \r\n(478,410,850.00) \r\n \r\n$ 69,963,869.58 (34,383,036.00) \r\n \r\n35,580,833.58 \r\n \r\n$ \r\n \r\n776,738.32 \r\n \r\n2,653,233.18 \r\n \r\n3,429,971.50 \r\n \r\n$ (18,555,000.00) (309,250.00) \r\n(4,904,230.26) (1,967,998.01) (1,102,430.38) \r\n \r\n(26,838,908.65) \r\n \r\nNet position of governmental activities (Exhibit \"A\") \r\n \r\n$ \r\n \r\n11,808,141.39 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 4 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \r\nGOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2020 \r\n \r\nEXHIBIT \"E\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nCapital Outlay Debt Services \r\nPrincipal Interest \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nTransfers In Transfers Out \r\nTotal Other Financing Sources (Uses) \r\nNet Change in Fund Balances \r\nFund Balances - Beginning (Restated) \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 59,587,038.19 $ 29,679,678.72 \r\n214,096,172.57 31,092,267.16 8,458,978.68 921,557.23 5,177,187.38 \r\n \r\n- $ \r\n \r\n- $ \r\n \r\n21,064,459.39 \r\n \r\n6,800,000.00 \r\n \r\n4,293,951.70 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n238,272.10 \r\n \r\n78,132.09 \r\n \r\n92,500.00 \r\n \r\n- \r\n \r\n59,587,038.19 57,544,138.11 218,390,124.27 31,092,267.16 \r\n8,458,978.68 1,237,961.42 5,269,687.38 \r\n \r\n349,012,879.93 \r\n \r\n25,689,183.19 \r\n \r\n6,878,132.09 \r\n \r\n381,580,195.21 \r\n \r\n212,660,306.41 \r\n15,907,565.16 6,907,865.25 2,241,342.16 4,211,286.88 1,398,060.44 \r\n21,747,737.43 2,386,276.38 \r\n24,147,906.52 13,135,356.05 \r\n4,353,812.32 1,017,014.79 2,119,611.13 \r\n929,852.51 22,132,741.91 \r\n- \r\n287,461.47 4,685.79 \r\n335,588,882.60 \r\n13,423,997.33 \r\n \r\n959,196.11 \r\n9,555.52 1,404.90 \r\n5,250.00 343,894.00 459,204.73 43,330,332.29 \r\n- \r\n45,108,837.55 \r\n(19,419,654.36) \r\n \r\n- \r\n4,750.00 - \r\n5,945,000.00 1,046,650.00 \r\n6,996,400.00 \r\n(118,267.91) \r\n \r\n213,619,502.52 \r\n15,917,120.68 6,909,270.15 2,241,342.16 4,211,286.88 1,398,060.44 \r\n21,747,737.43 2,396,276.38 \r\n24,147,906.52 13,479,250.05 \r\n4,813,017.05 1,017,014.79 2,119,611.13 \r\n929,852.51 22,132,741.91 43,330,332.29 \r\n6,232,461.47 1,051,335.79 \r\n387,694,120.15 \r\n(6,113,924.94) \r\n \r\n(3,000,000.00) \r\n(3,000,000.00) \r\n10,423,997.33 \r\n90,634,865.79 \r\n \r\n3,000,000.00 - \r\n3,000,000.00 \r\n(16,419,654.36) \r\n26,614,193.33 \r\n \r\n- \r\n- \r\n(118,267.91) \r\n6,669,470.28 \r\n \r\n3,000,000.00 (3,000,000.00) \r\n- \r\n(6,113,924.94) \r\n123,918,529.40 \r\n \r\nFund Balances - Ending \r\n \r\n$ 101,058,863.12 $ 10,194,538.97 $ 6,551,202.37 $ 117,804,604.46 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 5 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF \r\nREVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2020 \r\n \r\nEXHIBIT \"F\" \r\n \r\nNet change in fund balances total - governmental funds (Exhibit \"E\") \r\nAmounts reported for governmental activities in the Statement of Activities are different because: \r\nGovernmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. \r\nCapital outlay Depreciation expense \r\nThe net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. \r\nTaxes reported in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. \r\nThe issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. \r\nBond principal retirements Capital lease payments Amortization of bond premium \r\nDistrict pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEBs, is reported in the Statement of Activities. \r\nPension expense OPEB expense \r\nSome items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. These activities consist of: \r\nAccrued interest on issuance of debt Compensated absences Claims and judgments \r\n \r\n$ \r\n \r\n(6,113,924.94) \r\n \r\n$ 44,168,347.24 (14,582,371.13) \r\n \r\n29,585,976.11 (7,489.80) \r\n2,718,421.50 \r\n \r\n$ \r\n \r\n5,945,000.00 \r\n \r\n287,461.47 \r\n \r\n630,544.22 \r\n \r\n6,863,005.69 \r\n \r\n$ (11,372,330.88) 1,036,233.00 \r\n \r\n(10,336,097.88) \r\n \r\n$ \r\n \r\n83,171.49 \r\n \r\n(1,384,603.36) \r\n \r\n297,602.41 \r\n \r\n(1,003,829.46) \r\n \r\nChange in net position of governmental activities (Exhibit \"B\") \r\n \r\n$ \r\n \r\n21,706,061.22 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 6 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nNOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nThe accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below. \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness. \r\nGOVERNMENT-WIDE STATEMENTS: \r\nThe Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. \r\nThe Statement of Net Position presents the School District's assets, deferred outflows of resources, deferred inflows of resources and liabilities, with the difference reported as net position. Net position is reported in three categories as follows: \r\n1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\n2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\n3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\nDirect expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n \r\n- 8 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nProgram revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFUND FINANCIAL STATEMENTS: \r\nThe fund financial statements provide information about the School District's funds. Eliminations have been made to minimize the double counting of internal activities. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), bond proceeds and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets. \r\n The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes legally restricted for the payment of general long-term principal and interest. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\n \r\n- 9 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\nIn fiscal year 2020, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 95, Postponement of the Effective Dates of Certain Authoritative Guidance. The primary objective of this statement is to provide temporary relief to governments and other stakeholders in light of the C0VID-19 pandemic. That objective is accomplished by postponing the effective dates of certain provisions in statements and Implementation Guides that first became effective or are scheduled to become effective for period beginning after June 15, 2018, and later. \r\nIn fiscal year 2020, the School District early adopted Governmental Accounting Standards Board (GASB) Statement No. 84, Fiduciary Activities. This statement establishes criteria for identifying fiduciary activities of all state and local governments. The focus of the criteria generally is on (1) whether a government is controlling the assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities. An activity meeting the criteria should be reported in a fiduciary fund in the basic financial statements. Governments with activities meeting the criteria should present a statement of fiduciary net position and a statement of changes in fiduciary net position. The cumulative effect of GASB Statement No. 84 is described in the restatement note in the Notes to the Basic Financial Statements. \r\nIn fiscal year 2020, the School District early adopted Governmental Accounting Standards Board (GASB) Statement No. 90, Majority Equity Interests. It defines a majority equity interest and specifies that majority equity interest in a legal separate organization should be reported as an investment. A majority equity interest that meets the definition of an investment should be measured using the equity method, unless it is held by a special-purpose government engaged only in fiduciary activities, a fiduciary fund, or an endowment (including permanent and term endowments) or permanent fund. Those governments and funds should measure the majority equity interest at fair value. The adoption of this statement did not have an impact on the School District's financial statements. \r\nCASH AND CASH EQUIVALENTS \r\nCash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\nINVESTMENTS \r\nThe School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. \r\nInvestments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value. \r\nFor accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired. \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nRECEIVABLES \r\n \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\n \r\nINVENTORIES \r\n \r\nFood Inventories \r\n \r\nOn the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the weighted average basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\n \r\nSupply Inventory \r\n \r\nOn the basic financial statements, inventories of consumable supplies and materials are reported at cost (weighted average). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\n \r\nCAPITAL ASSETS \r\n \r\nOn the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art. \r\n \r\nCapital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements. \r\n \r\nDepreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives. \r\n \r\nCapitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows: \r\n \r\nCapitalization Policy \r\n \r\nEstimated Useful Life \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible assets Construction In Progress \r\n \r\nAll All All \r\nAll $10,000.00 and any \r\nitem necessary for insurance purposes $100,000.00 to $1,000,000.00 \r\nAll \r\n \r\nN/A 8 to 25 Years 10 to 50 Years \r\n5 to 14 Years 5 to 10 Years \r\nUp to 20 Years N/A \r\n \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\nIn addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. \r\nIn addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\nPublic School Employees Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days, but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of forty-five days. Vacation leave of fifteen days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed forty-five days. \r\nLONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS \r\nIn the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\nIn the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nto/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (SEAD - OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the state employees' assurance department retired and vested inactive members trust fund (SEAD-OPEB) plan (the Plan) and additions to/deductions from the SEAD-OPEB's fiduciary net position have been determined on the same basis as they are reported by SEAD-OPEB. For this purpose, death benefits are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nFUND BALANCES \r\nFund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. \r\nThe School District's fund balances are classified as follows: \r\nNonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\nCommitted consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\nAssigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes. \r\nUnassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance. \r\nUSE OF ESTIMATES \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\nPROPERTY TAXES \r\nThe Houston County Board of Commissioners adopted the property tax levy for the 2019 tax digest year (calendar year) on July 26, 2019 (levy date) based on property values as of January 1, 2019. Taxes were due on December 20, 2019 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2019 tax digest are reported as revenue in the governmental funds for fiscal year 2020. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nbalance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2020, for maintenance and operations amounted to $51,044,044.40. \r\n \r\nThe tax millage rate levied for the 2019 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.297 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $8,386,843.65 during fiscal year ended June 30, 2020. \r\nSALES TAXES \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the School District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $27,895,132.33 and was recorded in the general fund. Local Option Sales Tax is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\nEducation Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $27,864,459.39 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years. \r\nNOTE 3: BUDGETARY DATA \r\nThe budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions, as necessary, based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review. \r\nNOTE 4: DEPOSITS AND CASH EQUIVALENTS \r\nCOLLATERALIZATION OF DEPOSITS \r\nO.C.G.A.  45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nof securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A.  45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\nCATEGORIZATION OF DEPOSITS \r\nCustodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2020, the School District had deposits with a carrying amount of $39,140,232.42, and a bank balance of $50,093,575.74. The bank balances insured by Federal depository insurance were $4,327,979.78 and the bank balances collateralized with securities held by the pledging financial institution or by the pledging financial institution's trust department or agent in the School District's name were $44,031.47. \r\nAt June 30, 2020, $45,721,564.49 of the School District's bank balances was exposed to custodial credit risk. This balance was in the State's Secure Deposit Program (SDP). \r\nThe School District participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased in the amount of up to 125% if economic or financial conditions warrants. The program lists the types of eligible criteria. The OST approves authorized custodians. \r\nIn accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized. \r\n \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nReconciliation of cash and cash equivalents balances to carrying value of deposits: \r\n \r\nCash and cash equivalents Statement of Net Position \r\n \r\n$ 102,357,184.36 \r\n \r\nAdd: Deposits with original maturity of three months or more reported as investments \r\n \r\n310,015.20 \r\n \r\nLess: Investment pools reported as cash and cash equivalents \r\nGeorgia Fund 1 \r\n \r\n63,526,967.14 \r\n \r\nTotal carrying value of deposits - June 30, 2020 \r\n \r\n$ 39,140,232.42 \r\n \r\nCATEGORIZATION OF CASH EQUIVALENTS \r\n \r\nThe School District reported cash equivalents of $63,526,967.14 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2020 was 38 days. \r\n \r\nGeorgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\n \r\nNOTE 5: CAPITAL ASSETS \r\n \r\nThe following is a summary of changes in the capital assets for governmental activities during the fiscal year: \r\n \r\nBalances June 30, 2019 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nBalances June 30, 2020 \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction in Progress \r\n \r\n$ \r\n \r\n12,625,106.15 $ \r\n \r\n3,011,455.96 $ \r\n \r\n- $ 15,636,562.11 \r\n \r\n29,360,915.55 \r\n \r\n43,376,198.23 \r\n \r\n50,677,791.30 \r\n \r\n22,059,322.48 \r\n \r\nTotal Capital Assets Not Being Depreciated \r\n \r\n41,986,021.70 \r\n \r\n46,387,654.19 \r\n \r\n50,677,791.30 \r\n \r\n37,695,884.59 \r\n \r\nCapital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n442,889,880.90 30,570,599.62 13,721,089.90 1,437,220.47 \r\n \r\n41,615,676.17 1,415,703.01 5,427,105.17 - \r\n \r\n507,418.30 \r\n- \r\n \r\n484,505,557.07 31,478,884.33 19,148,195.07 1,437,220.47 \r\n \r\nLess Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n173,620,640.97 21,413,034.47 4,691,549.89 215,583.07 \r\n \r\n11,628,475.57 1,842,449.60 967,723.91 143,722.05 \r\n \r\n499,928.50 \r\n- \r\n \r\n185,249,116.54 22,755,555.57 5,659,273.80 359,305.12 \r\n \r\nTotal Capital Assets, Being Depreciated, Net \r\n \r\n288,677,982.49 \r\n \r\n33,876,113.22 \r\n \r\n7,489.80 \r\n \r\n322,546,605.91 \r\n \r\nGovernmental Activity Capital Assets - Net \r\n \r\n$ 330,664,004.19 $ 80,263,767.41 $ 50,685,281.10 $ 360,242,490.50 \r\n \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction Support Services \r\nEducational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services \r\n \r\n$ 405,109.40 15,612.00 \r\n438,228.18 168,623.81 221,800.06 1,150,948.38 263,933.08 \r\n \r\n$ 10,899,209.92 \r\n2,664,254.91 1,018,906.30 \r\n \r\n$ 14,582,371.13 \r\n \r\nNOTE 6: INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2020, consisted of the following: \r\n \r\nTransfer to \r\n \r\nTransfers From General Fund \r\n \r\nCapital Projects Fund \r\n \r\n$ 3,000,000.00 \r\n \r\nTransfers are used to move local revenues collected by the general fund to the capital projects fund as a supplemental funding source for capital construction projects. NOTE 7: LONG-TERM LIABILITIES \r\n \r\nThe changes in long-term liabilities during the fiscal year for governmental activities were as follows: \r\n \r\nBalance June 30, 2019 \r\n \r\nAdditions \r\n \r\nGovernmental Funds Deductions \r\n \r\nBalance June 30, 2020 \r\n \r\nDue Within One Year \r\n \r\nG.O. Bonds \r\n \r\n$ \r\n \r\nUnamortized Bond Premiums \r\n \r\nCapital Leases \r\n \r\nCompensated Absences (1) \r\n \r\n24,500,000.00 $ 2,598,542.23 287,461.47 3,519,626.90 \r\n \r\n- $ 3,032,661.59 \r\n \r\n5,945,000.00 $ 630,544.22 287,461.47 \r\n1,648,058.23 \r\n \r\n18,555,000.00 $ 1,967,998.01 4,904,230.26 \r\n \r\n6,050,000.00 641,680.84 - \r\n \r\n$ 30,905,630.60 $ 3,032,661.59 $ 8,511,063.92 $ 25,427,228.27 $ 6,691,680.84 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements. \r\n \r\nGENERAL OBLIGATION DEBT OUTSTANDING \r\nThe School District's bonded debt consists of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved Education Special Purpose Local Option Sales taxes. \r\nThe School District had no unused line of credit or outstanding notes from direct borrowings and direct placements related to governmental activities as of June 30, 2020. In the event the entity is unable to make the principal and interest payments using proceeds from the Education Special Purpose Local Option Sales Tax (EPLOST), the debt will be satisfied from a direct annual ad valorem tax levied upon all taxable property within the School District. Additional security is provided by the \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nState of Georgia Intercept Program which allows for state appropriations entitled to the School District to be transferred to the Debt Service Account Custodian for the payment of debt. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. \r\nGeneral obligation bonds currently outstanding are as follows: \r\n \r\nDescription General Government - Series 2017 \r\n \r\nInterest Rates \r\n4.00% - 5.00% \r\n \r\nIssue Date 4/6/2017 \r\n \r\nMaturity Date \r\n9/1/2022 $ \r\n \r\nAmount Issued \r\n30,000,000.00 $ \r\n \r\nAmount Outstanding \r\n18,555,000.00 \r\n \r\nThe following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nGeneral Obligation Debt \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nUnamortized Bond Premium \r\n \r\n2021 2022 2023 \r\n \r\n$ 6,050,000.00 $ 776,500.00 $ \r\n \r\n6,180,000.00 \r\n \r\n470,750.00 \r\n \r\n6,325,000.00 \r\n \r\n158,125.00 \r\n \r\n641,680.84 655,469.02 670,848.15 \r\n \r\nTotal Principal and Interest \r\n \r\n$ 18,555,000.00 $ 1,405,375.00 $ 1,967,998.01 \r\n \r\nCOMPENSATED ABSENCES \r\nCompensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\nNOTE 8: RISK MANAGEMENT \r\nINSURANCE \r\nCommercial Insurance \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disasters; and unemployment compensation. \r\nGeorgia School Boards Association Risk Management Fund \r\nThe School District participates in the Georgia School Boards Association Risk Management Fund (the Fund), a public entity risk pool organized on August 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, errors and omissions liability, cyber risk and property damage, including safety engineering and other loss prevention and control techniques, and to administer the Fund including the processing and defense of claims brought against members of the Fund. The School District pays an annual contribution to the Fund for coverage. Reinsurance is provided to the Fund through agreements by the Fund with insurance companies according to their specialty for property (including coverage for flood and earthquake), machinery breakdown, general liability, errors and omissions, crime, cyber risk and automobile risks. Reinsurance limits and retentions vary by line of coverage. \r\n \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nWORKERS' COMPENSATION \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000 loss per occurrence, up to the statutory limit. \r\n \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2019 2020 \r\n \r\n$ 1,554,698.12 $ 1,400,032.79 \r\n \r\n$ 931,949.66 $ 513,723.54 \r\n \r\n$ 1,086,614.99 $ 811,325.95 \r\n \r\n$ 1,400,032.79 $ 1,102,430.38 \r\n \r\nUNEMPLOYMENT COMPENSATION \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. \r\n \r\nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2019 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n6,302.97 $ \r\n \r\n6,302.97 $ \r\n \r\n- \r\n \r\n2020 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\nSURETY BOND The School District purchased a surety bond to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nNOTE 9: FUND BALANCE CLASSIFICATION DETAILS \r\n \r\nThe School District's financial statements include the following amounts presented in the aggregate at June 30, 2020: \r\n \r\nNonspendable Inventories \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\nAssigned Local Capital Outlay Projects School Activity Accounts Subsequent Period Expenditures \r\nUnassigned \r\n \r\n$ 4,371,356.82 \r\n \r\n$ 6,771,360.22 8,420,643.81 6,551,202.37 \r\n43,657,914.92 \r\n \r\n65,401,121.32 \r\n \r\n$ 1,773,895.16 3,489,289.04 4,683,974.00 \r\n \r\n9,947,158.20 38,084,968.12 \r\n \r\nFund Balance, June 30, 2020 \r\n \r\n$ 117,804,604.46 \r\n \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\n \r\nIt is the goal of the School District to achieve and maintain a committed, assigned, and unassigned fund balance in the general fund at fiscal year-end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, in compliance with O.C.G.A.  20-2-167(a)5. If the unassigned fund balance at fiscal year-end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\n \r\nNOTE 10: SIGNIFICANT COMMITMENTS \r\n \r\nCOMMITMENTS UNDER CONSTRUCTION CONTRACTS \r\n \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2020: \r\n \r\nProject \r\n \r\nUnearned Executed Contracts (1) \r\n \r\nPayments through June 30, 2020 (2) \r\n \r\nMatt Arthur Elementary Parking Improvements \r\n \r\n$ \r\n \r\nNew Elementary School #12 \r\n \r\nParkwood Elementary Parking Improvements \r\n \r\n258,078.34 $ 484,126.06 246,293.84 \r\n \r\n119,287.97 20,634,383.03 \r\n143,063.28 \r\n \r\n$ \r\n \r\n988,498.24 $ 20,896,734.28 \r\n \r\n(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts and retainages payable at year-end. \r\nNOTE 11: SIGNIFICANT CONTINGENT LIABILITIES \r\nFEDERAL GRANTS \r\nAmounts 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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nLITIGATION \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District. \r\nNOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) \r\nGEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND \r\nPlan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board. \r\nBenefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted. \r\nContributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $5,048,822.00 for the year ended June 30, 2020. Active employees are not required to contribute to the School OPEB Fund. \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\nAt June 30, 2020, the School District reported a liability of $183,017,696.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2019. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2018. An expected total OPEB liability as of June 30, 2019 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2019. At June 30, 2019, the School District's proportion was 1.491326%, which was an increase of 0.017377% from its proportion measured as of June 30, 2018. \r\n \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nFor the year ended June 30, 2020, the School District recognized OPEB expense of $4,014,027.00. At June 30, 2020, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nDeferred Outflows of Resources \r\n \r\nDeferred Inflows of Resources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ \r\n \r\n- $ 19,910,421.00 \r\n \r\nChanges of assumptions \r\n \r\n6,355,847.00 25,799,716.00 \r\n \r\nNet difference between projected and actual earnings on OPEB plan investments \r\n \r\n398,556.00 \r\n \r\n- \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n2,224,095.00 \r\n \r\n2,703,387.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n5,048,822.00 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 14,027,320.00 $ 48,413,524.00 \r\n \r\nSchool District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nOPEB \r\n \r\n2021 2022 2023 2024 2025 Thereafter \r\n \r\n$ (9,081,808.00) $ (9,081,808.00) $ (9,097,128.00) $ (7,696,102.00) $ (3,795,081.00) $ (683,099.00) \r\n \r\nActuarial assumptions: The total OPEB liability as of June 30, 2019 was determined by an actuarial valuation as of June 30, 2018 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2019: \r\n \r\nOPEB: \r\n \r\nInflation \r\n \r\n2.50% \r\n \r\nSalary increases \r\n \r\n3.00%  8.75%, including inflation \r\n \r\nLong-term expected rate of return Healthcare cost trend rate \r\n \r\n7.30%, compounded annually, net of investment expense, and including inflation \r\n \r\nPre-Medicare Eligible \r\n \r\n7.250% \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nMedicare Eligible \r\n \r\n5.375% \r\n \r\nUltimate trend rate \r\n \r\nPre-Medicare Eligible \r\n \r\n4.75% \r\n \r\nMedicare Eligible \r\n \r\n4.75% \r\n \r\nYear of Ultimate trend rate \r\n \r\nPre-Medicare Eligible \r\n \r\n2028 \r\n \r\nMedicare Eligible \r\n \r\n2022 \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows: \r\n \r\n For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection \r\nscale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement. \r\n For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with \r\nprojection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement. \r\n \r\nThe actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014, and adopted by the pension Board on December 17, 2015. The next experience study for TRS will be for the period ending June 30, 2018. \r\nThe remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2018 valuation were based on a review of recent plan experience done concurrently with the June 30, 2018 valuation. \r\nProjection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation. \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by \r\n \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nadding expected inflation. During fiscal year 2018, the School OPEB fund updated their investment strategy to a more long-term approach. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nTarget allocation \r\n \r\nLong-Term Expected Real Rate of Return* \r\n \r\nFixed income Domestic Stocks -- Large Cap Domestic Stocks -- Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatives \r\n \r\n30.00% 46.20% \r\n1.30% 12.40% \r\n5.10% 5.00% \r\n \r\n(0.10)% 8.90% \r\n13.20% 8.90% \r\n10.90% 12.00% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n*Net of Inflation \r\n \r\nDiscount rate: The discount rate has changed since the prior measurement date from 3.87% to 3.58%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.58% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.50% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2119. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2026. Therefore, the calculated discount rate of 3.58% was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.58%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point \r\nlower (2.58%) or 1 percentage-point higher (4.58%) than the current discount rate: \r\n \r\n1% Decrease (2.58%) \r\n \r\nCurrent Discount Rate (3.58%) \r\n \r\n1% Increase (4.58%) \r\n \r\nSchool District's proportionate share of the Net OPEB Liability \r\n \r\n$ 212,726,970.00 $ \r\n \r\n183,017,696.00 $ 158,850,536.00 \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point higher than the current healthcare cost trend rates: \r\n \r\n1% Decrease \r\n \r\nCurrent Healthcare Cost Trend Rate \r\n \r\n1% Increase \r\n \r\nSchool District's proportionate share of the Net OPEB Liability \r\n \r\n$ 154,173,018.00 $ 183,017,696.00 $ 219,652,626.00 \r\n \r\nOPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports. \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nPOSTEMPLOYEMENT BENEFITS OTHER THAN PENSIONS (SEAD  OPEB) \r\nPlan Description: SEAD-OPEB was created in 2007 by the Georgia General Assembly to amend Title 47 of the O.C.G.A., relating to retirement, so as to establish a fund for the provision of term life insurance to retired and vested inactive members of the Employees' Retirement System of Georgia (ERS), the Legislative Retirement System (LRS), and the Georgia Judicial Retirement System (GJRS). The plan is a cost-sharing multiple-employer defined benefit other postemployment benefit plan as defined in Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefit Plans other than OPEB Plans. The SEAD-OPEB trust fund accumulates the premiums received from the aforementioned retirement plans, including interest earned on deposits and investments of such payments. \r\nBenefits Provided: The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance in effect on the date of retirement. The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance in effect at age 60 or at termination, if earlier. Life insurance proceeds are paid in a lump sum to the beneficiary upon death of the retiree. \r\nContributions: Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable compensation. There were no employer contributions required for the fiscal year ended June 30, 2020. \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\nAt June 30, 2020, the School District reported an asset of $73,086.00 for its proportionate share of the net OPEB asset. The net OPEB asset was measured as of June 30, 2019. The total OPEB asset used to calculate the net OPEB asset was based on an actuarial valuation as of June 30, 2018. An expected total OPEB asset as of June 30, 2019 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB asset was based on actual member salaries reported to the SEAD-OPEB plan during the fiscal year ended June 30, 2019. At June 30, 2019, the School District's proportion was 0.025847%, which was a decrease of 0.005465 % from its proportion measured as of June 30, 2018. \r\n \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nFor the year ended June 30, 2020, the School District recognized OPEB expense of $1,438.00. At June 30, 2020, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nDeferred Outflows of Resources \r\n \r\nDeferred Inflows of Resources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ \r\n \r\n371.00 $ \r\n \r\n- \r\n \r\nChanges of assumptions \r\n \r\n1,480.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n6,715.00 \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n8,032.00 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ \r\n \r\n9,883.00 $ \r\n \r\n6,715.00 \r\n \r\nThere were no employer contributions subsequent to the measurement date. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nSEAD - OPEB \r\n \r\n2021 2022 2023 2024 \r\n \r\n$ \r\n \r\n4,007.00 \r\n \r\n$ \r\n \r\n(531.00) \r\n \r\n$ \r\n \r\n(637.00) \r\n \r\n$ \r\n \r\n329.00 \r\n \r\nActuarial assum ptions: The total OPEB liability as of June 30, 2019 was determined by an actuarial valuation as of June 30, 2018 using the following actuarial assumptions, applied to all periods \r\nincluded in the measurement: \r\n \r\nSEAD  OPEB: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases: \r\n \r\nERS \r\n \r\n3.25%  7.00% \r\n \r\nGJRS \r\n \r\n4.50% \r\n \r\nLRS \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of OPEB plan investment expense, including inflation \r\n \r\nHealthcare cost trend rate \r\n \r\nN/A \r\n \r\nPostretirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. There is a margin for future mortality improvement in the tables used by the plan. \r\n \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nThe actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014, with the exception of the longterm assumed rate of return. \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nSEAD - OPEB Target \r\nallocation \r\n \r\nLong-term expected real rate of return* \r\n \r\nFixed income Domestic large stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 46.20% \r\n1.30% 12.40% \r\n5.10% 5.00% \r\n \r\n(0.10)% 8.90% 13.20% 8.90% 10.90% 12.00% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n* Rates shown are net of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total OPEB liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the OPEB plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 7.30%, as well as what the School District's proportionate \r\nshare of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage- \r\npoint lower (6.30%) or 1- percentage-point higher (8.30%) than the current rate: \r\n \r\n1% Decrease (6.30%) \r\n \r\nCurrent Discount Rate (7.30%) \r\n \r\n1% Increase (8.30%) \r\n \r\nSchool District's proportionate share of the net OPEB asset \r\n \r\n$ (40,443.00) $ \r\n \r\n(73,086.00) $ (99,912.00) \r\n \r\nOPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the separately issued ERS comprehensive annual financial report which is publicly \r\navailable at www.ers.ga.gov/financials. \r\n \r\nNOTE 13: RETIREMENT PLANS \r\nThe School District participates in various retirement plans administered by the State of Georgia, as further explained below. \r\n \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \r\nPlan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications. \r\nBenefits P rovided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2020. The School District's contractually required contribution rate for the year ended June 30, 2020 was 21.14% of annual School District payroll, of which 21.08% of payroll was required from the School District and 0.06% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $37,704,109.06 and $114,470.98 from the School District and the State, respectively. \r\nEMPLOYEES' RETIREMENT SYSTEM \r\nPlan Description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials. \r\nBenefits Provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\n \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's required contribution rate for the year ended June 30, 2020 was 24.66% of annual covered payroll for old and new plan members and 21.64% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $76,830.52 for the current fiscal year. \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS) \r\nPlan Description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials. \r\nBenefits Provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\nUpon retirement, the member will receive a monthly benefit of $15.25, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $650,124.00. \r\n \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\n \r\nAt June 30, 2020, the School District reported a liability of $295,466,240.00 for its proportionate share of the net pension liability for TRS ($294,926,572.00) and ERS ($539,668.00). \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n$ 294,926,572.00 \r\n \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n924,401.00 \r\n \r\nTotal \r\n \r\n$ 295,850,973.00 \r\n \r\nThe net pension liability for TRS and ERS was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2018. An expected total pension liability as of June 30, 2019 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2019. \r\nAt June 30, 2019, the School District's TRS proportion was 1.371579%, which was an increase of 0.010194% from its proportion measured as of June 30, 2018. At June 30, 2019, the School District's ERS proportion was 0.013078%, which was a decrease of 0.003917% from its proportion measured as of June 30, 2018. \r\nAt June 30, 2020, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $3,693,525.00. \r\nThe PSERS net pension liability was measured as of June 30, 2019. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2018. An expected total pension liability as of June 30, 2019 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2019. \r\nFor the year ended June 30, 2020, the School District recognized pension expense of $49,150,129.00 for TRS, $108,332.00 for ERS and $1,139,038.00 for PSERS and revenue of $113,091.00 for TRS and $1,139,038.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nAt June 30, 2020, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: \r\n \r\nTRS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nInflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nERS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nInflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nDifferences between expected and \r\n \r\nactual experience \r\n \r\n$ 16,623,565.00 $ \r\n \r\n87,438.00 $ 17,973.00 $ \r\n \r\n- \r\n \r\nChanges of assumptions \r\n \r\n28,302,053.00 \r\n \r\n- \r\n \r\n9,499.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n7,023,102.00 \r\n \r\n- \r\n \r\n16,799.00 \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n3,791,095.00 \r\n \r\n9,232,251.00 \r\n \r\n- \r\n \r\n109,103.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n37,704,109.06 \r\n \r\n- \r\n \r\n76,830.52 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 86,420,822.06 $ 16,342,791.00 $ 104,302.52 $ 125,902.00 \r\n \r\nThe School District contributions subsequent to the measurement date for TRS and for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nTRS \r\n \r\nERS \r\n \r\n2021 2022 2023 2024 \r\n \r\n$ 14,443,445.00 $ $ (560,628.00) $ $ 8,523,371.00 $ $ 9,967,734.00 $ \r\n \r\n(48,563.00) (48,785.00) \r\n(3,309.00) 2,227.00 \r\n \r\nActuarial assum ptions: The total pension liability as of June 30, 2019 was determined by an actuarial valuation as of June 30, 2018, using the following actuarial assumptions, applied to all periods \r\nincluded in the measurement: \r\n \r\nTeachers Retirement System: \r\n \r\nInflation \r\n \r\n2.50% \r\n \r\nSalary increases \r\n \r\n3.00%  8.75%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.25%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement benefit increases 1.50% semi-annually \r\n \r\n- 31 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nPost-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014, with the exception of the longterm assumed rate of return. \r\n \r\nEmployees' Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  7.00%, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP-2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014, with the exception of the assumed investment rate of return. \r\n \r\nPublic School Employees Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement benefit increases 1.50% semi-annually \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\n- 32 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nThe actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014, with the exception of the assumed investment rate of return. \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nTRS Target allocation \r\n \r\nERS/PSERS Target \r\nallocation \r\n \r\nLong-term expected real rate of return* \r\n \r\nFixed income Domestic large equities Domestic small equities International developed market equities International emerging market equities Alternatives \r\n \r\n30.00% 51.00% \r\n1.50% 12.40% \r\n5.10% - \r\n \r\n30.00% 46.20% \r\n1.30% 12.40% \r\n5.10% 5.00% \r\n \r\n(0.10)% 8.90% 13.20% 8.90% 10.90% 12.00% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n100.00% \r\n \r\n* Rates shown are net of assumed rate of inflation. \r\n \r\nDiscount rate: The discount rate used to measure the total TRS pension liability was 7.25%. The discount rate used to measure the total ERS and PSERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\n \r\nSensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.25% and 7.30%, as well as what the School \r\nDistrict's proportionate share of the net pension liability would be if it were calculated using a discount \r\nrate that is 1-percentage-point lower (6.25% and 6.30%) or 1-percentage-point higher (8.25% \r\nand 8.30%) than the current rate: \r\n \r\nTeachers' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.25%) \r\n \r\nCurrent Discount Rate \r\n(7.25%) \r\n \r\n1% Increase (8.25%) \r\n \r\n$ 478,752,146.00 $ 294,926,572.00 $ 143,756,635.00 \r\n \r\nEmployees' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.30%) \r\n \r\nCurrent Discount Rate \r\n(7.30%) \r\n \r\n$ \r\n \r\n766,917.00 $ \r\n \r\n539,668.00 $ \r\n \r\n1% Increase (8.30%) \r\n345,941.00 \r\n \r\n- 33 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nPension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publicly \r\navailable at www.trsga.com/publications and www.ers.ga.gov/financials. \r\n \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, the School District began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\n \r\nThe School District selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\n \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\n \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County School District. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the School District. \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2020 2019 2018 \r\n \r\n100% 100% 100% \r\n \r\n$ 328,048.42 $ 233,484.22 $ 199,262.27 \r\n \r\nNOTE 14: RESTATEMENT OF PRIOR YEAR NET POSITION AND FUND BALANCE \r\nFor fiscal year 2020, the School District made prior period adjustments due to the adoption of GASB Statement No, 84, as described in \"New Accounting Pronouncements,\" which requires the restatement of the June 30, 2019 net position in governmental activities and fund balance in the general fund and fiduciary funds. These changes are in accordance with generally accepted accounting principles. \r\n \r\n- 34 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2020 \r\n \r\nEXHIBIT \"G\" \r\n \r\nNet Position, July 1, 2019, as previously reported \r\nPrior Period adjustment - Implementation of GASB No. 84: Donation accounts reclassification School Activity Account Reclassification \r\nNet Position, July 1, 2019, as restated \r\nFund Balance (General Fund), July 1, 2019, as previously reported \r\nPrior Period adjustment - Implementation of GASB No. 84: Donation accounts reclassification School Activity Account Reclassification \r\nFund Balance (General Fund), July 1, 2019, as restated \r\nNet Position (Fiduciary Funds) , July 1, 2019, as previously reported \r\nPrior Period adjustment - Implementation of GASB No. 84: Donation accounts reclassification School Activity Account Reclassification \r\nNet Position (Fiduciary Funds), July 1, 2019, as restated \r\n \r\n$ (10,598,124.55) \r\n \r\n35,172.07 665,032.65 \r\n$ (9,897,919.83) \r\n$ 89,934,661.07 \r\n \r\n35,172.07 665,032.65 \r\n \r\n$ 90,634,865.79 \r\n \r\n$ \r\n \r\n700,204.72 \r\n \r\n(35,172.07) (665,032.65) \r\n \r\n$ \r\n \r\n- \r\n \r\nNOTE 15: TAX ABATEMENTS \r\nThe School District property tax revenues were reduced by $457,869.33 under agreements entered into by the Houston County Development Authority (Development Authority). The Development Authority issued revenue bonds to provide capital financing for several local businesses. \r\nIncluded in the amount abated, the following are individual tax abatement agreements that each exceeded 10 percent of the total amount abated: \r\n A manufacturing plant expansion. The abatement amounted to $47,246.63.  A manufacturing plant expansion. The abatement amounted to $80,904.57.  A manufacturing plant expansion. The abatement amounted to $101,010.58. \r\n \r\n- 35 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"1\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the net pension \r\nliability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nState of Georgia's proportionate share of the net pension liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its \r\ncovered payroll \r\n \r\nPlan fiduciary net position as a percentage of the total pension liability \r\n \r\n2020 2019 2018 2017 2016 2015 \r\n \r\n1.371579% $ 294,926,572.00 $ 1.361385% $ 252,702,217.00 $ 1.386441% $ 257,674,330.00 $ 1.478342% $ 304,998,438.00 $ 1.418023% $ 215,879,921.00 $ 1.412022% $ 178,390,355.00 $ \r\n \r\n924,401.00 $ 295,850,973.00 $ 809,495.00 $ 253,511,712.00 $ 875,182.00 $ 258,549,512.00 $ 1,090,354.00 $ 306,088,792.00 $ 852,392.00 $ 216,732,313.00 $ 719,867.00 $ 179,110,222.00 $ \r\n \r\n167,951,497.07 162,856,788.80 158,922,980.04 162,747,774.99 150,299,368.59 144,097,581.27 \r\n \r\n175.60% 155.17% 162.14% 187.41% 143.63% 123.80% \r\n \r\n78.56% 80.27% 79.33% 76.06% 81.44% 84.03% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 37 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"2\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the \r\nnet pension liability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nSchool District's covered payroll \r\n \r\nSchool District's proportionate share of the net pension liability \r\nas a percentage of covered payroll \r\n \r\nPlan fiduciary net position as a percentage of \r\ntotal pension liability \r\n \r\n2020 2019 2018 2017 2016 2015 \r\n \r\n0.013078% $ 539,668.00 $ 0.016995% $ 698,670.00 $ 0.018664% $ 758,008.00 $ 0.018934% $ 895,658.00 $ 0.018205% $ 737,557.00 $ 0.017996% $ 674,961.00 $ \r\n \r\n329,664.21 440,647.76 457,801.02 440,233.56 416,239.34 405,211.66 \r\n \r\n163.70% 158.56% 165.58% 203.45% 177.20% 166.57% \r\n \r\n76.74% 76.68% 76.33% 72.34% 76.20% 77.99% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 38 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"3\" \r\n \r\nYear Ended \r\n2020 2019 2018 2017 2016 2015 \r\n \r\nSchool District's proportion of the net pension \r\nliability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\n0.00% $ \r\n \r\n- \r\n \r\nState of Georgia's proportionate share of the net pension liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its \r\ncovered payroll \r\n \r\n$ \r\n \r\n3,693,525.00 $ 3,693,525.00 $ 10,829,358.06 \r\n \r\nN/A \r\n \r\n$ \r\n \r\n3,508,395.00 $ 3,508,395.00 $ 11,060,129.01 \r\n \r\nN/A \r\n \r\n$ \r\n \r\n3,218,420.00 $ 3,218,420.00 $ 10,507,779.29 \r\n \r\nN/A \r\n \r\n$ \r\n \r\n4,098,431.00 $ 4,098,431.00 $ 10,489,156.64 \r\n \r\nN/A \r\n \r\n$ \r\n \r\n2,607,682.00 $ 2,607,682.00 $ 10,330,432.81 \r\n \r\nN/A \r\n \r\n$ \r\n \r\n2,303,408.00 $ 2,303,408.00 $ 10,016,811.88 \r\n \r\nN/A \r\n \r\nPlan fiduciary net position as a percentage of the total pension liability \r\n85.02% 85.26% 85.69% 81.00% 87.00% 88.29% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 39 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY \r\nSCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"4\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the net OPEB \r\nliability \r\n \r\nSchool District's proportionate share of the net OPEB liability \r\n \r\nState of Georgia's proportionate share of the net OPEB liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as \r\na percentage of its covered-employee \r\npayroll \r\n \r\nPlan fiduciary net position as a percentage of the total OPEB liability \r\n \r\n2020 2019 2018 2017 \r\n \r\n1.491326% 1.473949% 1.484992% 1.504207% \r\n \r\n$ 183,017,696.00 $ 187,334,394.00 $ 208,640,779.00 $ 222,927,776.00 \r\n \r\n- \r\n \r\n$ 183,017,696.00 $ 127,221,476.44 \r\n \r\n- \r\n \r\n$ 187,334,394.00 $ 123,412,244.61 \r\n \r\n- \r\n \r\n$ 208,640,779.00 $ 121,721,036.65 \r\n \r\n- \r\n \r\n$ 222,927,776.00 $ 117,333,618.48 \r\n \r\n143.86% 151.80% 171.41% 189.99% \r\n \r\n4.63% 2.93% 1.61% 0.64% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 40 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB ASSET \r\nSEAD - OPEB FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"5\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the \r\nnet OPEB asset \r\n \r\nSchool District's proportionate share of the net \r\nOPEB asset \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as a \r\npercentage of its coveredemployee payroll \r\n \r\nPlan fiduciary net position as a percentage of the total OPEB asset \r\n \r\n2020 2019 2018 \r\n \r\n0.025847% $ 0.031312% $ 0.031437% $ \r\n \r\n(73,086.00) $ (84,745.00) $ (81,706.00) $ \r\n \r\n329,664.21 440,647.76 457,801.02 \r\n \r\n-22.17% -19.23% -17.85% \r\n \r\n129.73% 129.46% 130.17% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 41 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"6\" \r\n \r\nYear Ended \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered payroll \r\n \r\nContributions as a percentage of covered payroll \r\n \r\n2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 \r\n \r\n$ 37,704,109.06 $ $ 34,992,210.70 $ $ 27,288,902.73 $ $ 22,601,157.09 $ $ 23,141,378.51 $ $ 19,687,721.71 $ $ 17,625,185.67 $ $ 16,298,602.09 $ $ 14,377,512.24 $ $ 13,884,720.11 $ \r\n \r\n37,704,109.06 $ 34,992,210.70 $ 27,288,902.73 $ 22,601,157.09 $ 23,141,378.51 $ 19,687,721.71 $ 17,625,185.67 $ 16,298,602.09 $ 14,377,512.24 $ 13,884,720.11 $ \r\n \r\n- \r\n \r\n$ 178,898,712.25 \r\n \r\n- \r\n \r\n$ 167,951,497.07 \r\n \r\n- \r\n \r\n$ 162,856,788.80 \r\n \r\n- \r\n \r\n$ 158,922,980.04 \r\n \r\n- \r\n \r\n$ 162,747,774.99 \r\n \r\n- \r\n \r\n$ 150,299,368.59 \r\n \r\n- \r\n \r\n$ 144,097,581.27 \r\n \r\n- \r\n \r\n$ 143,401,483.17 \r\n \r\n- \r\n \r\n$ 140,498,203.02 \r\n \r\n- \r\n \r\n$ 135,846,018.48 \r\n \r\n21.08% 20.83% 16.76% 14.22% 14.22% 13.10% 12.23% 11.37% 10.23% 10.22% \r\n \r\n- 42 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"7\" \r\n \r\nYear Ended \r\n \r\nContributions in relation \r\n \r\nContractually required to the contractually Contribution deficiency \r\n \r\ncontribution \r\n \r\nrequired contribution \r\n \r\n(excess) \r\n \r\nSchool District's covered payroll \r\n \r\nContributions as a percentage of covered payroll \r\n \r\n2020 \r\n \r\n$ \r\n \r\n76,830.52 $ \r\n \r\n2019 \r\n \r\n$ \r\n \r\n81,690.76 $ \r\n \r\n2018 \r\n \r\n$ \r\n \r\n109,324.76 $ \r\n \r\n2017 \r\n \r\n$ \r\n \r\n113,580.49 $ \r\n \r\n2016 \r\n \r\n$ \r\n \r\n108,825.61 $ \r\n \r\n2015 \r\n \r\n$ \r\n \r\n91,406.16 $ \r\n \r\n2014 \r\n \r\n$ \r\n \r\n74,802.06 $ \r\n \r\n2013 \r\n \r\n$ \r\n \r\n53,504.66 $ \r\n \r\n2012 \r\n \r\n$ \r\n \r\n35,683.88 $ \r\n \r\n2011 \r\n \r\n$ \r\n \r\n29,845.78 $ \r\n \r\n76,830.52 $ 81,690.76 $ 109,324.76 $ 113,580.49 $ 108,825.61 $ 91,406.16 $ 74,802.06 $ 53,504.66 $ 35,683.88 $ 29,845.78 $ \r\n \r\n- \r\n \r\n$ 311,559.22 \r\n \r\n- \r\n \r\n$ 329,664.21 \r\n \r\n- \r\n \r\n$ 440,647.76 \r\n \r\n- \r\n \r\n$ 457,801.02 \r\n \r\n- \r\n \r\n$ 440,233.56 \r\n \r\n- \r\n \r\n$ 416,239.34 \r\n \r\n- \r\n \r\n$ 405,211.66 \r\n \r\n- \r\n \r\n$ 359,091.68 \r\n \r\n- \r\n \r\n$ 306,826.14 \r\n \r\n- \r\n \r\n$ 286,702.98 \r\n \r\n24.66% 24.78% 24.81% 24.69% 24.72% 21.96% 18.46% 14.90% 11.63% 10.41% \r\n \r\n- 43 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"8\" \r\n \r\nYear Ended \r\n \r\nContractually required \r\ncontribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\n2020 2019 2018 2017 \r\n \r\n$ 5,048,822.00 $ $ 8,031,819.00 $ $ 7,665,615.00 $ $ 7,742,869.00 $ \r\n \r\n5,048,822.00 $ 8,031,819.00 $ 7,665,615.00 $ 7,742,869.00 $ \r\n \r\n- \r\n \r\n$ 136,156,580.97 \r\n \r\n- \r\n \r\n$ 127,221,476.44 \r\n \r\n- \r\n \r\n$ 123,412,244.61 \r\n \r\n- \r\n \r\n$ 121,721,036.65 \r\n \r\nContributions as a percentage of covered- \r\nemployee payroll \r\n3.71% 6.31% 6.21% 6.36% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 44 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SEAD - OPEB \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"9\" \r\n \r\nYear Ended \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nContributions as a percentage of \r\ncovered-employee payroll \r\n \r\n2020 \r\n \r\n$ \r\n \r\n2019 \r\n \r\n$ \r\n \r\n2018 \r\n \r\n$ \r\n \r\n2017 \r\n \r\n$ \r\n \r\n2016 \r\n \r\n$ \r\n \r\n2015 \r\n \r\n$ \r\n \r\n2014 \r\n \r\n$ \r\n \r\n2013 \r\n \r\n$ \r\n \r\n2012 \r\n \r\n$ \r\n \r\n2011 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ 311,559.22 \r\n \r\n- \r\n \r\n$ 329,664.21 \r\n \r\n- \r\n \r\n$ 440,647.76 \r\n \r\n- \r\n \r\n$ 457,801.02 \r\n \r\n- \r\n \r\n$ 440,233.56 \r\n \r\n- \r\n \r\n$ 416,239.34 \r\n \r\n- \r\n \r\n$ 405,211.66 \r\n \r\n- \r\n \r\n$ 359,091.68 \r\n \r\n- \r\n \r\n$ 306,826.14 \r\n \r\n- \r\n \r\n$ 286,702.98 \r\n \r\n0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% \r\n \r\n- 45 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\nFOR THE YEAR ENDED JUNE 30, 2020 \r\n \r\nSCHEDULE \"10\" \r\n \r\nTeachers Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. \r\nOn November 18, 2015, the -Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males). \r\nOn May 15, 2019, the Board adopted recommended changes from the smoothed valuation interest rate methodology that has been in effect since June 30, 2009, to a constant interest rate method. In conjunction with the methodology, the long-term assumed rate of return in assets (discount rate) has been changed from 7.50% to 7.25%, and the assumed annual rate of inflation has been reduced from 2.75% to 2.50%. \r\nEmployees' Retirement System \r\nChanges of benefit terms:  A new benefit tier was added for members joining the System on and after July 1, 2009.  A one-time 3% payment was granted to certain retirees and beneficiaries effective July 2016. $RQHWLPHSD\\PHQWZDVJUDQWHGWRFHUWDLQUHWLUHHVDQGEHQHILFLDULHVHIIHFWLYH-XO\\ \r\nChanges of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, withdrawal and salary increases. \r\nOn March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. \r\nPublic School Employees Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to PRUHFORVHO\\UHIOHFWDFWXDOH[SHULHQFH \r\nOn-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females). \r\nOn March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. \r\nSchool OPEB Fund \r\nChanges of benefit terms: There have been no changes in benefit terms. \r\nChanges in assumptions: The June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to State OPEB fund based on their last employer payroll location; irrespective of retirement affiliation. \r\nThe discount rate was updated from 3.07% as of June 30, 2016 to 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018, and back to 3.58% as of June 30, 2019. \r\nSEAD-OPEB Employer \r\nChanges of assumptions: On December 17, 2015, the Board of Trustees adopted recommended changes to the economic and demographic assumptions utilized by the Plan. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary LQFUHDVHV \r\nOn March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. \r\n \r\n- 46 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION GENERAL FUND \r\nSCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL \r\nYEAR ENDED JUNE 30, 2020 \r\n \r\nSCHEDULE \"11\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nDebt Service \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nOther Sources Other Uses \r\nTotal Other Financing Sources (Uses) \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nNONAPPROPRIATED BUDGETS \r\n \r\nORIGINAL (1) \r\n \r\nFINAL (1) \r\n \r\nACTUAL AMOUNTS \r\n \r\nVARIANCE OVER/UNDER \r\n \r\n$ 57,421,750.00 $ 58,900,000.00 $ 59,587,038.19 $ \r\n \r\n26,325,105.00 \r\n \r\n26,775,105.00 \r\n \r\n29,679,678.72 \r\n \r\n210,214,240.00 \r\n \r\n214,421,628.00 \r\n \r\n214,096,172.57 \r\n \r\n31,597,183.00 \r\n \r\n32,771,809.00 \r\n \r\n31,092,267.16 \r\n \r\n7,816,517.00 \r\n \r\n8,139,397.00 \r\n \r\n8,458,978.68 \r\n \r\n1,235,072.00 \r\n \r\n980,766.00 \r\n \r\n921,557.23 \r\n \r\n6,362,040.00 \r\n \r\n7,066,675.00 \r\n \r\n5,177,187.38 \r\n \r\n340,971,907.00 \r\n \r\n349,055,380.00 \r\n \r\n349,012,879.93 \r\n \r\n687,038.19 2,904,573.72 \r\n(325,455.43) (1,679,541.84) \r\n319,581.68 (59,208.77) (1,889,487.62) \r\n(42,500.07) \r\n \r\n210,234,795.00 \r\n16,049,990.00 8,744,104.00 2,301,439.00 4,259,619.00 1,968,738.00 \r\n21,971,857.00 2,566,863.00 \r\n25,100,578.00 14,029,107.00 \r\n4,544,702.00 1,583,079.00 2,394,489.00 1,065,200.00 21,424,100.00 \r\n- \r\n338,238,660.00 \r\n2,733,247.00 \r\n \r\n213,669,945.00 \r\n16,097,433.00 6,944,275.00 2,528,507.00 4,149,619.00 2,185,115.00 \r\n21,956,620.00 2,397,649.00 \r\n24,509,425.00 13,399,169.00 \r\n4,313,665.00 1,386,567.00 2,063,776.00 \r\n910,983.00 21,424,100.00 \r\n- \r\n337,936,848.00 \r\n11,118,532.00 \r\n \r\n212,660,306.41 \r\n15,907,565.16 6,907,865.25 2,241,342.16 4,211,286.88 1,398,060.44 \r\n21,747,737.43 2,386,276.38 \r\n24,147,906.52 13,135,356.05 \r\n4,353,812.32 1,017,014.79 2,119,611.13 \r\n929,852.51 22,132,741.91 \r\n292,147.26 \r\n335,588,882.60 \r\n13,423,997.33 \r\n \r\n1,009,638.59 \r\n189,867.84 36,409.75 \r\n287,164.84 (61,667.88) 787,054.56 208,882.57 11,372.62 361,518.48 263,812.95 (40,147.32) 369,552.21 (55,835.13) (18,869.51) (708,641.91) (292,147.26) \r\n2,347,965.40 \r\n2,305,465.33 \r\n \r\n3,688,919.00 (6,565,887.00) (2,876,968.00) \r\n(143,721.00) 63,155,583.00 \r\n \r\n3,651,631.00 (6,651,631.00) (3,000,000.00) 8,118,532.00 49,887,698.57 \r\n \r\n(3,000,000.00) (3,000,000.00) 10,423,997.33 90,634,865.79 \r\n \r\n(3,651,631.00) 3,651,631.00 \r\n2,305,465.33 40,747,167.22 \r\n \r\n$ 63,011,862.00 $ 58,006,230.57 $ 101,058,863.12 $ 43,052,632.55 \r\n \r\nNotes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual \r\n(1) Original and Final Budget amounts do not include the Restricted Other - Property Tax Rollback fund balance in the beginning or ending fund balances. \r\nThe accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 47 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2020 \r\n \r\nSCHEDULE \"12\" \r\n \r\nFUNDING AGENCY PROGRAM/GRANT \r\nAgriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program \r\nTotal Child Nutrition Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Food Services Child Nutrition Discretionary Grants Limited Availability Child Nutrition Discretionary Grants Limited Availability Fresh Fruit and Vegetable Program \r\nTotal U. S. Department of Agriculture \r\nEducation, U. S. Department of Impact Aid Cluster Direct Impact Aid \r\nSpecial Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Grants to States Preschool Grants \r\nTotal Special Education Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to Schools Career and Technical Education - Basic Grants to Schools Education for Homeless Children and Youth English Language Acquisition Grants English Language Acquisition Grants Language Instruction for Immigrant Students Language Instruction for Immigrant Students Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Supporting Effective Instruction Supporting Effective Instruction Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies Title I School Improvement \r\nTotal Other Programs \r\nTotal U. S. Department of Education \r\nDefense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program P.L 102-375 \r\nTotal U. S. Department of Defense \r\n \r\nCFDA NUMBER \r\n \r\nPASSTHROUGH \r\nENTITY ID \r\nNUMBER \r\n \r\nEXPENDITURES IN PERIOD \r\n \r\n10.553 10.555 \r\n \r\n205GA324N1099 \r\n \r\n$ \r\n \r\n205GA324N1099 \r\n \r\n4,829,448.82 16,500,521.56 \r\n21,329,970.38 \r\n \r\n10.579 10.579 10.582 \r\n \r\n185GA350N8103 195GA350N8103 205GA324L1603 \r\n \r\n45,000.00 15,535.00 68,699.36 \r\n129,234.36 \r\n21,459,204.74 \r\n \r\n84.041 \r\n \r\n1,174,082.37 \r\n \r\n84.027 84.027 84.173 \r\n84.048 84.048 84.196 84.365 84.365 84.365 84.365 84.424 84.424 84.367 84.367 84.010 84.010 84.010 \r\n \r\nH027A180073 H027A190073 H173A190081 \r\nV048A180010 V048A190010 S196A190011 S365A180010 S365A190010 S365A180010 S365A190010 S424A180011 S424A190011 S367A180001 S367A190001 S010A180010 S010A190010 S010A190010 \r\n \r\n309,722.00 4,584,122.62 \r\n155,432.29 \r\n5,049,276.91 \r\n13,291.00 263,205.50 \r\n47,163.01 6,335.00 \r\n93,325.12 1,529.00 \r\n10,873.00 31,246.00 316,275.00 37,391.00 715,276.38 359,228.00 6,074,498.81 149,648.93 \r\n8,119,285.75 \r\n14,342,645.03 \r\n \r\n12.UNKNOWN \r\n \r\n414,021.49 507,330.09 \r\n921,351.58 \r\n \r\nTotal Expenditures of Federal Awards \r\n \r\n$ \r\n \r\n36,723,201.35 \r\n \r\nNotes to the Schedule of Expenditures of Federal Awards \r\nNote 1. Basis of Presentation \r\nThe accompanying schedule of expenditures of federal awards (the \"Schedule\") includes the Federal award activity of the Houston County Board of Education (the \"Board\") under programs of the federal government for the year ended June 30, 2020. The information in this Schedule is presented under the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net assets of the Board. \r\nNote 2. Summary of Significant Accounting Policies \r\nExpenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Government, or the cost principles in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited to reimbursement. \r\nNote 3: Indirect Cost Rate \r\nThe Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 48 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUES YEAR ENDED JUNE 30, 2020 \r\n \r\nSCHEDULE \"13\" \r\n \r\nAGENCY/FUNDING \r\nGRANTS Bright from the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program \r\nEducation, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Education Equalization Funding Grant Amended Formula Adjustment Other State Programs Food Services Hygiene Products in Georgia Schools Math and Science Supplements Military Counselors Preschool Handicapped Program Pupil Transportation - State Bonds School Security Grant Teachers Retirement Vocational Education \r\nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \r\nHuman Services, Georgia Department of Second Step Social-Emotional Learning \r\nOffice of the State Treasurer Public School Employees Retirement \r\n \r\nGOVERNMENTAL FUND TYPES \r\n \r\nCAPITAL \r\n \r\nGENERAL \r\n \r\nPROJECTS \r\n \r\nFUND \r\n \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ \r\n \r\n4,794,420.30 $ \r\n \r\n- $ \r\n \r\n4,794,420.30 \r\n \r\n8,684,747.00 2,707,022.00 21,244,345.00 7,265,152.00 11,254,889.00 2,381,451.00 20,494,711.00 16,443,960.00 5,741,524.00 28,180,467.00 14,663,072.00 4,190,914.00 1,419,810.00 2,061,023.00 3,753,881.00 1,096,251.00 \r\n666,675.00 10,936.00 \r\n4,975,924.00 7,160,664.00 7,893,735.00 \r\n1,608,243.00 618,290.00 28,280.00 \r\n32,705,964.00 (2,705,175.00) \r\n463,650.00 17,793.00 \r\n237,193.89 45,471.00 \r\n533,888.00 279,660.00 1,110,000.00 114,470.98 909,711.00 \r\n \r\n- \r\n \r\n8,684,747.00 \r\n \r\n- \r\n \r\n2,707,022.00 \r\n \r\n- \r\n \r\n21,244,345.00 \r\n \r\n- \r\n \r\n7,265,152.00 \r\n \r\n- \r\n \r\n11,254,889.00 \r\n \r\n- \r\n \r\n2,381,451.00 \r\n \r\n- \r\n \r\n20,494,711.00 \r\n \r\n- \r\n \r\n16,443,960.00 \r\n \r\n- \r\n \r\n5,741,524.00 \r\n \r\n- \r\n \r\n28,180,467.00 \r\n \r\n- \r\n \r\n14,663,072.00 \r\n \r\n- \r\n \r\n4,190,914.00 \r\n \r\n- \r\n \r\n1,419,810.00 \r\n \r\n- \r\n \r\n2,061,023.00 \r\n \r\n- \r\n \r\n3,753,881.00 \r\n \r\n- \r\n \r\n1,096,251.00 \r\n \r\n- \r\n \r\n666,675.00 \r\n \r\n- \r\n \r\n10,936.00 \r\n \r\n- \r\n \r\n4,975,924.00 \r\n \r\n- \r\n \r\n7,160,664.00 \r\n \r\n- \r\n \r\n7,893,735.00 \r\n \r\n- \r\n \r\n1,608,243.00 \r\n \r\n- \r\n \r\n618,290.00 \r\n \r\n- \r\n \r\n28,280.00 \r\n \r\n- \r\n \r\n32,705,964.00 \r\n \r\n- \r\n \r\n(2,705,175.00) \r\n \r\n- \r\n \r\n463,650.00 \r\n \r\n- \r\n \r\n17,793.00 \r\n \r\n- \r\n \r\n237,193.89 \r\n \r\n- \r\n \r\n45,471.00 \r\n \r\n- \r\n \r\n533,888.00 \r\n \r\n- \r\n \r\n279,660.00 \r\n \r\n- \r\n \r\n1,110,000.00 \r\n \r\n- \r\n \r\n114,470.98 \r\n \r\n- \r\n \r\n909,711.00 \r\n \r\n393,035.40 650,124.00 \r\n \r\n4,293,951.70 - \r\n \r\n4,293,951.70 393,035.40 650,124.00 \r\n \r\n$ 214,096,172.57 $ 4,293,951.70 $ 218,390,124.27 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 49 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\nYEAR ENDED JUNE 30, 2020 \r\n \r\nSCHEDULE \"14\" \r\n \r\nPROJECT \r\n2012 SPLOST \r\n(1) Acquiring instructional and administrative technology equipment (2) Acquiring safety and security equipment (3) Adding to, renovating, repairing, improving, and equipping existing school buildings and other buildings and facilities (4) Acquiring, constructing, and equipping two replacement elementary schools (5) Acquiring, constructing, and equipping a central transportation (bus) facility (6) Acquiring, constructing, and equipping stadium and tennis facilities (7) Acquiring any necessary property, both real and personal (8) Paying (Legal and Administrative) expenses incident to accomplishing the foregoing. \r\n2017 SPLOST \r\n(1) Acquiring instructional and administrative technology equipment and materials (2) Acquiring safety, security, and fire protection equipment (3) Adding to, renovating, repairing, improving, furnishing and equipping existing school buildings, and physical education and other buildings and facilities, including any necessary demolition (4) Adding to, constructing, renovating, furnishing, and equipping gymnasiums and athletic facilities (5) Renovations, additions,and improvements to parking and traffic access facilities, including any necessary sitework (6) Acquiring, constructing, furnishing, and equipping one new elementary school (7) Acquiring buses, vehicles, and transportation equipment (8) Acquiring any necessary property, both real and personal (9) Paying expenses incident to \r\n \r\nORIGINAL ESTIMATED \r\nCOST (1) \r\n \r\nCURRENT ESTIMATED COSTS (2) \r\n \r\nAMOUNT EXPENDED IN CURRENT YEAR (3) (4) \r\n \r\nAMOUNT EXPENDED IN PRIOR YEARS (3) (4) \r\n \r\nTOTAL COMPLETION \r\nCOST \r\n \r\nEXCESS PROCEEDS \r\n \r\n$ \r\n \r\n- $ 20,448,779.00 $ \r\n \r\n- $ 20,448,778.64 $ 20,448,778.64 $ \r\n \r\n- \r\n \r\n- \r\n \r\n1,659,729.00 \r\n \r\n- \r\n \r\n1,659,728.02 \r\n \r\n1,659,728.02 \r\n \r\n- \r\n \r\n- \r\n \r\n44,414,364.00 \r\n \r\n- \r\n \r\n44,414,363.96 \r\n \r\n44,414,363.96 \r\n \r\n- \r\n \r\n- \r\n \r\n26,508,184.00 \r\n \r\n- \r\n \r\n26,508,183.93 \r\n \r\n26,508,183.93 \r\n \r\n- \r\n \r\n- \r\n \r\n6,506,311.00 \r\n \r\n- \r\n \r\n6,506,310.17 \r\n \r\n6,506,310.17 \r\n \r\n- \r\n \r\n- \r\n \r\n15,502,268.00 \r\n \r\n1,241,153.66 \r\n \r\n14,261,113.70 \r\n \r\n15,502,267.36 \r\n \r\n- \r\n \r\n- \r\n \r\n1,222,146.00 \r\n \r\n- \r\n \r\n1,222,145.37 \r\n \r\n1,222,145.37 \r\n \r\n- \r\n \r\n- \r\n \r\n472,924.00 \r\n \r\n- \r\n \r\n472,923.22 \r\n \r\n472,923.22 \r\n \r\n- \r\n \r\n125,000,000.00 \r\n \r\n116,734,705.00 \r\n \r\n1,241,153.66 \r\n \r\n115,493,547.01 \r\n \r\n116,734,700.67 \r\n \r\n- \r\n \r\n- \r\n \r\n13,600,000.00 \r\n \r\n1,429,361.26 \r\n \r\n9,872,625.30 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n1,313,015.00 \r\n \r\n519,372.45 \r\n \r\n611,172.95 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n42,136,970.00 \r\n \r\n3,923,470.89 \r\n \r\n15,053,260.06 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n52,557,189.00 \r\n \r\n13,059,873.37 \r\n \r\n20,900,707.80 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n4,464,701.00 \r\n \r\n1,385,659.08 \r\n \r\n2,179,840.37 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n22,000,000.00 \r\n \r\n19,766,543.37 \r\n \r\n1,310,376.26 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n3,680,067.00 \r\n \r\n343,894.00 \r\n \r\n3,336,172.75 \r\n \r\n3,680,066.75 \r\n \r\n- \r\n \r\n- \r\n \r\n2,000,000.00 \r\n \r\n- \r\n \r\n1,549,065.35 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n396,612.00 \r\n \r\n5,250.00 \r\n \r\n380,232.16 \r\n \r\n- \r\n \r\n- \r\n \r\nPROJECT STATUS \r\n \r\nESTIMATED COMPLETION \r\nDATE \r\n \r\nCompleted Completed \r\n \r\nOctober 30, 2017 September 30, 2017 \r\n \r\nCompleted Completed Completed Completed Completed Completed \r\n \r\nDecember 31, 2018 November 30, 2014 \r\nJuly 31, 2017 January 31, 2020 \r\nJune 30, 2017 November 30, 2016 \r\n \r\nOngoing Ongoing \r\n \r\nJune 30, 2022 January 1, 2022 \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\nOngoing Ongoing Completed Ongoing Ongoing \r\n \r\nSeptember 30, 2021 September 30, 2020 \r\nJanuary 31, 2020 December 31, 2021 November 30, 2021 \r\n \r\n$ 135,000,000.00 $ 142,148,554.00 $ 40,433,424.42 $ 55,193,453.00 $ 3,680,066.75 $ \r\n \r\n- \r\n \r\n(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. (2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. (3) The voters of Houston County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, \r\nstate, local property taxes and/or other funds over the life of the projects. (4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows: \r\n \r\nPrior Years Current Year Total \r\n \r\n$ \r\n \r\n8,402,563.97 \r\n \r\n1,046,650.00 \r\n \r\n$ \r\n \r\n9,449,213.97 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 51 - \r\n \r\n SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 4-101 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON \r\nCOMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities and each major fund of the Houston County Board of Education (School District), as of and for the year ended June 30, 2020, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated February 25, 2021. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\n \r\n Compliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nFebruary 25, 2021 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 4-101 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education Board of Education \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited the Houston County Board of Education (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2020. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\nWe believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance. \r\n \r\n Opinion on Each Major Federal Program \r\nIn our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2020. \r\nReport on Internal Control over Compliance \r\nManagement of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nFebruary 25, 2021 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2020 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. \r\nPRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2020 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\nType of auditor's report issued: Governmental Activities; All Major Funds \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\nNoncompliance material to financial statements noted: \r\n \r\nUnmodified \r\nNo None Reported \r\nNo \r\n \r\nFederal Awards \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with 2 CFR 200.516(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: \r\n \r\nCFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n84.010 84.027, 84.173 \r\n \r\nTitle I Grants to Local Educational Agencies Special Education Cluster \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: \r\n \r\n$1,099,879.99 \r\n \r\nAuditee qualified as low-risk auditee? \r\n \r\nYes \r\n \r\nII FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2019-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2019 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2020-03-28"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2019 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2019-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2019-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"Houston County Board of Education \r\nPerry, Georgia \r\nFiscal Year 2019 Audit Report \r\nYear Ended June 30, 2019 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nPage \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\ni \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nGOVERNMENT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\n1 \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\n2 \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n4 \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\n5 \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n6 \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\n7 \r\n \r\nG \r\n \r\nSTATEMENT OF FIDUCIARY NET POSITION \r\n \r\nFIDUCIARY FUNDS \r\n \r\n8 \r\n \r\nH NOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\n9 \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n39 \r\n \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nEMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n40 \r\n \r\n3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\n \r\n41 \r\n \r\n4 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY \r\n \r\nSCHOOL OPEB FUND \r\n \r\n42 \r\n \r\n5 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB ASSET \r\n \r\nSEAD  OPEB \r\n \r\n43 \r\n \r\n6 SCHEDULE OF CONTRIBUTIONS  TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n44 \r\n \r\n7 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 45 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\nFINANCIAL \r\nSCHEDULES \r\nREQUIRED SUPPLEMENATARY INFORMATION \r\n8 SCHEDULE OF CONTRIBUTIONS  SCHOOL OPEB FUND 9 SCHEDULE OF CONTRIBUTIONS  SEAD  OPEB 10 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 11 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES \r\nIN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND \r\nSUPPLEMENTARY INFORMATION \r\n12 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 13 SCHEDULE OF STATE REVENUE 14 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\nPage \r\n46 47 48 49 \r\n50 51 53 \r\n \r\nSECTION II \r\nCOMPLIANCE AND INTERNAL CONTROL REPORTS \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n SECTION I FINANCIAL \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\n \r\n We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2019, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements. \r\nThe accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. \r\n \r\n Other Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated March 28, 2020 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\n \r\nMarch 28, 2020 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nINTRODUCTION \r\nThe discussion and analysis of Houston County Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2019. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFINANCIAL HIGHLIGHTS \r\nKey financial highlights for 2019 are as follows: \r\nOn the government-wide financial statements: \r\n On the government-wide financial statements, net position increased $30.0 million which represents a 73.9 percent increase from 2018. This total increase was due to governmental activities since the School District has no business-type activities. \r\n The School District had $324.8 million in expenses related to governmental activities. Revenues totaled $354.8 million. Program specific revenues in the form of charges for services and sales, grants, and contributions accounted for $207.9 million or 58.6 percent of the total revenues and were used to offset these expenditures. General revenues of $146.9 million or 41.4 percent of all revenues were adequate to provide for these programs. \r\n The current ratio, which measures the Board's ability to transform current assets into cash and to pay its short-term liabilities, was 6.33 for the fiscal year ended June 30, 2019. Generally, a ratio greater than 2.0 is considered very financially stable. \r\nOn the fund financial statements: \r\n Among major funds, the general fund had $325.1 million in revenues and other financing sources, and $320.1 million in expenditures and other financing uses. The general fund's fund balance increased to $89.9 million. \r\nOVERVIEW OF THE FINANCIAL STATEMENTS \r\nThis annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the Houston County Board of Education. These include the government-wide and fund financial statements. \r\nThe government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nThe fund financial statements focus on individual parts, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the short-term as well as what remains for future spending. The fiduciary funds statements provide information about the financial relationships in which the Board acts solely as a trustee or agent for the benefit of others. \r\nThe fund financial statements reflect the School District's most significant funds. For the year ending June 30, 2019, the general fund, the capital projects fund, and the debt service fund represent the most significant funds. \r\nThe financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. \r\nGovernment-Wide Statements \r\nThe government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. \r\nThe two government-wide statements report the School District's net position and how it has changed. Net position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in net position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities  All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, student and principal accounts, and various others. \r\nFund Financial Statements \r\nThe School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, capital projects fund, and debt service fund. \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\n \r\nGovernmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general governmental operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements. \r\nFiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others, such as the employee benefit programs, and school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations. \r\nFINANCIAL ANALYSIS OF THE BOARD AS A WHOLE \r\nRecall that the Statement of Net Position provides the perspective of the Board as a whole. Table 1 provides a summary of the Board's net position for 2019 compared to fiscal year 2018. \r\nTable 1 Net Position (In Thousands) \r\n \r\nAssets Current and Other Assets Capital Assets, Net \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\n$ \r\n \r\n145,054 $ 152,836 \r\n \r\n330,664 \r\n \r\n309,283 \r\n \r\nTotal Assets \r\n \r\n475,718 \r\n \r\n462,119 \r\n \r\nDeferred Outflows of Resources \r\n \r\n68,445 \r\n \r\n57,036 \r\n \r\nLiabilities Current and Other Liabilities Long-Term Liabilities \r\n \r\n22,917 471,556 \r\n \r\n21,176 504,176 \r\n \r\nTotal Liabilities \r\n \r\n494,473 \r\n \r\n525,352 \r\n \r\nDeferred Inflows of Resources \r\n \r\n60,288 \r\n \r\n34,461 \r\n \r\nNet Position Net Invested in Capital Assets Restricted Unrestricted (Deficit) \r\n \r\n307,326 80,585 \r\n(398,509) \r\n \r\n291,862 81,774 \r\n(414,294) \r\n \r\nTotal Net Position \r\n \r\n$ \r\n \r\n(10,598) $ (40,658) \r\n \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 Total net position increased $30.0 million to ($10.6) million. This increase was mainly attributable to the decrease in long-term liabilities, specifically the net pension liability and the net OPEB liability. As shown on Table 2, the School District's operations also increased $30.0 million. Table 2 shows the changes in net position for fiscal year 2019 compared to the changes in net position for fiscal year 2018. \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\n \r\nTable 2 Changes in Net Position \r\n(In Thousands) \r\n \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\n$ 8,687 196,368 2,829 \r\n \r\n$ \r\n \r\n8,471 \r\n \r\n187,118 \r\n \r\n617 \r\n \r\nTotal Program Revenues \r\n \r\n207,884 \r\n \r\n196,206 \r\n \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\nSpecial Item Gain on Sale of Assets \r\n \r\n52,225 3,456 \r\n26,276 \r\n26,280 1,380 \r\n28,351 2,103 6,521 \r\n350 \r\n \r\n51,317 2,460 \r\n24,199 \r\n24,200 1,325 \r\n25,112 1,263 5,266 \r\n- \r\n \r\nTotal General Revenues and Special Item \r\n \r\n146,942 \r\n \r\n135,142 \r\n \r\nTotal Revenues \r\n \r\n354,826 \r\n \r\n331,348 \r\n \r\nProgram Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n204,893 \r\n14,089 6,049 2,593 4,315 1,723 \r\n20,118 2,624 \r\n23,158 14,686 \r\n4,597 1,129 \r\n2,361 1,128 20,678 \r\n625 \r\n \r\n203,113 \r\n14,077 6,283 2,573 4,433 1,695 \r\n20,047 2,383 \r\n22,163 13,496 \r\n4,344 1,803 \r\n2,439 1,091 19,890 \r\n342 \r\n \r\nTotal Expenses \r\n \r\n324,766 \r\n \r\n320,172 \r\n \r\nIncrease in Net Position \r\n \r\n$ 30,060 \r\n \r\n$ 11,176 \r\n \r\nFigure A shows the funding sources for the revenues. 55.4 percent of the School District's revenues are derived from state grants. Property taxes make up 15.7 percent of the total funding, while an additional 15.2 percent is earned from the School District's sales taxes. \r\n \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nAs shown in Figure B, Instruction comprised 63.1 percent of governmental program expenses. Administration and Other Services (3.1 percent) consist of the central office, business and warehouse, and other central operations of the School District. \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nGovernmental Activities \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2019 with fiscal year 2018. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(In Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\nNet Cost of Services \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n$ 204,893 \r\n14,089 6,049 2,593 4,315 1,723 \r\n20,118 2,624 \r\n23,158 14,686 \r\n4,597 1,129 \r\n2,361 1,128 20,678 \r\n625 \r\n \r\n$ 203,113 $ 59,964 \r\n \r\n14,077 6,283 2,573 4,433 1,695 \r\n20,047 2,383 \r\n22,163 13,496 \r\n4,344 1,803 \r\n \r\n5,559 3,067 \r\n300 261 1,010 12,281 1,999 13,926 11,922 3,660 220 \r\n \r\n2,439 1,091 19,890 \r\n342 \r\n \r\n802 1,129 \r\n157 625 \r\n \r\n$ 66,227 \r\n6,584 2,911 \r\n328 517 1,154 12,518 1,812 13,341 11,250 3,408 1,223 \r\n900 1,091 \r\n360 342 \r\n \r\nTotal Expenses \r\n \r\n$ 324,766 $ 320,172 $ 116,882 $ 123,966 \r\n \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 29.3 percent of instruction activities are supported through taxes and other general revenues, and for all governmental activities general revenue support is 36.0 percent. \r\n \r\nThe School District's Funds \r\n \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $358.1 million and expenditures and other financing uses of $367.8 million. There was a decrease in the fund balance totaling $9.7 million for the governmental funds as a whole. The general fund increased by $5.0 million due mainly to increases in mid-term funding, local taxes and careful planning of expenditures. The capital projects funds had a decrease of ($15.1) million and debt service funds had an increase of $0.4 million to meet the subsequent year's debt requirements. The capital projects fund decrease was attributable to the increased construction and renovation expenditures that were funded by the proceeds of the Educational Special Purpose Local Option Sales Tax (ESPLOST) and the issuance of general obligation bonds during fiscal year 2017. These funds will continue to be depleted as the School District completes the projects in the current capital outlay plan. The increase in the debt service fund was attributable to the amount of ESPLOST proceeds needed to pay next fiscal year's interest and \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nprincipal payments due on the outstanding debt associated with the previously issued general obligation bonds. The increase in the fund balance of the general fund for the year reflects that the School District was able to meet current costs as planned and budgeted. \r\nGeneral Fund Budgeting Highlights \r\nThe School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund. During the course of fiscal year 2019, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. For the general fund, the final budgeted revenues and other financing sources of $323.9 million was greater than the original budgeted amount of $320.8 million by $3.1 million. The overall difference was mainly due to additional federal grant awards of $1.4 million, increased property taxes of $1.6 million and additional local revenues. The actual revenues and other financing sources of $325.1 million was greater than the budgeted amount by $1.2 million due mainly to the elimination of intra-fund transfers and an increase in sales taxes. The final budgeted expenditures and other financing uses of $324.6 million was more than the original budgeted amount of $321.5 million by $3.1 million. This difference was due mainly to adjusting the budget to reflect the revised needs, including a local supplemental funding transfer to the capital projects fund. The actual expenditures and other financing uses of $320.1 million was $4.5 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. The differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes that had previously been reported as deferred as current and prior year revenues for report purposes. \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\n \r\nCapital Assets and Debt Administration \r\n \r\nCapital Assets \r\n \r\nAt the end of fiscal year 2019, the School District had $330.7 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2019 balances compared with fiscal year 2018 balances. \r\n \r\nTable 4 Capital Assets at June 30 (Net of Depreciation, In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\nLand Construction In Progress Buildings and Building Improvements Equipment Land Improvements Intangible Assets \r\n \r\n$ 12,625 29,361 \r\n269,269 9,158 9,029 1,222 \r\n \r\n$ 11,278 10,381 \r\n272,935 7,779 5,544 1,366 \r\n \r\nTotal \r\n \r\n$ 330,664 $ 309,283 \r\n \r\nThe overall capital assets increased in fiscal year 2019 by $21.4 million due to the construction and renovation expenses from the 2012 and 2017 ESPLOST capital outlay projects during the current year, partially offset by the fiscal year 2019 depreciation of $13.9 million. \r\nDebt \r\nAt June 30, 2019, the School District had $24.5 million in bonds outstanding with $5.9 million due within one year, $0.3 million in capital leases outstanding with all of it being due within one year, $3.5 million in compensated absences earned as of the end of the year, and $2.6 million in unamortized bond premiums with $0.6 million due with one year. In addition, the School District reported long-term liabilities for its proportionate share of the net pension and net OPEB liabilities. Reporting these liabilities is required by GASB Statements No. 68 and No. 75. \r\n \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\n \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2019, compared to fiscal year 2018 balances. \r\n \r\nTable 5 Debt at June 30 (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2019 \r\n \r\n2018 \r\n \r\nGeneral Obligation Bonds Capital Leases Compensated Absences Unamortized Bond Premiums Net Pension Liability Net OPEB Liability \r\n \r\n$ \r\n \r\n24,500 $ 30,000 \r\n \r\n287 \r\n \r\n940 \r\n \r\n3,520 \r\n \r\n3,063 \r\n \r\n2,598 \r\n \r\n3,182 \r\n \r\n253,401 \r\n \r\n258,432 \r\n \r\n187,250 \r\n \r\n208,559 \r\n \r\nTotal \r\n \r\n$ 471,556 $ 504,176 \r\n \r\nAt June 30, 2019, the School District's overall legal bonding authority was $402.0 million based on the assessed value of taxable property as of December 31, 2018. The School District's bonds have assigned ratings of Aa1 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. Both the current year payments and subsequently scheduled payments are well below the $6.3 million threshold. \r\nCURRENT ISSUES \r\nThe Houston County School District consists of 39 campuses located in Houston County, a fast-growing area with a population of approximately 155,469. Current enrollment is approximately 30,221 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 14th in population, 15th in economics, and 16th in income. The 2018 School District millage ranks 167th out of 180 districts in Georgia. \r\nThe State of Georgia experienced serious financial hardship over the past several years, and as a result, more pressure was being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2.0 million in 2003 to a high of $23.8 million in 2010. Since the austerity reductions were enacted, the reductions total $158.4 million and the overall reduction of state funding, including other grants and programs, is approximately $317.6 million. For the first time in sixteen years, the fiscal year 2019 state allotments did not include an austerity reduction. Austerity reductions were not included in the initial fiscal year 2020 allotments either. Hopefully this trend will continue in future years. While Houston County's class sizes remain below the state maximum recommendations, any additional reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. \r\n \r\nx \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019 \r\nHouston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2018 economic impact on the State of Georgia of $3.15 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the County include the Board of Education, Houston County Hospital Authority, Perdue Farms, Frito-Lay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 62.8 percent work in the County. Houston County is Georgia's sixty-fifth largest county in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990 - 2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and was projected to grow to 155,469 in 2018. This growth results in school system enrollment increases between 198 to 487 students for the past five years. Houston County has three municipalities: Centerville with an estimated population of 7,776; Perry with 17,377; and Warner Robins with 75,797. The County also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. \r\nContacting the School District's Financial Management \r\nThis financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nxi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2019 \r\nASSETS \r\nCash and Cash Equivalents Investments Accounts Receivable, Net \r\nTaxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) \r\nTotal Assets \r\nDEFERRED OUTFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Outflows of Resources \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Interest Payable Claims Incurred but not Reported (IBNR) Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities \r\nDue Within One Year Due in More Than One Year \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Outflows of Resources \r\nNET POSITION \r\nNet Investment in Capital Assets Restricted for \r\nContinuation of Federal Programs Debt Service Capital Projects Net OPEB Asset Property Tax Rollback Unrestricted (Deficit) \r\nTotal Net Position \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\nEXHIBIT \"A\" \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\n$ \r\n \r\n106,439,372.70 \r\n \r\n258,039.41 \r\n \r\n6,521,565.04 23,697,855.13 \r\n3,286,688.65 520,393.65 \r\n4,330,526.33 41,986,021.70 288,677,982.49 \r\n \r\n475,718,445.10 \r\n \r\n60,153,911.46 8,290,734.00 \r\n68,444,645.46 \r\n \r\n12,958.29 19,160,374.42 \r\n392,421.49 1,400,032.79 1,951,233.52 253,400,887.00 187,249,649.00 \r\n6,863,005.69 24,042,624.91 \r\n494,473,187.11 \r\n \r\n20,883,064.00 39,404,964.00 \r\n60,288,028.00 \r\n \r\n307,326,522.28 \r\n10,398,689.22 6,277,048.79 \r\n23,071,159.19 84,745.00 \r\n40,752,887.45 (398,509,176.48) \r\n \r\n$ \r\n \r\n(10,598,124.55) \r\n \r\n- 1 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES \r\nFOR THE YEAR ENDED JUNE 30, 2019 \r\n \r\nGOVERNMENTAL ACTIVITIES \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\nTotal Governmental Activities \r\nGeneral Revenues Taxes Property Taxes For Maintenance and Operations Alternative Ad Valorem Tax Forest Land Protection Tax Railroad Cars Title Ad Valorem Tax Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Services For Capital Projects Intangible Recording Tax Real Estate Transfer Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\nSpecial Items Gain on Sale of Assets \r\nTotal General Revenues and Special Item \r\nChange in Net Position \r\nNet Position - Beginning of Year \r\n \r\nEXPENSES \r\n \r\nCHARGES FOR SERVICES \r\n \r\n$ 204,892,761.49 $ \r\n14,088,984.88 6,048,872.99 2,592,537.65 4,315,793.46 1,723,277.70 \r\n20,117,847.50 2,623,608.21 \r\n23,158,036.16 14,685,728.58 \r\n4,596,928.69 1,129,018.81 \r\n2,360,941.59 1,128,464.59 20,678,251.56 \r\n624,962.34 \r\n$ 324,766,016.20 $ \r\n \r\n2,702,937.50 \r\n5,089.88 114,035.22 - \r\n1,558,942.76 - \r\n4,305,948.02 - \r\n8,686,953.38 \r\n \r\nNet Position - Ending of Year \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 2 - \r\n \r\n EXHIBIT \"B\" \r\n \r\nPROGRAM REVENUES OPERATING GRANTS AND \r\nCONTRIBUTIONS \r\n \r\nCAPITAL GRANTS AND CONTRIBUTIONS \r\n \r\nNET (EXPENSES) REVENUES \r\nAND CHANGES IN NET POSITION \r\n \r\n$ \r\n \r\n140,215,989.24 $ \r\n \r\n2,009,795.72 $ \r\n \r\n(59,964,039.03) \r\n \r\n8,529,954.98 2,981,910.89 2,292,770.96 3,985,483.90 \r\n710,431.97 7,766,115.85 \r\n601,444.54 9,193,112.32 2,236,606.02 \r\n902,122.45 908,746.83 \r\n \r\n69,851.28 2,521.97 70,906.03 22,978.50 33,461.10 412,880.00 34,910.01 - \r\n \r\n(5,559,029.90) (3,066,962.10) \r\n(299,766.69) (260,458.28) (1,010,323.76) (12,280,825.62) (1,999,185.17) (13,926,372.86) (11,922,207.34) (3,659,896.23) (220,271.98) \r\n \r\n16,042,915.95 - \r\n \r\n172,237.69 - \r\n \r\n(801,998.83) (1,128,464.59) \r\n(157,149.90) (624,962.34) \r\n \r\n$ \r\n \r\n196,367,605.90 $ \r\n \r\n2,829,542.30 \r\n \r\n(116,881,914.62) \r\n \r\n52,225,362.88 26,655.67 94,507.38 32,967.07 \r\n3,301,543.28 \r\n26,275,562.90 \r\n7,036,281.58 19,243,082.51 \r\n995,116.17 384,541.88 28,351,372.00 2,103,351.21 6,521,210.54 \r\n350,000.00 \r\n146,941,555.07 \r\n30,059,640.45 \r\n(40,657,765.00) \r\n \r\n$ \r\n \r\n(10,598,124.55) \r\n \r\n- 3 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION BALANCE SHEET \r\nGOVERNMENTAL FUNDS JUNE 30, 2019 \r\n \r\nEXHIBIT \"C\" \r\n \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Other Inventories \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 73,436,052.16 $ 26,333,850.26 $ 6,669,470.28 $ 106,439,372.70 \r\n \r\n258,039.41 \r\n \r\n- \r\n \r\n- \r\n \r\n258,039.41 \r\n \r\n4,289,988.45 23,697,855.13 \r\n3,286,688.65 520,393.65 \r\n4,330,526.33 \r\n \r\n2,231,576.59 - \r\n \r\n- \r\n \r\n6,521,565.04 \r\n \r\n- \r\n \r\n23,697,855.13 \r\n \r\n- \r\n \r\n3,286,688.65 \r\n \r\n- \r\n \r\n520,393.65 \r\n \r\n- \r\n \r\n4,330,526.33 \r\n \r\nTotal Assets \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Retainages Payable \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nUnavailable Revenue - Property Taxes \r\nFUND BALANCES \r\nNonspendable Restricted Assigned Unassigned \r\nTotal Fund Balances \r\n \r\n$ 109,819,543.78 $ 28,565,426.85 $ 6,669,470.28 $ 145,054,440.91 \r\n \r\n$ \r\n \r\n12,958.29 $ \r\n \r\n19,160,374.42 \r\n \r\n- \r\n \r\n19,173,332.71 \r\n \r\n- $ 1,951,233.52 \r\n1,951,233.52 \r\n \r\n- $ \r\n \r\n12,958.29 \r\n \r\n- \r\n \r\n19,160,374.42 \r\n \r\n- \r\n \r\n1,951,233.52 \r\n \r\n- \r\n \r\n21,124,566.23 \r\n \r\n711,550.00 \r\n \r\n- \r\n \r\n- \r\n \r\n711,550.00 \r\n \r\n4,330,526.33 50,248,131.02 \r\n2,632,553.68 32,723,450.04 \r\n89,934,661.07 \r\n \r\n23,071,159.19 \r\n3,543,034.14 - \r\n26,614,193.33 \r\n \r\n6,669,470.28 \r\n- \r\n6,669,470.28 \r\n \r\n4,330,526.33 79,988,760.49 \r\n6,175,587.82 32,723,450.04 \r\n123,218,324.68 \r\n \r\nTotal Liabilities, Deferred Inflows of Resources and Fund Balances \r\n \r\n$ 109,819,543.78 $ 28,565,426.85 $ 6,669,470.28 $ 145,054,440.91 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 4 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\nTO THE STATEMENT OF NET POSITION JUNE 30, 2019 \r\n \r\nEXHIBIT \"D\" \r\n \r\nTotal fund balances - governmental funds (Exhibit \"C\") \r\nAmounts reported for Governmental Activities in the Statement of Net Position are different because: \r\nCapital assets used in governmental activities are not financial resources and therefore are not reported in the funds. These assets consist of: \r\nLand Construction in progress Land improvements Buildings Equipment Intangible assets Accumulated depreciation \r\nSome liabilities, including net pension obligations, are not due and payable in the current period, and, therefore, are not reported in the funds. \r\nNet pension liability Net OPEB liability \r\nDeferred outflows and inflows of resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds. \r\nRelated to pensions Related to OPEB \r\nTaxes that are not available to pay for current period expenditures are deferred in the funds. \r\nLong-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term liabilities at year-end consist of: \r\nBonds payable Accrued interest payable Capital leases payable Compensated absences payable Unamortized bond premiums Claims and judgements payable \r\nTotal Long-term Liabilities \r\nNet position of governmental activities (Exhibit \"A\") \r\n \r\n$ 123,218,324.68 \r\n \r\n$ 12,625,106.15 29,360,915.55 13,721,089.90 \r\n442,889,880.90 30,570,599.62 1,437,220.47 \r\n(199,940,808.40) \r\n \r\n330,664,004.19 \r\n \r\n$ (253,400,887.00) (187,249,649.00) \r\n \r\n(440,650,536.00) \r\n \r\n$ 39,270,847.46 (31,114,230.00) \r\n \r\n8,156,617.46 711,550.00 \r\n \r\n$ (24,500,000.00) (392,421.49) (287,461.47) \r\n(3,519,626.90) (2,598,542.23) (1,400,032.79) \r\n \r\n(32,698,084.88) \r\n \r\n$ (10,598,124.55) \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 5 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \r\nGOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2019 \r\n \r\nEXHIBIT \"E\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nCapital Outlay Debt Services \r\nPrincipal Interest \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nTransfers In Transfers Out \r\nTotal Other Financing Sources (Uses) \r\nSPECIAL ITEMS \r\nProceeds from Sale of Assets \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 55,731,165.01 $ 27,655,220.95 \r\n193,976,164.21 31,344,068.62 8,686,953.38 1,249,504.38 6,141,460.54 \r\n324,784,537.09 \r\n \r\n- $ 19,243,082.51 \r\n2,068,662.30 - \r\n729,254.95 379,750.00 \r\n22,420,749.76 \r\n \r\n- $ 7,036,281.58 \r\n124,591.88 - \r\n7,160,873.46 \r\n \r\n55,731,165.01 53,934,585.04 196,044,826.51 31,344,068.62 \r\n8,686,953.38 2,103,351.21 6,521,210.54 \r\n354,366,160.31 \r\n \r\n197,448,493.11 \r\n14,718,129.45 6,351,718.68 2,634,044.55 4,057,615.25 1,774,584.19 \r\n20,646,229.76 2,721,304.10 \r\n23,285,778.57 13,722,153.59 \r\n4,080,989.58 1,284,433.40 2,431,685.59 1,128,512.14 19,783,279.99 \r\n- \r\n652,125.06 13,705.56 \r\n316,734,782.57 \r\n8,049,754.52 \r\n \r\n5,250,292.99 \r\n1,802,256.75 1,090,396.11 32,767,260.92 \r\n- \r\n40,910,206.77 \r\n(18,489,457.01) \r\n \r\n- \r\n4,750.00 - \r\n5,500,000.00 1,275,550.00 \r\n6,780,300.00 \r\n380,573.46 \r\n \r\n202,698,786.10 \r\n14,718,129.45 6,351,718.68 2,634,044.55 4,057,615.25 1,774,584.19 \r\n20,646,229.76 2,726,054.10 \r\n23,285,778.57 15,524,410.34 \r\n5,171,385.69 1,284,433.40 2,431,685.59 1,128,512.14 19,783,279.99 32,767,260.92 \r\n6,152,125.06 1,289,255.56 \r\n364,425,289.34 \r\n(10,059,129.03) \r\n \r\n(3,405,000.00) \r\n(3,405,000.00) \r\n \r\n3,405,000.00 - \r\n3,405,000.00 \r\n \r\n- \r\n \r\n3,405,000.00 \r\n \r\n- \r\n \r\n(3,405,000.00) \r\n \r\n- \r\n \r\n- \r\n \r\n350,000.00 4,294,754.52 84,939,906.55 \r\n \r\n(15,084,457.01) 41,698,650.34 \r\n \r\n380,573.46 6,288,896.82 \r\n \r\n350,000.00 (9,709,129.03) 132,927,453.71 \r\n \r\nFund Balances - Ending \r\n \r\n$ 89,234,661.07 $ 26,614,193.33 $ 6,669,470.28 $ 123,218,324.68 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 6 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF \r\nREVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2019 \r\n \r\nEXHIBIT \"F\" \r\n \r\nNet change in fund balances total - governmental funds (Exhibit \"E\") \r\nAmounts reported for governmental activities in the Statement of Activities are different because: \r\nGovernmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. \r\nCapital outlay Depreciation expense \r\nThe net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. \r\nTaxes reported in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. \r\nThe issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. \r\nBond principal retirements Capital lease payments Amortization of bond premium \r\nDistrict pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEBs, is reported in the Statement of Activities. \r\nPension expense OPEB expense \r\nSome items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. These activities consist of: \r\nAccrued interest on issuance of debt Compensated absences Claims and judgments \r\n \r\n$ \r\n \r\n(9,709,129.03) \r\n \r\n$ 51,809,186.56 (13,958,192.20) \r\n \r\n37,850,994.36 (16,469,592.65) \r\n(50,128.73) \r\n \r\n$ \r\n \r\n5,500,000.00 \r\n \r\n652,125.06 \r\n \r\n583,346.22 \r\n \r\n6,735,471.28 \r\n \r\n$ 11,137,635.97 784,860.00 \r\n \r\n11,922,495.97 \r\n \r\n$ \r\n \r\n80,947.00 \r\n \r\n(456,083.08) \r\n \r\n154,665.33 \r\n \r\n(220,470.75) \r\n \r\nChange in net position of governmental activities (Exhibit \"B\") \r\n \r\n$ 30,059,640.45 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 7 - \r\n \r\n ASSETS Cash and Cash Equivalents Receivables, Net \r\nOther \r\nTotal Assets LIABILITIES Accounts Payable Funds Held for Others \r\nTotal Liabilities \r\n \r\nHOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION \r\nFIDUCIARY FUNDS JUNE 30, 2019 \r\n \r\nEXHIBIT \"G\" \r\n \r\nAGENCY FUNDS \r\n \r\n$ \r\n \r\n1,640,912.25 \r\n \r\n7,445.23 \r\n \r\n$ \r\n \r\n1,648,357.48 \r\n \r\n$ \r\n \r\n948,152.76 \r\n \r\n700,204.72 \r\n \r\n$ \r\n \r\n1,648,357.48 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 8 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nThe accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below. \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness. \r\nGOVERNMENT-WIDE STATEMENTS: \r\nThe Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange transactions. \r\nThe Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows: \r\n1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\n2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\n3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\nDirect expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n \r\n- 9 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nProgram revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFUND FINANCIAL STATEMENTS: \r\nThe fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), Bond Proceeds and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets. \r\n The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes legally restricted for the payment of general long-term principal and interest. \r\nThe School District reports the following fiduciary fund type: \r\n Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\nIn fiscal year 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 83, Certain Asset Retirement Obligations. This statement addresses accounting and financial reporting for certain asset retirement obligations (AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital asset. A government that has legal obligations to perform future asset retirement activities related to its tangible capital assets should recognize a liability based on the guidance in this statement. The adoption of this statement did not have an impact on the School District's financial statement. \r\nIn fiscal year 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements. The primary objective of this statement is to improve the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements. It also clarifies which liabilities governments should include when disclosing information related to debt. The School District included additional information in the Long-term Liabilities note disclosures. \r\nCASH AND CASH EQUIVALENTS \r\nCash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\nINVESTMENTS \r\nThe School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. \r\nInvestments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value. \r\nFor accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired. \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nRECEIVABLES \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\nINVENTORIES \r\nFood Inventories \r\nOn the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the weighted average basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\nSupply Inventories \r\nOn the basic financial statements, inventories of consumable supplies and materials are reported at cost (weighted average). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\nCAPITAL ASSETS \r\nOn the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art. \r\nCapital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities' column in the government-wide financial statements. \r\nDepreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives. \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCapitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows: \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible assets Construction In Progress \r\n \r\nCapitalization Policy \r\nAll All All \r\nAll $10,000 and any item necessary for insurance purposes $100,000 to $1,000,000 \r\nAll \r\n \r\nEstimated Useful Life \r\nN/A 8 to 25 Years 10 to 50 Years \r\n5 to 14 Years 5 to 10 Years \r\nup to 20 years N/A \r\n \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\nIn addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. \r\nIn addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s), and therefore, will not be recognized as an inflow of resources (revenue) until that time. \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\nPublic School Employees Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days, but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of forty-five days. Vacation leave of fifteen days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed forty-five days. \r\nLONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS \r\nIn the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the effective interest method. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nIn the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (SEAD - OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the state employees' assurance department retired and vested inactive members trust fund (SEAD-OPEB) plan (the plan) and additions to/deductions from the SEAD-OPEB's fiduciary net position have been determined on the same basis as they are reported by SEAD-OPEB. For this purpose, death benefits are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nFUND BALANCES \r\nFund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. \r\nThe School District's fund balances are classified as follows: \r\nNonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\nCommitted consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\nAssigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes. \r\n \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nUnassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance. \r\n \r\nUSE OF ESTIMATES \r\n \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\n \r\nPROPERTY TAXES \r\n \r\nThe Houston County Board of Commissioners adopted the property tax levy for the 2018 tax digest year (calendar year) on July 17, 2018 (levy date) based on property values as of January 1, 2018. Taxes were due on December 20, 2018 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2018 tax digest are reported as revenue in the governmental funds for fiscal year 2019. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2019, for maintenance and operations amounted to $52,275,491.61. \r\n \r\nThe tax millage rate levied for the 2018 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.297 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $3,301,543.28 during fiscal year ended June 30, 2019. \r\nSALES TAXES \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the School District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $26,275,562.90 and was recorded in the general fund. Local Option Sales Tax is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\nEducation Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $26,279,364.09 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and must be re-authorized at least every five years. \r\nNOTE 3: BUDGETARY DATA \r\nThe budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\n \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions, as necessary, based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review. \r\nNOTE 4: DEPOSITS AND CASH EQUIVALENTS \r\nCOLLATERALIZATION OF DEPOSITS \r\nO.C.G.A.  45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A.  45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\n \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCATEGORIZATION OF DEPOSITS \r\n \r\nCustodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2019, School District had deposits with a carrying amount of $20,359,785.94, and a bank balance of $28,072,376.78. The bank balances insured by Federal depository insurance were $4,651,310.90 and the bank balances collateralized with securities held by the pledging financial institution, by the pledging financial institution's trust department or agent in the School District's name were $53,209.25, and bank balances included in the State's Secure Deposit Program (SDP) were $23,367,856.63. \r\n \r\nReconciliation of cash and cash equivalents balances to carrying value of deposits: \r\n \r\nCash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position \r\n \r\n$ 106,439,372.70 1,640,912.25 \r\n \r\nTotal cash and cash equivalents \r\n \r\n108,080,284.95 \r\n \r\nAdd: Deposits with original maturity of three months or more reported as investments \r\n \r\n258,039.41 \r\n \r\nLess: Investment pools reported as cash and cash equivalents \r\nGeorgia Fund 1 \r\n \r\n87,978,538.42 \r\n \r\nTotal carrying value of deposits - June 30, 2019 \r\n \r\n$ 20,359,785.94 \r\n \r\nCATEGORIZATION OF CASH EQUIVALENTS \r\nThe School District reported cash equivalents of $87,978,538.42 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2019, was 39 days. \r\nGeorgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 5: CAPITAL ASSETS \r\n \r\nThe following is a summary of changes in the capital assets for governmental activities during the fiscal year: \r\n \r\nBalances June 30, 2018 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nBalances June 30, 2019 \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction in Progress \r\n \r\n$ 11,278,291.55 $ 1,351,564.60 $ \r\n \r\n4,750.00 $ 12,625,106.15 \r\n \r\n10,381,028.35 \r\n \r\n34,663,436.95 \r\n \r\n15,683,549.75 \r\n \r\n29,360,915.55 \r\n \r\nTotal Capital Assets Not Being Depreciated \r\n \r\n21,659,319.90 \r\n \r\n36,015,001.55 \r\n \r\n15,688,299.75 \r\n \r\n41,986,021.70 \r\n \r\nCapital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n440,505,502.52 29,441,604.66 9,557,511.85 1,437,220.47 \r\n \r\n8,264,894.35 3,365,712.61 4,163,578.05 \r\n- \r\n \r\n5,880,515.97 2,236,717.65 \r\n- \r\n \r\n442,889,880.90 30,570,599.62 13,721,089.90 1,437,220.47 \r\n \r\nLess Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n167,570,207.60 21,662,558.49 4,013,929.81 \r\n71,861.02 \r\n \r\n11,374,320.39 1,762,529.68 \r\n677,620.08 143,722.05 \r\n \r\n5,323,887.02 2,012,053.70 \r\n- \r\n \r\n173,620,640.97 21,413,034.47 4,691,549.89 \r\n215,583.07 \r\n \r\nTotal Capital Assets, Being Depreciated, Net \r\n \r\n287,623,282.58 \r\n \r\n1,835,992.81 \r\n \r\n781,292.90 \r\n \r\n288,677,982.49 \r\n \r\nGovernmental Activity Capital Assets - Net \r\n \r\n$ 309,282,602.48 $ 37,850,994.36 $ 16,469,592.65 $ 330,664,004.19 \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction Support Services \r\nEducational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services \r\n \r\n$ 432,407.58 15,612.00 \r\n438,936.96 142,246.17 207,137.73 1,152,337.96 216,107.06 \r\n \r\n$ 10,287,185.97 \r\n2,604,785.46 1,066,220.77 \r\n \r\n$ 13,958,192.20 \r\n \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 6: INTERFUND TRANSFERS \r\n \r\nInterfund transfers for the year ended June 30, 2019, consisted of the following: \r\n \r\nTransfer to \r\n \r\nTransfers From General Fund \r\n \r\nCapital Projects Fund \r\n \r\n$ 3,405,000.00 \r\n \r\nTransfers are used to move local revenues collected by the general fund to the capital projects fund as a supplemental funding source for capital construction projects. \r\n \r\nNOTE 7: LONG-TERM LIABILITIES \r\n \r\nThe changes in long-term liabilities during the fiscal year for governmental activities were as follows: \r\n \r\nBalance June 30, 2018 \r\n \r\nAdditions \r\n \r\nGovernmental Funds Deductions \r\n \r\nBalance June 30, 2019 \r\n \r\nDue Within One Year \r\n \r\nG.O. Bonds \r\n \r\n$ 30,000,000.00 $ \r\n \r\nUnamortized Bond Premiums \r\n \r\n3,181,888.45 \r\n \r\nCapital Leases \r\n \r\n939,586.53 \r\n \r\nCompensated Absences (1) \r\n \r\n3,063,543.82 \r\n \r\n- $ 2,534,734.71 \r\n \r\n5,500,000.00 $ 583,346.22 652,125.06 \r\n2,078,651.63 \r\n \r\n24,500,000.00 $ 2,598,542.23 287,461.47 3,519,626.90 \r\n \r\n5,945,000.00 630,544.22 287,461.47 - \r\n \r\n$ 37,185,018.80 $ \r\n \r\n2,534,734.71 $ \r\n \r\n8,814,122.91 $ 30,905,630.60 $ \r\n \r\n6,863,005.69 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements. \r\n \r\nThe School District has no unused line of credit or outstanding notes from direct borrowings and direct placements related to governmental activities as of June 30, 2019. In the event the entity is unable to make the principal and interest payments using proceeds of the Education Special Purpose Local Option Sales Tax (ESPLOST), the debt will be satisfied from the general fund or from a direct annual ad valorem tax levied upon all taxable property within the School District. Additional security is provided by the State of Georgia Intercept Program which allows for state appropriations entitled to the School District to be transferred to the Debt Service Account Custodian for the payment of debt. \r\n \r\nGENERAL OBLIGATION DEBT OUTSTANDING \r\n \r\nThe School District's bonded debt consists of general obligation bonds that are generally noncallable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved Education Special Purpose Local Option Sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. \r\n \r\nGeneral obligation bonds currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\nGeneral Government - Series 2017 \r\n \r\n4.00% - 5.00% \r\n \r\n4/6/2017 9/1/2022 $ 30,000,000.00 $ 24,500,000.00 \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nGeneral Obligation Debt \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nUnamortized Bond Premium \r\n \r\n2020 2021 2022 2023 \r\n \r\n$ 5,945,000.00 $ 1,046,650.00 $ \r\n \r\n6,050,000.00 \r\n \r\n776,500.00 \r\n \r\n6,180,000.00 \r\n \r\n470,750.00 \r\n \r\n6,325,000.00 \r\n \r\n158,125.00 \r\n \r\n630,544.23 641,680.84 655,469.02 670,848.14 \r\n \r\nTotal Principal and Interest \r\n \r\n$ 24,500,000.00 $ 2,452,025.00 $ 2,598,542.23 \r\n \r\nCAPITAL LEASES \r\nThe School District has acquired buses under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term. \r\nThe following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end: \r\nGovernmental Activities \r\n \r\nEquipment Less: Accumulated Depreciation \r\n \r\n$ 1,394,688.00 627,609.60 \r\n \r\n$ 767,078.40 \r\n \r\nCapital leases currently outstanding are as follows: \r\n \r\nDescription 12 School Buses \r\n \r\nInterest Rate \r\n1.618% \r\n \r\nIssue Date 11/11/2014 \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\n9/1/2019 $ 1,394,688.00 $ 287,461.47 \r\n \r\nThe following is a schedule of total capital lease payments: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nCapital Leases \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\n2020 \r\n \r\n$ 287,461.47 $ \r\n \r\n4,685.79 \r\n \r\nCOMPENSATED ABSENCES \r\nCompensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\n \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 8: RISK MANAGEMENT \r\n \r\nINSURANCE \r\n \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job-related illness or injuries to employees; and natural disasters; and unemployment compensation. \r\n \r\nGeorgia School Boards Association Risk and Insurance Management System \r\n \r\nThe School District participates in the Georgia School Boards Association Risk and Insurance Management System (the System), a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The School District pays an annual premium to the System for its general insurance coverage. Additional coverage is provided through agreements by the System with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the System varies by line of coverage. \r\n \r\nWORKERS' COMPENSATION \r\n \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000 loss per occurrence, up to the statutory limit. \r\n \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2018 $ 1,147,123.44 2019 $ 1,554,698.12 \r\n \r\n$ 1,376,604.88 $ 931,949.66 \r\n \r\n$ 969,030.20 $ 1,086,614.99 \r\n \r\n$ 1,554,698.12 $ 1,400,032.79 \r\n \r\nUNEMPLOYMENT COMPENSATION \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. \r\n \r\nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2018 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n2019 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n6,302.97 \r\n \r\n$ \r\n \r\n6,302.97 \r\n \r\n$ \r\n \r\n- \r\n \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nSURETY BOND \r\n \r\nThe School District purchased a surety bond to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\nNOTE 9: FUND BALANCE CLASSIFICATION DETAILS \r\nThe School District's financial statements include the following amounts presented in the aggregate at June 30, 2019: \r\n \r\nNonspendable Inventories \r\n \r\n$ 4,330,526.33 \r\n \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\nAssigned Local Capital Outlay Projects School Activity Accounts \r\n \r\n$ 9,495,243.57 23,071,159.19 6,669,470.28 40,752,887.45 \r\n$ 3,543,034.14 2,632,553.68 \r\n \r\n79,988,760.49 6,175,587.82 \r\n \r\nUnassigned \r\n \r\n32,723,450.04 \r\n \r\nFund Balance, June 30, 2019 \r\n \r\n$ 123,218,324.68 \r\n \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\nIt is the goal of the School District to achieve and maintain a committed, assigned, and unassigned fund balance in the general fund at fiscal year-end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, in compliance with O.C.G.A.  20-2-167(a)5. If the unassigned fund balance at fiscal year-end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 10: SIGNIFICANT COMMITMENTS \r\nCOMMITMENTS UNDER CONSTRUCTION CONTRACTS \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2019, together with funding available: \r\n \r\nProject \r\n \r\nUnearned Executed Contracts (1) \r\n \r\nPayments through Funding Available June 30, 2019 (2) From State (1) \r\n \r\n19-676-001 \r\n \r\n$ \r\n \r\n19-676-002 \r\n \r\n19-676-003 \r\n \r\n19-676-004 \r\n \r\n19-676-005 \r\n \r\n19-676-006 \r\n \r\nCentral Registration Parking Improvements \r\n \r\nCentral Tennis Facility \r\n \r\nFood Processing Facility \r\n \r\nHVAC Upgrades - Central Office \r\n \r\nLake Joy Primary Parking Improvements \r\n \r\nNew Elementary School #12 \r\n \r\nNorthside High Competition Gym \r\n \r\nNorthside High Theater Renovation \r\n \r\nOld Perry Primary Demolition \r\n \r\nPerry High Competition Gym \r\n \r\nRussell Elementary Parking Improvements \r\n \r\nShirley Hills Elementary Parking Improvements \r\n \r\nWarner Robins High Competition Gym \r\n \r\nWestside Elementary Parking Improvements \r\n \r\n128,253.91 $ 159,840.29 \r\n98,489.51 186,831.62 183,620.77 \r\n188,987.65 1,215,241.72 132,008.88 613,045.75 366,046.91 19,246,149.27 7,126,648.26 798,713.76 \r\n467.28 244,545.22 214,950.86 175,485.77 5,365,363.07 280,284.58 \r\n \r\n1,151,520.09 $ 1,110,168.71 1,168,302.49 \r\n700,950.38 743,630.23 5,583,769.65 261,281.70 2,197,460.78 717,569.22 \r\n16,079.25 223,725.09 1,310,376.26 4,414,486.95 190,803.59 213,022.73 10,519,616.14 \r\n69,405.98 118,583.22 4,258,599.97 169,654.69 \r\n \r\n991,802.00 991,802.00 991,802.00 587,173.00 670,757.00 \r\n60,615.70 - \r\n \r\n$ \r\n \r\n36,724,975.08 $ 35,139,007.12 $ 4,293,951.70 \r\n \r\n(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts payable and retainages payable at year-end. \r\nNOTE 11: SIGNIFICANT CONTINGENT LIABILITIES \r\nFEDERAL GRANTS \r\nAmounts 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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\nLITIGATION \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District. \r\n \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB) \r\nGEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND \r\nPlan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board. \r\nBenefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted. \r\nContributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $8,031,819.00 for the year ended June 30, 2019. Active employees are not required to contribute to the School OPEB Fund. \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\nAt June 30, 2019, the School District reported a liability of $187,334,394.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2018. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2017. An expected total OPEB liability as of June 30, 2018 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2018. At June 30, 2018, the School District's proportion was 1.473949%, which was a decrease of 0.011043% from its proportion measured as of June 30, 2017. \r\n \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nFor the year ended June 30, 2019, the School District recognized OPEB expense of $7,229,018. At June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nDeferred Outflow of Resources \r\n \r\nOPEB \r\n \r\nDeferred Inflow of Resources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ \r\n \r\n- $ \r\n \r\n4,261,120.00 \r\n \r\nChanges of assumptions \r\n \r\n- \r\n \r\n31,735,347.00 \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n253,462.00 \r\n \r\n- \r\n \r\nChanges in proportion and difference between School District contributions and proportionate share of contributions \r\n \r\n- \r\n \r\n3,393,115.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n8,031,819.00 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 8,285,281.00 $ 39,389,582.00 \r\n \r\nSchool District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nOPEB \r\n \r\n2020 2021 2022 2023 2024 2025 \r\n \r\n$ (7,629,375.00) $ (7,629,375.00) $ (7,629,375.00) $ (7,644,517.00) $ (6,257,591.00) $ (2,345,887.00) \r\n \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nActuarial assumptions: The total OPEB liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2018: \r\n \r\nOPEB: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  9.00%, including inflation \r\n \r\nLong-term expected rate of return \r\n \r\n7.30%, compounded annually, net of investment expense, and including inflation \r\n \r\nHealthcare cost trend rate Pre-Medicare Eligible Medicare Eligible \r\n \r\n7.50% 5.50% \r\n \r\nUltimate trend rate Pre-Medicare Eligible Medicare Eligible \r\n \r\n4.75% 4.75% \r\n \r\nYear of Ultimate trend rate \r\n \r\nPre-Medicare Eligible Medicare Eligible \r\n \r\n2028 2022 \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows: \r\n \r\n For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement. \r\n For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement. \r\n \r\nThe actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014. \r\n \r\nThe remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2017 valuation were based on a review of recent plan experience done concurrently with the June 30, 2017 valuation. \r\n \r\nProjection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation. \r\n \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. During fiscal year 2018, the School OPEB fund updated their investment strategy to a more long-term approach. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nTarget allocation \r\n \r\nLong-Term Expected Real Rate of Return* \r\n \r\nFixed income Domestic Stocks -- Large Cap Domestic Stocks -- Mid Cap Domestic Stocks -- Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatives \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% \r\n12.00% 13.50% \r\n8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n*Net of Inflation \r\n \r\nDiscount rate: The discount rate has changed since the prior measurement date from 3.58% to 3.87%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.87% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.87% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2118. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2018. Therefore, the calculated discount rate of 3.87% was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.87%, as well as, what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.87%) or 1 percentage-point higher (4.87%) than the current discount rate: \r\n \r\n1% Decrease (2.87%) \r\n \r\nCurrent Discount Rate (3.87%) \r\n \r\n1% Increase (4.87%) \r\n \r\nSchool District's proportionate share of the Net OPEB Liability \r\n \r\n$ 218,747,834.00 $ 187,334,394.00 $ 162,002,742.00 \r\n \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB liability, as well as, what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1percentage-point higher than the current healthcare cost trend rates: \r\n \r\n1% Decrease \r\n \r\nCurrent Healthcare Cost Trend Rate \r\n \r\n1% Increase \r\n \r\nSchool District's proportionate share of the Net OPEB Liability \r\n \r\n$ 157,493,534.00 $ \r\n \r\n187,334,394.00 $ 225,469,915.00 \r\n \r\nOPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports. \r\n \r\nPOSTEMPLOYEMENT BENEFITS OTHER THAN PENSIONS (SEAD  OPEB) \r\nP lan description: SEAD-OPEB was created in 2007 by the Georgia General Assembly to amend Title 47 of the O.C.G.A., relating to retirement, so as to establish a fund for the provision of term life insurance to retired and vested inactive members of the Employees' Retirement System of Georgia (ERS), the Legislative Retirement System (LRS), and the Georgia Judicial Retirement System (GJRS). The plan is a cost-sharing multiple-employer defined benefit other postemployment benefit plan as defined in Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefit Plans other than OPEB Plans. The SEAD-OPEB trust fund accumulates the premiums received from the aforementioned retirement plans, including interest earned on deposits and investments of such payments. \r\n \r\nBenefits provided: The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance in effect on the date of retirement. The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance in effect at age 60 or at termination, if earlier. Life insurance proceeds are paid in a lump sum to the beneficiary upon death of the retiree. \r\n \r\nContributions: Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable \r\ncompensation. There were no employer contributions required for the fiscal year ended June 30, 2019. \r\n \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\n \r\nAt June 30, 2019, the Employer reported an asset of $84,745.00 for its proportionate share of the net OPEB liability (asset). The net OPEB liability (asset) was measured as of June 30, 2018. The total OPEB liability (asset) used to calculate the net OPEB liability (asset) was based on an actuarial valuation as of June 30, 2017. An expected total OPEB liability (asset) as of June 30, 2018 was determined using standard roll-forward techniques. The Employer's proportion of the net OPEB liability (asset) was based on actual member salaries reported to the SEAD-OPEB plan during the fiscal year ended June 30, 2018. At June 30, 2018, the Employer's proportion was 0.031312%, which was a decrease of 0.000125% from its proportion measured as of June 30, 2017. \r\n \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nFor the year ended June 30, 2019, the Employer recognized OPEB income of $8,338.00. At June 30, 2019, the Employer reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nSEAD - OPEB \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflow of \r\n \r\nInflow of \r\n \r\nResources \r\n \r\nResources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ \r\n \r\n926.00 $ \r\n \r\n- \r\n \r\nChanges of assumptions \r\n \r\n4,354.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n14,010.00 \r\n \r\nChanges in proportion and difference between School District contributions and proportionate share of contributions \r\n \r\n173.00 \r\n \r\n1,372.00 \r\n \r\nTotal \r\n \r\n$ \r\n \r\n5,453.00 $ \r\n \r\n15,382.00 \r\n \r\nThere were no employer contributions subsequent to the measurement date. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nSEAD - OPEB \r\n \r\n2020 \r\n \r\n$ (2,444.00) \r\n \r\n2021 \r\n \r\n$ (2,035.00) \r\n \r\n2022 \r\n \r\n$ (4,280.00) \r\n \r\n2023 \r\n \r\n$ (1,170.00) \r\n \r\nActuarial assum ptions: The total OPEB liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 Based on the funding policy adopted by the Board on March 15, 2018, the investment rate of return assumption will be changed to 7.30% in the June 30, 2018 actuarial valuation. Therefore, the investment rate of return used in the roll-forward of the total pension liability is 7.30% using the following actuarial assumptions, applied to all periods included in the measurement: \r\n \r\nSEAD  OPEB: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases: \r\n \r\nERS \r\n \r\n3.25%  7.00% \r\n \r\nGJRS \r\n \r\n4.50% \r\n \r\nLRS \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of OPEB plan investment expense, including inflation \r\n \r\nHealthcare cost trend rate \r\n \r\nN/A \r\n \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nPostretirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. There is a margin for future mortality improvement in the tables used by the plan. \r\nThe actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nSEAD - OPEB Target \r\nallocation \r\n \r\nLong-term expected real rate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n* Rates shown are net of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total OPEB liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the OPEB plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the Employer's proportionate share of the net OPEB liability calculated using the discount rate of 7.30 %, as well as what the Employer's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.30 %) or 1- percentage-point higher (8.30 %) than the current rate: \r\n \r\n1% Decrease (6.30%) \r\n \r\nCurrent Discount Rate (7.30%) \r\n \r\n1% Increase (8.30%) \r\n \r\nNet OPEB Asset \r\n \r\n$ (45,660.00) $ \r\n \r\n(84,745.00) $ (116,781.00) \r\n \r\nOP EB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the separately issued ERS comprehensive annual financial report which is publically \r\navailable at www.ers.ga.gov/financials. \r\n \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 13: RETIREMENT PLANS \r\nThe School District participates in various retirement plans administered by the State of Georgia, as further explained below. \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \r\nP lan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications. \r\nBenefits P rovided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2019. The School District's contractually required contribution rate for the year ended June 30, 2019 was 20.90% of annual School District payroll, of which 20.83% of payroll was required from the School District and 0.07% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $34,992,210.70 and $105,588.93 from the School District and the State, respectively. \r\nEMPLOYEES' RETIREMENT SYSTEM \r\nP lan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\n \r\n- 31 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2019 was 24.78% of annual covered payroll for old and new plan members and 21.78% for GSEPS members. The rates include the annual actuarially determined employer contribution rate of 24.66% of annual covered payroll of new and old plan members and 21.66% for GSEPES members, plus a 0.12% adjustment for the HB 751 one-time benefit adjustment of 3% to retired state employees. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $81,690.76 for the current fiscal year. \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS) \r\nP lan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\nUpon retirement, the member will receive a monthly benefit of $15.00, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\n \r\n- 32 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $588,990.00. \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\n \r\nAt June 30, 2019, the School District reported a liability of $253,400,887.00 for its proportionate share of the net pension liability for TRS ($252,702,217.00) and ERS ($698,670.00). \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n$ 252,702,217.00 \r\n \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n809,495.00 \r\n \r\nTotal \r\n \r\n$ 253,511,712.00 \r\n \r\nThe net pension liability for TRS and ERS was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2018. \r\nAt June 30, 2018, the School District's TRS proportion was 1.361385%, which was a decrease of 0.025056% from its proportion measured as of June 30, 2017. At June 30, 2018, the School District's ERS proportion was 0.016995%, which was a decrease of 0.001669% from its proportion measured as of June 30, 2017. \r\nAt June 30, 2019, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $3,508,395.00. \r\nThe PSERS net pension liability was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2018. \r\nFor the year ended June 30, 2019, the School District recognized pension expense of $23,886,032.00 for TRS, $58,845.00 for ERS and $812,321.00 for PSERS and revenue of $41,883.00 for TRS and $812,321.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\n- 33 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nAt June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: \r\n \r\nTRS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflow of \r\n \r\nIntflow of \r\n \r\nResources \r\n \r\nResources \r\n \r\nDeferred Outflow of Resources \r\n \r\nERS Deferred Intflow of Resources \r\n \r\nDifferences between expected and \r\n \r\nactual experience \r\n \r\n$ 16,729,243.00 $ 520,825.00 $ 21,730.00 $ \r\n \r\n- \r\n \r\nChanges of assumptions \r\n \r\n3,813,185.00 \r\n \r\n- \r\n \r\n32,916.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n6,909,369.00 \r\n \r\n- \r\n \r\n16,101.00 \r\n \r\nChanges in proportion and difference between School District contributions and proportionate share of contributions \r\n \r\n4,482,936.00 13,392,875.00 \r\n \r\n- \r\n \r\n43,894.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n34,992,210.70 \r\n \r\n- \r\n \r\n81,690.76 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 60,017,574.70 $ 20,823,069.00 $ 136,336.76 $ 59,995.00 \r\n \r\nThe School District contributions subsequent to the measurement date for TRS and for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nTRS \r\n \r\nERS \r\n \r\n2020 2021 2022 2023 2024 \r\n \r\n$ 11,084,198.00 $ 24,103.00 \r\n \r\n$ \r\n \r\n4,580,124.00 $ \r\n \r\n4,508.00 \r\n \r\n$ (10,324,204.00) $ (26,765.00) \r\n \r\n$ (1,289,760.00) $ (7,195.00) \r\n \r\n$ \r\n \r\n151,937.00 $ \r\n \r\n- \r\n \r\nActuarial assum ptions: The total pension liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017, using the following actuarial assumptions, applied to all periods \r\nincluded in the measurement: \r\n \r\nTeachers Retirement System: \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  9.00%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\n- 34 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nPost-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nEmployees' Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  7.00%, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP- 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nPublic School Employees Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.30%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\nThe actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\n- 35 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nTRS Target allocation \r\n \r\nERS/PSERS Target \r\nallocation \r\n \r\nLong-term expected real rate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 39.80% \r\n3.70% 1.50% 19.40% 5.60% \r\n- \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n100.00% \r\n \r\n* Rates shown are net of the 2.75% assumed rate of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total TRS pension liability was 7.50%. The discount rate used to measure the total ERS and PSERS pension liability was 7.30%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\n \r\nSensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50% and 7.30%, as well as, what the School \r\nDistrict's proportionate share of the net pension liability would be if it were calculated using a discount \r\nrate that is 1-percentage-point lower (6.50% and 6.30%) or 1-percentage-point higher (8.50% \r\nand 8.30%) than the current rate: \r\n \r\nTeachers Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\n$ 421,832,358.00 $ 252,702,217.00 $ 113,330,373.00 \r\n \r\nEmployees' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.30%) \r\n \r\nCurrent Discount Rate \r\n(7.30%) \r\n \r\n1% Increase (8.30%) \r\n \r\n$ \r\n \r\n993,756.00 $ \r\n \r\n698,670.00 $ \r\n \r\n447,250.00 \r\n \r\n- 36 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2019 \r\n \r\nEXHIBIT \"H\" \r\n \r\nP ension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publicly \r\navailable at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs.html. \r\n \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, the School District began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\n \r\nThe School District selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\n \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\n \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County School District. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the School District. \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2019 2018 2017 \r\n \r\n100% 100% 100% \r\n \r\n$ \r\n \r\n233,484.22 \r\n \r\n$ \r\n \r\n199,262.27 \r\n \r\n$ \r\n \r\n167,113.99 \r\n \r\nNOTE 14: TAX ABATEMENTS \r\nThe School District property tax revenues were reduced by $704,609.59 under agreements entered into by the Houston County Development Authority (Development Authority). The Development Authority issued revenue bonds to provide capital financing for several local businesses. \r\n \r\nIncluded in the amount abated, the following are individual tax abatement agreements that each exceeded 10 percent of the total amount abated: \r\n \r\n A manufacturing plant expansion. The abatement amounted to $88,304.49.  A manufacturing plant expansion. The abatement amounted to $74,720.18.  A manufacturing plant expansion. The abatement amounted to $107,302.42.  A manufacturing plant expansion. The abatement amounted to $141,582.71. \r\n \r\n- 37 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEMS OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"1\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the net pension \r\nliability \r\n \r\nSchool District's proportionate share of \r\nthe net pension liability \r\n \r\nState of Georgia's proportionate share of the net pension liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its \r\ncovered payroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\n2019 2018 2017 2016 2015 \r\n \r\n1.361385% $ 1.386441% $ 1.478342% $ 1.418023% $ 1.412022% $ \r\n \r\n252,702,217.00 $ 257,674,330.00 $ 304,998,438.00 $ 215,879,921.00 $ 178,390,355.00 $ \r\n \r\n809,495.00 $ 253,511,712.00 $ 162,856,788.80 875,182.00 $ 258,549,512.00 $ 158,922,980.04 1,090,354.00 $ 306,088,792.00 $ 162,747,774.99 852,392.00 $ 216,732,313.00 $ 150,299,368.59 719,867.00 $ 179,110,222.00 $ 144,097,581.27 \r\n \r\n155.17% 162.14% 187.41% 143.63% 123.80% \r\n \r\n80.27% 79.33% 76.06% 81.44% 84.03% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 39 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"2\" \r\n \r\nYear Ended \r\n2019 2018 2017 2016 2015 \r\n \r\nSchool District's proportion of the \r\nnet pension liability \r\n \r\nSchool District's proportionate share of the net pension \r\nliability \r\n \r\nSchool District's covered payroll \r\n \r\n0.016995% $ 0.018664% $ 0.018934% $ 0.018205% $ 0.017996% $ \r\n \r\n698,670.00 $ 758,008.00 $ 895,658.00 $ 737,557.00 $ 674,961.00 $ \r\n \r\n440,647.76 457,801.02 440,233.56 416,239.34 405,211.66 \r\n \r\nSchool District's proportionate share of the net pension liability \r\nas a percentage of covered payroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\n158.56% 165.58% 203.45% 177.20% 166.57% \r\n \r\n76.68% 76.33% 72.34% 76.20% 77.99% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 40 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"3\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the the net pension \r\nliability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nState of Georgia's proportionate share of the net pension liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its \r\ncovered payroll \r\n \r\nPlan fiduciary net position as a percentage of the total pension liability \r\n \r\n2019 2018 2017 2016 2015 \r\n \r\n0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ \r\n \r\n- \r\n \r\n$ \r\n \r\n3,508,395.00 $ 3,508,395.00 $ 11,060,129.01 \r\n \r\n- \r\n \r\n$ \r\n \r\n3,218,420.00 $ 3,218,420.00 $ 10,507,779.29 \r\n \r\n- \r\n \r\n$ \r\n \r\n4,098,431.00 $ 4,098,431.00 $ 10,489,156.64 \r\n \r\n- \r\n \r\n$ \r\n \r\n2,607,682.00 $ 2,607,682.00 $ 10,330,432.81 \r\n \r\n- \r\n \r\n$ \r\n \r\n2,303,408.00 $ 2,303,408.00 $ 10,016,811.88 \r\n \r\nN/A \r\n \r\n85.26% \r\n \r\nN/A \r\n \r\n85.69% \r\n \r\nN/A \r\n \r\n81.00% \r\n \r\nN/A \r\n \r\n87.00% \r\n \r\nN/A \r\n \r\n88.29% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 41 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY \r\nSCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"4\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the net \r\nOPEB liability \r\n \r\nSchool District's proportionate share of the net OPEB liability \r\n \r\nState of Georgia's proportionate share of the net OPEB liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as \r\na percentage of its covered-employee \r\npayroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total OPEB liability \r\n \r\n2019 2018 2017 \r\n \r\n1.473949% $ 187,334,394.00 $ 1.484992% $ 208,640,779.00 $ 1.504207% $ 222,927,776.00 $ \r\n \r\n- \r\n \r\n$ 187,334,394.00 $ 123,412,244.61 \r\n \r\n- \r\n \r\n$ 208,640,779.00 $ 121,721,036.65 \r\n \r\n- \r\n \r\n$ 222,927,776.00 $ 117,333,618.48 \r\n \r\n151.80% 171.41% 189.99% \r\n \r\n2.93% 1.61% 0.64% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 42 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB ASSET \r\nSEAD - OPEB FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"5\" \r\n \r\nYear Ended \r\n2019 2018 \r\n \r\nSchool District's proportion of the net OPEB asset \r\n \r\nSchool District's proportionate share of the net \r\nOPEB asset \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as a \r\npercentage of its coveredemployee payroll \r\n \r\n0.031312% $ 0.031437% $ \r\n \r\n(84,745.00) $ (81,706.00) $ \r\n \r\n440,647.76 457,801.02 \r\n \r\n(19.23%) (17.85%) \r\n \r\nPlan fiduciary net position as a percentage of the total OPEB liability \r\n129.46% 130.17% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 43 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"6\" \r\n \r\nYear Ended \r\n2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered payroll \r\n \r\nContributions as a percentage of covered payroll \r\n \r\n$ \r\n \r\n34,992,210.70 $ \r\n \r\n$ \r\n \r\n27,288,902.73 $ \r\n \r\n$ \r\n \r\n22,601,157.09 $ \r\n \r\n$ \r\n \r\n23,141,378.51 $ \r\n \r\n$ \r\n \r\n19,687,721.71 $ \r\n \r\n$ \r\n \r\n17,625,185.67 $ \r\n \r\n$ \r\n \r\n16,298,602.09 $ \r\n \r\n$ \r\n \r\n14,377,512.24 $ \r\n \r\n$ \r\n \r\n13,884,720.11 $ \r\n \r\n$ \r\n \r\n13,544,690.10 $ \r\n \r\n34,992,210.70 $ 27,288,902.73 $ 22,601,157.09 $ 23,141,378.51 $ 19,687,721.71 $ 17,625,185.67 $ 16,298,602.09 $ 14,377,512.24 $ 13,884,720.11 $ 13,544,690.10 $ \r\n \r\n- \r\n \r\n$ 167,951,497.07 \r\n \r\n- \r\n \r\n$ 162,856,788.80 \r\n \r\n- \r\n \r\n$ 158,922,980.04 \r\n \r\n- \r\n \r\n$ 162,747,774.99 \r\n \r\n- \r\n \r\n$ 150,299,368.59 \r\n \r\n- \r\n \r\n$ 144,097,581.27 \r\n \r\n- \r\n \r\n$ 143,401,483.17 \r\n \r\n- \r\n \r\n$ 140,498,203.02 \r\n \r\n- \r\n \r\n$ 135,846,018.48 \r\n \r\n- \r\n \r\n$ 139,920,328.55 \r\n \r\n20.83% 16.76% 14.22% 14.22% 13.10% 12.23% 11.37% 10.23% 10.22% \r\n9.68% \r\n \r\n- 44 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"7\" \r\n \r\nYear Ended \r\n2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\n$ \r\n \r\n81,690.76 $ \r\n \r\n81,690.76 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n109,324.76 $ \r\n \r\n109,324.76 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n113,580.49 $ \r\n \r\n113,580.49 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n108,825.61 $ \r\n \r\n108,825.61 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n91,406.16 $ \r\n \r\n91,406.16 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n74,802.06 $ \r\n \r\n74,802.06 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n53,504.66 $ \r\n \r\n53,504.66 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n35,683.88 $ \r\n \r\n35,683.88 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,845.78 $ \r\n \r\n29,845.78 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,313.50 $ \r\n \r\n29,313.50 $ \r\n \r\n- \r\n \r\nSchool District's covered payroll \r\n \r\nContributions as a percentage of covered payroll \r\n \r\n$ \r\n \r\n329,664.21 \r\n \r\n$ \r\n \r\n440,647.76 \r\n \r\n$ \r\n \r\n457,801.02 \r\n \r\n$ \r\n \r\n440,233.56 \r\n \r\n$ \r\n \r\n416,239.34 \r\n \r\n$ \r\n \r\n405,211.66 \r\n \r\n$ \r\n \r\n359,091.68 \r\n \r\n$ \r\n \r\n306,826.14 \r\n \r\n$ \r\n \r\n286,702.98 \r\n \r\n$ \r\n \r\n281,589.82 \r\n \r\n24.78% 24.81% 24.69% 24.72% 21.96% 18.46% 14.90% 11.63% 10.41% 10.41% \r\n \r\n- 45 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"8\" \r\n \r\nContractually required \r\n \r\nYear Ended \r\n \r\ncontribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nContributions as a percentage of covered- \r\nemployee payroll \r\n \r\n2019 2018 2017 \r\n \r\n$ 8,031,819.00 $ $ 7,665,615.00 $ $ 7,742,869.00 $ \r\n \r\n8,031,819.00 $ 7,665,615.00 $ 7,742,869.00 $ \r\n \r\n- \r\n \r\n$ 127,221,476.44 \r\n \r\n- \r\n \r\n$ 123,412,244.61 \r\n \r\n- \r\n \r\n$ 121,721,036.65 \r\n \r\n6.31% 6.21% 6.36% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 46 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SEAD - OPEB \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"9\" \r\n \r\nYear Ended \r\n2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 \r\n \r\nContractually required contribution \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n329,664.21 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n440,647.76 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n457,801.02 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n440,233.56 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n416,239.34 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n405,211.66 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n359,091.68 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n306,826.14 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n286,702.98 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n281,589.82 \r\n \r\nContributions as a percentage of \r\ncovered-employee payroll \r\n0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% \r\n \r\n- 47 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\nFOR THE YEAR ENDED JUNE 30, 2019 \r\n \r\nSCHEDULE \"10\" \r\n \r\nTeachers Retirement System \r\n \r\nChanges of assumptions: On November 18, 2015, th-e Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The \r\n \r\nexpectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the \r\n \r\nSociety of Actuaries' projection scale BB (set forward one year for males). \r\n \r\n \r\n \r\nIn 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. \r\n \r\nEmployees' Retirement System \r\nChanges of benefit terms: A new benefit tier was added for members joining the System on and after July 1, 2009. A one-time 3% payment was granted to certain retirees and beneficiaries effective July 2016. A one-time 3% payment was granted to certain retirees and beneficiaries effective July 2017. \r\nChanges of assumptions: On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. \r\nOn December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. \r\n \r\nPublic School Employees Retirement System \r\nChanges of assumptions: On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date. \r\nOn-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (-set forward 3 years for males and 2 years for females). \r\nIn 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. \r\n \r\nSchool OPEB Fund \r\nChanges of benefit terms: There have been no changes in benefit terms. \r\nChanges of assumptions: June 30, 2017 valuation: the June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to the State OPEB fund based on their last employer payroll location: irrespective of retirement affiliation. \r\nThe discount rate was updated from 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018. \r\nSEAD-OPEB Employer \r\nChanges of benefit terms: There have been no changes in benefit terms. \r\nChanges of assumptions: June 30, 2017 valuation: the June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to the State OPEB fund based on their last employer payroll location: irrespective of retirement affiliation. \r\nThe discount rate was updated from 3.60% as of June 30, 2017 to 5.22% as of June 30, 2018. \r\n \r\n- 48 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION GENERAL FUND \r\nSCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL \r\nYEAR ENDED JUNE 30, 2019 \r\n \r\nSCHEDULE \"11\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nDebt Service \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nOther Sources Other Uses \r\nTotal Other Financing Sources (Uses) \r\nSPECIAL ITEMS \r\nProceeds from Sale of Assets \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nNONAPPROPRIATED BUDGETS \r\n \r\nORIGINAL (1) \r\n \r\nFINAL (1) \r\n \r\nACTUAL AMOUNTS \r\n \r\nVARIANCE OVER/UNDER \r\n \r\n$ 54,300,000.00 $ 24,306,119.00 \r\n193,906,724.00 30,129,314.00 8,408,699.04 805,301.79 5,895,247.31 \r\n \r\n55,900,000.00 $ 24,261,119.00 193,011,941.00 31,560,334.00 \r\n8,408,699.00 1,235,301.00 6,095,247.00 \r\n \r\n55,731,165.01 $ 27,655,220.95 193,976,164.21 31,344,068.62 \r\n8,686,953.38 1,249,504.38 6,141,460.54 \r\n \r\n317,751,405.14 \r\n \r\n320,472,641.00 \r\n \r\n324,784,537.09 \r\n \r\n(168,834.99) 3,394,101.95 \r\n964,223.21 (216,265.38) 278,254.38 \r\n14,203.38 46,213.54 \r\n4,311,896.09 \r\n \r\n199,620,650.11 \r\n15,117,284.00 6,175,244.00 2,129,041.00 4,193,456.00 2,148,565.00 \r\n21,130,059.00 2,698,755.00 \r\n22,632,625.00 13,568,962.00 \r\n4,168,980.00 1,333,164.00 2,411,656.00 1,102,200.00 19,928,799.03 \r\n- \r\n318,359,440.14 \r\n(608,035.00) \r\n \r\n197,505,637.00 \r\n14,732,311.00 6,299,711.00 2,671,109.00 4,065,029.00 2,141,591.00 \r\n20,855,059.00 2,735,099.00 \r\n23,208,944.00 14,325,923.00 \r\n4,106,913.00 1,519,779.00 2,411,656.00 1,102,200.00 19,928,799.00 \r\n- \r\n317,609,760.00 \r\n2,862,881.00 \r\n \r\n197,448,493.11 \r\n14,718,129.45 6,351,718.68 2,634,044.55 4,057,615.25 1,774,584.19 \r\n20,646,229.76 2,721,304.10 \r\n23,285,778.57 13,722,153.59 \r\n4,080,989.58 1,284,433.40 2,431,685.59 1,128,512.14 19,783,279.99 \r\n665,830.62 \r\n316,734,782.57 \r\n8,049,754.52 \r\n \r\n57,143.89 \r\n14,181.55 (52,007.68) 37,064.45 \r\n7,413.75 367,006.81 208,829.24 \r\n13,794.90 (76,834.57) 603,769.41 25,923.42 235,345.60 (20,029.59) (26,312.14) 145,519.01 (665,830.62) \r\n874,977.43 \r\n5,186,873.52 \r\n \r\n3,081,985.77 (3,185,543.29) \r\n(103,557.52) \r\n \r\n3,453,985.77 (6,962,543.29) \r\n(3,508,557.52) \r\n \r\n(3,405,000.00) \r\n(3,405,000.00) \r\n \r\n(3,453,985.77) 3,557,543.29 \r\n103,557.52 \r\n \r\n(711,592.52) 47,452,358.00 \r\n \r\n(645,676.52) 47,536,462.98 \r\n \r\n350,000.00 4,994,754.52 84,939,906.55 \r\n \r\n350,000.00 5,640,431.04 37,403,443.57 \r\n \r\n$ 46,740,765.48 $ \r\n \r\n46,890,786.46 $ \r\n \r\n89,934,661.07 $ \r\n \r\n43,043,874.61 \r\n \r\nNotes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual \r\n(1) Original and Final Budget amounts do not include the Restricted Other - Property Tax Rollback fund balance in the beginning or ending fund balances. \r\nThe accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 49 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2019 \r\n \r\nSCHEDULE \"12\" \r\n \r\nFUNDING AGENCY PROGRAM/GRANT \r\nAgriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program \r\nTotal Child Nutrition Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Food Services Fresh Fruit and Vegetable Program \r\nTotal U. S. Department of Agriculture \r\nEducation, U. S. Department of Impact Aid Cluster Direct Impact Aid \r\nSpecial Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants Preschool Grants \r\nTotal Special Education Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to Schools Education for Homeless Children and Youth English Language Acquisition Grants English Language Acquisition Grants Language Instruction for Immigrant Students Mathematics and Science Partnerships Migrant Education - State Grant Program Migrant Education - State Grant Program School Improvement Grant Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Supporting Effective Instruction Supporting Effective Instruction Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies \r\nTotal Other Programs \r\nTotal U. S. Department of Education \r\nDefense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program P.L 102-375 \r\nTotal U. S. Department of Defense \r\nFederal Emergency Management Agency Pass-Through From Georgia Emergency Management Agency Disaster Relief \r\n \r\nCFDA NUMBER \r\n \r\nPASSTHROUGH \r\nENTITY ID \r\nNUMBER \r\n \r\nEXPENDITURES IN PERIOD \r\n \r\n10.553 10.555 \r\n \r\n195GA324N1099 $ 195GA324N1100 \r\n \r\n4,410,477.44 14,556,222.32 \r\n18,966,699.76 \r\n \r\n10.582 \r\n \r\n195GA324L1603 \r\n \r\n98,217.51 19,064,917.27 \r\n \r\n84.041 \r\n \r\n1,834,228.67 \r\n \r\n84.027 84.173 84.173 \r\n \r\nH027A180073 H173A170081 H173A180081 \r\n \r\n84.048 84.196 84.365 84.365 84.365 84.366 84.011 84.011 84.010 84.424 84.424 84.367 84.367 84.010 84.010 \r\n \r\nV048A180010 S196A180011 S365A170010 S365A180010 S365A180010 S366B170011 S011A170011 S011A180011 S010A180010 S424A170011 S424A180011 S367A170001 S367A180001 S010A170010 S010A180010 \r\n \r\n4,914,556.53 543.00 \r\n148,229.00 \r\n5,063,328.53 \r\n250,358.00 42,227.00 149.00 \r\n102,522.60 14,408.89 49,735.91 414.00 44,142.00 340.56 10,239.00 \r\n402,343.69 92,142.17 \r\n697,071.65 266,015.00 6,189,823.00 \r\n8,161,932.47 \r\n15,059,489.67 \r\n \r\n12.UNKNOWN 97.036 \r\n \r\n343,073.53 380,712.68 723,786.21 \r\n7,571.28 \r\n \r\nTotal Expenditures of Federal Awards \r\n \r\n$ \r\n \r\nNotes to the Schedule of Expenditures of Federal Awards \r\n \r\nNote 1. Basis of Presentation \r\n \r\nThe accompanying schedule of expenditures of federal awards (the \"Schedule\") includes the Federal award activity of the Houston County Board of Education (the \"Board\") under programs of the federal government for the year ended June 30, 2019. The information in this Schedule is presented under the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board. \r\n \r\nNote 2. Summary of Significant Accounting Policies \r\n \r\nExpenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. \r\n \r\nNote 3. Indirect Cost Rate \r\n \r\nThe Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. \r\n \r\n34,855,764.43 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 50 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2019 \r\n \r\nSCHEDULE \"13\" \r\n \r\nAGENCY/FUNDING \r\nGRANTS Bright from the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program \r\nEducation, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations One Time QBE Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Military Counselors Preschool Handicapped Program Pupil Transportation - State Bonds School Safety Grant Teachers Retirement Vocational Education \r\nGeorgia Emergency Management Agency Disaster Relief \r\nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \r\nCONTRACT Human Services, Georgia Department of Second Step Social-Emotional Learning \r\nOffice of the State Treasurer Public School Employees Retirement \r\n \r\nGOVERNMENTAL FUND TYPES \r\n \r\nCAPITAL \r\n \r\nGENERAL \r\n \r\nPROJECTS \r\n \r\nFUND \r\n \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ \r\n \r\n4,380,707.47 $ \r\n \r\n- $ \r\n \r\n4,380,707.47 \r\n \r\n10,225,296.00 380,068.00 \r\n23,625,980.00 1,516,077.00 \r\n12,020,699.00 1,143,725.00 \r\n20,845,222.00 16,656,910.00 \r\n5,256,855.00 25,653,609.00 12,709,541.00 \r\n517,127.00 1,420,602.00 1,561,056.00 3,553,694.00 1,047,270.00 \r\n588,971.00 10,126.00 \r\n3,430,045.00 6,847,780.00 7,717,930.00 (1,403,325.00) \r\n1,594,633.00 599,550.00 28,598.00 \r\n28,351,372.00 \r\n447,942.00 294,165.11 \r\n40,468.00 554,410.00 412,880.00 216,877.00 105,588.93 955,462.00 \r\n1,009.50 \r\n \r\n- \r\n \r\n10,225,296.00 \r\n \r\n- \r\n \r\n380,068.00 \r\n \r\n- \r\n \r\n23,625,980.00 \r\n \r\n- \r\n \r\n1,516,077.00 \r\n \r\n- \r\n \r\n12,020,699.00 \r\n \r\n- \r\n \r\n1,143,725.00 \r\n \r\n- \r\n \r\n20,845,222.00 \r\n \r\n- \r\n \r\n16,656,910.00 \r\n \r\n- \r\n \r\n5,256,855.00 \r\n \r\n- \r\n \r\n25,653,609.00 \r\n \r\n- \r\n \r\n12,709,541.00 \r\n \r\n- \r\n \r\n517,127.00 \r\n \r\n- \r\n \r\n1,420,602.00 \r\n \r\n- \r\n \r\n1,561,056.00 \r\n \r\n- \r\n \r\n3,553,694.00 \r\n \r\n- \r\n \r\n1,047,270.00 \r\n \r\n- \r\n \r\n588,971.00 \r\n \r\n- \r\n \r\n10,126.00 \r\n \r\n- \r\n \r\n3,430,045.00 \r\n \r\n- \r\n \r\n6,847,780.00 \r\n \r\n- \r\n \r\n7,717,930.00 \r\n \r\n- \r\n \r\n(1,403,325.00) \r\n \r\n- \r\n \r\n1,594,633.00 \r\n \r\n- \r\n \r\n599,550.00 \r\n \r\n- \r\n \r\n28,598.00 \r\n \r\n- \r\n \r\n28,351,372.00 \r\n \r\n- \r\n \r\n447,942.00 \r\n \r\n- \r\n \r\n294,165.11 \r\n \r\n- \r\n \r\n40,468.00 \r\n \r\n- \r\n \r\n554,410.00 \r\n \r\n- \r\n \r\n412,880.00 \r\n \r\n- \r\n \r\n216,877.00 \r\n \r\n- \r\n \r\n105,588.93 \r\n \r\n- \r\n \r\n955,462.00 \r\n \r\n- \r\n \r\n1,009.50 \r\n \r\n- \r\n \r\n2,068,662.30 \r\n \r\n2,068,662.30 \r\n \r\n78,253.20 588,990.00 \r\n \r\n- \r\n \r\n78,253.20 \r\n \r\n- \r\n \r\n588,990.00 \r\n \r\n$ 193,976,164.21 $ 2,068,662.30 $ 196,044,826.51 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 51 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\nYEAR ENDED JUNE 30, 2019 \r\n \r\nSCHEDULE \"14\" \r\n \r\nPROJECT \r\n \r\nORIGINAL ESTIMATED \r\nCOST (1) \r\n \r\nCURRENT ESTIMATED COSTS (2) \r\n \r\nAMOUNT EXPENDED IN CURRENT YEAR (3) (4) \r\n \r\nAMOUNT EXPENDED IN PRIOR YEARS (3) (4) \r\n \r\nTOTAL COMPLETION \r\nCOST \r\n \r\nEXCESS PROCEEDS NOT \r\nEXPENDED \r\n \r\n2012 SPLOST \r\n \r\n(1) Acquiring instructional and \r\n \r\nadministrative technology equipment; \r\n \r\n$ \r\n \r\n- $ 20,448,779.00 \r\n \r\n- $ 20,448,778.64 $ 20,448,778.64 $ \r\n \r\n- \r\n \r\n(2) Acquiring safety and security \r\n \r\nequipment; \r\n \r\n- \r\n \r\n1,659,728.00 \r\n \r\n- \r\n \r\n1,659,728.02 \r\n \r\n1,659,728.02 \r\n \r\n(3) Adding to, renovating, repairing, \r\n \r\nimproving, and equipping existing \r\n \r\nschool buildings and other buildings \r\n \r\nand facilities; \r\n \r\n- \r\n \r\n44,414,364.00 \r\n \r\n840,031.59 \r\n \r\n43,574,332.37 \r\n \r\n44,414,363.96 \r\n \r\n- \r\n \r\n(4) Acquiring, constructing, and \r\n \r\nequipping two replacement \r\n \r\nelementary schools; \r\n \r\n- \r\n \r\n26,508,184.00 \r\n \r\n- \r\n \r\n26,508,183.93 \r\n \r\n26,508,183.93 \r\n \r\n- \r\n \r\n(5) Acquiring, constructing, and \r\n \r\nequipping a central transportation \r\n \r\n(bus) facility; \r\n \r\n- \r\n \r\n6,506,310.00 \r\n \r\n- \r\n \r\n6,506,310.17 \r\n \r\n6,506,310.17 \r\n \r\n- \r\n \r\n(6) Acquiring, constructing, and \r\n \r\nequipping stadium and tennis facilities; \r\n \r\n- \r\n \r\n15,513,653.00 \r\n \r\n2,197,460.78 \r\n \r\n12,063,652.92 \r\n \r\n14,261,113.70 \r\n \r\n- \r\n \r\n(7) Acquiring any necessary property, \r\n \r\nboth real and personal; and \r\n \r\n- \r\n \r\n1,222,145.00 \r\n \r\n- \r\n \r\n1,222,145.37 \r\n \r\n1,222,145.37 \r\n \r\n- \r\n \r\n(8) Paying (Legal and Administrative) \r\n \r\nexpenses incident to accomplishing \r\n \r\nthe foregoing. \r\n \r\n- \r\n \r\n472,923.00 \r\n \r\n- \r\n \r\n472,923.22 \r\n \r\n472,923.22 \r\n \r\n- \r\n \r\n$ 125,000,000.00 $ 116,746,086.00 $ 3,037,492.37 $ 112,456,054.64 $ 115,493,547.01 $ \r\n \r\n- \r\n \r\nPROJECT STATUS \r\n \r\nESTIMATED COMPLETION \r\nDATE \r\n \r\nCompleted Completed \r\n \r\nOctober 30, 2017 September 30, 2017 \r\n \r\nCompleted \r\n \r\nDecember 31, 2018 \r\n \r\nCompleted \r\n \r\nNovember 30, 2014 \r\n \r\nCompleted Ongoing \r\nCompleted \r\n \r\nJuly 31, 2017 November 30, 2019 \r\nJune 30, 2017 \r\n \r\nCompleted \r\n \r\nNovember 30, 2016 \r\n \r\n2017 SPLOST \r\n \r\n(1) Acquiring instructional and \r\n \r\nadministrative technology equipment \r\n \r\nand materials; \r\n \r\n$ \r\n \r\n(2) Acquiring safety, security, and \r\n \r\nfire protection equipment; \r\n \r\n(3) Adding to, renovating, repairing, \r\n \r\nimproving, furnishing and equipping \r\n \r\nexisting school buildings, and physical \r\n \r\neducation and other buildings and \r\n \r\nfacilities, including any necessary \r\n \r\ndemolition; \r\n \r\n(4) Adding to, constructing, renovating, \r\n \r\nfurnishing, and equipping gymnasiums \r\n \r\nand athletic facilities; \r\n \r\n(5) Renovations, additions, and \r\n \r\nimprovements to parking and traffic \r\n \r\naccess facilities, including any \r\n \r\nnecessary sitework; \r\n \r\n(6) Acquiring, constructing, furnishing, \r\n \r\nand equipping one new elementary \r\n \r\nschool; \r\n \r\n(7) Acquiring buses, vehicles, and \r\n \r\ntransportation equipment; \r\n \r\n(8) Acquiring any necessary property, \r\n \r\nboth real and personal; and \r\n \r\n(9) Paying expenses incident to \r\n \r\naccomplishing the foregoing. \r\n \r\n- $ 19,180,000.00 $ 6,340,689.10 $ \r\n \r\n- \r\n \r\n1,913,015.00 \r\n \r\n264,543.97 \r\n \r\n3,531,936.20 $ 9,872,625.30 $ \r\n \r\n346,628.98 \r\n \r\n611,172.95 \r\n \r\n- \r\n \r\n32,586,890.00 \r\n \r\n7,045,130.36 \r\n \r\n8,008,129.70 \r\n \r\n15,053,260.06 \r\n \r\n- \r\n \r\n50,905,040.00 \r\n \r\n17,802,025.03 \r\n \r\n3,098,682.77 \r\n \r\n20,900,707.80 \r\n \r\n- \r\n \r\n4,327,084.00 \r\n \r\n1,713,477.12 \r\n \r\n466,363.25 \r\n \r\n2,179,840.37 \r\n \r\n- \r\n \r\n22,000,000.00 \r\n \r\n1,310,376.26 \r\n \r\n- \r\n \r\n1,310,376.26 \r\n \r\n- \r\n \r\n5,312,750.00 \r\n \r\n1,802,256.75 \r\n \r\n1,533,916.00 \r\n \r\n3,336,172.75 \r\n \r\n- \r\n \r\n2,000,000.00 \r\n \r\n1,545,165.35 \r\n \r\n3,900.00 \r\n \r\n1,549,065.35 \r\n \r\n- \r\n \r\n404,612.00 \r\n \r\n- \r\n \r\n380,232.16 \r\n \r\n380,232.16 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nSeptember 30, 2021 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2020 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2021 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nNovember 30, 2021 \r\n \r\n$ 135,000,000.00 $ 138,629,391.00 $ 37,823,663.94 $ 17,369,789.06 $ 55,193,453.00 $ \r\n \r\n- \r\n \r\n(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. \r\n \r\n(2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. \r\n \r\n(3) The voters of Houston County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. \r\n \r\n(4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows: \r\n \r\nPrior Years \r\n \r\n$ \r\n \r\n7,127,013.97 \r\n \r\nCurrent Year \r\n \r\n1,275,550.00 \r\n \r\nTotal \r\n \r\n$ \r\n \r\n8,402,563.97 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 53 - \r\n \r\n SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON \r\nCOMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 28, 2020. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\n \r\n Compliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nMarch 28, 2020 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\n \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited the Houston County Board of Education's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2019. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\nWe believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance. \r\n \r\n Opinion on Each Major Federal Program \r\nIn our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2019. \r\nReport on Internal Control over Compliance \r\nManagement of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nMarch 28, 2020 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2019 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\nPRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2019 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\nType of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information \r\n \r\nUnmodified \r\n \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nNoncompliance material to financial statements noted: \r\n \r\nNo \r\n \r\nFederal Awards \r\n \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with 2 CFR 200.516(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: CFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n84.010 84.041 \r\n \r\nTitle I Grants to Local Educational Agencies Impact Aid Cluster \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: Auditee qualified as low-risk auditee? \r\n \r\n$1,034,251.55 Yes \r\n \r\nII FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2018-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2018 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2019-03-18"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2018 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2018-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2018-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"Houston County Board of Education \r\nPerry, Georgia \r\nFiscal Year 2018 Audit Report \r\nYear Ended June 30, 2018 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nGOVERNMENT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\nG \r\n \r\nSTATEMENT OF FIDUCIARY NET POSITION \r\n \r\nFIDUCIARY FUNDS \r\n \r\nH NOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\n4 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND \r\n5 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB ASSET SEAD  OPEB \r\n6 SCHEDULE OF CONTRIBUTIONS  TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\nPage \r\ni \r\n1 2 \r\n4 5 6 7 8 10 \r\n39 40 41 42 43 44 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\nFINANCIAL \r\nSCHEDULES \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n7 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 8 SCHEDULE OF CONTRIBUTIONS  SCHOOL OPEB FUND 9 SCHEDULE OF CONTRIBUTIONS  SEAD  OPEB 10 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 11 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES \r\nIN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND \r\nSUPPLEMENTARY INFORMATION \r\n12 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 13 SCHEDULE OF STATE REVENUE 14 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\nPage \r\n45 46 47 48 49 \r\n50 51 53 \r\n \r\nSECTION II \r\nCOMPLIANCE AND INTERNAL CONTROL REPORTS \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n SECTION I FINANCIAL \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 18, 2019 \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also \r\n \r\n includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\nWe believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2018, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nEmphasis of Matter \r\nAs described in Note 2 to the financial statements, in 2018, the School District adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, as amended by GASB Statement No. 85, Omnibus 2017. The School District restated beginning net position for the effect of GASB Statement No. 75. Our opinions are not modified with respect to this matter. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements. \r\n \r\n The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. \r\nOther Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated March 18, 2019 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\nINTRODUCTION \r\nThe discussion and analysis of Houston County Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2018. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFINANCIAL HIGHLIGHTS \r\nKey financial highlights for the fiscal year 2018 are as follows: \r\nOn the government-wide financial statements: \r\n On the government-wide financial statements, net position increased $11.2 million which represents a 21.6 percent increase from 2017, after restating the beginning net position for the effect of adopting GASB Statement No.75. This total increase was due to governmental activities since the School District has no business-type activities. \r\n The School District had $320.2 million in expenses related to governmental activities. Revenues totaled $331.3 million. Program specific revenues in the form of charges for services and sales, grants, and contributions accounted for $196.2 million or 59.2 percent of the total revenues and were used to offset these expenditures. General revenues of $135.1 million or 40.8 percent of all revenues were adequate to provide for these programs. \r\n The current ratio, which measures the Board's ability to transform current assets into cash and to pay its short-term liabilities, was 7.22 for the fiscal year ended June 30, 2018. Generally, a ratio greater than 2.0 is considered very financially stable. \r\n During the fiscal year, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. This statement establishes standards for recognizing and measuring liabilities, deferred outflows, deferred inflows, and expenditures for defined benefit OPEB plans. Implementation of this statement resulted in a restatement to the beginning net position of ($215.1) million. This restatement is based on actuarial estimates and information is not available for the fiscal year 2017 comparative balances. Note 13 in Exhibit \"H\", Notes to the Basic Financial Statements, provides more information on this restatement. \r\nOn the fund financial statements: \r\n Among major funds, the general fund had $306.0 million in revenues and other financing sources, and $300.1 million in expenditures and other financing uses. The general fund's fund balance increased to $84.9 million. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\nOVERVIEW OF THE FINANCIAL STATEMENTS \r\nThis annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the Houston County Board of Education. These include the government-wide and fund financial statements. \r\nThe government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status. \r\nThe fund financial statements focus on individual parts, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the short-term as well as what remains for future spending. The fiduciary funds statements provide information about the financial relationships in which the Board acts solely as a trustee or agent for the benefit of others. \r\nThe fund financial statements reflect the School District's most significant funds. For the year ending June 30, 2018, the general fund, the capital projects fund, and the debt service fund represent the most significant funds. \r\nThe financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. \r\nGovernment-Wide Statements \r\nThe government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. \r\nThe two government-wide statements report the School District's net position and how it has changed. Net position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in net position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities  All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, student and principal accounts, and various others. \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\nFund Financial Statements \r\nThe School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, capital projects fund, and debt service fund. Governmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general governmental operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements. Fiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others, such as the employee benefit programs, and school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations. \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\n \r\nFINANCIAL ANALYSIS OF THE BOARD AS A WHOLE \r\n \r\nRecall that the Statement of Net Position provides the perspective of the Board as a whole. Table 1 provides a summary of the Board's net position for 2018 compared to fiscal year 2017. \r\nTable 1 Net Position (In Thousands) \r\n \r\nAssets Current and Other Assets Capital Assets, Net \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 (1) \r\n \r\n$ \r\n \r\n152,836 $ 149,380 \r\n \r\n309,283 \r\n \r\n308,818 \r\n \r\nTotal Assets \r\n \r\n462,119 \r\n \r\n458,198 \r\n \r\nDeferred Outflows of Resources \r\n \r\n57,036 \r\n \r\n82,602 \r\n \r\nLiabilities Current and Other Liabilities Long-Term Liabilities \r\n \r\n21,176 504,176 \r\n \r\n19,790 355,139 \r\n \r\nTotal Liabilities \r\n \r\n525,352 \r\n \r\n374,929 \r\n \r\nDeferred Inflows of Resources \r\n \r\n34,461 \r\n \r\n2,578 \r\n \r\nNet Position Net Invested in Capital Assets Restricted Unrestricted (Deficit) \r\n \r\n291,862 81,774 \r\n(414,294) \r\n \r\n307,256 66,339 \r\n(210,302) \r\n \r\nTotal Net Position \r\n \r\n$ \r\n \r\n(40,658) $ 163,293 \r\n \r\n(1) Fiscal year 2017 balances do not reflect the effect of the Restatement of Net Position. See Note 13 in the Notes to the Basic Financial Statements for additional information. \r\nTotal net position decreased ($203.9) million due to the restatement of the beginning net position by ($215.1) million for the adoption of GASB Statement No. 75. However, based strictly on the School District's operations, an increase of $11.2 million was realized as shown on Table 2. The significant changes to the deferred outflows, deferred inflows and long-term liabilities is also attributable to the implementation of the statement. \r\n \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\n \r\nTable 2 shows the changes in net position for fiscal year 2018 compared to the changes in net position for fiscal year 2017. \r\nTable 2 Changes in Net Position \r\n(In Thousands) \r\n \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 (1) \r\n \r\n$ \r\n \r\n8,471 $ \r\n \r\n8,188 \r\n \r\n187,118 \r\n \r\n176,367 \r\n \r\n617 \r\n \r\n2,294 \r\n \r\nTotal Program Revenues \r\n \r\n196,206 \r\n \r\n186,849 \r\n \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted Investment Earnings Miscellaneous \r\n \r\n51,317 2,460 \r\n24,199 \r\n24,200 1,325 \r\n25,112 1,263 5,266 \r\n \r\n51,503 2,088 \r\n22,267 \r\n22,270 1,285 \r\n21,207 410 \r\n6,161 \r\n \r\nTotal General Revenues \r\n \r\n135,142 \r\n \r\n127,191 \r\n \r\nTotal Revenues \r\n \r\n331,348 \r\n \r\n314,040 \r\n \r\nProgram Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n203,113 \r\n14,077 6,283 2,573 4,433 1,695 \r\n20,047 2,383 \r\n22,163 13,496 \r\n4,344 1,803 \r\n2,439 1,091 19,890 \r\n342 \r\n \r\n202,381 \r\n13,058 8,044 \r\n4,424 1,630 19,952 2,778 20,905 12,078 4,102 1,187 \r\n2,379 1,054 19,419 \r\n(287) \r\n \r\nTotal Expenses \r\n \r\n320,172 \r\n \r\n313,104 \r\n \r\nIncrease in Net Position \r\n \r\n$ \r\n \r\n11,176 $ \r\n \r\n936 \r\n \r\n(1) Fiscal year 2017 balances do not reflect the effect of the Restatement of Net Position. See Note 13 in the Notes to the Basic Financial Statements for additional information. \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\nFigure A shows the funding sources for the revenues. 55.2 percent of the School District's revenues are derived from state grants. Property taxes make up 16.3 percent of the total funding, while an additional 15.0 percent is earned from the School District's sales taxes. \r\nFigure A Sources of Revenue for Fiscal Year 2018 \r\n \r\nState Funds 55.2% \r\n \r\nFederal Funds 8.9% \r\n \r\nCharges for Se r vice s 2.6% \r\n \r\nM is ce llane ous 1.6% \r\n \r\nSales Taxes 15.0% \r\n \r\nProperty Taxes 16.3% \r\nInvestm ent Ear nings 0.4% \r\n \r\nAs shown in Figure B, Instruction comprised 63.4 percent of governmental program expenses. Administration and Other Services (3.2 percent) consist of the central office, business and warehouse, and other central operations of the School District. \r\n \r\nFigure B Functional Expenses for Fiscal Year 2018 \r\n \r\nEducational Media 1.4% \r\nImprovement of Instruction and Staff \r\nTrainin g 2.8% \r\nPupil Services 4.4% \r\nInterest on Debt 0.1% \r\n \r\nInstruction 63.4% \r\n \r\nAdministration and Other Services \r\n3.2% \r\n \r\nEnterprise and Community \r\nServices 1.1% \r\n \r\nFood Services 6.2% \r\n \r\nStudent \r\nTransportation \r\nServices 4.2% \r\n \r\nSchool Administration \r\n6.3% \r\nMaintenance and Operation of Plant \r\n6.9% \r\n \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\nGovernmental Activities \r\n \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2018 with fiscal year 2017. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(In Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 (1) \r\n \r\nNet Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 (1) \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n$ 203,113 $ 202,381 $ 66,227 $ \r\n \r\n14,077 6,283 2,573 4,433 1,695 \r\n20,047 2,383 \r\n22,163 13,496 \r\n4,344 1,803 \r\n \r\n13,058 8,044 \r\n4,424 1,630 19,952 2,778 20,905 12,078 4,102 1,187 \r\n \r\n6,584 2,911 \r\n328 517 1,154 12,518 1,812 13,341 11,250 3,408 1,223 \r\n \r\n2,439 1,091 19,890 \r\n342 \r\n \r\n2,379 1,054 19,419 \r\n(287) \r\n \r\n900 1,091 \r\n360 342 \r\n \r\n73,317 \r\n5,843 3,137 \r\n672 1,086 12,716 2,246 12,185 9,834 3,263 \r\n714 \r\n830 1,054 \r\n(356) (287) \r\n \r\nTotal Expenses \r\n \r\n$ 320,172 $ 313,104 $ 123,966 $ 126,254 \r\n \r\n(1) Fiscal year 2017 balances do not reflect the effect of the Restatement of Net Position. See Note 13 in the Notes to the Basic Financial Statements for additional information. \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 32.6 percent of Instruction activities are supported through taxes and other general revenues, and for all governmental activities general revenue support is 38.7 percent. \r\n \r\nThe School District's Funds \r\n \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $330.9 million and expenditures and other financing uses of $328.3 million. There was an increase in the fund balance totaling $2.6 million for the governmental funds as a whole. The general fund increased by $5.9 million due mainly to increases in mid-term funding and careful planning of expenditures. The capital projects funds had an increase of $1.5 million and debt service funds had a decrease of ($4.8) million to meet the subsequent year's debt requirements. The capital projects fund increase was due to the increased \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 proceeds from the ESPLOST. The decrease in the debt service fund was attributable to the amount of ESPLOST proceeds being needed to meet the interest and principal payments due on the outstanding debt associated with previously issued general obligation bonds in the subsequent year. The increase in the fund balance of the general fund for the year reflects that the School District was able to meet current costs as planned and budgeted. \r\nGeneral Fund Budgeting Highlights \r\nThe School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund. During the course of fiscal year 2018, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. For the general fund, the final budgeted revenues and other financing sources of $306.4 million was greater than the original budgeted amount of $302.4 million by $4.0 million. The overall difference was mainly due to additional state grant awards of $2.9 million and additional local revenues. The actual revenues and other financing sources of $306.0 million was less than the budgeted amount by $0.4 million due mainly to the elimination of intra-fund transfers and an increase in sales taxes. The final budgeted expenditures and other financing uses of $304.4 million was less than the original budgeted amount of $305.7 million by $1.3 million. This difference was due mainly to adjusting the budget to reflect the revised needs. The actual expenditures and other financing uses of $300.1 million was $4.3 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. The differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes that had previously been reported as deferred as current and prior year revenues for report purposes. \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\n \r\nCapital Assets and Debt Administration \r\n \r\nCapital Assets \r\n \r\nAt the end of fiscal year 2018, the School District had $309.3 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2018 balances compared with fiscal year 2017 balances. \r\n \r\nTable 4 Capital Assets at June 30 (Net of Depreciation, In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 \r\n \r\nLand Construction In Progress Buildings and Building Improvements Equipment Land Improvements Intangible Assets \r\n \r\n$ 11,278 $ \r\n \r\n11,278 \r\n \r\n10,381 \r\n \r\n8,343 \r\n \r\n272,935 \r\n \r\n276,825 \r\n \r\n7,779 \r\n \r\n6,948 \r\n \r\n5,544 \r\n \r\n5,424 \r\n \r\n1,366 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 309,283 $ 308,818 \r\n \r\nThe overall capital assets increased in fiscal year 2018 by $0.5 million due to the construction and renovation expenses from the 2012 and 2017 ESPLOST capital outlay projects during the current year being offset by the fiscal year 2018 depreciation of $13.4 million. \r\n \r\nDebt \r\n \r\nAt June 30, 2018, the School District had $30.0 million in bonds outstanding with $5.5 million due within one year, $0.9 million in capital leases outstanding with $0.6 million due within one year, $3.1 million in compensated absences earned as of the end of the year, and $3.2 million in unamortized bond premiums with $0.6 million due with one year. In addition, the School District reported long-term liabilities for its proportionate share of the net pension and net OPEB liabilities. Reporting these liabilities is required by GASB Statements No. 68 and No. 75. \r\n \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 \r\n \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2018, compared to fiscal year 2017 balances. \r\n \r\nTable 5 Debt at June 30 (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2018 \r\n \r\nYear 2017 \r\n \r\nGeneral Obligation Bonds Capital Leases Compensated Absences Unamortized Bond Premiums Net Pension Liability Net OPEB Liability \r\n \r\n$ \r\n \r\n30,000 \r\n \r\n$ \r\n \r\n40,305 \r\n \r\n940 \r\n \r\n1,583 \r\n \r\n3,063 \r\n \r\n3,114 \r\n \r\n3,182 \r\n \r\n4,243 \r\n \r\n258,432 \r\n \r\n305,894 \r\n \r\n208,559 \r\n \r\n- \r\n \r\n$ \r\n \r\n504,176 \r\n \r\n$ 355,139 \r\n \r\nAt June 30, 2018, the School District's overall legal bonding authority was $381.7 million based on the assessed value of taxable property as of December 31, 2017. The School District's bonds have assigned ratings of Aa1 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. Both the current year payments and subsequently scheduled payments are well below the $5.7 million threshold. \r\n \r\nCURRENT ISSUES \r\n \r\nThe Houston County School District consists of 38 campuses located in Houston County, a fast-growing area with a population of approximately 153,479. Current enrollment is approximately 29,770 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 15th in population, 15th in economics, and 16th in income. The 2017 School District millage ranks 168th out of 180 districts in Georgia. \r\n \r\nThe State of Georgia experienced serious financial hardship over the past several years, and as a result, more pressure was being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2.0 million in 2003 to a high of $23.8 million in 2010. For fiscal year 2018, the reduction was $3.0 million. Since the austerity reductions were enacted, the reductions total $158.4 million and the overall reduction of state funding, including other grants and programs, is approximately $317.6 million. For the first time in sixteen years, the fiscal year 2019 state allotments did not include an austerity reduction. Hopefully this trend will continue in future years. While Houston County's class sizes remain below the state maximum recommendations, any additional reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. \r\n \r\nx \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Houston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2017 economic impact on the State of Georgia of $2.87 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the County include the Board of Education, Houston County Hospital Authority, Perdue Farms, Frito-Lay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 62.8 percent work in the County. Houston is Georgia's sixty-fifth largest county in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990-2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and was projected to grow to 153,479 in 2017. This growth results in school system enrollment increases between 198 to 487 students for the past five years. Houston County has three municipalities: Centerville with an estimated population of 7,716; Perry with 16,684; and Warner Robins with 74,854. The County also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. \r\nContacting the School District's Financial Management \r\nThis financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nxi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2018 \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) \r\nTotal Assets \r\nDEFERRED OUTFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Outflows of Resources \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Interest Payable Claims Incurred but not Reported (IBNR) Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities \r\nDue Within One Year Due in More Than One Year \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans Related to OPEB Plans \r\nTotal Deferred Inflows of Resources \r\nNET POSITION \r\nNet Investment in Capital Assets Restricted for \r\nContinuation of Federal Programs Capital Projects Debt Service Net OPEB Asset Property Tax Rollback Unrestricted (Deficit) \r\nTotal Net Position \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\nEXHIBIT \"A\" \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\n$ \r\n \r\n115,703,977.05 \r\n \r\n277,312.87 \r\n \r\n6,247,585.06 23,464,378.85 \r\n2,571,500.12 155,803.43 \r\n4,416,098.71 21,659,319.90 287,623,282.58 \r\n \r\n462,119,258.57 \r\n \r\n49,309,579.49 7,726,639.00 \r\n57,036,218.49 \r\n \r\n58,123.80 18,459,413.03 \r\n473,368.49 1,554,698.12 \r\n629,986.82 258,432,338.00 208,559,073.00 \r\n6,735,471.28 30,449,547.52 \r\n525,352,020.06 \r\n \r\n16,144,917.00 18,316,305.00 \r\n34,461,222.00 \r\n \r\n291,861,903.28 \r\n9,604,437.01 28,950,435.28 \r\n5,815,528.33 81,706.00 \r\n37,403,443.44 (414,375,218.34) \r\n \r\n$ \r\n \r\n(40,657,765.00) \r\n \r\n- 1 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES \r\nFOR THE YEAR ENDED JUNE 30, 2018 \r\n \r\nGOVERNMENTAL ACTIVITIES \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\nTotal Governmental Activities \r\nGeneral Revenues Taxes Property Taxes For Maintenance and Operations Railroad Cars Title Ad Valorem Tax Sales Taxes Special Purpose Local Option Sales Tax For Debt Services For Capital Projects Local Option Sales Tax Intangible Recording Tax Real Estate Transfer Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\nTotal General Revenues \r\nChange in Net Position \r\nNet Position - Beginning of Year (Restated) \r\nNet Position - End of Year \r\n \r\nEXPENSES \r\n \r\nCHARGES FOR SERVICES \r\n \r\n$ 203,112,848.75 $ \r\n14,076,559.59 6,283,124.94 2,572,505.07 4,433,064.32 1,694,846.96 \r\n20,047,377.05 2,382,661.18 \r\n22,163,122.77 13,496,225.00 \r\n4,343,739.64 1,803,005.39 \r\n2,439,446.45 1,090,733.16 19,890,492.83 \r\n342,374.47 \r\n$ 320,172,127.57 $ \r\n \r\n2,715,860.36 \r\n5,904.73 104,826.50 - \r\n1,539,809.98 - \r\n4,104,509.95 - \r\n8,470,911.52 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 2 - \r\n \r\n EXHIBIT \"B\" \r\n \r\nPROGRAM REVENUES OPERATING GRANTS AND \r\nCONTRIBUTIONS \r\n \r\nCAPITAL GRANTS AND CONTRIBUTIONS \r\n \r\nNET (EXPENSES) REVENUES \r\nAND CHANGES IN NET POSITION \r\n \r\n$ 133,733,645.33 $ \r\n7,492,483.37 3,372,263.64 2,244,148.09 3,896,984.00 \r\n540,195.18 7,510,297.82 \r\n565,939.00 8,809,154.09 2,063,941.26 \r\n930,492.26 580,420.44 \r\n15,378,452.47 - \r\n$ 187,118,416.95 $ \r\n \r\n436,122.60 $ \r\n87.49 - \r\n19,144.44 746.70 \r\n18,960.63 5,166.82 7,026.66 \r\n77,319.58 4,843.99 \r\n47,827.78 - \r\n617,246.69 \r\n \r\n(66,227,220.46) \r\n(6,583,988.73) (2,910,861.30) \r\n(328,356.98) (516,935.88) (1,153,905.08) (12,518,118.60) (1,811,555.36) (13,341,037.29) (11,250,137.66) (3,408,403.39) (1,222,584.95) \r\n(899,636.47) (1,090,733.16) \r\n(359,702.63) (342,374.47) \r\n(123,965,552.41) \r\n \r\n51,317,368.42 30,188.10 \r\n2,429,770.26 \r\n6,861,332.94 17,338,343.45 24,198,810.26 \r\n991,105.72 333,979.78 25,111,767.20 1,262,991.25 5,266,219.87 \r\n135,141,877.25 \r\n11,176,324.84 \r\n(51,834,089.84) \r\n \r\n$ \r\n \r\n(40,657,765.00) \r\n \r\n- 3 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION BALANCE SHEET \r\nGOVERNMENTAL FUNDS JUNE 30, 2018 \r\n \r\nEXHIBIT \"C\" \r\n \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Other Inventories \r\nTotal Assets \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Retainages Payable \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nUnavailable Revenue - Property Taxes \r\nFUND BALANCES \r\nNonspendable Restricted Assigned Unassigned \r\nTotal Fund Balances \r\nTotal Liabilities, Deferred Inflows of Resources, and Fund Balances \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 69,056,159.11 $ 40,359,195.54 $ \r\n \r\n277,038.45 \r\n \r\n- \r\n \r\n4,278,143.44 23,464,378.85 \r\n2,571,500.12 155,803.43 \r\n4,416,098.71 \r\n \r\n1,969,441.62 - \r\n \r\n6,288,622.40 $ 274.42 \r\n \r\n115,703,977.05 277,312.87 \r\n \r\n- \r\n \r\n6,247,585.06 \r\n \r\n- \r\n \r\n23,464,378.85 \r\n \r\n- \r\n \r\n2,571,500.12 \r\n \r\n- \r\n \r\n155,803.43 \r\n \r\n- \r\n \r\n4,416,098.71 \r\n \r\n$ 104,219,122.11 $ 42,328,637.16 $ 6,288,896.82 $ 152,836,656.09 \r\n \r\n$ \r\n \r\n58,123.80 $ \r\n \r\n18,459,413.03 \r\n \r\n- \r\n \r\n18,517,536.83 \r\n \r\n- $ 629,986.82 \r\n629,986.82 \r\n \r\n- $ - \r\n- \r\n \r\n58,123.80 18,459,413.03 \r\n629,986.82 \r\n19,147,523.65 \r\n \r\n761,678.73 \r\n \r\n- \r\n \r\n- \r\n \r\n761,678.73 \r\n \r\n4,416,098.71 46,294,249.92 \r\n2,376,677.49 31,852,880.43 \r\n84,939,906.55 \r\n \r\n41,578,565.74 \r\n120,084.60 - \r\n41,698,650.34 \r\n \r\n6,288,896.82 \r\n- \r\n6,288,896.82 \r\n \r\n4,416,098.71 94,161,712.48 \r\n2,496,762.09 31,852,880.43 \r\n132,927,453.71 \r\n \r\n$ 104,219,122.11 $ 42,328,637.16 $ 6,288,896.82 $ 152,836,656.09 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 4 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\nTO THE STATEMENT OF NET POSITION JUNE 30, 2018 \r\n \r\nEXHIBIT \"D\" \r\n \r\nTotal fund balances - governmental funds (Exhibit \"C\") \r\nAmounts reported for governmental activities in the Statement of Net Position are different because: \r\nCapital assets used in governmental activities are not financial resources and therefore are not reported in the funds. \r\nLand Construction in progress Land improvements Buildings Equipment Intangible Assets Accumulated depreciation \r\nSome liabilities, including net pension obligations, are not due and payable in the current period, and, therefore, are not reported in the funds. \r\nNet pension liability Net OPEB liability \r\nDeferred outflows and inflows of resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds. \r\nRelated to pensions Related to OPEB \r\nTaxes that are not available to pay for current period expenditures are deferred in the funds. \r\nProperty taxes \r\nLong-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-Term Liabilities at year-end consists of: \r\nBonds payable Accrued interest payable Capital leases payable Compensated absences payable Unamortized bond premiums Claims and judgments payable \r\n \r\n$ 132,927,453.71 \r\n \r\n$ \r\n \r\n11,278,291.55 \r\n \r\n10,381,028.35 \r\n \r\n9,557,511.85 \r\n \r\n440,505,502.52 \r\n \r\n29,441,604.66 \r\n \r\n1,437,220.47 \r\n \r\n(193,318,556.92) \r\n \r\n309,282,602.48 \r\n \r\n$ (258,432,338.00) (208,559,073.00) \r\n \r\n(466,991,411.00) \r\n \r\n$ \r\n \r\n33,164,662.49 \r\n \r\n(10,589,666.00) \r\n \r\n22,574,996.49 \r\n \r\n761,678.73 \r\n \r\n$ \r\n \r\n(30,000,000.00) \r\n \r\n(473,368.49) \r\n \r\n(939,586.53) \r\n \r\n(3,063,543.82) \r\n \r\n(3,181,888.45) \r\n \r\n(1,554,698.12) \r\n \r\n(39,213,085.41) \r\n \r\nNet position of governmental activities (Exhibit \"A\") \r\n \r\n$ \r\n \r\n(40,657,765.00) \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 5 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \r\nGOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2018 \r\n \r\nEXHIBIT \"E\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Instructional Staff Training Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nCapital Outlay Debt Services \r\nPrincipal Interest \r\nTotal Expenditures \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ \r\n \r\n53,908,089.04 $ \r\n \r\n25,523,895.76 \r\n \r\n182,722,128.16 \r\n \r\n29,542,339.65 \r\n \r\n8,470,911.52 \r\n \r\n673,006.15 \r\n \r\n5,194,169.87 \r\n \r\n306,034,540.15 \r\n \r\n- $ 17,338,343.45 \r\n512,623.66 72,050.00 \r\n17,923,017.11 \r\n \r\n- $ 6,861,332.94 \r\n77,361.44 - \r\n \r\n53,908,089.04 49,723,572.15 182,722,128.16 29,542,339.65 \r\n8,470,911.52 1,262,991.25 5,266,219.87 \r\n \r\n6,938,694.38 \r\n \r\n330,896,251.64 \r\n \r\n187,757,771.23 \r\n13,936,903.97 6,230,142.97 2,572,505.07 3,918,657.59 1,671,794.65 \r\n19,402,606.23 2,457,833.60 \r\n22,006,720.75 12,392,973.53 \r\n3,699,093.35 1,395,488.65 2,439,446.45 1,090,733.16 18,508,162.06 \r\n- \r\n643,028.20 22,802.43 \r\n300,146,663.89 \r\n5,887,876.26 \r\n79,052,030.29 \r\n \r\n2,400,638.72 \r\n- \r\n5,620.00 1,455,652.00 583,587.41 12,003,600.16 \r\n- \r\n16,449,098.29 \r\n1,473,918.82 \r\n40,224,731.52 \r\n \r\n- \r\n- \r\n4,750.00 - \r\n10,305,000.00 1,395,059.38 \r\n11,704,809.38 \r\n(4,766,115.00) \r\n11,055,011.82 \r\n \r\n190,158,409.95 \r\n13,936,903.97 6,230,142.97 2,572,505.07 3,918,657.59 1,671,794.65 \r\n19,402,606.23 2,468,203.60 \r\n22,006,720.75 13,848,625.53 \r\n4,282,680.76 1,395,488.65 2,439,446.45 1,090,733.16 18,508,162.06 12,003,600.16 \r\n10,948,028.20 1,417,861.81 \r\n328,300,571.56 \r\n2,595,680.08 \r\n130,331,773.63 \r\n \r\nFund Balances - Ending \r\n \r\n$ \r\n \r\n84,939,906.55 $ \r\n \r\n41,698,650.34 $ \r\n \r\n6,288,896.82 $ 132,927,453.71 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 6 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF \r\nREVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2018 \r\n \r\nEXHIBIT \"F\" \r\n \r\nNet change in fund balances total governmental funds (Exhibit \"E\") \r\nAmounts reported for governmental activities in the Statement of Activities are different because: \r\nGovernmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. \r\nCapital outlay Depreciation expense \r\nThe net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. \r\nTaxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. \r\nThe issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. \r\nBond principal retirements Capital lease payments Amortization of bond premiums \r\nDistrict pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEBs, is reported in the Statement of Activities. \r\nPension expense OPEB expense \r\nSome items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. These activities consist of: \r\nAccrued interest on issuance of debt Compensated absences Claims and judgments \r\n \r\n$ \r\n \r\n2,595,680.08 \r\n \r\n$ 13,928,027.08 (13,425,637.63) \r\n \r\n502,389.45 (37,698.80) (130,762.26) \r\n \r\n$ 10,305,000.00 643,028.20 \r\n1,061,643.95 \r\n \r\n12,009,672.15 \r\n \r\n$ \r\n \r\n601,623.91 \r\n \r\n(4,021,389.00) \r\n \r\n(3,419,765.09) \r\n \r\n$ \r\n \r\n13,843.39 \r\n \r\n50,540.60 \r\n \r\n(407,574.68) \r\n \r\n(343,190.69) \r\n \r\nChange in net position of governmental activities (Exhibit \"B\") \r\n \r\n$ 11,176,324.84 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 7 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION \r\nFIDUCIARY FUNDS JUNE 30, 2018 \r\nASSETS Cash and Cash Equivalents Accounts Receivable, Net \r\nOther \r\nTotal Assets LIABILITIES Accounts Payable Funds Held for Others \r\nTotal Liabilities \r\n \r\nEXHIBIT \"G\" \r\n \r\nAGENCY FUNDS \r\n \r\n$ \r\n \r\n1,686,599.88 \r\n \r\n120,027.11 \r\n \r\n$ \r\n \r\n1,806,626.99 \r\n \r\n$ \r\n \r\n968,269.65 \r\n \r\n838,357.34 \r\n \r\n$ \r\n \r\n1,806,626.99 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 8 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nThe accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below. \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness. \r\nGOVERNMENT-WIDE STATEMENTS: \r\nThe Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. \r\nThe Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows: \r\n1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\n2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\n3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\nDirect expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nProgram revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFUND FINANCIAL STATEMENTS: \r\nThe fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and Bond Proceeds that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets. \r\n The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes legally restricted for the payment of general long-term principal and interest. \r\nThe School District reports the following fiduciary fund type: \r\n Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes and grants. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, claims and judgments, and compensated absences, which are recognized as expenditures \r\n \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nto the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\nIn fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. This statement establishes standards for recognizing and measuring liabilities, deferred outflows of resources, deferred inflows of resources, and expense/expenditures. For defined benefit OPEB, this statement identifies the methods and assumptions that are required to be used to project benefit payments, discount projected benefit payments to their actuarial present value, and attribute that present value to periods of employee service. Note disclosure and required supplementary information requirements about defined benefit OPEB also are addressed. The adoption of this statement has a significant impact on the School District's financial statements. As noted in the Restatement of Net Position note disclosure, the School District restated beginning net position for the cumulative effect of this accounting change. \r\nIn fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 81, Irrevocable Split-Interest Agreements. This statement requires that a government that receives resources pursuant to an irrevocable split-interest agreement recognize assets, liabilities, and deferred inflows of resources at the inception of the agreement. Furthermore, this statement requires that a government recognize assets representing its beneficial interests in irrevocable split-interest agreements that are administered by a third party, if the government controls the present service capacity of the beneficial interests. This statement requires that a government recognize revenue when the resources become applicable to the reporting period. The adoption of this statement does not have a significant impact on the School District's financial statements. \r\nIn fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 85, Omnibus 2017. The objective of this statement is to address practice issues that have been identified during implementation and application of certain GASB Statements. This statement addresses a variety of topics including issues related to blending component units, goodwill, fair value measurement and application, and postemployment benefits (pensions and other postemployment benefits OPEB). The adoption of this statement does not have a significant impact on the School District's financial statements. \r\nIn fiscal year 2018, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 86, Certain Debt Extinguishment Issues. The primary objective of this statement is to improve consistency in accounting and financial reporting for in-substance defeasance of debt by providing guidance for transactions in which cash and other monetary assets acquired with only existing resources--resources other than the proceeds of refunding debt--are placed in an irrevocable trust for the sole purpose of extinguishing debt. This statement also improves accounting and financial reporting for prepaid insurance on debt that is extinguished and notes to financial statements for debt that is defeased in substance. The adoption of this statement does not have a significant impact on the School District's financial statements. \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCASH AND CASH EQUIVALENTS \r\nCash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\nINVESTMENTS \r\nThe School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. \r\nInvestments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value. \r\nFor accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired. \r\nRECEIVABLES \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\nINVENTORIES \r\nFood Inventories \r\nOn the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the weighted average basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\nSupply Inventory \r\nOn the basic financial statements, inventories of consumable supplies and materials are reported at cost (weighted average). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\nCAPITAL ASSETS \r\nOn the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art. \r\n \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCapital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements. \r\n \r\nDepreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives. \r\n \r\nCapitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows: \r\n \r\nCapitalization Policy \r\n \r\nEstimated Useful Life \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible assets Construction In Progress \r\n \r\nAll All All \r\nAll $10,000.00 and any \r\nitem necessary for insurance purposes $100,000.00 to $1,000,000.00 \r\nAll \r\n \r\nN/A 8 to 25 Years 10 to 50 Years \r\n5 to 14 Years 5 to 10 Years \r\nup to 20 Years N/A \r\n \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\nIn addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element, represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. \r\n \r\nIn addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. \r\n \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\n \r\nPublic School Employees Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\n \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of twenty days. Vacation leave of twelve days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed twenty days. \r\n \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nLONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS \r\nIn the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the effective interest method. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\nIn the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Postemployment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nPOSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS (SEAD - OPEB) \r\nFor purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the State Employees' Assurance Department Retired and Vested Inactive Members Trust Fund (SEADOPEB) plan (the Plan) and additions to/deductions from the SEAD-OPEB's fiduciary net position have been determined on the same basis as they are reported by SEAD-OPEB. For this purpose, death benefits are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nFUND BALANCES \r\nFund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. \r\nThe School District's fund balances are classified as follows: \r\nNonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\n \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCommitted consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\n \r\nAssigned consists of resources constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes. \r\n \r\nUnassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance. \r\n \r\nUSE OF ESTIMATES \r\n \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\n \r\nPROPERTY TAXES \r\n \r\nThe Houston County Board of Commissioners adopted the property tax levy for the 2017 tax digest year (calendar year) on July 18, 2017 (levy date) based on property values as of January 1, 2017. Taxes were due on December 20, 2017 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2017 tax digest are reported as revenue in the governmental funds for fiscal year 2018. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2018, for maintenance and operations amounted to $51,448,130.68. \r\n \r\nThe tax millage rate levied for the 2017 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.32 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $2,429,770.26 during fiscal year ended June 30, 2018. \r\n \r\nSALES TAXES \r\n \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the School District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $24,198,810.26 and was recorded in the general fund. Local Option Sales Tax (LOST) is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\n \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nEducation Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $24,199,676.39 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years. \r\nNOTE 3: BUDGETARY DATA \r\nThe budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review. \r\nNOTE 4: DEPOSITS, CASH EQUIVALENTS AND INVESTMENTS \r\nCOLLATERALIZATION OF DEPOSITS \r\nO.C.G.A.  45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A.  45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\n \r\nCATEGORIZATION OF DEPOSITS \r\n \r\nCustodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2018, School District had deposits with a carrying amount of $20,891,057.99, and a bank balance of $33,218,284.58. The bank balances insured by Federal depository insurance were $4,475,064.20 and the bank balances collateralized with securities held by the pledging financial institution or by the pledging financial institution's trust department or agent in the School District's name were $72,756.73. \r\n \r\nAt June 30, 2018, $28,670,463.65 of the School District's bank balance was exposed to custodial credit risk as follows: \r\n \r\nUninsured with collateral held by the pledging financial institution's trust department or agent but not in the School District's name \r\n \r\n$ 28,670,463.65 \r\n \r\nReconciliation of cash and cash equivalents balances to carrying value of deposits: \r\n \r\nCash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position \r\n \r\n$ 115,703,977.05 1,686,599.88 \r\n \r\nTotal cash and cash equivalents \r\n \r\n117,390,576.93 \r\n \r\nAdd: Deposits with original maturity of three months or more reported as investments \r\n \r\n277,312.87 \r\n \r\nLess: Investment pools reported as cash and cash equivalents \r\nGeorgia Fund 1 \r\n \r\n96,776,831.81 \r\n \r\nTotal carrying value of deposits - June 30, 2018 \r\n \r\n$ 20,891,057.99 \r\n \r\nCATEGORIZATION OF CASH EQUIVALENTS \r\nThe School District reported cash equivalents of $96,776,831.81 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2018, was 10 days. \r\nGeorgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 5: CAPITAL ASSETS \r\n \r\nThe following is a summary of changes in the capital assets for governmental activities during the fiscal year: \r\n \r\nBalances June 30, 2017 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nTransfers \r\n \r\nBalances June 30, 2018 \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction in Progress \r\n \r\n$ 11,278,291.55 $ \r\n \r\n- $ \r\n \r\n8,343,032.91 \r\n \r\n12,992,280.29 \r\n \r\n- $ \r\n \r\n- $ 11,278,291.55 \r\n \r\n- \r\n \r\n(10,954,284.85) \r\n \r\n10,381,028.35 \r\n \r\nTotal Capital Assets Not Being Depreciated \r\n \r\n19,621,324.46 \r\n \r\n12,992,280.29 \r\n \r\n- \r\n \r\n(10,954,284.85) \r\n \r\n21,659,319.90 \r\n \r\nCapital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n433,680,560.30 27,331,306.61 8,938,417.69 - \r\n \r\n913,946.79 \r\n21,800.00 - \r\n \r\n521,450.00 327,226.74 \r\n49,800.00 - \r\n \r\n7,346,392.22 1,523,578.00 \r\n647,094.16 1,437,220.47 \r\n \r\n440,505,502.52 29,441,604.66 9,557,511.85 1,437,220.47 \r\n \r\nLess Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements Intangible Assets \r\n \r\n156,856,063.50 20,383,170.46 3,514,463.27 - \r\n \r\n11,235,594.10 1,596,305.97 521,876.54 71,861.02 \r\n \r\n521,450.00 316,917.94 \r\n22,410.00 - \r\n \r\n- \r\n \r\n167,570,207.60 \r\n \r\n- \r\n \r\n21,662,558.49 \r\n \r\n- \r\n \r\n4,013,929.81 \r\n \r\n- \r\n \r\n71,861.02 \r\n \r\nTotal Capital Assets, Being Depreciated, Net \r\n \r\n289,196,587.37 \r\n \r\n(12,489,890.84) \r\n \r\n37,698.80 \r\n \r\n10,954,284.85 \r\n \r\n287,623,282.58 \r\n \r\nGovernmental Activity Capital Assets - Net \r\n \r\n$ 308,817,911.83 $ \r\n \r\n502,389.45 $ \r\n \r\n37,698.80 $ \r\n \r\n- $ 309,282,602.48 \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction Support Services \r\nPupil Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services \r\n \r\n$ \r\n \r\n2,010.00 \r\n \r\n439,793.91 \r\n \r\n17,153.50 \r\n \r\n435,571.26 \r\n \r\n118,694.30 \r\n \r\n161,419.30 \r\n \r\n1,022,211.25 \r\n \r\n111,278.03 \r\n \r\n$ 10,018,786.73 \r\n2,308,131.55 1,098,719.35 \r\n \r\n$ 13,425,637.63 \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 6: LONG-TERM LIABILITIES \r\n \r\nThe changes in long-term liabilities during the fiscal year for governmental activities were as follows: \r\n \r\nBalance June 30, 2017 \r\n \r\nAdditions \r\n \r\nGovernmental Funds Deductions \r\n \r\nBalance June 30, 2018 \r\n \r\nDue Within One Year \r\n \r\nG.O. Bonds Unamortized Bond Premiums Capital Leases Compensated Absences (1) \r\n \r\n$ 40,305,000.00 $ 4,243,532.40 1,582,614.73 3,114,084.42 \r\n \r\n- $ 2,258,746.63 \r\n \r\n10,305,000.00 $ 1,061,643.95 643,028.20 2,309,287.23 \r\n \r\n30,000,000.00 $ 3,181,888.45 939,586.53 3,063,543.82 \r\n \r\n5,500,000.00 583,346.22 652,125.06 - \r\n \r\n$ 49,245,231.55 $ 2,258,746.63 $ 14,318,959.38 $ 37,185,018.80 $ 6,735,471.28 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements. \r\n \r\nGENERAL OBLIGATION DEBT OUTSTANDING \r\n \r\nThe School District's bonded debt consists of various issues of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved Education Special Purpose Local Option Sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. \r\n \r\nGeneral obligation bonds currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\nGeneral Government - Series 2017 \r\n \r\n4.00% - 5.00% \r\n \r\n4/6/2017 \r\n \r\n9/1/2022 $ 30,000,000.00 $ 30,000,000.00 \r\n \r\nThe following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nGeneral Obligation Debt \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nUnamortized Bond Premium \r\n \r\n2019 2020 2021 2022 2023 \r\n \r\n$ \r\n \r\n5,500,000.00 $ 1,275,550.00 $ \r\n \r\n583,346.22 \r\n \r\n5,945,000.00 \r\n \r\n1,046,650.00 \r\n \r\n630,544.23 \r\n \r\n6,050,000.00 \r\n \r\n776,500.00 \r\n \r\n641,680.84 \r\n \r\n6,180,000.00 \r\n \r\n470,750.00 \r\n \r\n655,469.02 \r\n \r\n6,325,000.00 \r\n \r\n158,125.00 \r\n \r\n670,848.14 \r\n \r\nTotal Principal and Interest \r\n \r\n$ 30,000,000.00 $ 3,727,575.00 $ 3,181,888.45 \r\n \r\nCAPITAL LEASES \r\nThe School District has acquired buses and band equipment under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term. \r\n \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end: \r\nGovernmental Activities \r\n \r\nEquipment Less: Accumulated Depreciation \r\n \r\n$ 3,081,846.00 1,247,361.90 \r\n \r\n$ 1,834,484.10 \r\n \r\nCapital leases currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\n15 School Buses 12 School Buses Band Equipment \r\n \r\n1.086% 1.618% 3.500% \r\n \r\n6/27/2013 11/11/2014 \r\n6/3/2015 \r\n \r\n8/1/2018 9/1/2019 2/15/2019 \r\n \r\n$ 1,687,158.00 $ 1,394,688.00 92,662.29 \r\n \r\n345,150.46 570,312.34 \r\n24,123.73 \r\n \r\n$ 3,174,508.29 $ 939,586.53 \r\n \r\nThe following is a schedule of total capital lease payments: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nCapital Leases \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\n2019 2020 \r\nTotal Principal and Interest \r\n \r\n$ 652,125.06 $ 287,461.47 \r\n$ 939,586.53 $ \r\n \r\n13,705.56 4,685.79 \r\n18,391.35 \r\n \r\nCOMPENSATED ABSENCES \r\nCompensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\nNOTE 7: RISK MANAGEMENT \r\nINSURANCE \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disasters and unemployment compensation. \r\nGeorgia School Boards Association Risk and Insurance Management System \r\nThe School District participates in the Georgia School Boards Association Risk and Insurance Management System (the System), a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The School District pays an annual premium to the System for its general insurance coverage. Additional coverage is provided through agreements by the System \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nwith other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the System varies by line of coverage. \r\n \r\nWORKERS' COMPENSATION \r\n \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000 loss per occurrence, up to the statutory limit. \r\n \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2017 2018 \r\n \r\n$ 1,004,296.54 $ 1,147,123.44 \r\n \r\n$ 809,479.13 $ 1,376,604.88 \r\n \r\n$ 666,652.23 $ 969,030.20 \r\n \r\n$ 1,147,123.44 $ 1,554,698.12 \r\n \r\nUNEMPLOYMENT COMPENSATION \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District had no unemployment compensation claims in the past two years. \r\n \r\nSURETY BOND \r\n \r\nThe School District purchased a surety bond to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\nNOTE 8: FUND BALANCE CLASSIFICATION DETAILS \r\nThe School District's financial statements include the following amounts presented in the aggregate at June 30, 2018: \r\n \r\nNonspendable Inventories \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\nAssigned Local Capital Outlay Projects School Activity Accounts \r\nUnassigned \r\n \r\n$ 4,416,098.71 \r\n \r\n$ 8,890,806.48 41,578,565.74 6,288,896.82 37,403,443.44 \r\n \r\n94,161,712.48 \r\n \r\n$ \r\n \r\n120,084.60 \r\n \r\n2,376,677.49 \r\n \r\n2,496,762.09 31,852,880.43 \r\n \r\nFund Balance, June 30, 2018 \r\n \r\n$ 132,927,453.71 \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\n \r\nIt is the goal of the School District to achieve and maintain a committed, assigned, and unassigned fund balance in the general fund at fiscal year-end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, in compliance with O.C.G.A.  20-2-167(a)5. If the unassigned fund balance at fiscal year-end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\n \r\nNOTE 9: SIGNIFICANT COMMITMENTS \r\n \r\nCOMMITMENTS UNDER CONSTRUCTION CONTRACTS \r\n \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2018, together with funding available: \r\n \r\nProject \r\n \r\nUnearned Executed Contracts (1) \r\n \r\nPayments through June 30, 2018 (2) \r\n \r\nFunding Available From State (1) \r\n \r\n18-676-021 \r\n \r\n$ \r\n \r\n18-676-024 \r\n \r\n18-676-027 \r\n \r\n19-676-006 \r\n \r\nDavid Perdue Primary Parking Improvements \r\n \r\nEagle Springs Parking Improvements \r\n \r\nKings Chapel Parking Improvements \r\n \r\nNorthside High New Competition Gym \r\n \r\nOld Perry Primary Demolition \r\n \r\nPerry High Competition Gym \r\n \r\nPerry High Parking Improvements \r\n \r\nPerry High Turf,Fieldhouse and Track \r\n \r\nRumble Academy Demolition \r\n \r\n$ \r\n \r\n168,357.27 $ 323,889.42 487,105.65 144,269.53 486,895.00 140,874.00 309,916.00 330,775.00 \r\n28,267.28 9,080,056.59 \r\n191,794.15 188,099.60 857,253.60 \r\n12,737,553.09 $ \r\n \r\n735,484.73 $ 447,424.58 199,286.35 5,944,419.77 \r\n28,648.00 290,589.05 114,729.05 \r\n18,387.00 184,022.73 1,560,050.94 \r\n3,020.00 1,502,184.83 \r\n156,221.33 \r\n11,184,468.36 $ \r\n \r\n616,573.00 452,485.00 454,063.00 606,157.00 \r\n- \r\n2,129,278.00 \r\n \r\n(1) The amounts described are not reflected in the basic financial statements. (2) Payments include retainages payable at year-end. \r\n \r\nNOTE 10: SIGNIFICANT CONTINGENT LIABILITIES \r\nFEDERAL GRANTS \r\nAmounts 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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\nLITIGATION \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to have a material adverse effect on the financial condition of the School District. \r\n \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 11: OTHER POST-EMPLOYMENT BENEFITS (OPEB) \r\nGEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND \r\nPlan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit postemployment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board. \r\nBenefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted. \r\nContributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $7,665,615.00 for the year ended June 30, 2018. Active employees are not required to contribute to the School OPEB Fund. \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\nAt June 30, 2018, the School District reported a liability of $208,640,779.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2017. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2016. An expected total OPEB liability as of June 30, 2017 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2017. At June 30, 2017, the School District's proportion was 1.484992%, which was a decrease of 0.019215% from its proportion measured as of June 30, 2016. \r\n \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nFor the year ended June 30, 2018, the School District recognized OPEB expense of $11,695,925.00. At June 30, 2018, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nDeferred Outflow of Resources \r\n \r\nOPEB \r\n \r\nDeferred Intflow of Resources \r\n \r\nChanges of assumptions \r\n \r\n$ \r\n \r\n- $ 15,887,463.00 \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n61,024.00 \r\n \r\n- \r\n \r\nChanges in proportion and difference between School District contributions and proportionate share of contributions \r\n \r\n- \r\n \r\n2,413,614.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n7,665,615.00 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 7,726,639.00 $ 18,301,077.00 \r\n \r\nSchool District contributions subsequent to the measurement date of $7,665,615.00 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nOPEB \r\n \r\n2019 2020 2021 2022 2023 2024 \r\n \r\n$ (3,276,304.00) $ (3,276,304.00) $ (3,276,304.00) $ (3,276,304.00) $ (3,291,560.00) $ (1,843,277.00) \r\n \r\nActuarial assumptions: The total OPEB liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2017: \r\nOPEB: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\nERS \r\n \r\n3.25%  7.00%, average, including inflation \r\n \r\nJRS \r\n \r\n4.50%, including inflation \r\n \r\nLRS \r\n \r\nNone \r\n \r\nTRS \r\n \r\n3.25 -- 9.00%, including inflation \r\n \r\nPSERS \r\n \r\nN/A \r\n \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nLong-term expected rate of return Healthcare cost trend rate \r\nPre-Medicare Eligible Medicare Eligible Ultimate trend rate Pre-Medicare Eligible Medicare Eligible Year of Ultimate trend rate \r\n \r\n3.88%, compounded annually, net of investment expense, and including inflation \r\n7.75% 5.75% \r\n5.00% 5.00% 2022 \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows: \r\n For ERS, JRS and LRS members: The RP-2000 Combined Mortality Table projected to 2025 with projection scale BB and set forward 2 years or both males and females is used for the period after service retirement and for dependent beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB and set back 7 years for males and set forward 3 years for females is used for the period after disability retirement. \r\n For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with projection scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement. \r\n For PSERS members: The RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement. \r\nThe actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014. \r\nProjection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation. \r\nAdditionally, there was a change of assumptions that affected measurement of the total OPEB liability since the prior measurement date. The methodology used to determine employee and retiree participation in the School OPEB Fund is based on their current or last employer payroll location. Current and former employees of public school districts, libraries, regional educational service agencies and community colleges are allocated to the School OPEB Fund irrespective of retirement system affiliation. In addition, the discount rate increased from 3.07% to 3.58%. \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nweighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset Class \r\n \r\nTarget Allocation \r\n \r\nLong-Term Expected Real Rate of Return \r\n \r\nLocal Government Investment Pool \r\n \r\n100.00% \r\n \r\n1.13%* \r\n \r\n*Rate shown is net of the 2.75% assumed rate of inflation. \r\n \r\nDiscount rate: In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.58% was used as the discount rate. This is comprised mainly of the yield or index rate for 20 year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.56% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2115. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2029. Therefore, the calculated discount rate of 3.58% was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\nSensitivity of the District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.58%, as well as what the District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.58%) or 1 percentage-point higher (4.58%) than the current discount rate: \r\n \r\n1% Decrease (2.58%) \r\n \r\nCurrent Discount Rate (3.58%) \r\n \r\n1% Increase (4.58%) \r\n \r\nNet OPEB Liability \r\n \r\n$ 247,723,551.00 $ \r\n \r\n208,640,779.00 $ 177,796,555.00 \r\n \r\nSensitivity of the District's proportionate share of the net OPEB liability to changes in the healthcare cost trend rates: The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentagepoint higher than the current healthcare cost trend rates: \r\n \r\n1% Decrease \r\n \r\nCurrent Healthcare Cost Trend Rate \r\n \r\n1% Increase \r\n \r\nNet OPEB Liability \r\n \r\n$ 172,939,436.00 $ \r\n \r\n208,640,779.00 $ 255,123,872.00 \r\n \r\nOPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports. \r\nPOSTEMPLOYEMENT BENEFITS OTHER THAN PENSIONS (SEAD  OPEB) \r\nP lan description: SEAD-OPEB was created in 2007 by the Georgia General Assembly to amend Title 47 of the O.C.G.A., relating to retirement, so as to establish a fund for the provision of term life insurance to retired and vested inactive members of the Employees' Retirement System of Georgia (ERS), the Legislative Retirement System (LRS), and the Georgia Judicial Retirement System (GJRS). The plan is a cost-sharing multiple-employer defined benefit other postemployment benefit plan as defined in Governmental Accounting Standards Board (GASB) Statement No. 74, Financial Reporting for Postemployment Benefit Plans other than OPEB Plans. The SEAD-OPEB trust fund accumulates the premiums received from the aforementioned retirement plans, including interest earned on deposits and investments of such payments. \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nBenefits provided: The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance in effect on the date of retirement. The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance in effect at age 60 or at termination, if earlier. Life insurance proceeds are paid in a lump sum to the beneficiary upon death of the retiree. \r\n \r\nContributions: Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable \r\ncompensation. There were no employer contributions required for the fiscal year ended June 30, 2018. \r\n \r\nOPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB \r\n \r\nAt June 30, 2018, the Employer reported an asset of $81,706.00 for its proportionate share of the net OPEB asset. The net OPEB asset was measured as of June 30, 2017. The total OPEB asset used to calculate the net OPEB asset was based on an actuarial valuation as of June 30, 2016. An expected total OPEB asset as of June 30, 2017 was determined using standard roll-forward techniques. The Employer's proportion of the net OPEB asset was based on actual member salaries reported to the SEAD-OPEB plan during the fiscal year ended June 30, 2017. At June 30 2017, the Employer's proportion was 0.031437%, which was an increase of 0.002097 % from its proportion measured as of June 30, 2016. \r\n \r\nFor the year ended June 30, 2018, the Employer recognized OPEB income of $8,921.00. At June 30, 2018, the Employer reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: \r\n \r\nSEAD - OPEB \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflow of \r\n \r\nIntflow of \r\n \r\nResources \r\n \r\nResources \r\n \r\nNet difference between projected and \r\n \r\nactual earnings on pension plan investments \r\n \r\n$ \r\n \r\n- $ \r\n \r\n12,485.00 \r\n \r\nChanges in proportion and difference between School District contributions and proportionate share of contributions \r\n \r\n- \r\n \r\n2,743.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n- \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ \r\n \r\n- $ \r\n \r\n15,228.00 \r\n \r\nEmployer contributions subsequent to the measurement date of $0.00 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nSEAD-OPEB \r\n \r\n2019 2020 2021 2022 \r\n \r\n$ (4,492.00) $ (4,493.00) $ (3,121.00) $ (3,122.00) \r\n \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nActuarial assum ptions: The total OPEB liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016 using the following actuarial assumptions, applied to all periods \r\nincluded in the measurement: \r\n \r\nSEAD  OPEB: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases: \r\n \r\nIncludes Inflation \r\n \r\nERS \r\n \r\n3.25%  7.00% \r\n \r\nGJRS \r\n \r\n4.50% \r\n \r\nLRS \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of OPEB plan investment expense, including inflation \r\n \r\nPostretirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. There is a margin for future mortality improvement in the tables used by the plan. \r\n \r\nThe actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nThe long-term expected rate of return on OPEB plan investments was determined using a log-normal \r\n \r\ndistribution analysis in which best-estimate ranges of expected future real rates of return (expected \r\n \r\nnominal returns, net of plan investment expense and the assumed rate of inflation) are developed for \r\n \r\neach major asset class. These ranges are combined to produce the long-term expected rate of return \r\n \r\nby weighting the expected future real rates of return by the target asset allocation percentage and by \r\n \r\nadding expected inflation. The target asset allocation and estimates of arithmetic real rates of return \r\n \r\nfor each major asset class are summarized in the following table: \r\n \r\nSEAD - OPEB \r\n \r\nLong-term \r\n \r\nTarget \r\n \r\nexpected real \r\n \r\nAsset class \r\n \r\nallocation \r\n \r\nrate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n* Rates shown are net of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total OPEB liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the OPEB plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. \r\n \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nSensitivity of the School District's proportionate share of the net OPEB liability to changes in the discount rate: The following presents the Employer's proportionate share of the net OPEB liability calculated using the discount rate of 7.50 %, as well as what the Employer's proportionate share of \r\nthe net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point \r\nlower (6.50 %) or 1- percentage-point higher (8.50 %) than the current rate: \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate (7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\nNet OPEB Asset \r\n \r\n$ (44,721.00) $ \r\n \r\n(81,706.00) $ (112,017.00) \r\n \r\nOP EB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the separately issued ERS comprehensive annual financial report which is publically \r\navailable at www.ers.ga.gov/financials. \r\n \r\nNOTE 12: RETIREMENT PLANS \r\nThe School District participates in various retirement plans administered by the State of Georgia, as further explained below. \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \r\nP lan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications. \r\nBenefits P rovided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2018. The School District's contractually required contribution rate for the year ended June 30, 2018 was 16.81% of annual School District payroll, of which 16.76% of payroll was required from the School District and 0.05% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $27,288,902.73 and $84,502.08 from the School District and the State, respectively. \r\nEMPLOYEES' RETIREMENT SYSTEM \r\nP lan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nO.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's required contribution rate for the year ended June 30, 2018 was 24.81% of annual covered payroll for old and new plan members and 21.81% for GSEPS members. The rates include the annual actuarially determined employer contributions rate of 24.69% of annual covered payroll for old and new plan members and 21.69% for GSPES members, plus a 0.12% adjustment for the HB 751 one-time benefit adjustment of 3% to retired state employees. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $109,324.76 for the current fiscal year. \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS) \r\nP lan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\nUpon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon \r\n- 31 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\ntermination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\n \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\n \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $ 587,258.00. \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\n \r\nAt June 30, 2018, the School District reported a liability of $258,432,338.00 for its proportionate share of the net pension liability for TRS ($257,674,330.00) and ERS ($758,008.00). \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n$ 257,674,330.00 \r\n \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n875,182.00 \r\n \r\nTotal \r\n \r\n$ 258,549,512.00 \r\n \r\nThe net pension liability for TRS and ERS was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2017. \r\nAt June 30, 2017, the School District's TRS proportion was 1.386441%, which was a decrease of 0.091901% from its proportion measured as of June 30, 2016. At June 30, 2017, the School District's ERS proportion was 0.018664%, which was a decrease of 0.000270% from its proportion measured as of June 30, 2016. \r\nAt June 30, 2018, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $3,218,420.00. \r\nThe PSERS net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2017. \r\n \r\n- 32 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nFor the year ended June 30, 2018, the School District recognized pension expense of $26,891,614.00 for TRS, $87,203.00 for ERS and $648,637.00 for PSERS and revenue of $66,159.00 for TRS and $648,637.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\nAt June 30, 2018, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: \r\n \r\nDeferred Outflows of Resources \r\n \r\nTRS Deferred Inflows of Resources \r\n \r\nERS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nInflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ 9,638,607.00 $ \r\n \r\n972,436.00 $ 8,306.00 $ \r\n \r\n6.00 \r\n \r\nChanges of assumptions \r\n \r\n5,648,541.00 \r\n \r\n- \r\n \r\n1,726.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n1,773,230.00 \r\n \r\n- \r\n \r\n1,887.00 \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n6,610,010.00 \r\n \r\n13,390,346.00 \r\n \r\n4,162.00 \r\n \r\n7,012.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n27,288,902.73 \r\n \r\n- \r\n \r\n109,324.76 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 49,186,060.73 $ 16,136,012.00 $ 123,518.76 $ 8,905.00 \r\n \r\nThe School District contributions subsequent to the measurement date of $27,288,902.73 for TRS and $109,324.76 for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\nYear Ended June 30: \r\n \r\nTRS \r\n \r\nERS \r\n \r\n2019 2020 2021 2022 2023 \r\n \r\n$ (3,071,081.00) $ (9,119.00) \r\n \r\n$ 12,461,854.00 $ 27,390.00 \r\n \r\n$ 5,837,695.00 $ 8,509.00 \r\n \r\n$ (9,311,798.00) $ (21,491.00) \r\n \r\n$ \r\n \r\n(155,524.00) $ \r\n \r\n- \r\n \r\nActuarial assum ptions: The total pension liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016, using the following actuarial assumptions, applied to all periods \r\nincluded in the measurement: \r\n \r\nTeachers Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  9.00%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 \r\n \r\n- 33 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nDisabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nEmployees' Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  7.00%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP- 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nPublic School Employees Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\nThe actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected \r\n- 34 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nrate of return by weighting the expected future real rates of return by the target asset allocation \r\n \r\npercentage and by adding expected inflation. The target allocation and best estimates of arithmetic \r\n \r\nreal rates of return for each major asset class are summarized in the following table: \r\n \r\nTRS \r\n \r\nERS/PSERS \r\n \r\nLong-term \r\n \r\nTarget \r\n \r\nTarget \r\n \r\nexpected real \r\n \r\nAsset class \r\n \r\nallocation \r\n \r\nallocation \r\n \r\nrate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 39.80% \r\n3.70% 1.50% 19.40% 5.60% \r\n- \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n100.00% \r\n \r\n* Rates shown are net of the 2.75% assumed rate of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total TRS, ERS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\n \r\nSensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's \r\nproportionate share of the net pension liability would be if it were calculated using a discount rate that \r\nis 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate: \r\n \r\nTeachers' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\n$ 422,873,808.00 $ 257,674,330.00 $ 121,587,091.00 \r\n \r\nEmployees' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n$ 1,069,890.00 $ \r\n \r\n758,008.00 $ \r\n \r\n1% Increase (8.50%) \r\n491,962.00 \r\n \r\nP ension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publically \r\navailable at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs.html. \r\n \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, the School District began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\n- 35 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe School District selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\n \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County School District. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the School District. \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2018 2017 2016 \r\n \r\n100% 100% 100% \r\n \r\n$ \r\n \r\n199,262.27 \r\n \r\n$ \r\n \r\n167,113.99 \r\n \r\n$ \r\n \r\n163,288.54 \r\n \r\nNOTE 13: RESTATEMENT OF PRIOR YEAR NET POSITION \r\nFor fiscal year 2018, the School District made prior period adjustments due to the adoption of GASB Statement No. 75, as described in \"New Accounting Pronouncements\", which require the restatement of the June 30, 2017, net position in Governmental Activities. The result is a decrease in net position at July 1, 2017 of $215,127,350.00. This change is in accordance with generally accepted accounting procedures. \r\n \r\nNet Position, July 1, 2017 as previously reported \r\n \r\n$ 163,293,260.16 \r\n \r\nPrior Period Adjustment - Implementation of GASB No. 75: Net OPEB Liability (measurement date) \r\n \r\n(222,870,219.00) \r\n \r\nDeferred Outflows - School District's Contributions made during fiscal year 2017 \r\n \r\n7,742,869.00 \r\n \r\nNet Position, July 1, 2017, as restated \r\n \r\n$ (51,834,089.84) \r\n \r\n- 36 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2018 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 14: TAX ABATEMENTS \r\nThe School District property tax revenues were reduced by $774,592.78 under agreements entered into by the Houston County Development Authority (Development Authority). The Development Authority issued revenue bonds to provide capital financing for several local businesses. \r\nIncluded in the amount abated, the following are individual tax abatement agreements that each exceeded 10 percent of the total amount abated: \r\n A manufacturing plant expansion. The abatement amounted to $106,591.75.  A manufacturing plant expansion. The abatement amounted to $101,305.11.  A manufacturing plant expansion. The abatement amounted to $135,083.74.  A manufacturing plant expansion. The abatement amounted to $156,467.94. \r\n \r\n- 37 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"1\" \r\n \r\nYear Ended \r\n2018 2017 2016 2015 \r\n \r\nSchool District's proportion of the \r\nnet pension liability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nState of Georgia's proportionate share of the \r\nnet pension liability associated with the School \r\nDistrict \r\n \r\n1.386441% $ 257,674,330.00 $ 1.478342% $ 304,998,438.00 $ 1.418023% $ 215,879,921.00 $ 1.412022% $ 178,390,355.00 $ \r\n \r\n875,182.00 1,090,354.00 \r\n852,392.00 719,867.00 \r\n \r\nTotal \r\n$ 258,549,512.00 $ 306,088,792.00 $ 216,732,313.00 $ 179,110,222.00 \r\n \r\nSchool District's employee payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its employee \r\npayroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\n$ 158,922,980.04 $ 162,747,774.99 $ 150,299,368.59 $ 144,097,581.27 \r\n \r\n162.14% 187.41% 143.63% 123.80% \r\n \r\n79.33% 76.06% 81.44% 84.03% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 39 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"2\" \r\n \r\nYear Ended \r\n2018 2017 2016 2015 \r\n \r\nSchool District's proportion of the net pension liability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nSchool District's covered employee \r\npayroll \r\n \r\n0.018664% $ 758,008.00 $ 0.018934% $ 895,658.00 $ 0.018205% $ 737,557.00 $ 0.017996% $ 674,961.00 $ \r\n \r\n457,801.02 440,233.56 416,239.34 405,211.66 \r\n \r\nSchool District's proportionate share of the net pension liability \r\nas a percentage of covered payroll \r\n165.58% 203.45% 177.20% 166.57% \r\n \r\nPlan fiduciary net position as a \r\npercentage of total net pension liability \r\n76.33% 72.34% 76.20% 77.99% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 40 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOLS EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"3\" \r\n \r\nYear Ended \r\n2018 2017 2016 2015 \r\n \r\nSchool District's proportion of the \r\nnet pension liability \r\n \r\nSchool District's proportionate share of \r\nthe net pension liability \r\n \r\nState of Georgia's proprotionate share of the \r\nnet pension liaibility associated with the School \r\nDistrict \r\n \r\n0.00% $ 0.00% $ 0.00% $ 0.00% $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n3,218,420.00 $ 4,098,431.00 $ 2,607,682.00 $ 2,303,408.00 $ \r\n \r\nTotal \r\n3,218,420.00 4,098,431.00 2,607,682.00 2,303,408.00 \r\n \r\nSchool District's employee payroll \r\n \r\n$ \r\n \r\n11,060,129.01 \r\n \r\n$ \r\n \r\n10,489,156.64 \r\n \r\n$ \r\n \r\n10,330,432.81 \r\n \r\n$ \r\n \r\n10,016,811.88 \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its \r\nemployee payroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\nN/A \r\n \r\n85.69% \r\n \r\nN/A \r\n \r\n81.00% \r\n \r\nN/A \r\n \r\n87.00% \r\n \r\nN/A \r\n \r\n88.29% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 41 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY \r\nSCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"4\" \r\n \r\nYear Ended \r\n \r\nSchool District's proportion of the net OPEB liability \r\n \r\nSchool Distict's proportionate share of the net OPEB liability \r\n \r\nState of Georgia proportionate share of the net OPEB liability \r\nassociated with the School District \r\n \r\nTotal \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as \r\na percentage of its covered-employee \r\npayroll \r\n \r\nPlan fiduciary net position as a percentage of the total OPEB liability \r\n \r\n2018 2017 \r\n \r\n1.484992% $ 208,640,779.00 $ 1.504207% $ 222,927,776.00 $ \r\n \r\n- \r\n \r\n$ 208,640,779.00 $ 121,721,036.65 \r\n \r\n- \r\n \r\n$ 222,927,776.00 $ 117,333,618.48 \r\n \r\n171.41% 189.99% \r\n \r\n1.61% 0.64% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 42 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY (ASSET) \r\nSEAD - OPEB FOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"5\" \r\n \r\nYear Ended 2018 \r\n \r\nSchool District's proportion of the net OPEB asset \r\n \r\nSchool District's proportionate share \r\nof the net OPEB asset \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net OPEB liability as a percentage of its covered- \r\nemployee payroll \r\n \r\n0.031437% $ (81,706.00) $ \r\n \r\n457,801.02 \r\n \r\n(17.85)% \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total OPEB liability \r\n130.17% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 43 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"6\" \r\n \r\nYear Ended \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\nContribution deficiency (excess) \r\n \r\n2018 \r\n \r\n$ \r\n \r\n27,288,902.73 $ \r\n \r\n27,288,902.73 $ \r\n \r\n- \r\n \r\n2017 \r\n \r\n$ \r\n \r\n22,601,157.09 $ \r\n \r\n22,601,157.09 $ \r\n \r\n- \r\n \r\n2016 \r\n \r\n$ \r\n \r\n23,141,378.51 $ \r\n \r\n23,141,378.51 $ \r\n \r\n- \r\n \r\n2015 \r\n \r\n$ \r\n \r\n19,687,721.71 $ \r\n \r\n19,687,721.71 $ \r\n \r\n- \r\n \r\n2014 \r\n \r\n$ \r\n \r\n17,625,185.67 $ \r\n \r\n17,625,185.67 $ \r\n \r\n- \r\n \r\n2013 \r\n \r\n$ \r\n \r\n16,298,602.09 $ \r\n \r\n16,298,602.09 $ \r\n \r\n- \r\n \r\n2012 \r\n \r\n$ \r\n \r\n14,377,512.24 $ \r\n \r\n14,377,512.24 $ \r\n \r\n- \r\n \r\n2011 \r\n \r\n$ \r\n \r\n13,884,720.11 $ \r\n \r\n13,884,720.11 $ \r\n \r\n- \r\n \r\n2010 \r\n \r\n$ \r\n \r\n13,544,690.10 $ \r\n \r\n13,544,690.10 $ \r\n \r\n- \r\n \r\n2009 \r\n \r\n$ \r\n \r\n13,467,356.63 $ \r\n \r\n13,467,356.63 $ \r\n \r\n- \r\n \r\nSchool District's covered payroll \r\n$ 162,856,788.80 $ 158,922,980.04 $ 162,747,774.99 $ 150,299,368.59 $ 144,097,581.27 $ 143,401,483.17 $ 140,498,203.02 $ 135,846,018.48 $ 139,920,328.55 $ 145,452,439.94 \r\n \r\nContribution as a percentage of covered \r\npayroll \r\n16.76% 14.22% 14.22% 13.10% 12.23% 11.37% 10.23% 10.22% \r\n9.68% 9.26% \r\n \r\n- 44 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"7\" \r\n \r\nYear Ended \r\n2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\n$ \r\n \r\n109,324.76 $ \r\n \r\n109,324.76 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n113,580.49 $ \r\n \r\n113,580.49 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n108,825.61 $ \r\n \r\n108,825.61 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n91,406.16 $ \r\n \r\n91,406.16 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n74,802.06 $ \r\n \r\n74,802.06 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n53,504.66 $ \r\n \r\n53,504.66 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n35,683.88 $ \r\n \r\n35,683.88 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,845.78 $ \r\n \r\n29,845.78 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,313.50 $ \r\n \r\n29,313.50 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n27,150.80 $ \r\n \r\n27,150.80 $ \r\n \r\n- \r\n \r\nSchool District's covered payroll \r\n \r\n$ \r\n \r\n440,647.76 \r\n \r\n$ \r\n \r\n457,801.02 \r\n \r\n$ \r\n \r\n440,233.56 \r\n \r\n$ \r\n \r\n416,239.34 \r\n \r\n$ \r\n \r\n405,211.66 \r\n \r\n$ \r\n \r\n359,091.68 \r\n \r\n$ \r\n \r\n306,826.14 \r\n \r\n$ \r\n \r\n286,702.98 \r\n \r\n$ \r\n \r\n281,589.82 \r\n \r\n$ \r\n \r\n260,814.60 \r\n \r\nContribution as a percentage of covered \r\npayroll \r\n24.81% 24.69% 24.72% 21.96% 18.46% 14.90% 11.63% 10.41% 10.41% 10.41% \r\n \r\n- 45 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"8\" \r\n \r\nContractually required \r\n \r\nYear Ended \r\n \r\ncontribution \r\n \r\nContributions in relations to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's coveredemployee payroll \r\n \r\nContributions as a percentage of \r\ncovered-employee payroll \r\n \r\n2018 2017 \r\n \r\n$ \r\n \r\n7,665,615.00 $ \r\n \r\n$ \r\n \r\n7,742,869.00 $ \r\n \r\n7,665,615.00 $ 7,742,869.00 $ \r\n \r\n- \r\n \r\n$ 123,412,244.61 \r\n \r\n- \r\n \r\n$ 121,721,036.65 \r\n \r\n6.21% 6.36% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 46 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS SEAD - OPEB \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"9\" \r\n \r\nYear Ended \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required contribution \r\n \r\nContribution deficiency (excess) \r\n \r\nSchool District's coveredemployee payroll \r\n \r\nContributions as a percentage of \r\ncovered-employee payroll \r\n \r\n2018 \r\n \r\n$ \r\n \r\n2017 \r\n \r\n$ \r\n \r\n2016 \r\n \r\n$ \r\n \r\n2015 \r\n \r\n$ \r\n \r\n2014 \r\n \r\n$ \r\n \r\n2013 \r\n \r\n$ \r\n \r\n2012 \r\n \r\n$ \r\n \r\n2011 \r\n \r\n$ \r\n \r\n2010 \r\n \r\n$ \r\n \r\n2009 \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n440,647.76 457,801.02 440,233.56 416,239.34 405,211.66 359,091.68 306,826.14 286,702.98 281,589.82 260,814.60 \r\n \r\n0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 47 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\nFOR THE YEAR ENDED JUNE 30, 2018 \r\n \r\nSCHEDULE \"10\" \r\n \r\nTeachers Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. \r\nOn November 18, 2-015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP 2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males). \r\nEmployees' Retirement System \r\nChanges of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. \r\nPublic School Employees Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. \r\nOn-December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP 2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females). \r\nSchool OPEB Fund \r\nChanges of benefit terms: In the June 30, 2010 actuarial valuation, there was a change of benefit terms to require Medicare-eligible recipients to enroll in a Medicare Advantage plan to receive the State subsidy. \r\nChanges in assumptions: In the revised June 30, 2017 actuarial valuation, there was a change relating to employee allocation. Employees were previously allocated based on their Retirement System membership, and currently employees are allocated based on their current employer payroll location. Additionally, there were changes to the discount rate and an increase in the investment rate of return due to a longer-term investment strategy. \r\nIn the June 30, 2015 actuarial valuation, decremental and underlying inflation assumptions were changed to reflect the Retirement Systems' experience studies. \r\nIn the June 30, 2012 actuarial valuation, a data audit was performed and data collection procedures and assumptions were changed. \r\nSEAD-OPEB Employer \r\nChanges of assumptions: On December 17, 2015, the Board of Trustees adopted recommended changes to the economic and demographic assumptions utilized by the Plan. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. \r\n \r\n- 48 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION GENERAL FUND \r\nSCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL \r\nYEAR ENDED JUNE 30, 2018 \r\n \r\nSCHEDULE \"11\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services \r\nInstructional Staff Training \r\nEducational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation Debt Service \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nOther Sources Other Uses \r\nTotal Other Financing Sources (Uses) \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nNONAPPROPRIATED BUDGETS \r\n \r\nORIGINAL (1) \r\n \r\nFINAL (1) \r\n \r\nACTUAL AMOUNTS \r\n \r\nVARIANCE OVER/UNDER \r\n \r\n$ \r\n \r\n53,300,000.00 $ \r\n \r\n53,950,000.00 $ \r\n \r\n53,908,089.04 $ \r\n \r\n23,371,027.00 \r\n \r\n23,546,027.00 \r\n \r\n25,523,895.76 \r\n \r\n179,245,030.14 \r\n \r\n182,117,052.22 \r\n \r\n182,722,128.16 \r\n \r\n28,835,073.00 \r\n \r\n29,655,916.00 \r\n \r\n29,542,339.65 \r\n \r\n8,231,238.00 \r\n \r\n8,231,238.00 \r\n \r\n8,470,911.52 \r\n \r\n253,725.00 \r\n \r\n618,725.00 \r\n \r\n673,006.15 \r\n \r\n6,050,096.00 \r\n \r\n5,172,691.00 \r\n \r\n5,194,169.87 \r\n \r\n299,286,189.14 \r\n \r\n303,291,649.22 \r\n \r\n306,034,540.15 \r\n \r\n(41,910.96) 1,977,868.76 \r\n605,075.94 (113,576.35) 239,673.52 \r\n54,281.15 21,478.87 \r\n2,742,890.93 \r\n \r\n191,264,565.14 \r\n13,295,025.00 8,069,647.00 15,500.00 3,940,303.00 1,894,138.00 \r\n19,441,510.00 2,572,612.00 \r\n21,236,160.00 12,818,366.00 \r\n3,776,636.00 1,364,314.00 2,357,297.00 1,035,000.00 19,418,090.00 \r\n- \r\n302,499,163.14 \r\n(3,212,974.00) \r\n \r\n187,388,368.32 \r\n14,109,369.39 6,306,951.90 2,761,900.81 3,915,303.00 1,832,032.99 \r\n19,551,510.00 2,466,296.21 \r\n21,804,294.76 13,046,355.54 \r\n3,683,564.00 1,411,509.09 2,357,297.00 1,035,000.00 19,483,699.28 \r\n- \r\n301,153,452.29 \r\n2,138,196.93 \r\n \r\n187,757,771.23 \r\n13,936,903.97 6,230,142.97 2,572,505.07 3,918,657.59 1,671,794.65 \r\n19,402,606.23 2,457,833.60 \r\n22,006,720.75 12,392,973.53 \r\n3,699,093.35 1,395,488.65 2,439,446.45 1,090,733.16 18,508,162.06 \r\n665,830.63 \r\n300,146,663.89 \r\n5,887,876.26 \r\n \r\n(369,402.91) \r\n172,465.42 76,808.93 \r\n189,395.74 (3,354.59) \r\n160,238.34 148,903.77 \r\n8,462.61 (202,425.99) 653,382.01 \r\n(15,529.35) 16,020.44 (82,149.45) (55,733.16) 975,537.22 (665,830.63) \r\n1,006,788.40 \r\n3,749,679.33 \r\n \r\n3,098,873.00 (3,225,762.00) \r\n(126,889.00) (3,339,863.00) 44,100,273.74 \r\n \r\n3,098,873.00 (3,225,762.00) \r\n(126,889.00) 2,011,307.93 43,706,370.53 \r\n \r\n5,887,876.26 79,052,030.29 \r\n \r\n(3,098,873.00) 3,225,762.00 \r\n126,889.00 3,876,568.33 35,345,659.76 \r\n \r\n$ \r\n \r\n40,760,410.74 $ \r\n \r\n45,717,678.46 $ \r\n \r\n84,939,906.55 $ \r\n \r\n39,222,228.09 \r\n \r\nNotes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual \r\n(1) Original and Final Budget amounts do not include the Restricted Other - Property Tax Rollback fund balance in the beginning or ending fund balances. \r\nThe accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 49 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2018 \r\n \r\nSCHEDULE \"12\" \r\n \r\nFUNDING AGENCY PROGRAM/GRANT \r\nAgriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program \r\nTotal Child Nutrition Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Food Services Fresh Fruit and Vegetable Program \r\nTotal U. S. Department of Agriculture \r\nEducation, U. S. Department of Impact Aid Cluster Direct Impact Aid \r\nSpecial Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants \r\nTotal Special Education Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Education for Homeless Children and Youth English Language Acquisition Grants Supporting Effective Instruction State Grants Mathematics and Science Partnerships Migrant Education - State Grant Program Student Support and Academic Enrichment Program Title I Grants to Local Educational Agencies \r\nTotal Other Programs \r\nTotal U. S. Department of Education \r\nDefense, U. S. Department of the Air Force Direct Department of the Air Force R.O.T.C. Program \r\nFederal Emergency Management Agency Pass-Through From Georgia Emergency Management Agency Disaster Relief \r\nTotal Expenditures of Federal Awards \r\n \r\nCFDA NUMBER \r\n \r\nPASSTHROUGH \r\nENTITY ID \r\nNUMBER \r\n \r\nEXPENDITURES IN PERIOD \r\n \r\n10.553 10.555 \r\n \r\n18185GA324N1099 $ 18185GA324N1100 \r\n \r\n4,131,949.21 13,676,546.08 \r\n17,808,495.29 \r\n \r\n10.582 \r\n \r\n185GA324L1603 \r\n \r\n138,184.26 17,946,679.55 \r\n \r\n84.041 \r\n \r\n1,131,037.20 \r\n \r\n84.027 84.173 \r\n \r\nH027A170073 H173A170081 \r\n \r\n4,951,978.00 139,711.00 \r\n5,091,689.00 \r\n \r\n84.048 84.196 84.365 84.367 84.366 84.011 84.424A 84.010 \r\n \r\nV048A170010 S196A170011 S365A170010 S367A170001 S366B170011 S011A170011 S424A170011 S010A170010 \r\n \r\n234,016.00 45,238.79 \r\n122,990.66 784,317.57 110,217.09 \r\n40,777.54 149,150.59 6,540,732.05 \r\n8,027,440.29 \r\n14,250,166.49 \r\n \r\n12.UNKNOWN 97.036 \r\n \r\n361,868.25 \r\n \r\n13,243.14 \r\n \r\n$ \r\n \r\n32,571,957.43 \r\n \r\nNotes to the Schedule of Expenditures of Federal Awards \r\nNote 1. Basis of Presentation \r\nThe accompanying schedule of expenditures of federal awards (the \"Schedule\") includes the Federal award activity of the Houston County Board of Education (the \"Board\") under programs of the federal government for the year ended June 30, 2018. The information in this Schedule is presented under the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board. \r\nNote 2. Summary of Significant Accounting Policies \r\nExpenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Government, or the cost principles in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited to reimbursement. The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 50 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2018 \r\nAGENCY/FUNDING \r\nGRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program \r\nEducation, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle Grades (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Amended Formula Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Migrant Education Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Military Counselors Preschool Handicapped Program Pupil Transportation - State Bonds Teacher of the Year Teachers Retirement Vocational Education \r\nGeorgia Emergency Management Agency Disaster Relief \r\nGovernor's Office of Student Achievement Connections for Classroom Grant \r\nOffice of the State Treasurer Public School Employees Retirement \r\nSee notes to the basic financial statements. \r\n \r\nSCHEDULE \"13\" \r\n \r\nGOVERNMENTAL FUND TYPE GENERAL FUND \r\n \r\n$ \r\n \r\n4,229,867.72 \r\n \r\n9,912,336.00 521,881.00 \r\n23,478,540.00 1,404,045.00 \r\n11,818,304.00 1,041,130.00 \r\n19,571,707.00 16,007,739.00 \r\n5,277,238.00 23,752,041.00 12,933,200.00 \r\n665,309.00 1,362,055.00 1,496,316.00 3,463,106.00 1,017,167.00 \r\n574,340.00 10,042.00 \r\n3,733,792.00 6,623,650.00 7,578,771.00 (2,504,000.00) \r\n1,538,269.00 571,906.00 33,006.00 \r\n23,980,730.00 \r\n449,530.00 284,792.14 \r\n40,468.00 476,041.00 \r\n77,319.58 507.25 \r\n84,502.08 571,476.00 \r\n934.81 \r\n56,811.58 \r\n587,258.00 \r\n \r\n$ \r\n \r\n182,722,128.16 \r\n \r\n- 51 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\nYEAR ENDED JUNE 30, 2018 \r\n \r\nSCHEDULE \"14\" \r\n \r\nPROJECT \r\n2012 SPLOST (1) Acquiring instructional and administrative technology equipment (2) Acquiring safety and security equipment (3) Adding to, renovating, repairing, improving, and equipping existing school buildings and other buildings and facilities (4) Acquiring, constructing, and equipping two replacement elementary schools (5) Acquiring, constructing, and equipping a central transportation (bus) facility (6) Acquiring, constructing, and equipping stadium and tennis facilities (7) Acquiring any necessary property, both real and personal (8) Paying (Legal and Administrative) expenses incident to accomplishing the foregoing \r\n \r\nORIGINAL ESTIMATED \r\nCOST (1) \r\n \r\nCURRENT ESTIMATED COSTS (2) \r\n \r\nAMOUNT EXPENDED IN CURRENT YEAR (3) (4) \r\n \r\nAMOUNT EXPENDED IN PRIOR YEARS (3) (4) \r\n \r\nTOTAL COMPLETION \r\nCOST \r\n \r\nEXCESS PROCEEDS \r\nNOT EXPENDED \r\n \r\nPROJECT STATUS \r\n \r\nESTIMATED COMPLETION \r\nDATE \r\n \r\n$ \r\n \r\n- $ 20,448,779.00 $ \r\n \r\n9,813.78 $ 20,438,964.86 $ 20,448,778.64 $ \r\n \r\n- \r\n \r\n1,659,729.00 \r\n \r\n102,100.03 \r\n \r\n1,557,627.99 \r\n \r\n1,659,728.02 \r\n \r\n- \r\n \r\n44,899,971.00 \r\n \r\n- \r\n \r\n26,508,184.00 \r\n \r\n- \r\n \r\n6,506,311.00 \r\n \r\n- \r\n \r\n13,563,653.00 \r\n \r\n- \r\n \r\n1,222,146.00 \r\n \r\n- \r\n \r\n472,924.00 \r\n \r\n$ 125,000,000.00 $ 115,281,697.00 $ \r\n \r\n419,586.63 \r\n \r\n43,154,745.74 \r\n \r\n- \r\n \r\n- \r\n \r\n26,508,183.93 \r\n \r\n26,508,183.93 \r\n \r\n267,117.72 \r\n \r\n6,239,192.45 \r\n \r\n6,506,310.17 \r\n \r\n- \r\n \r\n12,063,652.92 \r\n \r\n- \r\n \r\n- \r\n \r\n1,222,145.37 \r\n \r\n1,222,145.37 \r\n \r\n- \r\n \r\n472,923.22 \r\n \r\n472,923.22 \r\n \r\n798,618.16 $ 111,657,436.48 $ 56,818,069.35 $ \r\n \r\n- \r\n \r\nCompleted \r\n \r\nOctober 30, 2017 \r\n \r\n- \r\n \r\nCompleted \r\n \r\nSeptember 30, 2017 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nDecember 31, 2018 \r\n \r\n- \r\n \r\nCompleted \r\n \r\nNovember 30, 2014 \r\n \r\n- \r\n \r\nCompleted \r\n \r\nJuly 31, 2017 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2019 \r\n \r\n- \r\n \r\nCompleted \r\n \r\nJune 30, 2017 \r\n \r\n- \r\n \r\nCompleted \r\n \r\nNovember 30, 2016 \r\n \r\n- \r\n \r\n2017 SPLOST \r\n \r\n(1) Acquiring instructional and administrative technology \r\n \r\nequipment and materials \r\n \r\n$ \r\n \r\n(2) Acquiring safety, security, and fire protection equipment \r\n \r\n(3) Adding to, renovating, repairing, improving, furnishing \r\n \r\nand equipping existing school buildings, and physical \r\n \r\neducation and other buildings and facilities, including any \r\n \r\nnecessary demolition \r\n \r\n(4) Adding to, constructing, renovating, furnishing, and \r\n \r\nequipping gymnasiums and athletic facilities \r\n \r\n(5) Renovations, additions,and improvements to parking and \r\n \r\ntraffic access facilities, including any necessary sitework \r\n \r\n(6) Acquiring, constructing, furnishing, and equipping one \r\n \r\nnew elementary school \r\n \r\n(7) Acquiring buses, vehicles, and transportation equipment \r\n \r\n(8) Acquiring any necessary property, both real and \r\n \r\npersonal \r\n \r\n(9) Paying expenses incident to accomplishing the foregoing \r\n \r\n- $ 20,000,000.00 $ 2,912,422.35 $ \r\n \r\n- \r\n \r\n1,913,015.00 \r\n \r\n262,525.23 \r\n \r\n619,513.85 $ 84,103.75 \r\n \r\n3,531,936.20 $ 346,628.98 \r\n \r\n- \r\n \r\n32,120,021.00 \r\n \r\n7,456,434.65 \r\n \r\n- \r\n \r\n49,082,540.00 \r\n \r\n3,098,682.77 \r\n \r\n- \r\n \r\n3,834,403.00 \r\n \r\n466,363.25 \r\n \r\n- \r\n \r\n15,680,000.00 \r\n \r\n- \r\n \r\n- \r\n \r\n5,000,000.00 \r\n \r\n1,442,452.00 \r\n \r\n- \r\n \r\n2,000,000.00 \r\n \r\n- \r\n \r\n404,612.00 \r\n \r\n3,900.00 5,620.00 \r\n \r\n551,695.05 \r\n- \r\n- \r\n91,464.00 \r\n374,612.16 \r\n \r\n8,008,129.70 \r\n3,098,682.77 \r\n466,363.25 \r\n1,533,916.00 \r\n3,900.00 380,232.16 \r\n \r\n- \r\n \r\nOngoing \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 June 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nSeptember 30, 2021 \r\n \r\n- \r\n \r\nOngoing \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2020 August 31, 2021 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nNovember 30, 2021 \r\n \r\n$ 135,000,000.00 $ 130,034,591.00 $ 15,648,400.25 $ \r\n \r\n1,721,388.81 $ 17,369,789.06 $ \r\n \r\n- \r\n \r\n(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. \r\n \r\n(2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. \r\n \r\n(3) The voters of Houston County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. \r\n \r\n(4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows: \r\n \r\nPrior Years Current Year \r\n \r\n$ 5,731,954.59 1,395,059.38 \r\n \r\nTotal \r\n \r\n$ 7,127,013.97 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 53 - \r\n \r\n SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 18, 2019 \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED \r\nIN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 18, 2019. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\n \r\n Compliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 18, 2019 \r\n \r\nThe Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited the Houston County Board of Education's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\nWe believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance. \r\n \r\n Opinion on Each Major Federal Program \r\nIn our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018. \r\nReport on Internal Control over Compliance \r\nManagement of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2018 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\nPRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2018 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\nType of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information \r\n \r\nUnmodified \r\n \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nNoncompliance material to financial statements noted: \r\n \r\nNo \r\n \r\nFederal Awards \r\n \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with 2 CFR 200.516(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: CFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n10.553, 10.555 \r\n \r\nChild Nutrition Cluster \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: \r\n \r\n$977,159.26 \r\n \r\nAuditee qualified as low-risk auditee? \r\n \r\nYes \r\n \r\nII FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\n \r\nNo matters were reported. \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2017-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2017 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2018-03-22"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2017 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2017-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2017-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"Houston County Board of Education \r\nPerry, Georgia \r\nFiscal Year 2017 Audit Report \r\nYear Ended June 30, 2017 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nPage \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\ni \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nGOVERNMENT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\n1 \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\n2 \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n4 \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\n5 \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n6 \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\n7 \r\n \r\nG \r\n \r\nSTATEMENT OF FIDUCIARY NET POSITION \r\n \r\nFIDUCIARY FUNDS \r\n \r\n8 \r\n \r\nH \r\n \r\nNOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\n9 \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n33 \r\n \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nEMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n34 \r\n \r\n3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\n \r\n35 \r\n \r\n4 SCHEDULE OF CONTRIBUTIONS  TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n36 \r\n \r\n5 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 37 \r\n \r\n6 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n38 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n7 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND \r\n \r\nSUPPLEMENTARY INFORMATION \r\n \r\n8 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 9 SCHEDULE OF STATE REVENUE 10 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\nPage \r\n39 40 41 43 \r\n \r\nSECTION II \r\nCOMPLIANCE AND INTERNAL CONTROL REPORTS \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\n \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n SECTION I FINANCIAL \r\n \r\n GREG S. GRIFFIN \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2018 \r\n \r\nThe Honorable Nathan Deal, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also \r\n \r\n includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\nWe believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2017, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nEmphasis of Matter \r\nAs described in Note 2 to the financial statements, in 2017, the School District adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 77, Tax Abatement Disclosures, GASB Statement No. 80, Blending Requirements for Certain Component Units, and GASB Statement No. 82, Pension Issues. Our opinions are not modified with respect to these matters. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Schedules of Proportionate Share of the Net Pension Liability, Schedules of Contributions to Retirement Systems, Notes to the Required Supplementary Information and the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual as presented on pages i through ix, and pages 33 through 39 respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements. \r\n \r\n The accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. \r\nOther Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated March 22, 2018 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\nINTRODUCTION \r\nThe discussion and analysis of Houston County Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2017. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFINANCIAL HIGHLIGHTS \r\nKey financial highlights for 2017 are as follows: \r\nOn the government-wide financial statements: \r\n On the government-wide financial statements, net position increased $0.9 million which represents a 0.6 percent increase from 2016. This total increase was due to governmental activities since the School District has no business-type activities. \r\n The School District had $313.1 million in expenses related to governmental activities. Revenues totaled $314.0 million. Program specific revenues in the form of charges for services and sales, grants, and contributions accounted for $186.8 million or 59.5 percent of the total revenues and were used to offset these expenditures. General revenues of $127.2 million or 40.5 percent of all revenues were adequate to provide for these programs. \r\n The current ratio, which measures the Board's ability to transform current assets into cash and pay its short-term liabilities, was 7.55 for the fiscal year ended June 30, 2017. Generally, a ratio greater than 2.0 is considered very financially stable. \r\nOn the fund financial statements: \r\n Among major funds, the general fund had $289.9 million in revenues and other financing sources, and $286.4 million in expenditures and other financing uses. The general fund's fund balance increased to $79.1 million. \r\nOverview of the Financial Statements \r\nThis annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the Houston County Board of Education. These include the government-wide and fund financial statements. \r\nThe government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status. \r\nThe fund financial statements focus on individual parts, reporting the School District's operation in more detail. The governmental funds statements disclose how basic services are financed in the shortterm as well as what remains for future spending. The fiduciary funds statements provide information about the financial relationships in which the Board acts solely as a trustee or agent for the benefit of others. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\nThe fund financial statements reflect the School District's most significant funds. For the years ending June 30, 2017, the general fund, the capital projects fund, and the debt service fund represent the most significant funds. \r\nThe financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. \r\nGovernment-Wide Statements \r\nThe government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. \r\nThe two government-wide statements report the School District's net position and how it has changed. Net position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in net position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities  All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, student and principal accounts, and various others. \r\nFund Financial Statements \r\nThe School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, capital projects fund, and debt service fund. \r\nGovernmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements. \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\n \r\nFiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others, such as the employee benefit programs, and school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations. \r\n \r\nFINANCIAL ANALYSIS OF THE BOARD AS A WHOLE \r\n \r\nRecall that the Statement of Net Position provides the perspective of the Board as a whole. Table 1 provides a summary of the Board's net position for 2017 compared to fiscal year 2016. \r\n \r\nAssets Current and Other Assets Capital Assets, Net \r\n \r\nTable 1 Net Position (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year 2017 \r\n \r\nFiscal Year 2016 \r\n \r\n$ 149,380 308,818 \r\n \r\n$ 111,374 311,702 \r\n \r\nTotal Assets \r\n \r\n458,198 \r\n \r\n423,076 \r\n \r\nDeferred Outflows of Resources \r\n \r\n82,602 \r\n \r\n24,123 \r\n \r\nLiabilities Current and Other Liabilities Long-Term Liabilities \r\n \r\n19,790 355,139 \r\n \r\n19,245 243,917 \r\n \r\nTotal Liabilities \r\n \r\n374,929 \r\n \r\n263,162 \r\n \r\nDeferred Inflows of Resources \r\n \r\n2,578 \r\n \r\n21,680 \r\n \r\nNet Position Net Investment in Capital Assets Restricted Unrestricted (Deficit) \r\n \r\n307,256 66,339 \r\n(210,302) \r\n \r\n302,604 59,029 \r\n(199,276) \r\n \r\nTotal Net Position \r\n \r\n$ 163,293 $ 162,357 \r\n \r\nTotal net position increased $0.9 million to $163.3 million. \r\n \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\n \r\nTable 2 shows the changes in net position for fiscal year 2017 compared to the changes in net position for fiscal year 2016. \r\nTable 2 Changes in Net Position \r\n(In Thousands) \r\n \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2017 \r\n \r\nYear 2016 \r\n \r\n$ \r\n \r\n8,188 $ \r\n \r\n8,219 \r\n \r\n176,367 \r\n \r\n166,655 \r\n \r\n2,294 \r\n \r\n2,557 \r\n \r\nTotal Program Revenues \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted Investment Earnings Miscellaneous \r\n \r\n186,849 \r\n \r\n177,431 \r\n \r\n51,503 2,088 \r\n22,267 \r\n22,270 1,285 \r\n21,207 410 \r\n6,161 \r\n \r\n51,074 2,453 \r\n22,302 \r\n22,296 1,073 \r\n19,081 166 \r\n6,193 \r\n \r\nTotal General Revenues \r\n \r\n127,191 \r\n \r\n124,638 \r\n \r\nTotal Revenues \r\n \r\n314,040 \r\n \r\n302,069 \r\n \r\nProgram Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n202,381 \r\n13,058 8,044 4,424 1,630 \r\n19,952 2,778 \r\n20,905 12,078 \r\n4,102 1,187 \r\n2,379 1,054 19,419 \r\n(287) \r\n \r\n177,182 \r\n8,660 7,360 3,864 1,417 17,470 2,209 18,707 10,960 2,919 1,120 \r\n2,255 1,022 18,689 \r\n(228) \r\n \r\nTotal Expenses \r\n \r\n313,104 \r\n \r\n273,606 \r\n \r\nIncrease in Net Position \r\n \r\n$ \r\n \r\n936 $ 28,463 \r\n \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\nFigure A shows the funding sources for the revenues. 54.1 percent of the School District's revenues are derived from state grants. Property Taxes make up 17.3 percent of the total funding, while an additional 14.7 percent is earned from the District's sales taxes. \r\nFigure A Sources of Revenue for Fiscal Year 2017 \r\n \r\nState Funds 54.1% \r\n \r\nFederal Funds 9.1% \r\n \r\nCharges for Services 2.6% \r\n \r\nMiscellaneous 2.1% \r\n \r\nSales Taxes 14.7% \r\n \r\nProperty Taxes 17.3% \r\nInvestment Earnings \r\n0.1% \r\n \r\nAs shown in Figure B, Instruction comprised 64.6 percent of governmental program expenses. Administration and Other Services (3.1 percent) consist of the central office, business and warehouse, and other central operations of the School District. \r\nFigure B Functional Expenses for Fiscal Year 2017 \r\n \r\nEducational Media 1.4% \r\nImprovement of Instruction 2.6% \r\nPupil Services 4.2% Interest on Debt -0.1% \r\n \r\nInstruction 64.6% \r\n \r\nAdministration \u0026 Other Services \r\n3.1% \r\n \r\nSchool Administration \r\n6.4% \r\n \r\nEnterprise \u0026 \r\n \r\nCommunity Food Services \r\n \r\nServices \r\n \r\n6.2% \r\n \r\n1.1% \r\n \r\nStudent Transportation \r\nServices 3.8% \r\n \r\nMaintenance and Operation of Plant \r\n6.7% \r\n \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\n \r\nGovernmental Activities \r\n \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2017 with fiscal year 2016. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(In Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2017 \r\n \r\nYear 2016 \r\n \r\nNet Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2017 \r\n \r\nYear 2016 \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\n \r\n$ 202,381 $ 177,182 $ \r\n \r\n13,058 8,044 4,424 1,630 \r\n19,952 2,778 \r\n20,905 12,078 \r\n4,102 1,187 \r\n \r\n8,660 7,360 3,864 1,417 17,470 2,209 18,707 10,960 2,919 1,120 \r\n \r\n2,379 1,054 19,419 (287) \r\n \r\n2,255 1,022 18,689 (228) \r\n \r\n73,317 $ \r\n5,843 3,137 \r\n672 1,086 12,716 2,246 12,185 9,834 3,263 \r\n714 \r\n830 1,054 (356) (287) \r\n \r\n53,902 \r\n4,476 2,367 \r\n147 937 9,570 1,712 11,030 8,923 2,215 \r\n24 \r\n739 1,022 (661) (228) \r\n \r\nTotal Expenses \r\n \r\n$ 313,104 $ 273,606 $ 126,254 $ 96,175 \r\n \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 36.2 percent of Instruction activities are supported through taxes and other general revenues, and for all governmental activities general revenue support is 40.3 percent. \r\n \r\nThe School District's Funds \r\n \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $345.6 million and expenditures of $307.4 million. There was an increase in the fund balance totaling $38.2 million for the governmental funds as a whole. The general fund increased by $3.5 million due mainly to increases in mid-term funding and careful planning of expenditures. The capital projects funds had an increase of $34.0 million and debt service fund had a slight increase of $0.6 million to meet the subsequent year's debt requirements. The capital projects fund increase was due to the sale of $30.0 million in general obligation bonds during the fiscal year 2017 to be repaid by the proceeds of the Education Special Purpose Local Option Sales Tax (ESPLOST) to be collected during fiscal years 2017 to 2022. The increase in the debt service fund was attributable to the amount of ESPLOST proceeds being needed to meet the interest and principal payments due on the outstanding debt associated \r\n \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\n \r\nwith previously issued general obligation bonds in the subsequent year. The increase in the fund balance of the general fund for the year reflects that the School District was able to meet current costs as planned and budgeted. \r\n \r\nGeneral Fund Budgeting Highlights \r\n \r\nThe School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund. \r\n \r\nDuring the course of fiscal year 2017, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. \r\n \r\nFor the general fund, the final budgeted revenues and other financing sources of $292.4 million was greater than the original budgeted amount of $290.4 million by $2.0 million. The overall difference was mainly due to additional state grant awards and additional local revenues. The actual revenues and other financing sources of $290.0 million was less than the budgeted amount by $2.4 million due mainly to the elimination of intrafund transfers and an increase in local funding. \r\n \r\nThe final budgeted expenditures and other financing uses of $291.1 million was less than the original budgeted amount of $292.7 million by $1.6 million. This difference was due mainly to adjusting the budget to reflect the revised needs. The actual expenditures and other financing uses of $286.5 million was $4.6 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. \r\n \r\nThe differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes that had previously been reported as deferred as current and prior year revenues for report purposes. \r\n \r\nCAPITAL ASSETS AND DEBT ADMINISTRATION \r\n \r\nCapital Assets \r\n \r\nAt the end of fiscal year 2017, the School District had $308.8 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2017 balances compared with fiscal year 2016 balances. \r\nTable 4 Capital Assets at June 30 (Net Depreciation, in Thousands) \r\n \r\nLand Construction In Progress Buildings and Building Improvements Equipment Land Improvements \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2017 \r\n \r\nYear 2016 \r\n \r\n$ 11,278 8,343 \r\n276,825 6,948 5,424 \r\n \r\n$ 11,278 24,646 \r\n264,125 6,696 4,957 \r\n \r\nTotal \r\n \r\n$ 308,818 $ 311,702 \r\n \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\n \r\nThe overall capital assets decreased in fiscal year 2017 by $2.9 million due to the construction and renovation expenses from the 2012 ESPLOST and Capital Outlay Projects during the current year being offset by the fiscal year 2017 depreciation of $12.7 million. \r\n \r\nDebt \r\n \r\nAt June 30, 2017, the School District had $40.3 million in bonds outstanding with $10.3 million due within one year, $1.6 million in capital leases outstanding with $0.6 million due within one year, $3.1 million in compensated absences earned as of the end of the year, and $4.2 million in unamortized bond premiums with $1.1 million due with one year. In addition, the School District reported a liability for its proportionate share of the net pension liability. Reporting this liability was required by GASB No. 68. \r\n \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2017, compared to fiscal year 2016 balances. \r\nTable 5 Debt at June 30 (In Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2017 \r\n \r\nYear 2016 \r\n \r\nGeneral Obligation Bonds Capital Leases Compensated Absences Unamortized Bond Premiums Net Pension Liability \r\n \r\n$ \r\n \r\n40,305 $ 20,390 \r\n \r\n1,583 \r\n \r\n2,217 \r\n \r\n3,114 \r\n \r\n2,592 \r\n \r\n4,243 \r\n \r\n2,101 \r\n \r\n305,894 \r\n \r\n216,617 \r\n \r\n$ 355,139 $ 243,917 \r\n \r\nAt June 30, 2017, the School District's overall legal bonding authority was $375.9 million based on the assessed value of taxable property as of December 31, 2016. The School District's bonds have assigned ratings of Aa1 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. Both the current year payments and subsequently scheduled payments are well below the $5.8 million threshold. \r\n \r\nCurrent Issues \r\n \r\nThe Houston County School District consists of 39 campuses located in Houston County, a fast-growing area with a population of approximately 152,122. Current enrollment is approximately 29,500 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 15th in population, 15th in economics, and 16th in income. The 2016 School District millage ranks 165th out of 180 districts in Georgia. \r\n \r\nThe State of Georgia experienced serious financial hardship over the past few years, and as a result, more pressure is being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2.0 million in 2003 to a high of $23.8 million in 2010. For fiscal year 2017 the reduction was $2.9 million. Reductions in other state grants and programs resulted in the total reduction of state funding for 2017 reaching approximately $19.5 million. For fiscal year 2018, \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2017 \r\nadditional austerity reductions of $2.9 million have already been approved by the state for the School District. Since the austerity reductions were enacted, the reductions total $158.4 million and the overall reduction of state funding is approximately $317.6 million. While Houston County's class sizes remain below the state maximum recommendations, continued reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. Houston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2016 economic impact on the State of Georgia of $2.86 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the county include the Board of Education, Houston County Hospital Authority, Perdue Farms, FritoLay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 62.8 percent work in county. Houston is Georgia's sixty-fifth largest county in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990-2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and was projected to grow to 152,122 in 2016. This growth results in school system enrollment increases between 198 to 487 students for the past five years. Houston County has three municipalities: Centerville with an estimated population of 7,615; Perry with 14,730; and Warner Robins with 74,388. The County also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. CONTACTING THE SCHOOL DISTRICT'S FNANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2017 \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) \r\nTotal Assets \r\nDEFERRED OUTFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Interest Payable Claims Incurred but not Reported (IBNR) Retainages Payable Net Pension Liability Long-Term Liabilities \r\nDue Within One Year Due in More Than One Year \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans \r\nNET POSITION \r\nNet Investment in Capital Assets Restricted for \r\nContinuation of Federal Programs Debt Service Capital Projects Property Tax Rollback Unrestricted (Deficit) \r\nTotal Net Position \r\n \r\nEXHIBIT \"A\" \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\n$ \r\n \r\n113,558,073.82 \r\n \r\n275,671.46 \r\n \r\n6,334,651.39 20,711,329.53 \r\n3,053,611.83 733,969.80 \r\n4,712,405.90 19,621,324.46 289,196,587.37 \r\n \r\n458,197,625.56 \r\n \r\n82,602,803.58 \r\n \r\n49,298.76 17,517,833.31 \r\n487,211.88 1,147,123.44 \r\n588,367.04 305,894,096.00 \r\n12,009,672.15 37,235,559.40 \r\n374,929,161.98 \r\n \r\n2,578,007.00 \r\n \r\n307,255,768.16 \r\n8,529,562.72 10,567,799.94 11,896,006.45 35,345,659.76 (210,301,536.87) \r\n \r\n$ \r\n \r\n163,293,260.16 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 1 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES \r\nFOR THE YEAR ENDED JUNE 30, 2017 \r\n \r\nGOVERNMENTAL ACTIVITIES \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\nTotal Governmental Activities \r\nGeneral Revenues Taxes Property Taxes For Maintenance and Operations Alternative Ad Valorem Tax Forest Land Protection Tax Railroad Cars Title Ad Valorem Tax Sales Taxes Special Purpose Local Option Sales Tax For Debt Services For Capital Projects Local Option Sales Tax Intangible Recording Tax Real Estate Transfer Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\nTotal General Revenues \r\nChange in Net Position \r\nNet Position - Beginning of Year \r\n \r\nEXPENSES \r\n \r\nCHARGES FOR SERVICES \r\n \r\nPROGRAM REVENUES \r\n \r\n$ 202,380,397.05 $ \r\n13,057,820.66 8,044,326.28 4,424,640.07 1,629,978.50 \r\n19,952,034.59 2,777,928.59 \r\n20,904,956.27 12,078,479.54 \r\n4,101,707.71 1,186,518.24 \r\n2,379,441.19 1,053,698.76 19,418,646.88 \r\n(286,904.71) \r\n$ 313,103,669.62 $ \r\n \r\n2,702,628.39 \r\n5,015.86 115,136.94 - \r\n1,549,120.18 - \r\n3,816,373.23 - \r\n8,188,274.60 \r\n \r\nNet Position - End of Year \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 2 - \r\n \r\n EXHIBIT \"B\" \r\n \r\nPROGRAM REVENUES OPERATING GRANTS AND \r\nCONTRIBUTIONS \r\n \r\nCAPITAL GRANTS AND CONTRIBUTIONS \r\n \r\nNET (EXPENSES) REVENUES \r\nAND CHANGES IN NET POSITION \r\n \r\n$ 124,906,546.58 $ \r\n7,214,520.98 4,907,858.60 3,686,673.83 \r\n541,750.49 7,170,632.67 \r\n516,858.08 8,696,720.84 2,052,077.53 \r\n833,383.03 472,692.49 \r\n15,367,585.44 - \r\n$ 176,367,300.56 $ \r\n \r\n1,454,106.81 $ \r\n610.73 - \r\n65,625.70 1,810.73 \r\n65,383.07 14,901.45 17,857.11 77,216.25 \r\n5,727.07 - \r\n590,634.75 - \r\n2,293,873.67 \r\n \r\n(73,317,115.27) \r\n(5,842,688.95) (3,136,467.68) \r\n(672,340.54) (1,086,417.28) (12,716,018.85) (2,246,169.06) (12,185,362.46) (9,834,048.82) (3,262,597.61) \r\n(713,825.75) \r\n(830,321.01) (1,053,698.76) \r\n355,946.54 286,904.71 \r\n(126,254,220.79) \r\n \r\n51,503,313.50 31,849.58 \r\n179,773.34 24,768.80 \r\n1,851,253.03 \r\n11,121,499.75 11,148,555.11 22,266,836.47 \r\n962,834.18 322,644.39 21,207,086.61 409,708.81 6,160,535.25 \r\n127,190,658.82 \r\n936,438.03 \r\n162,356,822.13 \r\n \r\n$ \r\n \r\n163,293,260.16 \r\n \r\n- 3 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION BALANCE SHEET \r\nGOVERNMENTAL FUNDS JUNE 30, 2017 \r\n \r\nEXHIBIT \"C\" \r\n \r\nASSETS \r\nCash and Cash Equivalents Investments Receivables, Net \r\nTaxes State Government Federal Government Local Inventories \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 63,580,193.66 $ 38,922,880.91 $ 11,054,999.25 $ \r\n \r\n275,658.89 \r\n \r\n- \r\n \r\n12.57 \r\n \r\n4,444,433.74 \r\n \r\n1,890,217.65 \r\n \r\n- \r\n \r\n20,711,329.53 \r\n \r\n- \r\n \r\n- \r\n \r\n3,053,611.83 \r\n \r\n- \r\n \r\n- \r\n \r\n733,969.80 \r\n \r\n- \r\n \r\n- \r\n \r\n4,712,405.90 \r\n \r\n- \r\n \r\n- \r\n \r\n113,558,073.82 275,671.46 \r\n6,334,651.39 20,711,329.53 \r\n3,053,611.83 733,969.80 \r\n4,712,405.90 \r\n \r\nTotal Assets \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Retainages Payable \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nUnavailable Revenue - Property Taxes \r\nFUND BALANCES \r\nNonspendable Restricted Assigned Unassigned \r\nTotal Fund Balances \r\n \r\n$ 97,511,603.35 $ 40,813,098.56 $ 11,055,011.82 $ \r\n \r\n149,379,713.73 \r\n \r\n$ \r\n \r\n49,298.76 $ \r\n \r\n17,517,833.31 \r\n \r\n- \r\n \r\n17,567,132.07 \r\n \r\n- $ 588,367.04 \r\n588,367.04 \r\n \r\n- $ - \r\n- \r\n \r\n49,298.76 17,517,833.31 \r\n588,367.04 \r\n18,155,499.11 \r\n \r\n892,440.99 \r\n \r\n- \r\n \r\n- \r\n \r\n892,440.99 \r\n \r\n4,712,405.90 43,014,095.97 \r\n5,598,410.19 25,727,118.23 \r\n79,052,030.29 \r\n \r\n40,174,617.04 \r\n50,114.48 - \r\n40,224,731.52 \r\n \r\n11,055,011.82 \r\n- \r\n11,055,011.82 \r\n \r\n4,712,405.90 94,243,724.83 \r\n5,648,524.67 25,727,118.23 \r\n130,331,773.63 \r\n \r\nTotal Liabilities, Deferred Inflows of Resources, and Fund Balances \r\n \r\n$ 97,511,603.35 $ 40,813,098.56 $ 11,055,011.82 $ \r\n \r\n149,379,713.73 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 4 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\nTO THE STATEMENT OF NET POSITION JUNE 30, 2017 \r\n \r\nEXHIBIT \"D\" \r\n \r\nTotal fund balances - governmental funds (Exhibit \"C\") \r\nAmounts reported for governmental activities in the Statement of Net Position are different because: \r\nCapital assets used in governmental activities are not financial resources and therefore are not reported in the funds. \r\nLand Construction in progress Buildings and improvements Equipment Land improvements Accumulated depreciation \r\nSome liabilities are not due and payable in the current period and, therefore, are not reported in the funds. \r\nNet pension liability \r\nDeferred outflows and inflows of resources related to pensions are applicable to future periods and, therefore, are not reported in the funds. \r\nTaxes that are not available to pay for current period expenditures are deferred in the funds. \r\nLong-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds. \r\nBonds payable Accrued interest payable Capital leases payable Compensated absences payable Unamortized bond premiums Claims and judgments payable \r\n \r\n$ 130,331,773.63 \r\n \r\n$ 11,278,291.55 8,343,032.91 \r\n433,680,560.30 27,331,306.61 8,938,417.69 \r\n(180,753,697.23) \r\n \r\n308,817,911.83 \r\n \r\n(305,894,096.00) 80,024,796.58 892,440.99 \r\n \r\n$ (40,305,000.00) (487,211.88) \r\n(1,582,614.73) (3,114,084.42) (4,243,532.40) (1,147,123.44) \r\n \r\n(50,879,566.87) \r\n \r\nNet position of governmental activities (Exhibit \"A\") \r\n \r\n$ 163,293,260.16 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 5 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \r\nGOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2017 \r\n \r\nEXHIBIT \"E\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nCapital Outlay Debt Services \r\nPrincipal Interest \r\nTotal Expenditures \r\nRevenues over Expenditures \r\nOTHER FINANCING SOURCES \r\nProceeds of Bonds Premiums on Bonds Sold \r\nTotal Other Financing Sources \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nGENERAL FUND \r\n \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ \r\n \r\n53,935,001.88 $ \r\n \r\n23,552,315.04 \r\n \r\n168,973,089.67 \r\n \r\n28,525,560.83 \r\n \r\n8,188,274.60 \r\n \r\n276,260.59 \r\n \r\n6,540,083.09 \r\n \r\n289,990,585.70 \r\n \r\n- $ 11,148,555.11 \r\n87,704.59 50,000.00 \r\n11,286,259.70 \r\n \r\n- $ 11,121,499.75 \r\n45,743.63 - \r\n \r\n53,935,001.88 45,822,369.90 168,973,089.67 28,525,560.83 \r\n8,188,274.60 409,708.81 \r\n6,590,083.09 \r\n \r\n11,167,243.38 \r\n \r\n312,444,088.78 \r\n \r\n180,800,993.12 \r\n12,628,317.91 7,719,900.46 3,735,942.15 1,551,802.75 \r\n18,487,988.28 2,225,608.65 \r\n20,885,544.12 11,355,114.04 \r\n3,506,210.02 1,009,848.35 2,379,441.19 1,053,698.76 18,442,152.32 \r\n- \r\n634,066.48 31,764.14 \r\n286,448,392.74 \r\n3,542,192.96 \r\n \r\n699,527.28 \r\n380,072.16 91,464.00 515,595.71 8,733,645.90 \r\n- \r\n10,420,305.05 \r\n865,954.65 \r\n \r\n- \r\n3,846.88 - \r\n10,085,000.00 490,131.26 \r\n10,578,978.14 \r\n588,265.24 \r\n \r\n181,500,520.40 \r\n12,628,317.91 7,719,900.46 3,735,942.15 1,551,802.75 \r\n18,487,988.28 2,609,527.69 \r\n20,885,544.12 11,446,578.04 \r\n4,021,805.73 1,009,848.35 2,379,441.19 1,053,698.76 18,442,152.32 8,733,645.90 \r\n10,719,066.48 521,895.40 \r\n307,447,675.93 \r\n4,996,412.85 \r\n \r\n- \r\n3,542,192.96 \r\n75,509,837.33 \r\n \r\n30,000,000.00 3,181,888.45 \r\n33,181,888.45 \r\n34,047,843.10 \r\n6,176,888.42 \r\n \r\n- \r\n588,265.24 \r\n10,466,746.58 \r\n \r\n30,000,000.00 3,181,888.45 \r\n33,181,888.45 \r\n38,178,301.30 \r\n92,153,472.33 \r\n \r\n$ \r\n \r\n79,052,030.29 $ 40,224,731.52 $ \r\n \r\n11,055,011.82 $ 130,331,773.63 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 6 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF \r\nREVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2017 \r\n \r\nEXHIBIT \"F\" \r\n \r\nNet change in fund balances total governmental funds (Exhibit \"E\") \r\nAmounts reported for governmental activities in the Statement of Activities are different because: \r\nGovernmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. \r\nCapital outlay Depreciation expense \r\nThe net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. \r\nTaxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. \r\nThe issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. \r\nGeneral obligation bonds issued, including a premium of $3,181,888.45 Bond principal retirements Capital lease payments Amortization of bond premiums \r\nDistrict pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension liability is measured a year before the District's report date. Pension expense, which is the change in the net pension liability adjusted for changes in deferred outflows and inflows of resources related to pensions, is reported in the Statement of Activities. \r\nPension expense \r\nSome items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. \r\nAccrued interest on issuance of bonds Compensated absences Claims and judgments \r\n \r\n$ 38,178,301.30 \r\n \r\n$ \r\n \r\n9,963,769.47 \r\n \r\n(12,705,526.82) \r\n \r\n(2,741,757.35) \r\n \r\n(142,568.57) \r\n \r\n(344,043.63) \r\n \r\n$ (33,181,888.45) 10,085,000.00 634,066.48 1,038,979.05 \r\n \r\n(21,423,842.92) \r\n \r\n(11,694,741.54) \r\n \r\n$ \r\n \r\n(230,178.94) \r\n \r\n(521,903.42) \r\n \r\n(142,826.90) \r\n \r\n(894,909.26) \r\n \r\nChange in net position of governmental activities (Exhibit \"B\") \r\n \r\n$ \r\n \r\n936,438.03 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 7 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION \r\nFIDUCIARY FUNDS JUNE 30, 2017 \r\nASSETS Cash and Cash Equivalents Accounts Receivable, Net \r\nOther \r\nTotal Assets LIABILITIES Accounts Payable and Accrued Liabilities Funds Held for Others \r\nTotal Liabilities \r\n \r\nEXHIBIT \"G\" \r\nAGENCY FUNDS $ 1,616,439.32 113,486.24 \r\n$ 1,729,925.56 $ 1,032,290.90 \r\n697,634.66 \r\n$ 1,729,925.56 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. \r\n \r\n- 8 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nThe accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below. \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness. \r\nGOVERNMENT-WIDE STATEMENTS: \r\nThe Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. \r\nThe Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows: \r\n1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\n2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\n3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net positon often has constraints on resources imposed by management which can be removed or modified. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\nDirect expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n \r\n- 9 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nProgram revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFUND FINANCIAL STATEMENTS: \r\nThe fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and Bond Proceeds that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets. \r\n The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes legally restricted for the payment of general long-term principal and interest. \r\nThe School District reports the following fiduciary fund type: \r\n Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, claims and judgments, and compensated absences, which are recognized as expenditures \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nto the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\nIn fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 77, Tax Abatement Disclosures. This statement requires governments that enter into tax abatement agreements to disclose the following information; (1) brief descriptive information, such as the tax being abated, the authority under which tax abatements are provided, eligibility criteria, the mechanism by which taxes are abated, provisions for recapturing abated taxes, and the types of commitments made by tax abatement recipients; (2) the gross dollar amount of taxes abated during the period; and (3) commitments made by a government, other than to abate taxes, as part of a tax abatement agreement. See note 13 for further disclosure of tax abatements in accordance with this standard. \r\nIn fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 80, Blending Requirements for Certain Component Units  an amendment of GASB Statement No. 14. This statement amends the blending requirements for the financial statement presentation of component units of all state and local governments. The additional criterion requires blending of a component unit incorporated as a not-for-profit corporation in which the primary government is the sole corporate member. The additional criterion does apply to component units included in the financial reporting entity pursuant to the provisions of Statement No. 39, Determining Whether Certain Organization Are Component Units. The adoption of this statement does not have a significant impact on the School District's financial statement. \r\nIn fiscal year 2017, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 82, Pension Issues  an amendment of GASB Statements No. 67, No. 68 and No. 73. This statement addresses certain issues that have been raised with respect to Statements No. 67, Financial Reporting for Pension Plans, No. 68, Accounting and Financial Reporting for Pensions, and No. 73, Accounting and Financial Reporting for Pensions and Related Assets That Are Not within the Scope of GASB Statement No. 68, and Amendments to Certain Provisions of GASB Statements No. 67 and No. 68. Specifically, this statement addresses issues regarding (1) the presentation of payrollrelated measures in required supplementary information, (2) the selection of assumptions and the treatment of deviations from the guidance in an Actuarial Standard of Practice for financial reporting purposes, and (3) the classification of payments made by employers to satisfy employee (plan member) contribution requirements. The adoption of this statement does not have a significant impact on the School District's financial statement. \r\nCASH AND CASH EQUIVALENTS \r\nCash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\n \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nINVESTMENTS \r\nThe School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. \r\nInvestments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value. \r\nFor accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired. \r\nRECEIVABLES \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\nINVENTORIES \r\nFood Inventories \r\nOn the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the weighted average basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\nSupply Inventory \r\nOn the basic financial statements, inventories of consumable supplies and materials are reported at cost (calculated on the weighted average basis). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\nCAPITAL ASSETS \r\nOn the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art. \r\nCapital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements. \r\nDepreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives. \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCapitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows: \r\n \r\nCapitalization Policy \r\n \r\nEstimated Useful Life \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible assets Construction In Progress \r\n \r\nAll All All \r\nAll $10,000.00 and any \r\nitem necessary for insurance purposes $100,000.00 to $1,000,000.00 \r\nAll \r\n \r\nN/A 8 to 25 Years 10 to 50 Years \r\n5 to 14 Years 5 to 10 Years \r\nup to 20 years N/A \r\n \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\nIn addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element, represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. \r\n \r\nIn addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. \r\n \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\n \r\nPublic School Employees Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\n \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of twenty days. Vacation leave of twelve days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed twenty days. \r\n \r\nLONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS \r\nIn the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the effective interest method. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\n \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nIn the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nFUND BALANCES \r\nFund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. \r\nThe School District's fund balances are classified as follows: \r\nNonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\nCommitted consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\nAssigned consists of resources constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes. \r\nUnassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance. \r\nUSE OF ESTIMATES \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\nPROPERTY TAXES \r\nThe Houston County Board of Commissioners adopted the property tax levy for the 2016 tax digest year (calendar year) on July 18, 2016 (levy date) based on property values as of January 1, 2016. Taxes were due on December 20, 2016 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2016 tax digest are reported as revenue in the governmental funds for fiscal year 2017. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nbalance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2017, for maintenance and operations amounted to $51,847,357.13. \r\nThe tax millage rate levied for the 2016 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.34 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $1,851,253.03 during fiscal year ended June 30, 2017. \r\nSALES TAXES \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $22,266,836.47 and was recorded in the general fund. Local Option Sales Tax (LOST) is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\nEducation Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $22,270,054.86 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years. \r\nNOTE 3: BUDGETARY DATA \r\nThe budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year under review. \r\n \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 4: DEPOSITS AND CASH EQUIVALENTS \r\nCOLLATERALIZATION OF DEPOSITS \r\nO.C.G.A.  45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A.  45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\nCATEGORIZATION OF DEPOSITS \r\nCustodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2017, the School District had deposits with a carrying amount of $19,318,695.56, which includes $275,671.46 in Certificates of Deposit that are reported as Investments, and a bank balance of $22,452,969.47. The bank balances insured by Federal depository insurance were $4,468,024.87 and the bank balances collateralized with securities held by the pledging financial institution in the School District's name were $17,984,944.60. \r\n \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nReconciliation of cash and cash equivalents balances to carrying value of deposits: \r\n \r\nStatement of Net Position Cash and cash equivalents \r\nStatement of Fiduciary Net Position Cash and cash equivalents \r\n \r\n$ 113,558,073.82 1,616,439.32 \r\n \r\nTotal cash and cash equivalents \r\n \r\n115,174,513.14 \r\n \r\nAdd: Deposits with original maturity of three months or more reported as investments \r\n \r\n275,671.46 \r\n \r\nLess: Investment pools reported as cash and cash equivalents \r\nGeorgia Fund 1 \r\n \r\n96,131,489.04 \r\n \r\nTotal carrying value of deposits - June 30, 2016 \r\n \r\n$ 19,318,695.56 \r\n \r\nCATEGORIZATION OF CASH EQUIVALENTS \r\nThe School District reported cash equivalents of $96,131,489.04 in Georgia Fund 1, a local government investment pool. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2017, was 56 days. \r\nGeorgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 5: CAPITAL ASSETS \r\nThe following is a summary of changes in the capital assets for governmental activities during the fiscal year: \r\n \r\nBalances July 1, 2016 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nTransfers \r\n \r\nBalances June 30, 2017 \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction in Progress \r\n \r\n$ 11,278,291.55 $ \r\n \r\n- $ \r\n \r\n24,646,210.49 \r\n \r\n9,155,499.97 \r\n \r\n- $ \r\n \r\n- $ 11,278,291.55 \r\n \r\n- \r\n \r\n(25,458,677.55) \r\n \r\n8,343,032.91 \r\n \r\nTotal Capital Assets Not Being Depreciated \r\n \r\n35,924,502.04 \r\n \r\n9,155,499.97 \r\n \r\n- \r\n \r\n(25,458,677.55) \r\n \r\n19,621,324.46 \r\n \r\nCapital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements \r\n \r\n410,344,333.96 26,295,000.37 8,014,414.20 \r\n \r\n808,269.50 \r\n- \r\n \r\n126,305.00 732,753.98 111,352.00 \r\n \r\n23,462,531.34 960,790.72 \r\n1,035,355.49 \r\n \r\n433,680,560.30 27,331,306.61 8,938,417.69 \r\n \r\nLess Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements \r\n \r\n146,219,430.43 19,598,824.59 3,057,757.80 \r\n \r\n10,762,938.07 1,474,748.08 467,840.67 \r\n \r\n126,305.00 690,402.21 \r\n11,135.20 \r\n \r\n- \r\n \r\n156,856,063.50 \r\n \r\n- \r\n \r\n20,383,170.46 \r\n \r\n- \r\n \r\n3,514,463.27 \r\n \r\nTotal Capital Assets, Being Depreciated, Net \r\n \r\n275,777,735.71 \r\n \r\n(11,897,257.32) \r\n \r\n142,568.57 \r\n \r\n25,458,677.55 \r\n \r\n289,196,587.37 \r\n \r\nGovernmental Activity Capital Assets - Net \r\n \r\n$ 311,702,237.75 $ (2,741,757.35) $ \r\n \r\n142,568.57 $ \r\n \r\n- $ 308,817,911.83 \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction Support Services \r\nPupil Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services \r\n \r\n$ 9,571,316.27 \r\n \r\n$ 4,020.00 431,965.76 11,915.00 430,368.69 98,085.29 117,540.25 942,301.74 37,697.08 \r\n \r\n2,073,893.81 1,060,316.74 \r\n \r\n$ 12,705,526.82 \r\n \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 6: LONG-TERM LIABILITIES \r\nThe changes in long-term liabilities during the fiscal year for governmental activities were as follows: \r\n \r\nBalance June 30, 2016 \r\n \r\nAdditions \r\n \r\nGovernmental Funds Deductions \r\n \r\nBalance June 30, 2017 \r\n \r\nDue Within One Year \r\n \r\nG.O. Bonds Unamortized Bond Premiums Capital Leases Compensated Absences (1) \r\n \r\n$ 20,390,000.00 $ 30,000,000.00 $ \r\n \r\n2,100,623.00 \r\n \r\n3,181,888.45 \r\n \r\n2,216,681.21 \r\n \r\n- \r\n \r\n2,592,181.00 \r\n \r\n2,179,091.72 \r\n \r\n10,085,000.00 $ 1,038,979.05 634,066.48 1,657,188.30 \r\n \r\n40,305,000.00 $ 4,243,532.40 1,582,614.73 3,114,084.42 \r\n \r\n10,305,000.00 1,061,643.95 643,028.20 - \r\n \r\n$ 27,299,485.21 $ 35,360,980.17 $ 13,415,233.83 $ 49,245,231.55 $ 12,009,672.15 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements. \r\n \r\nGENERAL OBLIGATION DEBT OUTSTANDING \r\nThe School District's bonded debt consists of various issues of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved Education Special Purpose Local Option Sales Taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. \r\n \r\nDuring the current year, the School District issued general obligation bonds totaling $30,000,000.00. \r\n \r\nGeneral obligation bonds currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\nGeneral Government - Series 2012 General Government - Series 2017 \r\n \r\n2.799% - 4.00% 4.00% - 5.00% \r\n \r\n3/27/2012 4/6/2017 \r\n \r\n9/1/2017 $ 9/1/2022 \r\n$ \r\n \r\n43,560,000.00 $ 30,000,000.00 73,560,000.00 $ \r\n \r\n10,305,000.00 30,000,000.00 40,305,000.00 \r\n \r\nThe following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable: \r\n \r\nFiscal Year Ended June 30 \r\n \r\nGeneral Obligation Debt \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nUnamortized Bond Premium \r\n \r\n2018 2019 2020 2021 2022 2023 Total Principal and Interest \r\n \r\n$ 10,305,000.00 $ 1,395,059.38 $ 5,500,000.00 1,275,550.00 5,945,000.00 1,046,650.00 6,050,000.00 776,500.00 6,180,000.00 470,750.00 6,325,000.00 158,125.00 \r\n \r\n1,061,643.95 583,346.22 630,544.23 641,680.84 655,469.02 670,848.14 \r\n \r\n$ 40,305,000.00 $ 5,122,634.38 $ 4,243,532.40 \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCAPITAL LEASES \r\nThe School District has acquired buses and band equipment under the provisions of various long-term lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term. \r\nThe following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end: \r\nGovernmental Activities \r\n \r\nEquipment Less: Accumulated Depreciation \r\n \r\n$ 3,081,846.00 939,177.30 \r\n \r\n$ 2,142,668.70 \r\n \r\nCapital leases currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\n15 School Buses 12 School Buses Band Equipment \r\n \r\n1.086% 1.618% 3.500% \r\n \r\n6/27/2013 11/11/2014 \r\n6/3/2015 \r\n \r\n8/1/2018 $ 1,687,158.00 $ \r\n \r\n9/1/2019 1,394,688.00 \r\n \r\n2/15/2019 \r\n \r\n92,662.29 \r\n \r\n686,574.54 848,626.54 \r\n47,413.65 \r\n \r\n$ 3,174,508.29 $ 1,582,614.73 \r\n \r\nThe following is a schedule of total capital lease payments: \r\n \r\nFiscal Year Ended June 30 \r\n \r\nCapital Leases \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\n2018 2019 2020 \r\n \r\n$ 643,028.20 $ 652,125.06 287,461.47 \r\n \r\n22,802.43 13,705.56 \r\n4,685.79 \r\n \r\nTotal Principal and Interest \r\n \r\n$ 1,582,614.73 $ 41,193.78 \r\n \r\nCOMPENSATED ABSENCES \r\nCompensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\n \r\nNOTE 7: RISK MANAGEMENT \r\nINSURANCE \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disasters and unemployment compensation. \r\n \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nGeorgia School Boards Association Risk and Insurance Management System \r\nThe School District participates in the Georgia School Boards Association Risk and Insurance Management System (the System), a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The School District pays an annual premium to the System for its general insurance coverage. Additional coverage is provided through agreements by the System with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the System varies by line of coverage. \r\n \r\nWORKERS' COMPENSATION \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000 loss per occurrence, up to the statutory limit. \r\n \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2016 2017 \r\n \r\n$ 1,440,025.96 $ 1,004,296.54 \r\n \r\n$ 389,400.39 $ 809,479.13 \r\n \r\n$ 825,129.81 $ 666,652.23 \r\n \r\n$ 1,004,296.54 $ 1,147,123.44 \r\n \r\nUNEMPLOYMENT COMPENSATION \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims The School District accounts for claims within the general fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. The School District had no unemployment compensation claims in the past two years. \r\n \r\nSURETY BOND \r\nThe School District purchased a surety bond to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 8: FUND BALANCE CLASSIFICATION DETAILS \r\nThe School District's financial statements include the following amounts presented in the aggregate at June 30, 2017: \r\n \r\nNonspendable Inventories \r\n \r\n$ 4,712,405.90 \r\n \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\n \r\n$ \r\n \r\n7,668,436.21 \r\n \r\n40,174,617.04 \r\n \r\n11,055,011.82 \r\n \r\n35,345,659.76 \r\n \r\n94,243,724.83 \r\n \r\nAssigned Local Capital Outlay Projects School Activity Accounts Subsequent Period Expenditures \r\n \r\n$ \r\n \r\n50,114.48 \r\n \r\n2,468,866.19 \r\n \r\n3,129,544.00 \r\n \r\n5,648,524.67 \r\n \r\nUnassigned \r\n \r\n25,727,118.23 \r\n \r\nFund Balance, June 30, 2017 \r\n \r\n$ 130,331,773.63 \r\n \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\n \r\nIt is the goal of the School District to achieve and maintain an unassigned fund balance in the general fund at fiscal year-end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, in compliance with O.C.G.A.  20-2-167(a)5. If the unassigned fund balance at fiscal year-end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\n \r\nNOTE 9: SIGNIFICANT COMMITMENTS \r\n \r\nCOMMITMENTS UNDER CONSTRUCTION CONTRACTS \r\n \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2017: \r\nUnearned Executed Payments through \r\n \r\nProject \r\n \r\nContracts (1) (2) \r\n \r\nJune 30, 2017 (2) \r\n \r\nCentral Bus Facility \r\n \r\n$ \r\n \r\nNorthside High School Addition \r\n \r\nPerry High School Theater Renovation \r\n \r\nSite Upgrades - Miller Elem Parking \r\n \r\nSite Upgrades - Quail Run Elem Parking \r\n \r\n265,755.74 $ 702,491.98 1,139,880.00 128,178.55 119,637.74 \r\n \r\n6,239,192.45 506,695.65 45,000.00 83,871.86 89,962.00 \r\n \r\n$ \r\n \r\n2,355,944.01 $ \r\n \r\n6,964,721.96 \r\n \r\n(1) The amounts described are not reflected in the basic financial statements. (2) Payments include retainages payable at year end. \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 10: SIGNIFICANT CONTINGENT LIABILITIES \r\nFEDERAL GRANTS \r\nAmounts 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 costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\nLITIGATION \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to have a material adverse effect on the financial condition of the School District. \r\nNOTE 11: POST-EMPLOYMENT BENEFITS \r\nGEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND \r\nPlan Description. The Georgia School Personnel Post-Employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). Additional information about the School OPEB Fund is disclosed in the State of Georgia Comprehensive Annual Financial Report. This report can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\nFunding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012 pay approximately 25% of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State provides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy. \r\nParticipating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all benefits due under the health insurance plans for both active and retired employees based on projected \"payas-you-go\" financing requirements. Contributions are not based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. \r\n \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2017: \r\n \r\nFor certificated teachers, librarians and regional educational service agencies and certain other eligible participants: \r\n \r\nJuly 1, 2016  June 30, 2017 \r\n \r\n$945.00 per member per month \r\n \r\nFor non-certificated school personnel: \r\n \r\nJuly 1, 2016  December 31, 2016 $746.20 per member per month \r\n \r\nJanuary 1, 2017  June 30, 2017 $846.20 per member per month \r\n \r\nNo additional contribution was required by the Board for fiscal year 2017 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation. \r\n \r\nThe School District's combined active and retiree contributions to the health insurance plans, which equaled the required contribution, for the current fiscal year and the preceding two fiscal years were as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2017 2016 2015 \r\n \r\n100% 100% 100% \r\n \r\n$ 27,385,122.70 $ 25,836,553.80 $ 24,797,301.80 \r\n \r\nNOTE 12: RETIREMENT PLANS \r\nThe School District participates in various retirement plans administered by the State of Georgia, as further explained below. \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \r\nPlan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications. \r\nBenefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nexpected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2017. The School District's contractually required contribution rate for the year ended June 30, 2017 was 14.27% of annual School District payroll, of which 14.22% of payroll was required from the School District and 0.05% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $22,601,157.09 and $73,141,08 from the School District and the State, respectively. \r\nEMPLOYEES' RETIREMENT SYSTEM \r\nPlan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2017 was 24.69% of annual covered payroll for old and new plan members and 21.69% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $113,580.49 for the current fiscal year. \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS) \r\nPlan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nof the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\n \r\nBenefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\n \r\nUpon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\n \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\n \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $ 551,805.00. \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\n \r\nAt June 30, 2017, the School District reported a liability of $305,894,096.00 for its proportionate share of the net pension liability for TRS ($304,998,438.00) and ERS ($895,658.00). \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n$ 304,998,438.00 \r\n \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n1,090,354.00 \r\n \r\nTotal \r\n \r\n$ 306,088,792.00 \r\n \r\nThe net pension liability for TRS and ERS was measured as of June 30, 2016. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2015. An expected total pension liability as of June 30, 2016 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2016. \r\nAt June 30, 2016, the School District's TRS proportion was 1.478342%, which was an increase of 0.060319% from its proportion measured as of June 30, 2015. At June 30, 2016, the School District's ERS proportion was 0.018934%, which was an increase of 0.000729% from its proportion measured as of June 30, 2015. \r\n \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nAt June 30, 2017, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $4,098,431.00. \r\n \r\nThe PSERS net pension liability was measured as of June 30, 2016. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2015. An expected total pension liability as of June 30, 2016 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2016. \r\n \r\nFor the year ended June 30, 2017, the School District recognized pension expense of $34,376,116.00 for TRS, $138,329.00 for ERS and $671,886.00 for PSERS and revenue of $106,213.00 for TRS and $671,886.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\nAt June 30, 2017, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: \r\n \r\nTRS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nIntflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nERS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nIntflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nDifferences between expected and actual experience \r\n \r\n$ 4,543,655.00 $ 1,508,219.00 $ \r\n \r\n- $ \r\n \r\n2,069.00 \r\n \r\nChanges of assumptions \r\n \r\n7,905,138.00 \r\n \r\n- \r\n \r\n7,586.00 \r\n \r\n- \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n38,583,558.00 \r\n \r\n- \r\n \r\n91,063.00 \r\n \r\n- \r\n \r\nChanges in proportion and difference \r\n \r\nbetween School District contributions and \r\n \r\nproportionate share of contributions \r\n \r\n8,737,084.00 \r\n \r\n1,067,719.00 \r\n \r\n19,982.00 \r\n \r\n- \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n22,601,157.09 \r\n \r\n- \r\n \r\n113,580.49 \r\n \r\n- \r\n \r\nTotal \r\n \r\n$ 82,370,592.09 $ 2,575,938.00 $ 232,211.49 $ \r\n \r\n2,069.00 \r\n \r\nThe School District contributions subsequent to the measurement date of $ 22,601,157.09 for TRS and $113,580.49 for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\nYear Ended June 30: 2018 2019 2020 2021 2022 \r\n \r\nTRS \r\n$ 7,547,395.00 $ 7,547,380.00 \r\n24,092,230.00 17,027,616.00 \r\n978,876.00 \r\n \r\nERS \r\n25,359.00 11,672.00 49,096.00 30,435.00 \r\n- \r\n \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nActuarial assumptions: The total pension liability as of June 30, 2016 was determined by an actuarial valuation as of June 30, 2015, using the following actuarial assumptions, applied to all periods included in the measurement: \r\n \r\nTeachers Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  9.00%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nEmployees' Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\n3.25%  7.00%, average, including inflation \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB and set forward 2 years for both males and females for service retirements and dependent beneficiaries. The RP- 2000 Disabled Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back 7 years for males and set forward 3 years for females was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-12% less than the actual number of deaths that occurred during the study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nPublic School Employees Retirement System: \r\n \r\nInflation \r\n \r\n2.75% \r\n \r\nSalary increases \r\n \r\nN/A \r\n \r\nInvestment rate of return \r\n \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nPost-retirement mortality rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nafter disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB. \r\n \r\nThe actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2009  June 30, 2014. \r\n \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was \r\n \r\ndetermined using a log-normal distribution analysis in which best-estimate ranges of expected future \r\n \r\nreal rates of return (expected returns, net of pension plan investment expense and inflation) are \r\n \r\ndeveloped for each major asset class. These ranges are combined to produce the long-term expected \r\n \r\nrate of return by weighting the expected future real rates of return by the target asset allocation \r\n \r\npercentage and by adding expected inflation. The target allocation and best estimates of arithmetic \r\n \r\nreal rates of return for each major asset class are summarized in the following table: \r\n \r\nTRS \r\n \r\nERS/PSERS \r\n \r\nLong-term \r\n \r\nTarget \r\n \r\nTarget \r\n \r\nexpected real \r\n \r\nAsset class \r\n \r\nallocation \r\n \r\nallocation \r\n \r\nrate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative \r\n \r\n30.00% 39.80% \r\n3.70% 1.50% 19.40% 5.60% \r\n--% \r\n \r\n30.00% 37.20% \r\n3.40% 1.40% 17.80% 5.20% 5.00% \r\n \r\n(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n100.00% \r\n \r\n* Rates shown are net of the 2.75% assumed rate of inflation \r\nDiscount rate: The discount rate used to measure the total TRS, ERS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\n \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nSensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's \r\nproportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate: \r\n \r\nTeachers' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\n$ 474,733,831.00 $ 304,998,438.00 $ 165,249,320.00 \r\n \r\nEmployees' Retirement System \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n$ 1,213,782.00 $ \r\n \r\n895,658.00 $ \r\n \r\n1% Increase (8.50%) \r\n624,552.00 \r\n \r\nPension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publically available at www.trsga.com/publications and www.ers.ga.gov/formspubs/formspubs.html. \r\n \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, the School District began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\nThe School District selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County School District. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the School District. \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2017 2016 2015 \r\n \r\n100% 100% 100% \r\n \r\n$ \r\n \r\n167,113.99 \r\n \r\n$ \r\n \r\n163,288.54 \r\n \r\n$ \r\n \r\n136,887.41 \r\n \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2017 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 13: TAX ABATEMENTS \r\nThe School District property tax revenues were reduced by $1,085,047.01 under agreements entered into by the Houston County Development Authority (Development Authority). The Development Authority issued revenue bonds to provide capital financing for several local businesses. \r\nIncluded in the amount abated, the following are individual tax abatement agreements that each exceeded 10 percent of the total amount abated: \r\n A manufacturing plant expansion. The abatement amounted to $131,386.40.  A manufacturing plant expansion. The abatement amounted to $129,441.10.  A manufacturing plant expansion. The abatement amounted to $541,579.53. \r\n \r\n- 31 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"1\" \r\n \r\nYear Ended \r\n2017 2016 2015 \r\n \r\nSchool District's proportion of the net \r\npension liability \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\nState of Georgia's proportionate share of the \r\nnet pension liability associated with the School \r\nDistrict \r\n \r\nTotal \r\n \r\nSchool District's coveredemployee payroll \r\n \r\nSchool District's proportionate share of the net pension liability as a percentage of its covered \r\nemployee payroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\n1.478342% $ 304,998,438.00 $ 1.418023% $ 215,879,921.00 $ 1.412022% $ 178,390,355.00 $ \r\n \r\n1,090,354.00 $ 306,088,792.00 $ 852,392.00 $ 216,732,313.00 $ 719,867.00 $ 179,110,222.00 $ \r\n \r\n162,747,774.99 150,299,368.59 144,097,581.27 \r\n \r\n187.41% 143.63% 123.80% \r\n \r\n76.06% 81.44% 84.03% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 33 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"2\" \r\n \r\nYear Ended \r\n2017 2016 2015 \r\n \r\nSchool District's proportion of the net \r\npension liability \r\n \r\nSchool District's proportionate share of the net pension \r\nliability \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net pension liability as a \r\npercentage of covered payroll \r\n \r\n0.018934% $ 0.018205% $ 0.017996% $ \r\n \r\n895,658.00 $ 737,557.00 $ 674,961.00 $ \r\n \r\n440,233.56 416,239.34 405,211.66 \r\n \r\n203.45% 177.20% 166.57% \r\n \r\nPlan fiduciary net position as a \r\npercentage of total net pension liability \r\n72.34% 76.20% 77.99% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 34 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOLS EMPLOYEES RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"3\" \r\n \r\nYear Ended \r\n2017 2016 2015 \r\n \r\nSchool District's proportion of the net \r\npension liability \r\n \r\nSchool District's proportionate share of the \r\nnet pension liability \r\n \r\nState of Georgia's proprotionate share of the net pension liaibility associated with the School District \r\n \r\n0.00% $ 0.00% $ 0.00% $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n4,098,431.00 $ 2,607,682.00 $ 2,303,408.00 $ \r\n \r\nTotal \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nSchool District's proportionate share of the net pension liability as \r\na percentage of its covered employee payroll \r\n \r\nPlan fiduciary net position as a \r\npercentage of the total pension liability \r\n \r\n4,098,431.00 2,607,682.00 2,303,408.00 \r\n \r\n$ 10,489,156.64 $ 10,330,432.81 $ 10,016,811.88 \r\n \r\nN/A \r\n \r\n81.00% \r\n \r\nN/A \r\n \r\n87.00% \r\n \r\nN/A \r\n \r\n88.29% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. \r\n \r\n- 35 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"4\" \r\n \r\nYear Ended \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency School District's covered- \r\n \r\n(excess) \r\n \r\nemployee payroll \r\n \r\nContribution as a percentage of covered- \r\nemployee payroll \r\n \r\n2017 \r\n \r\n$ \r\n \r\n2016 \r\n \r\n$ \r\n \r\n2015 \r\n \r\n$ \r\n \r\n2014 \r\n \r\n$ \r\n \r\n2013 \r\n \r\n$ \r\n \r\n2012 \r\n \r\n$ \r\n \r\n2011 \r\n \r\n$ \r\n \r\n2010 \r\n \r\n$ \r\n \r\n2009 \r\n \r\n$ \r\n \r\n2008 \r\n \r\n$ \r\n \r\n22,601,157.09 $ 23,141,378.51 $ 19,687,721.71 $ 17,625,185.67 $ 16,298,602.09 $ 14,377,512.24 $ 13,884,720.11 $ 13,544,690.10 $ 13,467,356.63 $ 12,654,953.77 $ \r\n \r\n22,601,157.09 $ 23,141,378.51 $ 19,687,721.71 $ 17,625,185.67 $ 16,298,602.09 $ 14,377,512.24 $ 13,884,720.11 $ 13,544,690.10 $ 13,467,356.63 $ 12,654,953.77 $ \r\n \r\n- \r\n \r\n$ 158,922,980.04 \r\n \r\n- \r\n \r\n$ 162,747,774.99 \r\n \r\n- \r\n \r\n$ 150,299,368.59 \r\n \r\n- \r\n \r\n$ 144,097,581.27 \r\n \r\n- \r\n \r\n$ 143,401,483.17 \r\n \r\n- \r\n \r\n$ 140,498,203.02 \r\n \r\n- \r\n \r\n$ 135,846,018.48 \r\n \r\n- \r\n \r\n$ 139,920,328.55 \r\n \r\n- \r\n \r\n$ 145,452,439.94 \r\n \r\n- \r\n \r\n$ 137,234,950.82 \r\n \r\n14.22% 14.22% 13.10% 12.23% 11.37% 10.23% 10.22% \r\n9.68% 9.26% 9.22% \r\n \r\n- 36 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nSCHEDULE \"5\" \r\n \r\nYear Ended \r\n2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 \r\n \r\nContractually required contribution \r\n \r\nContributions in relation to the contractually required \r\ncontribution \r\n \r\nContribution deficiency (excess) \r\n \r\n$ \r\n \r\n113,580.49 $ \r\n \r\n113,580.49 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n108,825.61 $ \r\n \r\n108,825.61 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n91,406.16 $ \r\n \r\n91,406.16 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n74,802.06 $ \r\n \r\n74,802.06 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n53,504.66 $ \r\n \r\n53,504.66 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n35,683.88 $ \r\n \r\n35,683.88 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,845.78 $ \r\n \r\n29,845.78 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n29,313.50 $ \r\n \r\n29,313.50 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n27,150.80 $ \r\n \r\n27,150.80 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n25,866.31 $ \r\n \r\n25,866.31 $ \r\n \r\n- \r\n \r\nSchool District's covered-employee \r\npayroll \r\n \r\nContribution as a percentage of covered- \r\nemployee payroll \r\n \r\n$ \r\n \r\n457,801.02 \r\n \r\n$ \r\n \r\n440,233.56 \r\n \r\n$ \r\n \r\n416,239.34 \r\n \r\n$ \r\n \r\n405,211.66 \r\n \r\n$ \r\n \r\n359,091.68 \r\n \r\n$ \r\n \r\n306,826.14 \r\n \r\n$ \r\n \r\n286,702.98 \r\n \r\n$ \r\n \r\n281,589.82 \r\n \r\n$ \r\n \r\n260,814.60 \r\n \r\n$ \r\n \r\n248,475.60 \r\n \r\n24.69% 24.72% 21.96% 18.46% 14.90% 11.63% 10.41% 10.41% 10.41% 10.41% \r\n \r\n- 37 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\nFOR THE YEAR ENDED JUNE 30, 2017 \r\n \r\nSCHEDULE \"6\" \r\n \r\nTeachers Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. \r\nOn November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males). \r\nEmployees' Retirement System \r\nChanges of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. \r\nPublic School Employees Retirement System \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. \r\nOn December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females). \r\n \r\n- 38 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION GENERAL FUND \r\nSCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL \r\nYEAR ENDED JUNE 30, 2017 \r\n \r\nSCHEDULE \"7\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nDebt Service \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nOther Sources Other Uses \r\nTotal Other Financing Sources (Uses) \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\n \r\nNONAPPROPRIATED BUDGETS \r\n \r\nORIGINAL (1) \r\n \r\nFINAL (1) \r\n \r\nACTUAL AMOUNTS \r\n \r\nVARIANCE OVER/UNDER \r\n \r\n$ \r\n \r\n53,900,000.00 $ \r\n \r\n53,300,000.00 $ \r\n \r\n53,935,001.88 $ \r\n \r\n23,337,706.00 \r\n \r\n23,582,706.00 \r\n \r\n23,552,315.04 \r\n \r\n166,954,497.00 \r\n \r\n169,111,103.00 \r\n \r\n168,973,089.67 \r\n \r\n28,433,642.00 \r\n \r\n28,466,648.00 \r\n \r\n28,525,560.83 \r\n \r\n7,698,686.00 \r\n \r\n7,698,686.00 \r\n \r\n8,188,274.60 \r\n \r\n123,700.00 \r\n \r\n223,700.00 \r\n \r\n276,260.59 \r\n \r\n7,004,745.36 \r\n \r\n6,904,745.36 \r\n \r\n6,540,083.09 \r\n \r\n287,452,976.36 \r\n \r\n289,287,588.36 \r\n \r\n289,990,585.70 \r\n \r\n635,001.88 (30,390.96) (138,013.33) 58,912.83 489,588.60 52,560.59 (364,662.27) \r\n702,997.34 \r\n \r\n185,064,092.00 \r\n9,445,282.00 7,764,755.00 3,809,043.00 1,786,202.00 18,645,015.00 2,439,811.00 20,323,220.00 12,076,233.00 3,321,277.00 1,064,371.00 2,235,000.00 1,028,275.00 20,621,489.36 \r\n- \r\n289,624,065.36 \r\n(2,171,089.00) \r\n \r\n180,631,649.00 \r\n12,787,850.00 7,938,507.00 3,729,043.00 1,732,003.00 \r\n18,460,015.00 2,377,168.00 \r\n20,290,062.00 11,921,900.00 \r\n3,420,127.00 89,448.00 \r\n2,235,000.00 1,028,275.00 21,270,818.97 \r\n- \r\n287,911,865.97 \r\n1,375,722.39 \r\n \r\n180,800,993.12 \r\n12,628,317.91 7,719,900.46 3,735,942.15 1,551,802.75 \r\n18,487,988.28 2,225,608.65 \r\n20,885,544.12 11,355,114.04 \r\n3,506,210.02 1,009,848.35 2,379,441.19 1,053,698.76 18,442,152.32 \r\n665,830.62 \r\n286,448,392.74 \r\n3,542,192.96 \r\n \r\n2,956,000.00 (3,073,000.00) \r\n(117,000.00) (2,288,089.00) 40,210,212.32 \r\n \r\n3,118,000.00 (3,235,000.00) \r\n(117,000.00) 1,258,722.39 40,197,529.15 \r\n \r\n3,542,192.96 75,509,837.33 \r\n \r\n(169,344.12) \r\n159,532.09 218,606.54 \r\n(6,899.15) 180,200.25 (27,973.28) 151,559.35 (595,482.12) 566,785.96 (86,083.02) (920,400.35) (144,441.19) (25,423.76) 2,828,666.65 (665,830.62) \r\n1,463,473.23 \r\n2,166,470.57 \r\n(3,118,000.00) 3,235,000.00 \r\n117,000.00 \r\n2,283,470.57 \r\n35,312,308.18 \r\n \r\nFund Balances - Ending \r\n \r\n$ \r\n \r\n37,922,123.32 $ \r\n \r\n41,456,251.54 $ \r\n \r\n79,052,030.29 $ \r\n \r\n37,595,778.75 \r\n \r\nNotes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (1) Original and Final Budget amounts do not include the Restricted Other - Property Tax Rollback fund balance in the beginning or ending fund balances. \r\n \r\nThe accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 39 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2017 \r\n \r\nSCHEDULE \"8\" \r\n \r\nFUNDING AGENCY PROGRAM/GRANT \r\nAgriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program \r\nTotal Child Nutrition Cluster \r\nPass-Through From Georgia Department of Education Food Services Fresh Fruit and Vegetable Program \r\nTotal U. S. Department of Agriculture \r\nEducation, U. S. Department of Direct Impact Aid \r\nSpecial Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants \r\nTotal Special Education Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Education for Homeless Children and Youth English Language Acquisition Grants Improving Teacher Quality State Grants Migrant Education - State Grant Program Title I Grants to Local Educational Agencies \r\nTotal Other Programs \r\nTotal U. S. Department of Education \r\nDefense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program P.L. 102-375 \r\nTotal U. S. Department of Defense \r\n \r\nCFDA NUMBER \r\n \r\nPASSTHROUGH \r\nENTITY ID \r\nNUMBER \r\n \r\nEXPENDITURES IN PERIOD \r\n \r\n10.553 10.555 \r\n \r\n17175GA324N1099 $ 17175GA324N1100 \r\n \r\n4,034,060.65 13,238,325.72 \r\n17,272,386.37 \r\n \r\n10.582 \r\n \r\n17145GA324L1603 \r\n \r\n166,537.60 17,438,923.97 \r\n \r\n84.041 \r\n \r\n596,869.02 \r\n \r\n84.027 84.173 \r\n \r\nH027A160073 H173A160081 \r\n \r\n84.048 84.196 84.365 84.367 84.011 84.010 \r\n \r\nV048A160010 S196A160011 S365A160010 S367A160001 S011A160011 S010A160010 \r\n \r\n4,913,840.00 143,155.00 \r\n5,056,995.00 \r\n229,406.00 43,869.99 \r\n128,310.26 610,052.40 \r\n45,044.17 6,172,725.83 \r\n7,229,408.65 \r\n12,883,272.67 \r\n \r\n12.UNKNOWN \r\n \r\n339,073.60 409,447.59 \r\n748,521.19 \r\n \r\nTotal Expenditures of Federal Awards \r\n \r\n$ 31,070,717.83 \r\n \r\nNotes to the Schedule of Expenditures of Federal Awards \r\n \r\nNote 1. Basis of Presentation \r\n \r\nThe accompanying schedule of expenditures of federal awards (the \"Schedule\") includes the federal award activity of the Houston County Board of Education (the \"Board\") under programs of the federal government for the year ended June 30, 2017. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net assets of the Board. \r\n \r\nNote 2. Summary of Significant Accounting Policies \r\nExpenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Governments , or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards , wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 40 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2017 \r\nAGENCY/FUNDING \r\nGRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program \r\nEducation, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle Grades (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Amended Formula Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Preschool Handicapped Program Pupil Transportation - State Bonds Teacher of the Year Teachers Retirement Vocational Education \r\nGeorgia Office of Student Achievement Innovation Grant Technology Infrastructure Project \r\nOffice of the State Treasurer Public School Employees Retirement \r\n \r\nSCHEDULE \"9\" \r\n \r\nGOVERNMENTAL FUND TYPE GENERAL FUND \r\n \r\n$ \r\n \r\n4,043,548.82 \r\n \r\n9,562,465.00 424,066.00 \r\n22,543,168.00 1,289,875.00 \r\n10,789,294.00 889,270.00 \r\n17,917,444.00 14,742,741.00 \r\n5,037,029.00 21,332,815.00 12,608,388.00 \r\n829,768.00 1,256,397.00 1,256,671.00 3,256,424.00 \r\n949,615.00 552,978.00 \r\n8,588.00 \r\n3,139,382.00 6,282,955.00 7,421,354.00 (2,145,004.00) \r\n1,527,973.00 538,797.00 26,612.00 \r\n20,200,770.00 \r\n430,854.00 257,482.87 394,809.00 \r\n77,216.25 507.25 \r\n73,141.08 590,138.00 \r\n11,863.44 301,888.96 \r\n551,805.00 \r\n \r\n$ \r\n \r\n168,973,089.67 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 41 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\nYEAR ENDED JUNE 30, 2017 \r\n \r\nSCHEDULE \"10\" \r\n \r\nPROJECT \r\n2012 SPLOST (1) Acquiring instructional and administrative technology equipment (2) Acquiring safety and security equipment (3) Adding to, renovating, repairing, improving, and equipping existing school buildings and other buildings and facilities (4) Acquiring, constructing, and equipping two replacement elementary schools (5) Acquiring, constructing, and equipping a central transportation (bus) facility (6) Acquiring, constructing, and equipping stadium and tennis facilities (7) Acquiring any necessary property, both real and personal (8) Paying (Legal and Administrative) expenses incident to accomplishing the foregoing \r\n \r\nORIGINAL ESTIMATED \r\nCOST (1) \r\n \r\nCURRENT ESTIMATED COSTS (2) \r\n \r\nAMOUNT EXPENDED IN CURRENT YEAR (3) (4) \r\n \r\nAMOUNT EXPENDED IN PRIOR YEARS (3) (4) \r\n \r\nTOTAL COMPLETION \r\nCOST \r\n \r\nEXCESS PROCEEDS NOT \r\nEXPENDED \r\n \r\nPROJECT STATUS \r\n \r\nESTIMATED COMPLETION \r\nDATE \r\n \r\n$ \r\n \r\n- $ 20,450,000.00 $ \r\n \r\n595,609.14 $ 19,843,355.72 $ \r\n \r\n- $ \r\n \r\n- \r\n \r\nOngoing \r\n \r\nOctober 31, 2017 \r\n \r\n- \r\n \r\n1,659,728.00 \r\n \r\n23,824.45 \r\n \r\n1,533,803.54 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nSeptember 30, 2017 \r\n \r\n- \r\n \r\n43,418,111.00 \r\n \r\n317,085.21 \r\n \r\n42,837,660.53 \r\n \r\n- \r\n \r\n- \r\n \r\n26,508,184.00 \r\n \r\n- \r\n \r\n26,508,183.93 26,508,183.93 \r\n \r\n- \r\n \r\n6,506,000.00 \r\n \r\n5,733,322.03 \r\n \r\n505,870.42 \r\n \r\n- \r\n \r\n- \r\n \r\n15,013,653.00 \r\n \r\n2,023,614.81 \r\n \r\n10,040,038.11 \r\n \r\n- \r\n \r\n- \r\n \r\n1,222,146.00 \r\n \r\n- \r\n \r\n1,222,145.37 \r\n \r\n1,222,145.37 \r\n \r\n- \r\n \r\n472,924.00 \r\n \r\n5,460.00 \r\n \r\n467,463.22 \r\n \r\n472,923.22 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2017 \r\n \r\n- \r\n \r\nComplete \r\n \r\nNovember 30, 2014 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJuly 31. 2017 \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2018 \r\n \r\n- \r\n \r\nComplete \r\n \r\nJune 30, 2017 \r\n \r\n- \r\n \r\nComplete \r\n \r\nNovember 30, 2016 \r\n \r\n2017 SPLOST (1) Acquiring instructional and administrative technology equipment and materials (2) Acquiring safety, security and fire protection equipment (3) Adding to, renovating, repairing, improving, furnishing and equipping existing school buildings, and physical education and other buildings and facilities, including any necessary demolition (4) Adding to, constructing, renovating, furnishing, and equipping gymnasiums and athletic facilities (5) Renovations, additions and improvements to parking and traffic access facilities, including any necessary sitework (6) Acquiring, constructing, furnishing, and equipping one new elementary school (7) Acquiring buses, vehicles, and transportation equipment (8) Acquiring any necessary property, both real and personal (9) Paying expenses incident to accomplishing the foregoing \r\n \r\n$ 125,000,000.00 $ 115,250,746.00 $ 8,698,915.64 $ 102,958,520.84 $ 28,203,252.52 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- $ 20,000,000.00 $ \r\n \r\n619,513.85 $ \r\n \r\n- $ \r\n \r\n- $ \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\n1,913,015.00 \r\n \r\n84,103.75 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2020 \r\n \r\n- \r\n \r\n38,971,933.00 \r\n \r\n551,695.05 \r\n \r\n- \r\n \r\n- \r\n \r\n43,154,503.00 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n3,440,200.00 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n15,680,000.00 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n5,000,000.00 \r\n \r\n91,464.00 \r\n \r\n- \r\n \r\n- \r\n \r\n2,000,000.00 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\n404,612.00 \r\n \r\n374,612.16 \r\n \r\n- \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2021 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nAugust 31, 2020 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2021 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nJune 30, 2022 \r\n \r\n- \r\n \r\n- \r\n \r\nOngoing \r\n \r\nNovember 30, 2021 \r\n \r\n$ 135,000,000.00 $ 130,564,263.00 $ 1,721,388.81 $ \r\n \r\n- $ \r\n \r\n- $ \r\n \r\n- \r\n \r\n(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. \r\n \r\n(2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. \r\n \r\n(3) The voters of Houston County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. \r\n \r\n(4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows: \r\n \r\nPrior Years \r\n \r\n$ 5,241,823.33 \r\n \r\nCurrent Year \r\n \r\n490,131.26 \r\n \r\nTotal \r\n \r\n$ 5,731,954.59 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 43 - \r\n \r\n SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2018 \r\n \r\nThe Honorable Nathan Deal, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED \r\nIN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 22, 2018. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\n \r\n Compliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2018 \r\n \r\nThe Honorable Nathan Deal, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited the Houston County Board of Education's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2017. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\nWe believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance. \r\n \r\n Opinion on Each Major Federal Program \r\nIn our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2017. \r\nReport on Internal Control over Compliance \r\nManagement of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2017 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\nPRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS \r\nNo matters were reported. \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2017 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\n \r\nType of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information \r\n \r\nUnmodified \r\n \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nNoncompliance material to financial statements noted: \r\n \r\nNo \r\n \r\nFederal Awards \r\n \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with 2 CFR 200.516(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: \r\n \r\nCFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n10.553, 10.555 84.027, 84.173 \r\n \r\nChild Nutrition Cluster Special Education Cluster \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: Auditee qualified as low-risk auditee? II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n$929,361.86 Yes \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2016-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2016 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2017-03-22"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2016 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2016-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2016-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"Houston County Board of Education \r\nPerry, Georgia \r\nFiscal Year 2016 Audit Report \r\nYear Ended June 30, 2016 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nPage \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\ni \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nGOVERNMENT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\n1 \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\n2 \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n4 \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\n5 \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n6 \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\n7 \r\n \r\nG \r\n \r\nSTATEMENT OF FIDUCIARY NET POSITION \r\n \r\nFIDUCIARY FUNDS \r\n \r\n8 \r\n \r\nH NOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\n10 \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n33 \r\n \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nEMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n34 \r\n \r\n3 SCHEDULE OF CONTRIBUTIONS  TEACHERS RETIREMENT SYSTEM OF GEORGIA \r\n \r\n35 \r\n \r\n4 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA 36 \r\n \r\n5 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n37 \r\n \r\n6 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES - BUDGET AND ACTUAL \r\n \r\nGENERAL FUND \r\n \r\n38 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\nSECTION I FINANCIAL SCHEDULES SUPPLEMENTARY INFORMATION 7 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 8 SCHEDULE OF STATE REVENUE 9 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\nPage \r\n39 40 41 \r\n \r\nSECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n SECTION I FINANCIAL \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2017 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT \r\nLadies and Gentlemen: \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education (School District), as of and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the \r\n \r\n effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\nWe believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the basic financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the School District, as of June 30, 2016, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nEmphasis of Matter \r\nAs described in Note 2 to the financial statements, in 2016, the School District adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 72, Fair Value Measurement and Application, GASB Statement No. 73, Accounting and Financial Reporting for Pensions and Related Assets that are not within the Scope of GASB Statement No. 68, and Amendments to Certain Provisions of GASB Statements No. 67 and 68, and GASB Statement No. 79, Certain External Investment Pools and Pool Participants. Our opinions are not modified with respect to this matter. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Schedules of Proportionate Share of the Net Pension Liability, Schedules of Contributions to Retirement Systems, Notes to the Required Supplementary Information and the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual as presented on pages i through xi , and pages 33 through 38 respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, consisting of Schedules 7 through 9, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of \r\n \r\n Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements. \r\nThe accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. \r\nOther Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated March 22, 2017, on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\nThe discussion and analysis of Houston County Board of Education's financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2016. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFinancial Highlights \r\nKey financial highlights for 2016 are as follows: \r\nOn the government-wide financial statements: \r\n On the government-wide financial statements, net position increased $28.5 million which represents a 21.3 percent increase from 2015. This total increase was due to governmental activities since the School District has no business-type activities. \r\n The School District had $273.6 million in expenses related to governmental activities. Revenues totaled $302.0 million. Program specific revenues in the form of charges for services and sales, grants, and contributions accounted for $177.4 million or 58.7 percent of the total revenues and were used to offset these expenditures. General revenues of $124.6 million or 41.3 percent of all revenues were adequate to provide for these programs. \r\n The current ratio, which measures the Board's ability to transform current assets into cash and pay its short-term liabilities, was 5.79 for the fiscal year ended June 30, 2016. Generally, a ratio greater than 2.0 is considered very financially stable. \r\nOn the fund financial statements: \r\n Among major funds, the General Fund had $278.4 million in revenues and other financing sources, and $272.2 million in expenditures and other financing uses. The General Fund's balance increased to $75.5 million. \r\nOVERVIEW OF THE FINANCIAL STATEMENTS \r\nThis annual report consists of three parts; management's discussion and analysis, the basic financial statements and required supplementary information. The basic financial statements include two levels of statements that present different views of the Houston County Board of Education. These include the government-wide and fund financial statements. \r\nThe government-wide financial statements include the Statement of Net Position and Statement of Activities. These statements provide information about the activities of the School District presenting both short-term and long-term information about the overall financial status. \r\nThe fund financial statements focus on individual parts, reporting the School District's operation in more detail. The Governmental Fund statements disclose how basic services are financed in the short-term as well as what remains for future spending. The Fiduciary Fund statements provide information about the financial relationships in which the Board acts solely as a trustee or agent for the benefit of others. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\nThe fund financial statements reflect the School District's most significant funds. For the years ending June 30, 2016, the general fund, the capital projects fund, and the debt service fund represent the most significant funds. \r\nThe financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements. \r\nGovernment-Wide Statements \r\nThe government-wide statements report information about the School District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the School District's assets and liabilities. All of the current fiscal year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. \r\nThe two government-wide statements report the School District's Net Position and how it has changed. Net Position, the difference between the School District's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, are one way to measure the School District's overall financial health or position. Over time, increases or decreases in Net Position are an indication of whether its financial health is improving or deteriorating. Changes may be the result of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities  All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, student and principal accounts, and various others. \r\nFund Financial Statements \r\nThe School District's fund financial statements provide detailed information about the most significant funds, not the School District as a whole. Some funds are required by State law and some by bond requirements. The School District's major governmental funds are the general fund, capital projects fund, and debt service fund. \r\nGovernmental Funds - Most of the School District's activities are reported in governmental funds, which focus on the determination of financial position and change in financial position, not on income determination. These funds are reported using the modified accrual method of accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\n \r\nprograms. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements. \r\n \r\nFiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others, such as the employee benefit programs, and school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the government-wide financial statements because it cannot use these assets to finance its operations. \r\n \r\nFINANCIAL ANALYSIS OF THE BOARD AS A WHOLE \r\n \r\nRecall that the Statement of Net Position provides the perspective of the Board as a whole. Table 1 provides a summary of the Board's net position for 2016 compared to fiscal year 2015. \r\n \r\nTable 1 Net Position (in Thousands) \r\nAssets Current and Other Assets Capital Assets, Net \r\nTotal Assets \r\nDeferred Outflows of Resources Related to Defined Benefit Pension Plans \r\nLiabilities Current and Other Liabilities Long-Term Liabilities \r\nTotal Liabilities \r\nDeferred Inflows of Resources Related to Defined Benefit Pension Plans \r\nNet Position Net Investment in Capital Assets Restricted Unrestricted (Deficit) \r\nTotal Net Position \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2016 \r\n \r\nYear 2015 \r\n \r\n$ \r\n \r\n111,374 $ \r\n \r\n122,749 \r\n \r\n311,702 \r\n \r\n306,470 \r\n \r\n423,076 \r\n \r\n429,219 \r\n \r\n24,123 \r\n \r\n19,888 \r\n \r\n19,245 243,917 \r\n263,162 \r\n \r\n32,871 218,029 \r\n250,900 \r\n \r\n21,680 \r\n \r\n64,313 \r\n \r\n302,604 59,029 \r\n(199,276) \r\n \r\n285,862 61,279 \r\n(213,247) \r\n \r\n$ \r\n \r\n162,357 $ \r\n \r\n133,894 \r\n \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 Total net position increased $28.5 million to $162.4 million. Table 2 shows the changes in net position for fiscal year 2016 compared to the changes in net position for fiscal year 2015. \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\n \r\nTable 2 Change in Net Position \r\n(in Thousands) \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\nTotal Program Revenues \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted Investment Earnings Miscellaneous \r\nTotal General Revenues \r\nSpecial Items \r\nTotal Revenues and Special Items \r\nProgram Expenses: Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\nTotal Expenses \r\nIncrease in Net Position \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2016 \r\n \r\n2015 \r\n \r\n$ \r\n \r\n8,219 $ \r\n \r\n8,503 \r\n \r\n166,655 \r\n \r\n155,891 \r\n \r\n2,557 \r\n \r\n2,372 \r\n \r\n177,431 \r\n \r\n166,766 \r\n \r\n51,074 2,453 \r\n22,302 \r\n22,296 1,073 \r\n19,081 166 \r\n6,193 124,638 \r\n- \r\n302,069 \r\n \r\n50,445 3,047 \r\n22,109 \r\n22,109 1,025 \r\n20,529 108 \r\n5,533 124,905 \r\n40 \r\n291,711 \r\n \r\n177,182 \r\n \r\n177,544 \r\n \r\n8,660 7,360 3,864 1,417 17,470 2,209 18,707 10,960 2,919 1,120 \r\n \r\n8,192 7,590 3,906 1,346 17,492 2,080 18,151 11,028 3,536 2,112 \r\n \r\n2,255 1,022 18,689 \r\n(228) \r\n \r\n2,415 902 \r\n17,538 10 \r\n \r\n273,606 \r\n \r\n273,842 \r\n \r\n$ \r\n \r\n28,463 $ \r\n \r\n17,869 \r\n \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\nFigure A shows the funding sources for the revenues. 52.9 percent of the School District's revenues are derived from state grants. Property Taxes make up 17.7 percent of the total funding, while an additional 15.1 percent is earned from the County's sales taxes. \r\nFigure A Sources of Revenue for Fiscal Year 2016 \r\n \r\nState Funds 52.9% \r\n \r\nFederal Funds 9.3% \r\n \r\nCharges for Services 2.7% \r\n \r\nMiscellaneous 2.2% \r\n \r\nSales Taxes 15.1% \r\n \r\nProperty Taxes 17.7% \r\nInvestment Earnings 0.1% \r\n \r\nAs shown in Figure B, Instruction comprised 64.8 percent of governmental program expenses. Administration and Other Services (2.8 percent) consist of the central office, business and warehouse, and other central operations of the School District. \r\n \r\nFigure B Functional Expenses for Fiscal Year 2016 \r\nB \r\n \r\nEducational Media 1.4% \r\nImprovement of Instruction 2.7% \r\nPupil Services 3.2% Interest on Debt (0.1)% \r\n \r\nInstruction 64.8 % \r\n \r\nEnterprise and Community \r\nServices 1.2% \r\n \r\nFood Services 6.8% \r\n \r\nAdministration and Other Services \r\n2.8% \r\n \r\nStudent Transportation \r\nServices 4.0% \r\n \r\nSchool Administration \r\n6.4% \r\nMaintenance and Operation of Plant \r\n6.8% \r\n \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\n \r\nGovernmental Activities \r\n \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2016 with fiscal year 2015. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(in Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2016 \r\n \r\nYear 2015 \r\n \r\nNet Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2016 \r\n \r\nYear 2015 \r\n \r\nInstruction \r\n \r\n$ \r\n \r\n177,182 $ \r\n \r\n177,544 $ \r\n \r\nSupport Services: \r\n \r\nPupil Services \r\n \r\n8,660 \r\n \r\n8,192 \r\n \r\nImprovement of Instructional Services \r\n \r\n7,360 \r\n \r\n7,590 \r\n \r\nEducational Media Services \r\n \r\n3,864 \r\n \r\n3,906 \r\n \r\nGeneral Administration \r\n \r\n1,417 \r\n \r\n1,346 \r\n \r\nSchool Administration \r\n \r\n17,470 \r\n \r\n17,492 \r\n \r\nBusiness Administration \r\n \r\n2,209 \r\n \r\n2,080 \r\n \r\nMaintenance and Operation of Plant \r\n \r\n18,707 \r\n \r\n18,151 \r\n \r\nStudent Transportation Services \r\n \r\n10,960 \r\n \r\n11,028 \r\n \r\nCentral Support Services \r\n \r\n2,919 \r\n \r\n3,536 \r\n \r\nOther Support Services \r\n \r\n1,120 \r\n \r\n2,112 \r\n \r\nOperations of Non-Instructional Services: \r\n \r\nEnterprise Operations \r\n \r\n2,255 \r\n \r\n2,415 \r\n \r\nCommunity Services \r\n \r\n1,022 \r\n \r\n902 \r\n \r\nFood Services \r\n \r\n18,689 \r\n \r\n17,538 \r\n \r\nInterest on Short-Term and Long-Term Debt \r\n \r\n(228) \r\n \r\n10 \r\n \r\nTotal Expenses \r\n \r\n$ \r\n \r\n273,606 $ \r\n \r\n273,842 $ \r\n \r\n53,902 $ \r\n4,476 2,367 \r\n147 937 9,570 1,712 11,030 8,923 2,215 \r\n24 \r\n739 1,022 \r\n(661) (228) \r\n96,175 $ \r\n \r\n59,034 \r\n4,837 2,565 \r\n696 896 11,177 1,635 10,792 9,139 2,869 1,353 \r\n808 902 363 \r\n10 \r\n107,076 \r\n \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 30.4 percent of Instruction activities are supported through taxes and other general revenues, and for all governmental activities general revenue support is 35.2 percent. \r\n \r\nThe School District's Funds \r\n \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $302.6 million and expenditures and other financing uses of $300.9 million. There was an increase in the fund balance totaling $1.7 million for the governmental funds as a whole. The general fund increased by $6.2 million due mainly to increases in mid-term funding and careful planning of expenditures. The capital projects fund had a decrease of $4.5 million and debt service fund remained virtually unchanged. The capital project funds decrease was due to proceeds of the Education Special Purpose Local Option Sales Tax \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 (ESPLOST) being collected in prior years and used in subsequent years. The negligible increase in the debt service fund was attributable to the amount of ESPLOST proceeds being needed to meet the interest and principal payments due on the outstanding debt associated with previously issued general obligation bonds in the subsequent year. The increase in the fund balance of the general fund for the year reflects that the School District was able to meet current costs as planned and budgeted. General Fund Budgeting Highlights The School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund. During the course of fiscal year 2016, the School District amended its general fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. For the general fund, the final budgeted revenues and other financing sources of $278.6 million was greater than the original budgeted amount of $274.4 million by $4.2 million. The overall difference was mainly due to additional state grant awards of $3.5 million and additional local revenues. The actual revenues and other financing sources of $278.4 million was less than the budgeted amount by $0.2 million due mainly to the elimination of intrafund transfers and the difference in the recognition of the Local Option Sales Tax for budget purposes. The final budgeted expenditures and other financing uses of $274.3 million was less than the original budgeted amount of $278.6 million by $4.3 million. This difference was due mainly to adjusting the budget to reflect the revised needs. The actual expenditures and other financing uses of $272.2 million was $2.1 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. The differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes that had previously been reported as deferred as current and prior year revenues for report purposes. \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\n \r\nCapital Assets and Debt Administration \r\n \r\nCapital Assets \r\n \r\nAt the end of fiscal year 2016, the School District had $311.7 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2016 balances compared with fiscal year 2015 balances. \r\n \r\nTable 4 Capital Assets (Net of Depreciation, in Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2016 \r\n \r\nYear 2015 \r\n \r\nLand \r\n \r\n$ \r\n \r\nConstruction In Progress \r\n \r\nBuilding and Improvements \r\n \r\nEquipment \r\n \r\nLand Improvements \r\n \r\nIntangible Assets \r\n \r\nTotal \r\n \r\n$ \r\n \r\n11,278 $ 24,646 264,125 \r\n6,696 4,957 \r\n- \r\n311,702 $ \r\n \r\n11,072 9,001 \r\n274,271 7,586 4,540 - \r\n306,470 \r\n \r\nThe overall capital assets increased in fiscal year 2016 by $5.2 million due to the construction and renovation expenses from the 2012 E-SPLOST and Capital Outlay Projects during the current year offset by the fiscal year 2016 depreciation of $12.2 million. \r\nDebt \r\nAt June 30, 2016, the School District had $20.4 million in bonds outstanding with $10.1 million due within one year, $2.2 million in capital leases outstanding with $0.6 million due within one year, $2.6 million in compensated absences earned as of the end of the year, and $2.1 million in unamortized bond premiums with $1.0 million due within one year. In addition, the School District reported a liability for its proportionate share of the net pension liability. Reporting this liability was required by GASB 68. \r\n \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 \r\n \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2016, compared to fiscal year 2015 balances. \r\n \r\nTable 5 Debt at June 30 (in Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2016 \r\n \r\n2015 \r\n \r\nGeneral Obligation Bonds \r\n \r\n$ \r\n \r\nCapital Leases \r\n \r\nCompensated Absences \r\n \r\nUnamortized Bond Premiums \r\n \r\nNet Pension Liability \r\n \r\nTotal \r\n \r\n$ \r\n \r\n20,390 $ 2,217 2,592 2,101 \r\n216,617 \r\n243,917 $ \r\n \r\n30,275 2,846 2,724 3,119 \r\n179,065 \r\n218,029 \r\n \r\nAt June 30, 2016, the School District's overall legal bonding authority was $371.2 million based on the assessed value of taxable property as of December 31, 2015. The School District's bonds have assigned ratings of Aa2 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. Both the current year payments and subsequently scheduled payments are well below the $5.8 million threshold. \r\n \r\nCurrent Issues \r\n \r\nThe Houston County School District consists of 39 campuses located in Houston County, a fast-growing area with a population of approximately 149,111. Current enrollment is approximately 29,000 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 15th in population, 15th in economics, and 16th in income. The 2015 School District millage ranks 164th out of 180 districts in Georgia. \r\n \r\nThe State of Georgia experienced serious financial hardship over the past few years, and as a result, more pressure is being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2.0 million in 2003 to a high of $23.8 million in 2010. For fiscal year 2016 the reduction was $8.1 million. Reductions in other state grants and programs resulted in the total reduction of state funding for 2016 reaching approximately $24.7 million. For fiscal year 2017, additional austerity reductions of $2.9 million have already been approved by the state for the School District. Since the austerity reductions were enacted, the reductions total $155.4 million and the overall reduction of state funding is approximately $297.9 million. While Houston County's class sizes remain below the state maximum recommendations, continued reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of \r\n \r\nx \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2016 state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. Houston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2015 economic impact on the State of Georgia of $2.75 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the County include the Board of Education, Houston County Hospital Authority, Perdue Farms, Frito-Lay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 62.8 percent work in the County. Houston is Georgia's sixty-fifth largest county in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990-2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and is projected to grow to 154,526 in 2016. This growth results in school system enrollment increases between 175 to 473 students for the past five years. Houston has three municipalities: Centerville with a population of 7,531; Perry with 14,730; and Warner Robins with 70,712. The County also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. Contacting the School District's Financial Management This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nxi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n         (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nThe accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below. \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements of the Houston County Board of Education. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness. \r\nGOVERNMENT-WIDE STATEMENTS: \r\nThe Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. \r\nThe Statement of Net Position presents the School District's non-fiduciary assets and liabilities, with the difference reported as net position. Net position is reported in three categories as follows: \r\n1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\n2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\n3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\n Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\n Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFUND FINANCIAL STATEMENTS: \r\nThe fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements for each category (governmental and fiduciary) are presented. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned to the expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. \r\n The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general longterm principal and interest. \r\nThe School District reports the following fiduciary fund type: \r\n Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized \r\n \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nas expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\nIn fiscal year 2016, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 72, Fair Value Measurement and Application. This statement addresses accounting and financial reporting issues related to fair value measurements. The definition of fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This statement provides guidance for determining a fair value measurement for financial reporting purposes. This statement also provides guidance for applying fair value to certain investments and disclosures related to all fair value measurements. The School District did not have any items that required reassessment of value for reporting purposes as a result of adoption of this statement. \r\nIn fiscal year 2016, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 73, Accounting and Financial Reporting for Pensions and Related Assets that are not within the Scope of GASB Statement No. 68, and Amendments to Certain Provisions of GASB Statements No. 67 and 68. This statement establishes requirements for defined benefit pensions that are not within the scope of Statement No. 68, Accounting and Financial Reporting for Pensions, as well as for the assets accumulated for purposes of providing those pensions. In addition, it establishes requirements for defined contribution pensions that are not within the scope of Statement No. 68. It also amends certain provisions of Statement No. 67, Financial Reporting for Pension Plans, and Statement No. 68 for pension plans and pensions that are within their respective scopes. The adoption of this statement does not have a significant impact on the School District's financial statements. \r\nIn fiscal year 2016, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 79, Certain External Investment Pools and Pool Participants. This statement addresses accounting and financial reporting for certain external investment pools and pool participants. If an external investment pool meets the criteria in this statement and measures all of its investments at amortized cost, the pool's participants also should measure their investments in that external investment pool at amortized cost for financial reporting purposes. The School District participates in an external investment pool, the State of Georgia local government investment pool (Georgia Fund 1), which does not meet the criteria of this statement. Therefore, the investment in this pool is measured at fair value as provided in paragraph 11 of GASB Statement No. 31, as amended. \r\nCASH AND CASH EQUIVALENTS \r\nCash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nINVESTMENTS \r\nThe School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. \r\nInvestments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interestearning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value. \r\nFor accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired. \r\nRECEIVABLES \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\nINVENTORIES \r\nFood Inventories \r\nOn the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (weighted average). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\nSupply Inventory \r\nOn the basic financial statements, inventories of consumable supplies and materials are reported at cost (weighted average). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\nCAPITAL ASSETS \r\nOn the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections or works of art. \r\nCapital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities column in the government-wide financial statements. \r\nDepreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives. \r\n \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCapitalization thresholds and estimated useful lives of capital assets reported in the governmentwide statements are as follows: \r\n \r\nCapitalization Policy \r\n \r\nEstimated Useful Life \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible Assets Construction in Progress \r\n \r\nAll \r\n \r\nN/A \r\n \r\nAll \r\n \r\n8 to 25 years \r\n \r\nAll \r\n \r\n10 to 50 years \r\n \r\nAll \r\n \r\n5 to 14 years \r\n \r\n$10,000.00 and any \r\n \r\n5 to 10 years \r\n \r\nitem necessary \r\n \r\nfor insurance \r\n \r\npurposes \r\n \r\n$100,000.00 to $1.0 million up to 20 years \r\n \r\nAll \r\n \r\nN/A \r\n \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\nIn addition to assets, the statement of net position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. \r\nIn addition to liabilities, the statement of net position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\nPublic School Employees Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of twenty days. Vacation leave of twelve days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed twenty days. \r\nLONG-TERM LIABILITIES AND BOND DISCOUNTS/PREMIUMS \r\nIn the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the \r\n \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nnet carrying value of refunded debt are deferred and amortized over the life of the bonds using the effective interest method. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\nIn the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. \r\nFUND BALANCES \r\nFund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. \r\nThe School District's fund balances are classified as follows: \r\nNonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\nCommitted consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\nAssigned consists of resources constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or the Assistant Superintendent for Finance and Business Operations, to assign amounts to be used for specific purposes. \r\nUnassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance. \r\nUSE OF ESTIMATES \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\nPROPERTY TAXES \r\nThe Houston County Board of Commissioners adopted the property tax levy for the 2015 tax digest year (calendar year) on July 27, 2015 (levy date). Taxes were due on December 20, 2015 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2015 tax \r\n \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\ndigest are reported as revenue in the governmental funds for fiscal year 2016. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2016, for maintenance and operations amounted to $51,110,086.22. \r\nThe tax millage rate levied for the 2015 tax year (calendar year) for the Houston County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.34 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $2,322,941.86 during fiscal year ended June 30, 2016. \r\nSALES TAXES \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the School District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $22,301,619.10 and was recorded in the General Fund. Local Option Sales Tax is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\nEducation Special Purpose Local Option Sales Tax, (ESPLOST) at the fund reporting level, during the year amounted to $22,296,389.39 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be reauthorized at least every five years. \r\nNOTE 3: BUDGETARY DATA The budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund and function. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the General Fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of Official Code of Georgia Annotated section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee Schedule 6  General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual for a detail of any over/under expenditures during the fiscal year under review. \r\n \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 4: DEPOSITS AND CASH EQUIVALENTS \r\nCOLLATERALIZATION OF DEPOSITS \r\nOfficial Code of Georgia Annotated (O.C.G.A.) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. Section 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110 percent of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\nCATEGORIZATION OF DEPOSITS \r\nCustodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2016, the School District had deposits with a carrying amount of $17,596,046.87, which includes $274,283.07 in Certificates of Deposit that are reported as Investments, and a bank balance of $19,235,448.40. The bank balances insured by Federal depository insurance were $4,274,154.73 and the bank balances collateralized with securities held by the pledging financial institution in the School District's name were $14,961,293.67. \r\nCATEGORIZATION OF CASH EQUIVALENTS \r\nThe School District reported cash equivalents of $61,208,780.85 in Georgia Fund 1, a local government investment pool. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2016, was 42 days. \r\nGeorgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\nNOTE 5: CAPITAL ASSETS \r\nThe following is a summary of changes in the capital assets for governmental activities during the fiscal year: \r\n \r\nBalances June 30, 2015 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nTransfers \r\n \r\nBalances June 30, 2016 \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction in Progress \r\n \r\n$ 11,071,714.76 $ 9,000,532.39 \r\n \r\n- $ 17,016,895.29 \r\n \r\n- $ 206,576.79 $ 11,278,291.55 \r\n \r\n- \r\n \r\n(1,371,217.19) \r\n \r\n24,646,210.49 \r\n \r\nTotal Capital Assets Not Being Depreciated \r\n \r\n20,072,247.15 \r\n \r\n17,016,895.29 \r\n \r\n- \r\n \r\n(1,164,640.40) \r\n \r\n35,924,502.04 \r\n \r\nCapital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements \r\n \r\n410,116,749.56 26,257,822.60 7,275,353.26 \r\n \r\n691,719.57 \r\n- \r\n \r\n21,979.00 654,541.80 176,016.06 \r\n \r\n249,563.40 - \r\n915,077.00 \r\n \r\n410,344,333.96 26,295,000.37 8,014,414.20 \r\n \r\nLess Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements \r\n \r\n135,845.570.87 18,671,572.38 2,735,349.32 \r\n \r\n10,395,838.56 1,445,936.25 384,014.10 \r\n \r\n21,979.00 518,684.04 \r\n61,605.62 \r\n \r\n- \r\n \r\n146,219,430.43 \r\n \r\n- \r\n \r\n19,598,824.59 \r\n \r\n- \r\n \r\n3,057,757.80 \r\n \r\nTotal Capital Assets, Being Depreciated, Net \r\n \r\n286,397,432.85 \r\n \r\n(11,534,069.34) \r\n \r\n250,268.20 \r\n \r\n1,164,640.40 275,777,735.71 \r\n \r\nGovernmental Activity Capital Assets - Net \r\n \r\n$ 306,469,680.00 $ \r\n \r\n5,482,825.95 $ \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction \r\n \r\nSupport Services \r\n \r\nPupil Services \r\n \r\n$ \r\n \r\n6,379.35 \r\n \r\nImprovements of Instructional Services \r\n \r\n7,078.06 \r\n \r\nEducational Media Services \r\n \r\n423,263.02 \r\n \r\nGeneral Administration \r\n \r\n5,135.00 \r\n \r\nSchool Administration \r\n \r\n416,022.34 \r\n \r\nBusiness Administration \r\n \r\n112,163.31 \r\n \r\nMaintenance and Operation of Plant \r\n \r\n103,620.79 \r\n \r\nStudent Transportation Services \r\n \r\n982.923.40 \r\n \r\nCentral Support Services \r\n \r\n69,312.40 \r\n \r\nFood Services \r\n \r\n250,268.20 $ \r\n \r\n- $ 311,702,237.75 \r\n \r\n$ 9,091,959.97 \r\n \r\n2,125,897.67 1,007,931.27 \r\n \r\n$ 12,225,788.91 \r\n \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nNOTE 6: INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2016, consisted of the following: \r\n \r\nTransfers to \r\n \r\nTransfers From General Fund \r\n \r\nEXHIBIT \"H\" \r\n \r\nCapital Projects Fund \r\n \r\n$ 24,328.22 \r\n \r\nTransfers are used to move local revenues collected by the general fund to the government-wide capital projects fund for capital construction projects. NOTE 7: LONG-TERM LIABILITIES \r\nThe changes in long-term liabilities during the fiscal year ended June 30, 2016, were as follows: \r\n \r\nBalance June 30, 2015 \r\n \r\nAdditions \r\n \r\nGovernmental Activities \r\n \r\nBalance \r\n \r\nDeductions \r\n \r\nJune 30, 2016 \r\n \r\nDue Within One Year \r\n \r\nGeneral Obligation Bonds Unamortized Bond Premiums Capital Leases Compensated Absences(1) \r\n \r\n$ 30,275,000.00 $ \r\n \r\n- $ 9,885,000.00 $ \r\n \r\n3,118,997.61 \r\n \r\n- \r\n \r\n1,018,374.61 \r\n \r\n2,845,754.34 \r\n \r\n- \r\n \r\n629,073.13 \r\n \r\n2,723,740.47 1,787,366.15 1,918,925.62 \r\n \r\n20,390,000.00 $ 2,100,623.00 2,216,681.21 2,592,181.00 \r\n \r\n10,085,000.00 1,038,979.05 634,066.48 - \r\n \r\n$ 38,963,492.42 $ 1,787,366.15 $ 13,451.373.36$ 27,299,485.21 $ 11,758,045.53 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the \r\nbasic financial statements. \r\nGENERAL OBLIGATION DEBT OUTSTANDING The School District's bonded debt consists of issues of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voterapproved Education Special Purpose Local Option Sales Taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. \r\nGeneral obligation bonds currently outstanding are as follows: \r\n \r\nDescription \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\nGeneral Government - Series 2012 \r\n \r\n2.799% - 4.00% 3/27/2012 \r\n \r\n9/1/2017 $ 43,560,000.00 $ 20,390,000.00 \r\n \r\nThe following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nGeneral Obligation Debt \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nUnamortized Bond Premium \r\n \r\n2017 \r\n \r\n$ \r\n \r\n2018 \r\n \r\nTotal Principal and Interest $ \r\n \r\n10,085,000.00 $ 10,305,000.00 \r\n20,390,000.00 $ \r\n \r\n490,131.26 $ 144,215.63 \r\n634,346.89 $ \r\n \r\n1,038,979.05 1,061,643.95 \r\n2,100,623.00 \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCAPITAL LEASES The School District has acquired buses and band equipment under the provisions of various longterm lease agreements classified as capital leases for accounting purposes because they provide for a bargain purchase option or a transfer of ownership by the end of the lease term. \r\nThe following assets were acquired through capital leases and are reflected in the capital asset note at fiscal year-end: \r\nGovernmental Activities \r\n \r\nEquipment \r\n \r\n$ 3,081,846.00 \r\n \r\nLess: Accumulated Depreciation \r\n \r\n630,992.70 \r\n \r\n$ 2,450,853.30 \r\n \r\nCapital leases currently outstanding are as follows: \r\n \r\nPurpose \r\n \r\nInterest Rates \r\n \r\nIssue Date \r\n \r\nMaturity Date \r\n \r\nAmount Issued \r\n \r\nAmount Outstanding \r\n \r\n15 School Buses 12 School buses Band Equipment \r\n \r\n1.09% 1.62% 3.50% \r\n \r\n6/27/2013 11/11/2014 \r\n6/3/2015 \r\n \r\n8/1/2018 $ 9/1/2019 2/15/2019 \r\n \r\n1,687,158.00 $ 1,394,688.00 \r\n92,662.29 \r\n \r\n1,024,312.47 1,122,476.83 \r\n69,891.91 \r\n \r\n$ \r\n \r\n3,174,508.29 $ 2,216,681.21 \r\n \r\nThe following is a schedule of total capital lease payments: \r\n \r\nFiscal Year Ended June 30: \r\n \r\nCaptial Leases \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\n2017 2018 2019 2020 \r\n \r\n$ 634,066.48 $ 643,028.20 652,125.06 287,461.47 \r\n \r\n31,764.14 22,802.43 13,705.56 \r\n4,685.79 \r\n \r\nTotal Principal and Interest \r\n \r\n$ 2,216,681.21 $ 72,957.92 \r\n \r\nCOMPENSATED ABSENCES \r\nCompensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the General Fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\nNOTE 8: RISK MANAGEMENT \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; acts of God and unemployment compensation. \r\n \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe School District participates in the Georgia School Boards Association Risk and Insurance Management System, a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The School District pays an annual premium to the system for its general insurance coverage. Additional coverage is provided through agreements by the system with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the system varies by line of coverage. \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the General Fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000.00 loss per occurrence, up to the statutory limit. \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2015 2016 \r\n \r\n$ 1,130,162.46 $ 1,440,025.96 \r\n \r\n$ 1,186,308.30 $ 389,400.39 \r\n \r\n$ 876,444.80 $ 825,129.81 \r\n \r\n$ 1,440,025.96 $ 1,004,296.54 \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the General Fund with expenses/expenditures and liabilities being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. \r\n \r\nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2015 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n2016 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\nThe School District has purchased a surety bond to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNOTE 9: FUND BALANCE CLASSIFICATION DETAILS \r\n \r\nThe School District's financial statements include the following amounts presented in the aggregate at June 30, 2016: \r\n \r\nNonspendable Inventories \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\nAssigned School Activity Accounts Subsequent Period Expenditures \r\n \r\n$ 4,447,452.56 \r\n \r\n$ 6,718,679.66 6,176,888.42 \r\n10,466,746.58 35,346,528.85 \r\n \r\n58,708,843.51 \r\n \r\n$ 2,392,826.17 1,961,065.00 \r\n \r\n4,353,891.17 \r\n \r\nUnassigned \r\n \r\n24,643,285.09 \r\n \r\nFund Balance, June 30, 2016 \r\n \r\n$ 92,153,472.33 \r\n \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\n \r\nIt is the goal of the Houston County Board of Education to achieve and maintain an unassigned fund balance in the general fund at fiscal year-end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, net of any Committed Reserve Balance for capital expenditures, in compliance with O.C.G.A. 20-2-167(a)5. The School District should provide for the maintenance of annual expenditure increases necessary to provide a consistent educational environment satisfactory to its citizens. If the unassigned fund balance at fiscal yearend falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\n \r\nNOTE 10: SIGNIFICANT COMMITMENTS COMMITMENTS UNDER CONSTRUCTION CONTRACTS \r\n \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2016, together with funding available: \r\n \r\nProject \r\n \r\nUnearned Executed Contracts (1) \r\n \r\nFunding Available From State (1) \r\n \r\n14-678-108 \r\n \r\n$ \r\n \r\n30,346.80 $ \r\n \r\n- \r\n \r\nCentral Bus Facility \r\n \r\n146,645.16 \r\n \r\n- \r\n \r\nNew Stadium \r\n \r\n1,977,329.59 \r\n \r\n- \r\n \r\nRenovation of Lunchroom Freezers \r\n \r\n449,483.64 \r\n \r\n- \r\n \r\n$ \r\n \r\n2,603,805.19 $ \r\n \r\n- \r\n \r\n(1) The amounts described are not reflected in the basic financial statements. \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nOPERATING LEASES \r\nHouston County Board of Education has entered into various leases as lessee for copiers, servers and mail equipment. These leases are considered for accounting purposes to be operating leases. Lease expenditures for the year ended June 30, 2016, for governmental funds amounted to $4,800.00. \r\nNOTE 11: SIGNIFICANT CONTINGENT LIABILITIES \r\nFEDERAL GRANTS \r\nAmounts 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 costs which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\nLITIGATION \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the basic financial statements. \r\nNOTE 12: POST-EMPLOYMENT BENEFITS \r\nGEORGIA SCHOOL PERSONNEL POST-EMPLOYMENT HEALTH BENEFIT FUND \r\nPlan Description. The Georgia School Personnel Post-Employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). Additional information about the School OPEB Fund is disclosed in the State of Georgia Comprehensive Annual Financial Report. This report can be obtained from the Georgia Department of Audits and Accounts at www.audits.ga.gov/SGD/CAFR.html. \r\nFunding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012 pay approximately 25% of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State provides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy. \r\nParticipating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nbenefits due under the health insurance plans for both active and retired employees based on projected \"pay-as-you-go\" financing requirements. Contributions are not based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. \r\n \r\nThe combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2016: \r\n \r\nFor certificated teachers, librarians and regional educational service agencies and certain other eligible participants: \r\n \r\nJuly 1, 2015  June 30, 2016 \r\n \r\n$945.00 per member per month \r\n \r\nFor non-certificated school personnel: \r\n \r\nJuly 1, 2015  December 31, 2015 $596.20 per member per month \r\n \r\nJanuary 1, 2016  June 30, 2016 $746.20 per member per month \r\n \r\nNo additional contribution was required by the Board for fiscal year 2016 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation. \r\n \r\nThe School District's combined active and retiree contributions to the health insurance plans, which equaled the required contribution, for the current fiscal year and the preceding two fiscal years were as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2016 2015 2014 \r\n \r\n100% 100% 100% \r\n \r\n$ \r\n \r\n25,836,553.80 \r\n \r\n$ \r\n \r\n24,797,301.80 \r\n \r\n$ \r\n \r\n24,069,352.20 \r\n \r\nNOTE 13: RETIREMENT PLANS \r\n \r\nThe School District participates in various retirement plans administered by the State of Georgia, as further explained below. \r\n \r\nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \r\nPlan Description: All teachers of the School District as defined in O.C.G.A 47-3-60 and certain other support personnel as defined by 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications. \r\nBenefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would \r\n \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nbe payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2016. The School District's contractually required contribution rate for the year ended June 30, 2016 was 14.27% of annual School District payroll, of which 14.22% of payroll was required from the School District and 0.05% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $23,141,378.51 and $82,728.94 from the School District and the State, respectively. \r\nEMPLOYEES' RETIREMENT SYSTEM \r\nPlan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200.00, plus 6% of annual compensation in excess of $4,200.00. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2016 was 24.72% of annual covered payroll for old and new plan members and 21.69% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employer contributions to the pension plan were $108,825.61 for the current fiscal year. \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM (PSERS) \r\nPlan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\nBenefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\nUpon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $583,671.00. \r\n \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\n \r\nAt June 30, 2016, the School District reported a liability of $216,617,478.00 for its proportionate share of the net pension liability for TRS ($215,879,921.00) and ERS ($737,557.00). \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\n \r\n$ 215,879,921.00 \r\n \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n852,392.00 \r\n \r\nTotal \r\n \r\n$ 216,732,313.00 \r\n \r\nThe net pension liability for TRS and ERS was measured as of June 30, 2015. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2014. An expected total pension liability as of June 30, 2015 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2015. \r\nAt June 30, 2015, the School District's TRS proportion was 1.418023%, which was an increase of 0.006001% from its proportion measured as of June 30, 2014. At June 30, 2015, the School District's ERS proportion was 0.018205%, which was an increase of 0.000209% from its proportion measured as of June 30, 2014. \r\nAt June 30, 2016, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $2,607,682.00. \r\nThe PSERS net pension liability was measured as of June 30, 2015. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2014. An expected total pension liability as of June 30, 2015 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2015. \r\nFor the year ended June 30, 2016, the School District recognized pension expense of $13,874,971.00 for TRS, $111,225.00 for ERS and $155,507.00 for PSERS and revenue of $55,300.00 for TRS and $155,507.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nAt June 30, 2016, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: \r\n \r\nTRS \r\n \r\nDeferred Outflows \r\n \r\nDeferred Inflows \r\n \r\nof Resources \r\n \r\nof Resources \r\n \r\nERS \r\n \r\nDeferred Outflows \r\n \r\nDeferred Inflows \r\n \r\nof Resources \r\n \r\nof Resources \r\n \r\nDifferences between expected and actual experience $ \r\n \r\n- \r\n \r\n$ 1,898,775.00 $ \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n- \r\n \r\n18,209,698.00 \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n825,827.00 \r\n \r\n1,512,602.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\nTotal \r\n \r\n23,141,378.51 \r\n \r\n- \r\n \r\n$ 23,967,205.51 $ 21,621,075.00 $ \r\n \r\n- \r\n \r\n$ \r\n \r\n- \r\n \r\n47,073.00 \r\n108,825.61 155,898.61 $ \r\n \r\n5,893.00 - \r\n53,216.00 - \r\n59,109.00 \r\n \r\nThe School District contributions subsequent to the measurement date of June 30, 2015 of $23,141,378.51 for TRS and $108,825.61 for ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\n2017 2018 2019 2020 2021 \r\n \r\n$ (9,156,207.00) $ 17,475.00 \r\n \r\n$ (9,156,207.00) $ (23,734.00) \r\n \r\n$ (9,156,221.00) $ (23,719.00) \r\n \r\n$ 6,724,461.00 $ 17,942.00 \r\n \r\n$ \r\n \r\n(51,074.00) $ \r\n \r\n- \r\n \r\nActuarial assumptions: The total pension liability as of June 30, 2015 was determined by an actuarial valuation as of June 30, 2014, using the following actuarial assumptions, applied to all periods included in the measurement: \r\nTeachers Retirement System: \r\n \r\nInflation Salary increases Investment rate of return \r\n \r\n3.00% \r\n3.75% - 7.00%, average, including inflation 7.50%, net of pension plan investment expense, including inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for Males or Females set back two years for males and set back three years for females. \r\nThe actuarial assumptions used in the June 30, 2014 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\n \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\nEmployees' Retirement System: \r\n \r\nEXHIBIT \"H\" \r\n \r\nInflation Salary increases Investment rate of return \r\n \r\n3.00% \r\n5.45%  9.25%, average, including inflation 7.50%, net of pension plan investment expense, including inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for the periods after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement. \r\nThe actuarial assumptions used in the June 30, 2014 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\nPublic School Employees Retirement System: \r\n \r\nInflation \r\n \r\n3.00% \r\n \r\nSalary increases Investment rate of return \r\n \r\nN/A \r\n7.50%, net of pension plan investment expense, including inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table set forward one year for males for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females for the period after disability retirement. \r\n \r\nThe actuarial assumptions used in the June 30, 2014 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\n \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n \r\nAsset class \r\n \r\nTarget allocation \r\n \r\nLong-term expected real rate of return* \r\n \r\nFixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks \r\n \r\n30.00% 39.70% \r\n3.70% 1.60% 18.90% 6.10% \r\n \r\n3.00% 6.50% 10.00% 13.00% 6.50% 11.00% \r\n \r\nTotal \r\n \r\n100.00% \r\n \r\n* Rates shown are net of the 3.00% assumed rate of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total TRS, ERS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\ncontributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\nSensitivity of the School District's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate: \r\n \r\nTeachers Retirement System: \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate (7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\n$ 370,973,322.00 $ \r\n \r\n215,879,921.00 $ 88,046,055.00 \r\n \r\nEmployees' Retirement System: \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate (7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\nSchool District's proportionate share of the \r\n \r\nnet pension liability \r\n \r\n$ \r\n \r\n1,045,514.00 $ \r\n \r\n737,557.00 $ 475,012.00 \r\n \r\nPension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publically available at www.trsga.com/publications and http://www.ers.ga.gov/formspubs/formspubs.html. \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, Houston County Board of Education began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\nThe Board selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County Board of Education. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the Board. \r\n \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2016 \r\n \r\nEXHIBIT \"H\" \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2016 2015 2014 \r\n \r\n100% \r\n \r\n$ \r\n \r\n100% \r\n \r\n$ \r\n \r\n100% \r\n \r\n$ \r\n \r\n163,288.54 136,887.41 \r\n66,569.73 \r\n \r\n- 31 - \r\n \r\n (This page left intentionally blank) \r\n \r\n          SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2017 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nREPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH \r\nGOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT \r\nLadies and Gentlemen: \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Houston County Board of Education (School District) as of and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements and have issued our report thereon dated March 22, 2017. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\n \r\n Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nCompliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 22, 2017 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nREPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE \r\nINDEPENDENT AUDITOR'S REPORT \r\nLadies and Gentlemen: \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited Houston County Board of Education's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2016. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\n \r\n We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance. \r\nOpinion on Each Major Federal Program \r\nIn our opinion, the School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2016. \r\nReport on Internal Control over Compliance \r\nManagement of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\nGreg S. Griffin State Auditor \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2016 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2016 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\n \r\nType of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information \r\n \r\nUnmodified \r\n \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nNoncompliance material to financial statements noted: \r\n \r\nNo \r\n \r\nFederal Awards \r\n \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with 2 CFR 200.516(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: CFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n84.010 84.041 \r\n \r\nTitle I Grants to Local Educational Agencies Impact Aid Cluster \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: Auditee qualified as low-risk auditee? \r\n \r\n$935,439.80 Yes \r\n \r\nII FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\n \r\nNo matters were reported. \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS \r\n \r\nNo matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2015-belec-p-btext","title":"Houston County Board of Education, Perry, Georgia 2015 June 30 audit report","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, 32.75042, -83.50018"],"dcterms_creator":["Georgia. Department of Audits and Accounts"],"dc_date":["2016-03-16"],"dcterms_description":["Annual report from the Houston County Board of Education."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Georgia. Department of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Houston County Board of Education (Ga.)--Appropriations and expenditures--Periodicals","Education--Georgia--Houston County--Auditing--Periodicals","Education--Georgia--Houston County--Finance--Statistics--Periodicals"],"dcterms_title":["Houston County Board of Education, Perry, Georgia 2015 June 30 audit report"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2015-belec-p-btext"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b2015-belec-p-btext"],"dcterms_temporal":null,"dcterms_rights_holder":null,"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records","audits","financial statements","financial records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"Houston County Board of Education \r\nPerry, Georgia \r\nFiscal Year 2015 Audit Report \r\nYear Ended June 30, 2015 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nPage \r\n \r\nSECTION I \r\n \r\nFINANCIAL \r\n \r\nINDEPENDENT AUDITOR'S REPORT \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\nMANAGEMENT'S DISCUSSION AND ANALYSIS \r\n \r\ni \r\n \r\nEXHIBITS \r\n \r\nBASIC FINANCIAL STATEMENTS \r\n \r\nDISTRICT-WIDE FINANCIAL STATEMENTS \r\n \r\nA \r\n \r\nSTATEMENT OF NET POSITION \r\n \r\n1 \r\n \r\nB \r\n \r\nSTATEMENT OF ACTIVITIES \r\n \r\n2 \r\n \r\nFUND FINANCIAL STATEMENTS \r\n \r\nC \r\n \r\nBALANCE SHEET \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n4 \r\n \r\nD \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\n \r\nTO THE STATEMENT OF NET POSITION \r\n \r\n5 \r\n \r\nE \r\n \r\nSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES \r\n \r\nGOVERNMENTAL FUNDS \r\n \r\n6 \r\n \r\nF \r\n \r\nRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT \r\n \r\nOF REVENUES, EXPENDITURES AND CHANGES IN FUND \r\n \r\nBALANCES TO THE STATEMENT OF ACTIVITIES \r\n \r\n7 \r\n \r\nG \r\n \r\nSTATEMENT OF FIDUCIARY NET POSITION \r\n \r\nFIDUCIARY FUNDS \r\n \r\n9 \r\n \r\nH NOTES TO THE BASIC FINANCIAL STATEMENTS \r\n \r\n10 \r\n \r\nSCHEDULES \r\n \r\nREQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nTEACHERS' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n34 \r\n \r\n2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY \r\n \r\nEMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n35 \r\n \r\n3 SCHEDULE OF CONTRIBUTIONS  TEACHERS' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n36 \r\n \r\n4 SCHEDULE OF CONTRIBUTIONS  EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\n \r\n38 \r\n \r\n5 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\n \r\n40 \r\n \r\n6 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES \r\n \r\nIN FUND BALANCES - BUDGET AND ACTUAL \r\n \r\nGENERAL FUND \r\n \r\n41 \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \r\n \r\nSECTION I \r\nFINANCIAL \r\nSCHEDULES \r\nSUPPLEMENTARY INFORMATION \r\n7 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 8 SCHEDULE OF STATE REVENUE 9 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\n \r\nPage \r\n42 44 45 \r\n \r\nSECTION II \r\nCOMPLIANCE AND INTERNAL CONTROL REPORTS \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 \r\n \r\nSECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\n \r\n (This page left intentionally blank) \r\n \r\n SECTION I FINANCIAL \r\n \r\n (This page left intentionally blank) \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 16, 2016 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT \r\nLadies and Gentlemen: \r\nReport on the Financial Statements \r\nWe have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education, as of and for the year ended June 30, 2015, and the related notes to the financial statements (Exhibits A through H), which collectively comprise the Board's basic financial statements as listed in the table of contents. \r\nManagement's Responsibility for the Financial Statements \r\nManagement is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. \r\nAuditor's Responsibility \r\nOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in 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 financial statements are free from material misstatement. \r\nAn audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the \r\n2015ARL-11 \r\n \r\n (This page left intentionally blank) \r\n \r\n effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. \r\nWe believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. \r\nOpinions \r\nIn our opinion, the basic financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Houston County Board of Education, as of June 30, 2015, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. \r\nEmphasis of Matter \r\nAs described in Note 2 to the financial statements, in 2015, the Houston County Board of Education adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions  an amendment of GASB Statement No. 27 and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date  an amendment of GASB Statement No. 68. The School District restated beginning Net Position for the cumulative effect of these accounting changes. Our opinion is not modified with respect to this matter. \r\nOther Matters \r\nRequired Supplementary Information \r\nAccounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis, Schedules of Proportionate Share of the Net Pension Liability, Schedules of Contributions to Retirement Systems, Notes to the Required Supplementary Information and the Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual as presented on pages i through xi , and pages 34 through 41, respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. \r\nOther Information \r\nOur audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Houston County Board of Education's basic financial statements. The accompanying supplementary information, consisting of Schedules 7 through 9, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The \r\n2015ARL-11 \r\n \r\n (This page left intentionally blank) \r\n \r\n Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is not a required part of the basic financial statements. \r\nThe accompanying supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. \r\nOther Reporting Required by Government Auditing Standards \r\nIn accordance with Government Auditing Standards, we have also issued our report dated March 16, 2016, on our consideration of the Houston County Board of Education's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Houston County Board of Education's internal control over financial reporting and compliance. \r\nA copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. \r\nRespectfully submitted, \r\n \r\nGSG:as 2015ARL-11 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\nThe discussion and analysis of Houston County Board of Education's financial performance provides an overall review of the School District's financial activities for the fiscal year ended June 30, 2015. The intent of this discussion and analysis is to look at the School District's financial performance as a whole. Readers should also review the financial statements and the notes to the basic financial statements to enhance their understanding of the School District's financial performance. \r\nFinancial Highlights \r\nKey financial highlights for 2015 are as follows: \r\nOn the District-wide financial statements: \r\n On the District-wide financial statements, net position increased $17.9 million which represents a 15.4 percent increase from 2014, after restating the beginning net position for the effect of GASB 68 and GASB 71. This total increase was due to governmental activities since the School District has no business-type activities. \r\n General revenues accounted for $124.9 million in revenue or 42.8 percent of all revenues. Program specific revenues in the form of charges for services and sales, grants and contributions accounted for $166.8 million or 57.2 percent of total revenues of $291.7 million. \r\n The School District had $273.8 million in expenses related to governmental activities; only $166.8 million of these expenses were offset by program specific charges for services, grants or contributions. General revenues (primarily taxes) of $124.9 million were adequate to provide for these programs. \r\nOn the fund financial statements: \r\n Among major funds, the General Fund had $269.7 million in revenues and other financing sources, and $270.3 million in expenditures and other financing uses. The General Fund's balance decreased to $69.4 million. \r\nUsing the Basic Financial Statements \r\nThis annual report consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand the Houston County Board of Education as a financial whole, or as an entire operating entity. \r\nThe Statement of Net Position and Statement of Activities provide information about the activities of the whole School District, presenting both an aggregate view of the School District's finances and a longerterm view of those finances. Fund financial statements provide the next level of detail. For governmental funds, these statements tell how services were financed in the short-term as well as what remains for future spending. The fund financial statements also look at the School District's most significant funds. In the case of the Houston County Board of Education, the General Fund is by far the most significant fund. \r\ni \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\nReporting the School District as a Whole \r\nStatement of Net Position and the Statement of Activities \r\nWhile this document contains the large number of funds used by the School District to provide programs and activities for the schools, the view of the School District as a whole looks at all financial transactions and asks the question, \"How did we do financially during 2015?\" The Statement of Net Position and the Statement of Activities answers this question. These statements include all assets and liabilities using the economic resources focus and accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into account all of the current year's revenues and expenses regardless of when the cash is received or paid. Comparative data is provided for fiscal year 2015 and fiscal year 2014. However, the comparative data for fiscal year 2014 does not reflect the effects of the restatement of July 1, 2014 net position. This restatement is related to the implementation of Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 71 Pension Transition for Contributions Made Subsequent to the Measurement Date which were adopted by the School District for fiscal year 2015. The provisions of this statement establish accounting and financial reporting standards for pensions that are provided to the employees of state and local governmental employers through pension plans that are administered through trusts. Implementation of this statement resulted in a restatement to beginning net position of $231,375,493. This restatement is based on actuarial estimates and information is not available for the fiscal year 2014 comparative balances. See Note 2 in the Notes to the Financial Statements for more information about the restatement of July 1, 2014 net position. \r\nThese two statements report the School District's net position and changes in that position. This change in net position is important because it tells the reader that, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the result of many factors, some financial, some not. Non-financial factors include the School District's property tax base, facility conditions, required educational programs and other factors. \r\nIn the Statement of Net Position and the Statement of Activities, the School District has one distinct type of activity: \r\n Governmental Activities - All of the School District's programs and services are reported here including instruction, support services, operation and maintenance of plant, pupil transportation, food service, after school program, principal's accounts and various others. \r\nReporting the School District's Most Significant Funds \r\nFund Financial Statements \r\nFund financial reports provide detailed information about the School District's major funds. The School District uses many funds to account for a multitude of financial transactions. However, these fund financial statements focus on the School District's most significant funds. The School District's major governmental funds are the General Fund, Capital Projects Fund and the Debt Service Fund. \r\nGovernmental Funds: Most of the School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the current financial resources measurement focus and the modified accrual accounting method, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a \r\nii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are adequate financial resources that can be spent in the near future to finance educational programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is reconciled in the financial statements. Fiduciary Funds: The School District is the trustee, or fiduciary, for assets that belong to others, such as the employee benefit programs, and school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the District-wide financial statements because it cannot use these assets to finance its operations. The School District as a Whole The perspective of the statement of net position is of the School District as a whole. Table 1 provides a summary of the Board's net position for 2015 compared to fiscal year 2014. \r\niii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\n \r\nTable 1 Net Position (in Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2015 \r\n \r\nYear 2014 (1) \r\n \r\nAssets Current and Other Assets Capital Assets, Net \r\n \r\n$ \r\n \r\n122,749 $ \r\n \r\n121,620 \r\n \r\n306,470 \r\n \r\n308,200 \r\n \r\nTotal Assets \r\n \r\n429,219 \r\n \r\n429,820 \r\n \r\nDeferred Outflow of Resources \r\n \r\n19,888 \r\n \r\n0 \r\n \r\nTotal Assets and Deferred Outflows of Resources \r\n \r\n449,107 \r\n \r\n429,820 \r\n \r\nLiabilities Current and Other Liabilities Long-Term liabilities \r\n \r\n32,871 218,029 \r\n \r\n31,926 50,494 \r\n \r\nTotal Liabilities \r\n \r\n250,900 \r\n \r\n82,420 \r\n \r\nDeferred Inflows of Resources \r\n \r\n64,313 \r\n \r\n0 \r\n \r\nTotal Liabilities and Deferred Inflows of Resources \r\n \r\n315,213 \r\n \r\n82,420 \r\n \r\nNet Position Invested in Capital Assets Restricted Unrestricted \r\n \r\n285,862 61,279 \r\n-213,247 \r\n \r\n275,953 58,323 13,124 \r\n \r\nTotal Net Position \r\n \r\n$ \r\n \r\n133,894 $ \r\n \r\n(1) Fiscal year 2014 balances do not reflect the effect of the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information. \r\n \r\n347,400 \r\n \r\nTotal net position decreased $213.5 million due to the restatement of the beginning net position by $231.4 million for the adoption of GASB Statements No. 68 and No. 71. However, based strictly on the School District's operations, an increase of $17.9 million was realized as shown on Table 2. The increase in deferred outflows of resources, deferred inflows of resources, and long-term liabilities is also attributable to the adoption of the statements. \r\nTable 2 shows the changes in net position for fiscal year 2015 compared to the changes in net position for fiscal year 2014. \r\n \r\niv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\n \r\nTable 2 Change in Net Position \r\n(In Thousands) \r\n \r\nRevenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions \r\n \r\nGovernmental Activities \r\n \r\nFiscal Year \r\n \r\nFiscal Year \r\n \r\n2015 \r\n \r\nYear 2014 (1) \r\n \r\n$ \r\n \r\n8,503 $ \r\n \r\n8,207 \r\n \r\n155,891 \r\n \r\n145,976 \r\n \r\n2,372 \r\n \r\n5,642 \r\n \r\nTotal Program Revenues \r\n \r\n166,766 \r\n \r\n159,825 \r\n \r\nGeneral Revenues: Taxes Property Taxes For Maintenance and Operations Other Property Taxes Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Service and Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\n \r\n50,445 3,047 \r\n22,109 \r\n22,109 1,025 \r\n20,529 108 \r\n5,533 \r\n \r\n50,374 3,749 \r\n20,921 \r\n20,920 871 \r\n19,817 97 \r\n5,185 \r\n \r\nTotal General Revenues \r\n \r\n124,905 \r\n \r\n121,934 \r\n \r\nSpecial Items \r\n \r\n40 \r\n \r\nTotal Revenues and Special Items \r\n \r\n291,711 \r\n \r\n281,759 \r\n \r\nProgram Expenses: Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Liabilities \r\n \r\n177,544 \r\n8,192 7,590 3,906 1,346 17,492 2,080 18,151 11,028 3,536 2,112 \r\n2,415 902 \r\n17,538 10 \r\n \r\n180,091 \r\n8,155 5,830 3,977 1,352 17,854 2,189 18,167 9,293 3,462 1,646 \r\n2,117 808 \r\n17,229 1,394 \r\n \r\nTotal Expenses \r\n \r\n273,842 \r\n \r\n273,564 \r\n \r\nIncrease in Net Position \r\n \r\n$ \r\n \r\n17,869 $ \r\n \r\n8,195 \r\n \r\n(1) Fiscal year 2014 balances do not reflect the effect of the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information. \r\n \r\nv \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Figure A shows the funding sources for the revenues. 51.9 percent of the School District's revenues are derived from state grants. Property Taxes make up 18.4 percent of the total funding, while an additional 15.5 percent is earned from the county's sales taxes. \r\n18.5 % \r\nAs shown in Figure B, Instruction comprised 64.8 percent of governmental program expenses. Administration and Other Services (3.4 percent) consist of the central office, business and warehouse, and other central operations of the School District \r\nvi \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\n \r\nGovernmental Activities \r\nThe Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services comparing fiscal year 2015 with fiscal year 2014. That is, it identifies the cost of these services supported by tax revenue and unrestricted State entitlements. \r\n \r\nTable 3 Governmental Activities \r\n(In Thousands) \r\n \r\nTotal Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2015 \r\n \r\nYear 2014 (1) \r\n \r\nNet Cost of Services \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2015 \r\n \r\nYear 2014 (1) \r\n \r\nInstruction \r\n \r\n$ \r\n \r\nSupport Services: \r\n \r\nPupil Services \r\n \r\nImprovement of Instructional Services \r\n \r\nEducational Media Services \r\n \r\nGeneral Administration \r\n \r\nSchool Administration \r\n \r\nBusiness Administration \r\n \r\nMaintenance and Operation of Plant \r\n \r\nStudent Transportation Services \r\n \r\nCentral Support Services \r\n \r\nOther Support Services \r\n \r\nOperations of Non-Instructional Services: \r\n \r\nEnterprise Operations \r\n \r\nCommunity Services \r\n \r\nFood Services \r\n \r\nInterest on Short-Term and Long-Term Debt \r\n \r\n177,544 $ \r\n8,192 7,590 3,906 1,346 17,492 2,080 18,151 11,028 3,536 2,112 \r\n2,415 902 \r\n17,538 10 \r\n \r\n180,091 $ \r\n8,155 5,830 3,977 1,352 17,854 2,189 18,167 9,293 3,462 1,646 \r\n2,117 808 \r\n17,229 1,394 \r\n \r\n59,034 $ \r\n4,837 2,565 \r\n696 896 11,177 1,635 10,792 9,139 2,869 1,353 \r\n808 902 363 \r\n10 \r\n \r\n67,482 \r\n4,817 2,130 \r\n673 787 11,594 1,670 10,857 7,350 2,749 819 \r\n688 808 -80 1,394 \r\n \r\nTotal Expenses \r\n \r\n$ \r\n \r\n273,842 $ \r\n \r\n273,564 $ \r\n \r\n107,076 $ \r\n \r\n113,738 \r\n \r\n(1) Fiscal year 2014 balances do not reflect the effect of the Restatement of Net Position. See Note 2 in the Notes to the Basic Financial Statements for additional information. \r\n \r\nAlthough program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. Approximately 33.3 percent of Instruction activities are supported through taxes and other general revenues, and for all governmental activities general revenue support is 39.1 percent. \r\nThe School District's Funds \r\nThe School District's governmental funds are accounted for using the modified accrual basis of accounting. Total governmental funds had revenues and other financing sources of $294.1 million and expenditures and other financing uses of $293.3 million. There was an increase in the fund balance totaling $0.8 million for the governmental funds as a whole. The General Fund decreased by $0.6 million due mainly to a planned utilization of available reserves. The Capital Projects Funds had \r\n \r\nvii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\nan increase of $3.3 million and Debt Service Funds had a decrease of $1.9 million. The Capital Project Funds' increase was due to proceeds of the Education Special Purpose Local Option Sales Tax (ESPLOST) being collected and used in subsequent years. The Debt Service Funds' decrease was attributable to the amount of ESPLOST proceeds being needed to meet the interest and principal payments due on the outstanding debt associated with previously issued general obligation bonds in the subsequent year. The immaterial change in the fund balance of the General Fund for the year reflects that the School District was able to meet current costs as planned and budgeted. \r\nGeneral Fund Budgeting Highlights \r\nThe School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the General Fund. \r\nDuring the course of fiscal year 2015, the School District amended its General Fund budget as needed. The School District uses site-based budgeting. The budgeting systems are designed to tightly control total site budgets but provide flexibility for site management. \r\nFor the General Fund, the final budgeted revenues and other financing sources of $270.4 million was greater than the original budgeted amount of $267.1 million by $3.3 million. The overall difference was mainly due to additional federal and state grant awards of $1.7 million and additional local revenues. The actual revenues and other financing sources of $269.7 million was less than the budgeted amount by $0.7 million due mainly to the elimination of intrafund transfers and the difference in the recognition of the Local Option Sales Tax for budget purposes. \r\nThe final budgeted expenditures and other financing uses of $273.8 million was less than the original budgeted amount of $274.0 million by $0.2 million. This difference was due mainly to adjusting the budget to reflect the revised needs. The actual expenditures and other financing uses of $270.3 million was $3.5 million less than budgeted. The reduced expenditures were mainly a result of an adjustment removing intrafund transfers, reductions of expenditures by the School District, and the requirement to budget for specific federal grants in advance of anticipated and actual need. \r\nThe differences in the beginning and ending budgeted fund balances to actual is the result of the School District's decision to include the Local Option Sales Taxes that had previously been reported as deferred as current and prior year revenues for report purposes. \r\nCapital Assets and Debt Administration \r\nCapital Assets \r\nAt the end of fiscal year 2015, the School District had $306.5 million invested in capital assets, net of depreciation, all in governmental activities. Table 4 shows fiscal year 2015 balances compared with fiscal year 2014 balances. \r\nviii \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\n \r\nTable 4 Capital Assets (Net of Depreciation, in Thousands) \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2015 \r\n \r\nYear 2014 \r\n \r\nLand \r\n \r\n$ \r\n \r\nConstruction In Progress \r\n \r\nBuilding and Improvements \r\n \r\nEquipment \r\n \r\nLand Improvements \r\n \r\n11,072 $ 9,001 \r\n274,271 7,586 4,540 \r\n \r\n10,861 24,581 260,841 \r\n7,034 4,883 \r\n \r\nTotal \r\n \r\n$ \r\n \r\n306,470 $ \r\n \r\n308,200 \r\n \r\nThe overall capital assets decreased in fiscal year 2015 by $1.7 million due to the construction and renovation expenses from the 2012 ESPLOST and Capital Outlay Projects during the current year offset by the fiscal year 2015 depreciation of $11.8 million. \r\n \r\nDebt \r\nAt June 30, 2015, the School District had $30.3 million in bonds outstanding with $9.9 million due within one year, $2.8 million in capital leases outstanding with $0.6 million due within one year, $2.7 million in compensated absences earned as of the end of the year, and $3.1 million in unamortized bond premiums with $1.0 million due with one year. In addition, the School District reported a liability for its proportionate share of the net pension liability. Reporting this liability was required by GASB 68. \r\nTable 5 summarizes the long-term debt outstanding at June 30, 2015, compared to fiscal year 2014 balances. \r\nTable 5 Debt at June 30 \r\n \r\nGovernmental Activities \r\n \r\nFiscal \r\n \r\nFiscal \r\n \r\nYear 2015 \r\n \r\nYear 2014 \r\n \r\nGeneral Obligation Bonds \r\n \r\n$ \r\n \r\nCapital Leases \r\n \r\nCompensated Absences \r\n \r\nUnamortized Bond Premiums \r\n \r\nNet Pension Liability \r\n \r\n30,275 $ 2,846 2,724 3,119 \r\n179,065 \r\n \r\n41,795 1,717 2,676 4,306 \r\n \r\nTotal \r\n \r\n$ \r\n \r\n218,029 $ \r\n \r\n50,494 \r\n \r\nix \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 \r\nAt June 30, 2015, the School District's overall legal bonding authority was $371.9 million based on the assessed value of taxable property as of December 31, 2014. The School District's bonds have assigned ratings of Aa1 and AA+. In addition, the State of Georgia limits the amount available to be spent each year on multiyear leases, purchase, or lease purchase contracts to 7.5 percent of the locally generated taxes for the maintenance and operation of the school system. Both the current year payments and subsequently scheduled payments are well below the $5.8 million threshold. \r\nCurrent Issues \r\nThe Houston County School District consists of 38 campuses located in Houston County, a fast-growing area with a population of approximately 149,111. Current enrollment is approximately 28,530 students in grades PK-12. Among Georgia's 159 counties, Houston ranks 15th in population, 15th in economics, and 16th in income. The 2014 School District millage ranks 163rd out of 180 districts in Georgia. \r\nThe State of Georgia experienced serious financial hardship over the past few years, and as a result, more pressure is being placed on the local school systems to prioritize their instructional programs and to fund them with additional locally generated revenues. In fiscal year 2003, the State enacted Austerity Reductions for the State allotments, resulting in a reduction of state revenues to the School District of approximately $2 million in 2003 to a high of $23.8 million in 2010. For fiscal year 2015 the reduction was $12.2 million. Reductions in other state grants and programs resulted in the total reduction of state funding for 2015 reaching approximately $29.7 million. For fiscal year 2016, additional austerity reductions of $8.1 million have already been approved by the state for the School District. Since the austerity reductions were enacted, the reductions total $152.5 million and the overall reduction of state funding is approximately $278.3 million. While Houston County's class sizes remain below the state maximum recommendations, continued reductions in state funding combined with a growing system place a heavier burden on the locally generated taxes to help offset this loss of state funding. Despite these challenges, the Houston County Board of Education is strong financially, and we remain optimistic about the ability of the School District to maximize all of the financial resources to continue to provide a quality education to our students. \r\nIn the past, the county has thrived even during recent downturns in the economy. Sales tax revenue growth exceeded many other parts of Georgia, with shoppers paying seven percent tax on purchases. The School District experienced an average increase of 6.5 percent growth each year from 1984 to 2006 for the System's Local Option Sales Tax collections. However, during the calendar year 2007, the county's sales tax growth slowed tremendously to only 3.6 percent. This trend continued from a low of a -2.3% in 2008 to a high of 3.2% in 2012. During the 2013 calendar year, changes in collecting sales tax on automobile purchases were enacted by the state legislature, further reducing the proceeds received. As a result, the 2013 collections decreased 6% from the prior year receipts. Although the collections are still well below the average growth rate, the School District remains optimistic and will continue to monitor this situation closely. The unemployment rate was 7.4 percent in 2010, and continues to be well below the state and national rates. \r\nHouston County is home to Robins Air Force Base, Georgia's largest single industry. Robins Air Force Base had an estimated fiscal year 2014 economic impact on the State of Georgia of $2.7 billion, with Houston County being by far the largest beneficiary of that impact. Other large employers located in the county include the Board of Education, Houston County Hospital Authority, Perdue Farms, Frito-Lay Company, Anchor Glass, and Wal-Mart Associates. Of Houston's employed residents, 62.8 percent work in county. \r\nx \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2015 Houston is Georgia's sixty-fifth largest county in total area. As one of the fastest growing counties in Georgia, Houston had a 15 percent population increase from 1980-1990, a 24 percent increase from 1990-2000, and a 26.3 percent increase from 2000-2010. The population as of the 2010 census was 139,900 and is projected to grow to 154,526 in 2015. This growth results in school system enrollment increases between 175 to 384 students for the past five years. Houston has three municipalities: Centerville with a population of 7,531; Perry with 14,730; and Warner Robins with 70,712. The county also includes the communities of Bonaire, Clinchfield, Elko, Haynesville, Henderson, and Kathleen. The median household income as of 2010 was $54,977 per year. As of 2010, the per capita income was $33,505. 87 percent of the county's adult population is a high school graduate or higher with over 24.4 percent having a bachelor degree or higher. Contacting the School District's Financial Management This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Stephen J. Thublin, Assistant Superintendent for Finance and Business Operations, at the Houston County Board of Education, P.O. Box 1850, 1100 Main Street, Perry, Georgia 31069. You may also email your questions to Stephen.Thublin@hcbe.net. \r\nxi \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2015 \r\nASSETS \r\nCash and Cash Equivalents Investments Accounts Receivable, Net \r\nTaxes State Government Federal Government Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation) \r\nTotal Assets \r\nDEFERRED OUTFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Claims Incurred but not Reported (IBNR) Interest Payable Retainages Payable Long-Term Liabilities \r\nDue Within One Year Due in More Than One Year Net Pension Liability \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nRelated to Defined Benefit Pension Plans \r\nNET POSITION \r\nNet Investment in Capital Assets Restricted for \r\nContinuation of Federal Programs Debt Service Capital Projects Property Tax Rollback Unrestricted (Deficit) \r\nTotal Net Position \r\nThe notes to the basic financial statements are an integral part of this statement. - 1 - \r\n \r\nEXHIBIT \"A\" \r\n \r\nGOVERNMENTAL ACTIVITIES \r\n \r\n$ \r\n \r\n17,199,726.75 \r\n \r\n73,525,393.85 \r\n \r\n6,609,258.22 18,307,128.05 \r\n3,064,113.97 296,619.15 \r\n3,746,901.56 20,072,247.15 286,397,432.85 \r\n \r\n429,218,821.55 \r\n \r\n19,887,981.99 \r\n \r\n28,237.23 30,348,826.36 \r\n1,440,026.04 392,943.98 661,047.03 \r\n11,532,447.74 27,431,044.68 179,065,316.00 \r\n250,899,889.06 \r\n \r\n64,312,881.00 \r\n \r\n285,861,951.96 \r\n6,168,357.47 10,053,561.44 10,565,384.19 34,491,585.33 -213,246,806.91 \r\n \r\n$ 133,894,033.48 \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES \r\nFOR THE YEAR ENDED JUNE 30, 2015 \r\n \r\nGOVERNMENTAL ACTIVITIES \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt \r\nTotal Governmental Activities \r\nGeneral Revenues Taxes Property Taxes For Maintenance and Operations Alternative Ad Valorem Tax Forest Land Protection Tax Railroad Cars Title Ad Valorem Tax Sales Taxes Local Option Sales Tax Special Purpose Local Option Sales Tax For Debt Services For Capital Projects Intangible Recording Tax Real Estate Transfer Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous \r\nSpecial Items Gain on Sale of Land \r\nTotal General Revenues and Special Items \r\nChange in Net Position \r\nNet Position - Beginning of Year, Restated \r\nNet Position - End of Year \r\n \r\nEXPENSES \r\n \r\nCHARGES FOR SERVICES \r\n \r\n$ 177,544,182.01 $ \r\n8,192,193.58 7,590,108.23 3,905,608.67 1,346,011.25 17,491,644.89 2,079,851.34 18,151,363.02 11,028,148.48 3,535,799.60 2,111,901.83 \r\n2,414,539.95 902,286.17 \r\n17,537,988.63 9,936.94 \r\n$ 273,841,564.59 $ \r\n \r\n2,575,676.15 \r\n21,193.50 99,649.58 1,606,840.48 4,199,658.88 8,503,018.59 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 2 - \r\n \r\n EXHIBIT \"B\" \r\n \r\nPROGRAM REVENUES OPERATING GRANTS AND \r\nCONTRIBUTIONS \r\n \r\nCAPITAL GRANTS AND CONTRIBUTIONS \r\n \r\nNET EXPENSES AND CHANGES IN \r\nNET POSITION \r\n \r\n$ 114,009,991.24 $ \r\n3,353,129.58 5,021,816.37 3,125,985.75 \r\n448,967.02 6,231,565.18 \r\n418,206.36 7,320,953.65 1,789,390.74 \r\n644,696.51 758,928.52 \r\n12,767,149.87 \r\n$ 155,890,780.79 $ \r\n \r\n1,924,929.72 $ 1,786.56 2,894.07 \r\n83,632.28 1,049.78 \r\n83,206.40 26,422.86 17,355.74 21,951.01 \r\n208,490.61 \r\n2,371,719.03 \r\n \r\n-59,033,584.90 \r\n-4,837,277.44 -2,565,397.79 \r\n-695,990.64 -895,994.45 -11,176,873.31 -1,635,222.12 -10,791,860.13 -9,139,108.16 -2,869,152.08 -1,352,973.31 \r\n-807,699.47 -902,286.17 -362,689.27 \r\n-9,936.94 \r\n-107,076,046.18 \r\n \r\n50,444,884.07 22,452.34 \r\n163,912.20 23,716.15 \r\n2,836,885.80 \r\n22,109,147.51 \r\n10,972,231.16 11,137,053.29 \r\n782,262.15 242,759.42 20,528,774.09 107,789.23 5,533,249.92 \r\n40,217.78 \r\n124,945,335.11 \r\n17,869,288.93 \r\n116,024,744.55 \r\n \r\n$ \r\n \r\n133,894,033.48 \r\n \r\n- 3 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION BALANCE SHEET \r\nGOVERNMENTAL FUNDS JUNE 30, 2015 \r\n \r\nEXHIBIT \"C\" \r\n \r\nASSETS \r\nCash and Cash Equivalents Investments Accounts Receivable, Net \r\nTaxes State Government Federal Government Other Inventories \r\nTotal Assets \r\n \r\nGENERAL FUND \r\n \r\nDISTRICTWIDE \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 15,815,923.74 $ 1,381,598.08 $ \r\n \r\n2,204.93 $ 17,199,726.75 \r\n \r\n55,021,932.77 \r\n \r\n8,059,160.59 10,444,300.49 \r\n \r\n73,525,393.85 \r\n \r\n4,753,620.32 18,307,128.05 \r\n3,064,113.97 296,619.15 \r\n3,746,901.56 \r\n \r\n1,855,637.90 \r\n \r\n6,609,258.22 18,307,128.05 \r\n3,064,113.97 296,619.15 \r\n3,746,901.56 \r\n \r\n$ 101,006,239.56 $ 11,296,396.57 $ 10,446,505.42 $ 122,749,141.55 \r\n \r\nLIABILITIES \r\nAccounts Payable Salaries and Benefits Payable Retainages Payable \r\nTotal Liabilities \r\nDEFERRED INFLOWS OF RESOURCES \r\nUnavailable Revenues - Property Taxes \r\nFUND BALANCES \r\nNonspendable Restricted Assigned Unassigned \r\nTotal Fund Balances \r\n \r\n$ \r\n \r\n28,237.23 \r\n \r\n30,348,826.36 \r\n \r\n$ \r\n \r\n30,377,063.59 \r\n \r\n661,047.03 661,047.03 \r\n \r\n$ \r\n \r\n28,237.23 \r\n \r\n30,348,826.36 \r\n \r\n661,047.03 \r\n \r\n31,038,110.62 \r\n \r\n1,272,255.34 \r\n \r\n1,272,255.34 \r\n \r\n3,746,901.56 40,065,001.58 \r\n6,075,044.78 19,469,972.71 \r\n \r\n10,585,384.19 $ 10,446,505.42 49,965.35 \r\n \r\n69,356,920.63 10,635,349.54 10,446,505.42 \r\n \r\n3,746,901.56 61,096,891.19 \r\n6,125,010.13 19,469,972.71 \r\n90,438,775.59 \r\n \r\nTotal Liabilities, Deferred Inflows of Resources, and Fund Balances $ 101,006,239.56 $ 11,296,396.57 $ 10,446,505.42 $ 122,749,141.55 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 4 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET \r\nTO THE STATEMENT OF NET POSITION JUNE 30, 2015 \r\n \r\nEXHIBIT \"D\" \r\n \r\nTotal Fund Balances - Governmental Funds (Exhibit \"C\") \r\nAmounts reported for Governmental Activities in the Statement of Net Position are different because: \r\nCapital Assets used in Governmental Activities are not financial resources and therefore are not reported in the funds. These assets consist of: \r\nLand Construction in Progress Land Improvements Buildings and Improvements Equipment Accumulated Depreciation \r\nTotal Capital Assets \r\nSome liabilities, including net pension obligations, are not due and payable in the current period, and, therefore, are not reported in the funds. \r\nNet Pension Liability \r\nDeferred Outflows and Inflows of Resources related to pensions are applicable to future periods and, therefore, are not reported in the governmental funds. \r\nTaxes that are not available to pay for current period expenditures are deferred in the funds. \r\nProperty Taxes \r\nLong-Term Liabilities, including Bonds Payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-Term Liabilities at year-end consist of: \r\nBonds Payable Interest Payable Capital Leases Payable Compensated Absences Payable Unamortized Bond Premiums Claims and Judgments Payable \r\nTotal Long-Term Liabilities \r\nNet Position of Governmental Activities (Exhibit \"A\") \r\n \r\n$ 90,438,775.59 \r\n \r\n$ 11,071,714.76 9,000,532.39 7,275,353.26 \r\n410,116,749.56 26,257,822.60 \r\n-157,252,492.57 \r\n \r\n306,469,680.00 \r\n \r\n-179,065,316.00 -44,424,899.01 \r\n \r\n1,272,255.34 \r\n \r\n$ -30,275,000.00 -392,943.98 \r\n-2,845,754.34 -2,723,740.47 -3,118,997.61 -1,440,026.04 \r\n \r\n-40,796,462.44 \r\n \r\n$ 133,894,033.48 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 5 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \r\nGOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2015 \r\n \r\nEXHIBIT \"E\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nCapital Outlay Debt Services \r\nPrincipal Interest \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES \r\nCapital Leases \r\nSPECIAL ITEMS \r\nProceeds from Sale of Land \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nGENERAL FUND \r\n \r\nDISTRICTWIDE \r\nCAPITAL PROJECTS \r\nFUND \r\n \r\nDEBT SERVICE \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 53,970,799.02 \r\n \r\n23,134,169.08 $ 11,137,053.29 $ \r\n \r\n149,688,465.56 \r\n \r\n2,219,896.40 \r\n \r\n27,263,821.21 \r\n \r\n8,503,018.59 \r\n \r\n86,428.41 \r\n \r\n10,009.77 \r\n \r\n5,533,199.92 \r\n \r\n50.00 \r\n \r\n$ 53,970,799.02 \r\n \r\n10,972,231.16 \r\n \r\n45,243,453.53 \r\n \r\n151,908,361.96 \r\n \r\n27,263,821.21 \r\n \r\n8,503,018.59 \r\n \r\n11,351.05 \r\n \r\n107,789.23 \r\n \r\n5,533,249.92 \r\n \r\n268,179,901.79 13,367,009.46 \r\n \r\n10,983,582.21 292,530,493.46 \r\n \r\n173,621,978.73 \r\n8,473,480.10 7,738,246.41 3,615,891.69 1,384,646.44 17,752,669.21 1,988,021.53 18,946,544.94 11,588,406.13 2,999,860.74 1,824,236.90 2,414,539.95 \r\n902,286.17 16,679,966.57 \r\n358,766.87 20,671.30 \r\n270,310,213.68 \r\n-2,130,311.89 \r\n \r\n1,425,467.49 \r\n5,480.00 530,516.53 8,168,941.20 10,130,405.22 3,236,604.24 \r\n \r\n3,795.81 \r\n11,520,000.00 1,317,631.26 \r\n12,841,427.07 -1,857,844.86 \r\n \r\n175,047,446.22 \r\n8,473,480.10 7,738,246.41 3,615,891.69 1,384,646.44 17,752,669.21 1,997,297.34 18,946,544.94 11,588,406.13 3,530,377.27 1,824,236.90 2,414,539.95 \r\n902,286.17 16,679,966.57 \r\n8,168,941.20 \r\n11,878,766.87 1,338,302.56 \r\n293,282,045.97 \r\n-751,552.51 \r\n \r\n1,487,350.29 \r\n \r\n1,487,350.29 \r\n \r\n-642,961.60 69,999,882.23 \r\n \r\n95,324.40 3,331,928.64 7,303,420.90 \r\n \r\n-1,857,844.86 12,304,350.28 \r\n \r\n95,324.40 831,122.18 89,607,653.41 \r\n \r\n$ 69,356,920.63 $ 10,635,349.54 $ 10,446,505.42 $ 90,438,775.59 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 6 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF \r\nREVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2015 \r\n \r\nEXHIBIT \"F\" \r\n \r\nTotal Net Change in Fund Balances - Governmental Funds (Exhibit \"E\") \r\nAmounts reported for Governmental Activities in the Statement of Activities are different because: \r\nCapital Outlays are reported as expenditures in Governmental Funds. However, in the Statement of Activities, the cost of Capital Assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are: \r\nCapital Outlay Depreciation Expense \r\nExcess of Capital Outlay over Depreciation Expense \r\nTaxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. \r\nThe net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position. \r\nSome of the Capital Assets acquired this year were financed with capital leases. In Governmental Funds, a capital lease arrangement is considered a source of financing, but in the Statement of Net Position, the lease obligation is reported as a Long-Term Liability. \r\nRepayment of Long-Term Debt is reported as an expenditure in Governmental Funds, but the repayment reduces Long-Term Liabilities in the Statement of Net Position. In the current year, these amounts consist of: \r\nBond Principal Retirements Capital Lease Payments Amortization of Bond Premium \r\nTotal Long-Term Debt Repayments \r\nInterest expense reported in the Statement of Activities is recorded as incurred, whereas interest expense in the governmental fund statements is reported when paid. \r\nSome items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in Governmental Funds. These net adjusments consist of: \r\nCompensated Absences Pension Expense Claims and Judgments \r\nTotal Additional Expenditures \r\nChange in Net Position of Governmental Activities (Exhibit \"B\") \r\n \r\n$ 831,122.18 \r\n \r\n$ 10,152,904.11 -11,817,418.04 \r\n \r\n-1,664,513.93 \r\n \r\n-478,948.46 \r\n \r\n-66,090.68 \r\n \r\n-1,487,350.29 \r\n \r\n$ 11,520,000.00 358,766.87 \r\n1,186,815.93 \r\n \r\n13,065,582.80 \r\n \r\n141,549.69 \r\n \r\n$ \r\n \r\n-47,476.79 \r\n \r\n7,885,277.99 \r\n \r\n-309,863.58 \r\n \r\n7,527,937.62 \r\n \r\n$ 17,869,288.93 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 7 - \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY NET POSITION \r\nFIDUCIARY FUNDS JUNE 30, 2015 \r\nASSETS Cash and Cash Equivalents Accounts Receivable, Net \r\nOther \r\nTotal Assets \r\nLIABILITIES Accounts Payable Funds Held for Others \r\nTotal Liabilities \r\n \r\nEXHIBIT \"G\" \r\nAGENCY FUNDS $ 1,123,872.00 113,961.00 $ 1,237,833.00 \r\n$ 716,256.61 521,576.39 \r\n$ 1,237,833.00 \r\n \r\nThe notes to the basic financial statements are an integral part of this statement. - 9 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNote 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY \r\nREPORTING ENTITY \r\nThe Houston County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity. \r\nNote 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \r\nBASIS OF PRESENTATION \r\nThe School District's basic financial statements are collectively comprised of the District-wide financial statements, fund financial statements and notes to the basic financial statements of the Houston County Board of Education. \r\nDistrict-wide Statements: The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. \r\nThe Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities. \r\n Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs. \r\n Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. \r\nFund Financial Statements: The fund financial statements provide information about the School District's funds, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate statements for each category (governmental and fiduciary) are presented. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. \r\nThe School District reports the following major governmental funds: \r\n General Fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund. \r\n \r\n- 10 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\n District-wide Capital Projects Fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST) and grants from Georgia State Financing and Investment Commission that are restricted, committed or assigned to the expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. \r\n Debt Service Fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (sales) legally restricted for the payment of general long-term principal and interest. \r\nThe School District reports the following fiduciary fund type: \r\n Agency funds account for assets held by the School District as an agent for various funds, governments, or individuals. \r\nBASIS OF ACCOUNTING \r\nThe basis of accounting determines when transactions are reported on the financial statements. The District-wide governmental and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. \r\nThe School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. \r\nGovernmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers all revenues reported in the governmental funds to be available if they are collected within sixty days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general longterm debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities and acquisitions under capital leases are reported as other financing sources. \r\nThe School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues. \r\n \r\n- 11 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nRESTATEMENT OF PRIOR YEAR NET POSITION \r\n \r\nFor fiscal year 2015, the School District made several prior period adjustments due to the adoption of GASB Statement No. 68 and GASB Statement No. 71, as described in \"New Accounting Pronouncements\" below, which require the restatement of the June 30, 2014, net position in Governmental Activities. The result is a decrease in Net Position at July 1, 2014 of $231,375,493.00. This change is in accordance with generally accepted accounting principles. \r\n \r\nNet Position, July 1, 2014, as previously reported \r\n \r\n$ 347,400,237.55 \r\n \r\nPrior Period Adjustment - Implementation of GASB 68 Net Pension Liability (measurement date) TRS ERS \r\n \r\n$ -248,445,507.00 -694,656.00 \r\n \r\n-249,140,163.00 \r\n \r\nDeferred Outflows - School District's contributions made during fiscal year 2014 TRS ERS \r\n \r\n$ 17,689,868.00 74,802.00 \r\n \r\n17,764,670.00 \r\n \r\nNet Position, July 1, 2014, as restated \r\n \r\n$ 116,024,744.55 \r\n \r\nNEW ACCOUNTING PRONOUNCEMENTS \r\n \r\nIn fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions. The provisions of this statement establish accounting and financial reporting standards for pensions that are provided to the employees of state and local governmental employers through pension plans that are administered through trusts. Implementation of this statement requires a restatement to beginning net position. The adoption of this statement has a significant impact on the School District's financial statements. As noted above the School District restated beginning Net Positon for the cumulative effect of this accounting change. \r\n \r\nIn fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 69, Government Combinations and Disposals of Government Operations. This statement provides specific accounting and financial reporting guidance for combinations in the governmental environment. This statement also requires that disclosures be made by governments about combination arrangements in which they engage and for disposals of government operations. The School District did not have any activities of this type during the fiscal year and the adoption of this statement does not have a significant impact on the School District's financial statements. \r\n \r\nIn fiscal year 2015, the School District adopted Governmental Accounting Standards Board (GASB) Statement 71, Pension Transition for Contributions Made Subsequent to the Measurement Date - an amendment of GASB No. 68. The objective of this statement is to improve accounting and financial reporting by addressing an issue in Statement No. 68, Accounting and Financial Reporting for Pensions, concerning transition provisions related to certain pension contributions made to defined benefit pension plans prior to implementation of statement. This statement amends paragraph 137 of Statement No. 68 which limited recognition of pension-related deferred inflows of resources at the transition to circumstances in which it is practical to determine the amounts of all deferred outflows of resources and deferred inflows of resources related to pensions. The adoption of this statement has a significant impact on the School District's financial statements. As noted above the School District restated beginning Net Position for the cumulative effect of this accounting change. \r\n \r\n- 12 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCASH AND CASH EQUIVALENTS \r\nCOMPOSITION OF DEPOSITS Cash and cash equivalents consist of cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated Section 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations. \r\nINVESTMENTS \r\nCOMPOSITION OF INVESTMENTS Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year and equity investments are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the School District to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: \r\n(1) Obligations issued by the State of Georgia or by other states, \r\n(2) Obligations issued by the United States government, \r\n(3) Obligations fully insured or guaranteed by the United States government or a United States government agency, \r\n(4) Obligations of any corporation of the United States government, \r\n(5) Prime banker's acceptances, \r\n(6) The local government investment pool (Georgia Fund 1) administered by the State of Georgia, Office of the State Treasurer, \r\n(7) Repurchase agreements, and \r\n(8) Obligations of other political subdivisions of the State of Georgia. \r\nThe School District does not have a formal policy regarding investment policies that address credit risks, custodial credit risks, concentration of credit risks, interest rate risks or foreign currency risks. \r\nRECEIVABLES \r\nReceivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \r\n \r\n- 13 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nPROPERTY TAXES \r\n \r\nThe Houston County Board of Commissioners fixed the property tax levy for the 2014 tax digest year (calendar year) on July 28, 2014 (levy date). Taxes were due on December 20, 2014 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2014 tax digest are reported as revenue in the governmental funds for fiscal year 2015. The Houston County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2015, for maintenance and operations amounted to $50,923,832.53. \r\n \r\nThe tax millage rate levied for the 2014 tax year (calendar year) for the Houston County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): \r\n \r\nSchool Operations \r\n \r\n13.34 mills \r\n \r\nAdditionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $2,836,885.80 during fiscal year ended June 30, 2015. \r\n \r\nSALES TAXES \r\n \r\nIn 1982, the voters of Houston County approved a local amendment to the Constitution of the State of Georgia which limited the maximum allowable mill rate for ad valorem taxes levied by the School District each year. The maximum allowable mill rate for the School District in each year must be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the School District in the immediately preceding year from the local sales and use tax. Local Option Sales Tax revenue, at the fund reporting level, during the fiscal year amounted to $22,109,147.51 and was recorded in the General Fund. Local Option Sales Tax is to be used for the maintenance and operation of the School District, and the corresponding millage rate was adjusted accordingly. \r\n \r\nEducation Special Purpose Local Option Sales Tax, at the fund reporting level, during the year amounted to $22,109,284.45 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years. \r\n \r\nINVENTORIES \r\n \r\nFOOD INVENTORIES On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (weighted average). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used. \r\n \r\nSUPPLY INVENTORY On the basic financial statements, inventories of consumable supplies and materials are reported at cost (weighted average). The School District uses the consumption method to account for inventories of consumable supplies whereby an asset is recorded when supplies are purchased and expenditures are recorded at the time the supplies are consumed. \r\n \r\n- 14 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCAPITAL ASSETS \r\n \r\nCapital assets purchased, including capital outlay costs, are recorded as expenditures in the fund \r\n \r\nfinancial statements at the time of purchase (including ancillary charges). On the District-wide \r\n \r\nfinancial statements, all purchased capital assets are valued at cost where historical records are \r\n \r\navailable and at estimated historical cost based on appraisals or deflated current replacement cost \r\n \r\nwhere no historical records exist. Donated capital assets are recorded at estimated fair market value \r\n \r\non the date donated. Disposals are deleted at depreciated recorded cost. The cost of normal \r\n \r\nmaintenance and repairs that do not add to the value of assets or materially extend the useful lives of \r\n \r\nthe assets is not capitalized. Depreciation is computed using the straight-line method. The School \r\n \r\nDistrict does not capitalize book collections or works of art. During the fiscal year under review, no \r\n \r\nevents or changes in circumstances affecting a capital asset that may indicate impairment were known \r\n \r\nto the School District. Capitalization thresholds and estimated useful lives of capital assets reported \r\n \r\nin the District-wide statements are as follows: \r\n \r\nCapitalization \r\n \r\nEstimated \r\n \r\nPolicy \r\n \r\nUseful Life \r\n \r\nLand Land Improvements Buildings and Improvements Equipment \r\na. Vehicles b. Other Machinery and Equipment \r\nIntangible Assets Construction in Progress \r\n \r\nAll \r\n \r\nN/A \r\n \r\nAll \r\n \r\n20 to 25 years \r\n \r\nAll \r\n \r\n10 to 50 years \r\n \r\nAll $10,000.00 and any \r\nitem necessary for insurance \r\npurposes $100,000.00 to $1.0 million \r\nAll \r\n \r\n5 to 14 years 6 to 10 years \r\nup to 20 years N/A \r\n \r\nDepreciation is used to allocate the actual or estimated historical cost of all capital assets over estimated useful lives, with the exception of intangible assets which are amortized. \r\n \r\nAmortization of intangible assets such as water, timber, and mineral rights, easements, patents, trademarks, copyrights and internally generated software is computed using the straight-line method over the estimated useful lives of the assets. \r\nDEFERRED OUTFLOWS/INFLOWS OF RESOURCES \r\n \r\nIn addition to assets, the statement of net position and/or the balance sheet will report a separate section for deferred outflows of resources. This separate financial statement element, represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then. Under the full accrual method of accounting, the School District has reported deferred outflows of resources related to a defined benefit pension plan, as discussed in Note 14 - Retirement Plans. \r\n \r\nIn addition to liabilities, the statement of net position and/or the balance sheet will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time. Under the full accrual method of accounting, the School District has reported deferred inflows of resources related to a defined benefit pension plan, as discussed in Note 14 - Retirement Plans. This item is reported only in the District-wide Statement of \r\n- 15 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNet Position. Additionally, the School District has only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from property taxes and this amount is deferred and will be recognized as an inflow of resources in the period in which the amount becomes available. \r\nCOMPENSATED ABSENCES \r\nMembers of the Teachers' Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement in excess of sixty days. Employees retiring under the Teachers' Retirement System of Georgia are eligible to be paid for up to sixty days of leave at a rate of $22.50 per day, upon retirement. Employees retiring under the Public School Employees' Retirement System will be eligible to sell all unused leave up to the one hundred day maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous with retirement. \r\nPublic School Employees' Retirement System employees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the School District, contiguous to a voluntary termination. \r\nAccrued vacation leave will be paid to all eligible employees at their daily rate up to a maximum of twenty days. Vacation leave of twelve days is awarded to all full time personnel employed on a twelve month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed twenty days. \r\nGENERAL OBLIGATION BONDS \r\nThe School District issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. In the District-wide financial statements, bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued. \r\nIn the fund financial statements, the School District recognizes bond premiums and discounts, as well as bond issuance costs during the fiscal year bonds are issued. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds is recorded in the Statement of Net Position. \r\nPENSIONS \r\nFor purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Teachers' Retirement System of Georgia (TRS), the Employees' Retirement System of Georgia (ERS) and the Public School Employees' Retirement System (PSERS) and additions to/deductions from TRS/ERS/PSERS fiduciary net position have been determined on the same basis as they are reported by TRS/ERS/PSERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. See Note 14 - Retirement Plans. \r\n- 16 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNET POSITION \r\nThe School District's net position in the District-wide Statements is classified as follows: \r\nNet Investment in Capital Assets - This represents the School District's total investment in capital assets, net of outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets. \r\nRestricted Net Position - This represents resources for which the School District is legally or contractually obligated to spend resources for bus replacement, continuation of Federal programs, debt service and capital projects in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation. \r\nUnrestricted Net Position - Unrestricted Net Position is the net amount of the assets, deferred outflows of resources, liabilities and deferred inflows of resources that are not included in the determination of Net Investment of Capital Assets and Restricted Net Position. Included in the net deficit reported is the School District's Net Pension liability of $179,065,316.00 which is required for financial reporting. \r\nFUND BALANCES \r\nThe School District's fund balances are classified as follows: \r\nNonspendable  Amounts that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. \r\nRestricted  Constraints are placed on the use of resources are either (1) externally imposed conditions by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. \r\nCommitted  Amounts that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board of Education. The Board of Education is the School District's highest level of decision-making authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements. \r\nAssigned  Amounts that are constrained by the School District's intent to be used for specific purposes, but are neither restricted nor committed. The intent should be expressed by (1) the Board of Education or (2) the Superintendent, or the Assistant Superintendent for Finance and Business Operations, to assign amounts to be used for specific purposes. \r\nUnassigned  The residual classification for the General Fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the General Fund. \r\n \r\n- 17 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nFund Balances of the Governmental Funds at June 30, 2015, are as follows: \r\n \r\nNonspendable Inventories \r\nRestricted Continuation of Federal Programs Capital Projects Debt Service Property Tax Rollback \r\nAssigned Local Capital Outlay Projects School Activity Accounts Subsequent Period Expenditures \r\nUnassigned \r\n \r\n$ 3,746,901.56 \r\n \r\n$ 5,573,416.25 10,585,384.19 10,446,505.42 34,491,585.33 \r\n \r\n61,096,891.19 \r\n \r\n$ \r\n \r\n49,965.35 \r\n \r\n2,262,253.78 \r\n \r\n3,812,791.00 \r\n \r\n6,125,010.13 19,469,972.71 \r\n \r\nFund Balance, June 30, 2015 \r\n \r\n$ 90,438,775.59 \r\n \r\nIt is the goal of the Houston County Board of Education to achieve and maintain an unassigned fund balance in the general fund at fiscal year end of not less than 4% of budgeted expenditures, not to exceed 15% of the total budget of the subsequent fiscal year, net of any Committed Reserve Balance for capital expenditures, in compliance with O.C.G.A. 20-2-167(a)5. The School District should provide for the maintenance of annual expenditure increases necessary to provide a consistent educational environment satisfactory to its citizens. If the unassigned fund balance at fiscal year end falls below the goal, the School District shall develop a restoration plan to achieve and maintain the minimum fund balance. \r\nWhen multiple categories of fund balance are available for expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds. \r\nUSE OF ESTIMATES \r\nThe preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. \r\nNote 3: BUDGETARY DATA \r\nThe budget is a complete financial plan for the School District's fiscal year, and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund and function. The legal level of budgetary control was established by the Board at the aggregate fund level. The budget for the General Fund was prepared in accordance with accounting principles generally accepted in the United States of America. \r\nThe budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines and a tentative budget is approved. After approval of this tentative budget by the Board, such budget \r\n \r\n- 18 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nis advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of Official Code of Georgia Annotated section 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \r\nSee Schedule 6  General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances  Budget to Actual for a detail of any over/under expenditures during the fiscal year under review. \r\nNote 4: DEPOSITS AND INVESTMENTS \r\nCOLLATERALIZATION OF DEPOSITS Official Code of Georgia Annotated (O.C.G.A.) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. Section 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110 percent of the daily pool balance. \r\nAcceptable security for deposits consists of any one of or any combination of the following: \r\n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \r\n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \r\n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \r\n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, \r\n(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \r\n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \r\n(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed 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. \r\n \r\n- 19 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCATEGORIZATION OF DEPOSITS Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2015, the School District had deposits with a carrying amount of $18,596,501.97, which includes $272,903.22 in Certificates of Deposit that are reported as Investments, and a bank balance of $27,178,880.38. The bank balances insured by Federal depository insurance were $4,103,045.16 and the bank balances collateralized with securities held by the pledging financial institution in the School District's name were $23,075,835.22. \r\nCATEGORIZATION OF INVESTMENTS At June 30, 2015, the carrying value of the School District's total investments was $73,525,393.85, which is materially the same as fair value. This includes $272,903.22 invested in Certificates of Deposit, which are collateralized in the same manner as other cash deposits. This investment consisted entirely of funds invested in the Georgia Fund 1, (local government investment pool), administered by the State of Georgia, Office of the State Treasurer which is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1 (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Comprehensive Annual Financial Report. This audit can be obtained from the Georgia Department of Audits and Accounts at \r\nwww.audits.ga.gov/SGD/CAFR.html. \r\nThe Primary Liquidity Portfolio consists of Georgia Fund 1 which is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share. The pool is an AAAf rated investment pool by Standard and Poor's. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2015, was 56 days. \r\nNote 5: NON-MONETARY TRANSACTIONS \r\nThe School District receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 2  Inventories \r\n \r\n- 20 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNote 6: CAPITAL ASSETS \r\n \r\nThe following is a summary of changes in the Capital Assets during the fiscal year: \r\n \r\nGovernmental Activities Capital Assets, Not Being Depreciated: \r\nLand Construction Work In Progress \r\n \r\nBalances July 1, 2014 \r\n \r\nIncreases \r\n \r\nDecreases \r\n \r\nTransfers \r\n \r\nBalances June 30, 2015 \r\n \r\n$ 10,861,359.31 \r\n \r\n$ \r\n \r\n24,581,262.28 $ 8,614,292.69 \r\n \r\n55,106.62 $ \r\n \r\n265,462.07 $ 11,071,714.76 \r\n \r\n425,861.43 -23,769,161.15 \r\n \r\n9,000,532.39 \r\n \r\nTotal Capital Assets, Not Being Depreciated \r\n \r\n35,442,621.59 \r\n \r\n8,614,292.69 \r\n \r\n480,968.05 -23,503,699.08 \r\n \r\n20,072,247.15 \r\n \r\nCapital Assets, Being Depreciated: Buildings and Improvements Equipment Land Improvements \r\n \r\n386,721,753.48 24,568,608.21 7,275,353.26 \r\n \r\n1,964,472.85 \r\n \r\n108,703.00 275,258.46 \r\n \r\n23,503,699.08 \r\n \r\n410,116,749.56 26,257,822.60 7,275,353.26 \r\n \r\nLess: Accumulated Depreciation: Buildings and Improvements Equipment Land Improvements \r\n \r\n125,880,801.40 17,534,546.09 2,392,704.44 \r\n \r\n10,073,472.47 1,401,300.69 342,644.88 \r\n \r\n108,703.00 264,274.40 \r\n \r\n135,845,570.87 18,671,572.38 2,735,349.32 \r\n \r\nTotal Capital Assets, Being Depreciated, Net 272,757,663.02 -9,852,945.19 \r\n \r\n10,984.06 23,503,699.08 286,397,432.85 \r\n \r\nGovernmental Activity Capital Assets - Net $ 308,200,284.61 $ -1,238,652.50 $ 491,952.11 $ \r\n \r\n0.00 $ 306,469,680.00 \r\n \r\nCapital assets being acquired under capital leases as of June 30, 2015, are as follows: \r\n \r\nGovernmental Funds \r\n \r\nEquipment Less: Accumulated Depreciation \r\n \r\n$ \r\n \r\n3,081,846.00 \r\n \r\n322,805.70 \r\n \r\n$ \r\n \r\n2,759,040.30 \r\n \r\n- 21 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nCurrent year depreciation expense by function is as follows: \r\n \r\nInstruction Support Services \r\nPupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Food Services \r\n \r\n$ \r\n \r\n$ \r\n \r\n8,738.70 \r\n \r\n14,156.10 \r\n \r\n409,080.18 \r\n \r\n5,134.92 \r\n \r\n406,997.01 \r\n \r\n129,245.16 \r\n \r\n84,894.14 \r\n \r\n958,984.34 \r\n \r\n107,371.50 \r\n \r\n8,673,001.95 \r\n2,124,602.05 1,019,814.04 \r\n \r\n$ 11,817,418.04 \r\nNote 7: RISK MANAGEMENT \r\nThe School District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; acts of God and unemployment compensation. \r\nThe School District participates in the Georgia School Boards Association Risk and Insurance Management System, a public entity risk pool organized on July 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, or property damage, including safety engineering and other loss prevention and control techniques, and to administer one or more groups of self-insurance funds, including the processing and defense of claims brought against members of the system. The School District pays an annual premium to the system for its general insurance coverage. Additional coverage is provided through agreements by the system with other companies according to their specialty for property, boiler and machinery (including coverage for flood and earthquake), general liability (including coverage for sexual harassment, molestation and abuse), errors and omissions, crime and automobile risks. Payment of excess insurance for the system varies by line of coverage. \r\nThe School District has established a limited risk management program for workers' compensation claims. The School District accounts for claims within the General Fund with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $550,000.00 loss per occurrence, up to the statutory limit. \r\nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \r\n \r\nBeginning of Year Liability \r\n \r\nClaims and Changes in Estimates \r\n \r\nClaims Paid \r\n \r\nEnd of Year Liability \r\n \r\n2014 2015 \r\n \r\n$ 1,535,607.17 $ \r\n \r\n669,108.69 $ 1,074,553.40 $ 1,130,162.46 \r\n \r\n$ 1,130,162.46 $ 1,186,308.30 $ \r\n \r\n876,444.80 $ 1,440,025.96 \r\n \r\n- 22 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the General Fund with expenses/expenditures and liabilities being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. \r\n \r\nChanges in the unemployment compensation claims liability during the last two fiscal years are as \r\n \r\nfollows: \r\n \r\nClaims and \r\n \r\nBeginning of Year \r\n \r\nChanges in \r\n \r\nClaims \r\n \r\nEnd of Year \r\n \r\nLiability \r\n \r\nEstimates \r\n \r\nPaid \r\n \r\nLiability \r\n \r\n2014 $ 2015 $ \r\n \r\n0.00 $ 0.00 $ \r\n \r\n20,060.00 $ 0.00 $ \r\n \r\n20,060.00 $ 0.00 $ \r\n \r\n0.00 0.00 \r\n \r\nThe School District has purchased surety bonds to provide additional insurance coverage as follows: \r\n \r\nPosition Covered \r\n \r\nAmount \r\n \r\nSuperintendent All Employees \r\nNote 8: OPERATING LEASES \r\n \r\n$ \r\n \r\n50,000.00 \r\n \r\n$ \r\n \r\n100,000.00 \r\n \r\nHouston County Board of Education has entered into various leases as lessee for copiers, servers and mail equipment. These leases are considered for accounting purposes to be operating leases. Lease \r\n \r\nexpenditures for the year ended June 30, 2015, for governmental funds amounted to $5,760.00. Future minimum lease payments for these leases are as follows: \r\n \r\nGovernmental \r\n \r\nYear Ending \r\n \r\nFunds \r\n \r\n2016 \r\n \r\n$ \r\n \r\n4,800.00 \r\n \r\nNote 9: LONG-TERM LIABILITIES \r\n \r\nCAPITAL LEASES The Houston County Board of Education also entered into various lease agreements for the purchase of buses and band equipment. These lease agreements qualify as capital leases for accounting purposes, and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. \r\n \r\nCOMPENSATED ABSENCES Compensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the General Fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences. \r\n \r\nGENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: \r\n \r\nPurpose \r\n \r\nInterest Rates \r\n \r\nAmount \r\n \r\nGeneral Government - Series 2012 \r\n \r\n2.799% - 4.00% \r\n \r\n$ 30,275,000.00 \r\n \r\n- 23 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nThe changes in Long-Term Liabilities during the fiscal year ended June 30, 2015, were as follows: \r\n \r\nBalance July 1, 2014 \r\n \r\nAdditions \r\n \r\nGovernmental Activities \r\n \r\nBalance \r\n \r\nDeductions \r\n \r\nJune 30, 2015 \r\n \r\nDue Within One Year \r\n \r\nG. O. Bonds Capital Leases Compensated Absences (1) Bond Premium Amortized \r\n \r\n$ 41,795,000.00 1,717,170.92 $ 2,676,263.68 4,305,813.54 \r\n \r\n$ 11,520,000.00 $ 30,275,000.00 $ \r\n \r\n1,487,350.29 \r\n \r\n358,766.87 \r\n \r\n2,845,754.34 \r\n \r\n1,927,491.28 \r\n \r\n1,880,014.49 \r\n \r\n2,723,740.47 \r\n \r\n1,186,815.93 \r\n \r\n3,118,997.61 \r\n \r\n9,885,000.00 629,073.13 \r\n1,018,374.61 \r\n \r\n$ 50,494,248.14 $ 3,414,841.57 $ 14,945,597.29 $ 38,963,492.42 $ 11,532,447.74 \r\n \r\n(1) The portion of Compensated Absences due within one year has been determined to be immaterial to the basic financial statements. \r\n \r\nAt June 30, 2015, payments due by fiscal year which includes principal and interest for these items are as follows: \r\n \r\nCapital Leases \r\n \r\nGeneral Obligation Debt \r\n \r\nUnamortized \r\n \r\nFiscal Year Ended June 30: \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nPrincipal \r\n \r\nInterest \r\n \r\nBond Premium \r\n \r\n2016 2017 2018 2019 2020 \r\n \r\n$ \r\n \r\n629,073.13 $ \r\n \r\n634,066.48 \r\n \r\n643,028.20 \r\n \r\n652,125.06 \r\n \r\n287,461.47 \r\n \r\n36,757.49 $ 31,764.14 22,802.43 13,705.56 \r\n4,685.79 \r\n \r\n9,885,000.00 $ 10,085,000.00 10,305,000.00 \r\n \r\n889,531.26 $ 490,131.26 144,215.63 \r\n \r\n1,018,374.61 1,038,979.05 1,061,643.95 \r\n \r\nTotal Principal and Interest $ 2,845,754.34 $ 109,715.41 $ 30,275,000.00 $ 1,523,878.15 $ 3,118,997.61 \r\n \r\nNote 10: ON-BEHALF PAYMENTS \r\nThe School District has recognized revenues and costs in the amount of $633,289.26 for retirement contributions paid on the School District's behalf by the following State Agencies. \r\nGeorgia Department of Education Paid to the Teachers' Retirement System of Georgia For Teachers' Retirement System (TRS) Employer's Cost In the amount of $76,645.26 \r\nOffice of State Treasurer Paid to the Public School Employees' Retirement System For Public School Employees' Retirement (PSERS) Employer's Cost In the amount of $556,644.00 \r\nFunds paid on behalf of the School District are reported in governmental funds. See Note 14 Retirement Plans for the State support related to the Net Pension Liability. \r\n \r\n- 24 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNote 11: SIGNIFICANT COMMITMENTS \r\n \r\nThe following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2015, together with funding available: \r\n \r\nProject \r\n \r\nUnearned Executed Contracts \r\n \r\nFunding Available From State \r\n \r\n14-676-108 16-676-019 McConnell Talbert Stadium Renovations \r\n \r\n$ 3,826,084.46 $ \r\n \r\n231,821.50 \r\n \r\n1,137,730.50 \r\n \r\n1,633,977.00 \r\n \r\n485,384.76 \r\n \r\n$ 5,449,199.72 $ 1,865,798.50 \r\nThe amounts described in this note are not reflected in the basic financial statements. \r\n \r\nNote 12: SIGNIFICANT CONTINGENT LIABILITIES \r\n \r\nAmounts 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 costs which are disallowed under grant terms. The School District believes that such disallowances, if any, will be immaterial to its overall financial position. \r\n \r\nThe School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the basic financial statements. \r\n \r\nNote 13: POST-EMPLOYMENT BENEFITS \r\n \r\nGeorgia School Personnel Post-employment Health Benefit Fund \r\n \r\nPlan Description. The Georgia School Personnel Post-employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit post-employment healthcare plan that covers eligible former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State Employees Health Benefit Plan administered by the Department of Community Health. The Official Code of Georgia Annotated (O.C.G.A.) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). The Department of Community Health, which includes the School OPEB Fund, issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts. \r\n \r\nFunding Policy. The contribution requirements of plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of plan members or beneficiaries receiving benefits vary based on plan election, dependent coverage, and Medicare eligibility and election. For members with fewer than five years of service as of January 1, 2012, contributions also vary based on years of service. On average, members with five years or more of service as of January 1, 2012 pay approximately 25 percent of the cost of the health insurance coverage. In accordance with the Board resolution dated December 8, 2011, for members with fewer than five years of service as of January 1, 2012, the State \r\n \r\n- 25 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nprovides a premium subsidy in retirement that ranges from 0% for fewer than 10 years of service to 75% (but no greater than the subsidy percentage offered to active employees) for 30 or more years of service. The subsidy for eligible dependents ranges from 0% to 55% (but no greater than the subsidy percentage offered to dependents of active employees minus 20%). No subsidy is available to Medicare eligible members not enrolled in a Medicare Advantage Option. The Board of Community Health sets all member premiums by resolution and in accordance with the law and applicable revenue and expense projections. Any subsidy policy adopted by the Board may be changed at any time by Board resolution and does not constitute a contract or promise of any amount of subsidy. \r\nParticipating employers are statutorily required to contribute in accordance with the employer contribution rates established by the Board. The contribution rates are established to fund all benefits due under the health insurance plans for both active and retired employees based on projected \"payas-you-go\" financing requirements. Contributions are not based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. \r\nThe combined active and retiree contribution rates established by the Board for employers participating in the School OPEB Fund were as follows for the fiscal year ended June 30, 2015: \r\n \r\nFor certificated teachers, librarians and regional educational service agencies and certain other eligible participants: \r\n \r\nJuly 1, 2014 - June 30, 2015 \r\n \r\n$945.00 per member per month \r\n \r\nFor non-certificated school personnel: \r\n \r\nJuly 1, 2014 - June 30, 2015 \r\n \r\n$596.20 per member per month \r\n \r\nNo additional contribution was required by the Board for fiscal year 2015 nor contributed to the School OPEB Fund to prefund retiree benefits. Such additional contribution amounts are determined annually by the Board in accordance with the School plan for other post-employment benefits and are subject to appropriation. \r\n \r\nThe School District's combined active and retiree contributions to the health insurance plans, which \r\n \r\nequaled the required contribution, for the current fiscal year and the preceding two fiscal years were \r\n \r\nas follows: \r\n \r\nPercentage \r\n \r\nRequired \r\n \r\nFiscal Year Contributed \r\n \r\nContribution \r\n \r\n2015 2014 2013 \r\n \r\n100% 100% 100% \r\n \r\n$ 24,797,301.80 $ 24,069,352.20 $ 21,847,884.72 \r\n \r\n- 26 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nNote 14: RETIREMENT PLANS \r\n \r\nHouston County Board of Education participates in various retirement plans administered by the State of Georgia, as further explained below. \r\nTEACHERS' RETIREMENT SYSTEM OF GEORGIA (TRS) \r\n \r\nPlan Description: All teachers of the District as defined in 47-3-60 of the Official Code of Georgia Annotated (O.C.G.A.) and certain other support personnel as defined by 47-3-63 are provided a pension through the Teachers' Retirement System of Georgia (TRS). TRS, a cost-sharing multiple- employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers' Retirement System of Georgia issues a publicly available separate financial audit report that can be obtained at www.trsga.com/publications. \r\nBenefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death. \r\nContributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2015. The school district's contractually required contribution rate for the year ended June 30, 2015 was 13.15% of annual school district payroll. \r\n \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2015 2014 2013 \r\n \r\n100% 100% 100% \r\n \r\n$ 19,764,366.97 $ 17,695,182.98 $ 16,362,109.23 \r\n \r\nEMPLOYEES' RETIREMENT SYSTEM \r\n \r\nPlan description: The Employees' Retirement System of Georgia (ERS) is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\n- 27 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nBenefits provided: The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. \r\nUnder the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. \r\nRetirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. 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. \r\nContributions: Member contributions under the old plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The School District's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2015 was 21.96% of annual covered payroll for old and new plan members and 18.87% for GSEPS members. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2015 2014 2013 \r\n \r\n100% $ 100% $ 100% $ \r\n \r\n91,406.16 74,802.06 53,504.66 \r\n \r\nPUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM (PSERS) \r\n \r\nPlan description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers' Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. \r\n \r\n- 28 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nBenefits provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service. \r\n \r\nUpon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. \r\nContributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. \r\n \r\nIndividuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. \r\n \r\nPension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions \r\nAt June 30, 2015, the School District reported a liability of $179,065,316.00 for its proportionate share of the net pension liability for TRS $178,390,355.00 and ERS $674,961.00. \r\n \r\nThe TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows: \r\n \r\nSchool District's proportionate share of the net pension liability \r\nState of Georgia's proportionate share of the net pension liability associated with the School District \r\n \r\n$ 178,390,355.00 719,867.00 \r\n \r\nTotal \r\n \r\n$ 179,110,222.00 \r\n \r\nThe net pension liability was measured as of June 30, 2014. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS and ERS during the fiscal year ended June 30, 2014. \r\n \r\nAt June 30, 2014, the School District's TRS proportion was 1.412022%, which was a decrease of 0.013787% from its proportion measured as of June 30, 2013. At June 30, 2014, the School District's ERS proportion was 0.017996%, which was an increase of 0.003681% from its proportion measured as of June 30, 2013. \r\n \r\n- 29 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nAt June 30, 2015, the School District did not have a PSERS liability for a proportionate share of the Net Pension Liability because of a Special Funding Situation with the State of Georgia, which is responsible for the Net Pension Liability of the plan. The amount of the State's proportionate share of the Net Pension Liability associated with the School District is $2,303,408.00. \r\n \r\nThe PSERS net pension liability was measured as of June 30, 2014. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2013. An expected total pension liability as of June 30, 2014 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2014. \r\n \r\nFor the year ended June 30, 2015, the School District recognized pension expense of $11,782,860.00 for TRS, $109,920.00 for ERS and $200,036.00 for PSERS. Revenue of $52,344.00 for TRS and $200,036.00 for PSERS was also recognized by the School District. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel. \r\n \r\nAt June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of \r\n \r\nresources related to pension from the following sources: \r\n \r\nTRS \r\n \r\nERS \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nDeferred \r\n \r\nOutflows of \r\n \r\nInflows of \r\n \r\nOutflows of \r\n \r\nInflows of \r\n \r\nResources \r\n \r\nResources \r\n \r\nResources \r\n \r\nResources \r\n \r\nNet difference between projected and actual earnings on pension plan investments \r\n \r\n$ 62,190,659.00 \r\n \r\n$ 164,737.00 \r\n \r\nChanges in proportion and differences between School District contributions and proportionate share of contributions \r\n \r\n1,957,485.00 $ 109,924.00 \r\n \r\nSchool District contributions subsequent to the measurement date \r\n \r\n$ 19,686,651.83 \r\n \r\n91,406.16 \r\n \r\nTotal \r\n \r\n$ 19,686,651.83 $ 64,148,144.00 $ 201,330.16 $ 164,737.00 \r\n \r\nHouston County Board of Education contributions subsequent to the measurement date of June 30, 2014 for TRS and ERS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: \r\n \r\nYear Ending June 30: \r\n \r\nTRS \r\n \r\nERS \r\n \r\n2016 2017 2018 2019 2020 \r\n \r\n$ -15,992,544.00 $ $ -15,992,544.00 $ $ -15,992,544.00 $ $ -15,992,558.00 $ $ -177,954.00 $ \r\n \r\n27,518.00 38.00 \r\n-41,184.00 -41,185.00 \r\n0.00 \r\n \r\n- 30 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nActuarial assumptions: The total pension liability as of June 30, 2014 was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement: \r\n \r\nTeachers' Retirement System: \r\n \r\nInflation Salary increases Investment rate of return \r\n \r\n3.00% 3.75% - 7.00% \r\n7.50% \r\n \r\naverage, including inflation net of pension plan investment expense \r\nincluding inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for Males or Females set back two years for males and set back three years for females. \r\n \r\nThe actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\n \r\nEmployees' Retirement System: \r\n \r\nInflation Salary increases Investment rate of return \r\n \r\n3.00% 5.45% - 9.25% \r\n7.50% \r\n \r\naverage, including inflation net of pension plan investment expense \r\nincluding inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table for the periods after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement. \r\n \r\nThe actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\n \r\nPublic School Employees' Retirement System: \r\n \r\nInflation Salary increases Investment rate of return \r\n \r\n3.00% N/A \r\n7.50% \r\n \r\nnet of pension plan investment expense, including inflation \r\n \r\nMortality rates were based on the RP-2000 Combined Mortality Table set forward one year for males for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females for the period after disability retirement. \r\n \r\nThe actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004  June 30, 2009. \r\n \r\nThe long-term expected rate of return on TRS, ERS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: \r\n- 31 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nAsset Class \r\n \r\nTarget Allocation \r\n \r\nLong-Term Expected Real Rate of Return * \r\n \r\nFixed Income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks \r\n \r\n30.00% 39.70% \r\n3.70% 1.60% 18.90% 6.10% \r\n \r\n3.00% 6.50% 10.00% 13.00% 6.50% 11.00% \r\n \r\n100.00% * Rates shown are net of the 3.00% assumed rate of inflation \r\n \r\nDiscount rate: The discount rate used to measure the total TRS, ERS and PSERS pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS, ERS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. \r\n \r\nSensitivity of the Houston County Board of Education's proportionate share of the net pension liability to changes in the discount rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50%) or 1-percentage-point higher (8.50%) than the current rate: \r\n \r\nTeachers' Retirement System: \r\nSchool District's proportionate share of the net pension liability \r\n \r\n1% Decrease (6.50%) \r\n \r\nCurrent Discount Rate \r\n(7.50%) \r\n \r\n1% Increase (8.50%) \r\n \r\n$ 328,749,490.00 $ 178,390,355.00 $ 54,572,730.00 \r\n \r\nEmployees' Retirement System: \r\n \r\n1% \r\n \r\nCurrent \r\n \r\n1% \r\n \r\nDecrease \r\n \r\nDiscount Rate \r\n \r\nIncrease \r\n \r\n(6.50%) \r\n \r\n(7.50%) \r\n \r\n(8.50%) \r\n \r\nSchool District's proportionate share \r\n \r\nof the net pension liability \r\n \r\n$ \r\n \r\n984,227.00 $ \r\n \r\n674,961.00 $ \r\n \r\n411,704.00 \r\n \r\nPension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS, ERS and PSERS financial report which is publically available at www.trsga.com/publications and http://www.ers.ga.gov/formspubs/formspubs.html. \r\n \r\n- 32 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS \r\nJUNE 30, 2015 \r\n \r\nEXHIBIT \"H\" \r\n \r\nDEFINED CONTRIBUTION PLAN \r\nIn July 1999, Houston County Board of Education began an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees' Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group. \r\nThe Board selected AIG Valic as the provider of this plan. For each employee covered under PSERS, the Board began matching 100% of employee's contributions up to 5.0% of the employee's base pay. \r\nThe employee becomes vested in the plan with 5 years of experience. Employees who had already achieved 5 years of experience at the time the plan was implemented were vested upon enrollment. \r\nFunds accumulated in the employer paid accounts are only available to the employee upon termination of employment and 5 years of service to Houston County Board of Education. If an employee terminates employment prior to achieving 5 years of service, funds paid on behalf of the non-vested employee are credited back to the Board. \r\nEmployer contributions for the current fiscal year and the preceding two fiscal years are as follows: \r\n \r\nFiscal Year \r\n \r\nPercentage Contributed \r\n \r\nRequired Contribution \r\n \r\n2015 2014 2013 \r\n \r\n100% $ 100% $ 100% $ \r\n \r\n136,887.41 66,569.73 64,211.91 \r\n \r\n- 33 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30, 2015 \r\nSchool District's proportion of the net pension liability School District's proportionate share of the net pension liability State of Georgia's proportionate share of the net pension liability \r\nassociated with the School District Total School District's covered-employee payroll School District's proportionate share of the net pension liability \r\nas a percentage of its covered employee payroll Plan fiduciary net position as a percentage of the total pension liability \r\n \r\nSCHEDULE \"1\" \r\n2015 1.412022% $ 178,390,355.00 719,867.00 $ 179,110,222.00 $ 144,097,581.27 \r\n123.80% 84.03% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. Schedule includes all significant plans and funds administered by Houston County Board of Education. \r\n- 34 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30, 2015 \r\nSchool District's proportion of the net pension liability School District's proportionate share of the net pension liability School District's covered-employee payroll School District's proportionate share of the net pension liability \r\nas a percentage of its covered employee payroll Plan fiduciary net position as a percentage of the total pension liability \r\n \r\nSCHEDULE \"2\" \r\n2015 0.017996% $ 674,961.00 $ 405,211.66 \r\n166.57% 77.99% \r\n \r\nThis schedule is intended to show information for 10 years. Additional years will be displayed as they become available. Schedule includes all significant plans and funds administered by Houston County Board of Education. \r\n- 35 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nContractually required contribution Contributions in relation to the contractually required contribution Contribution deficiency (excess) School District's covered-employee payroll Contributions as a percentage of covered-employee payroll \r\n \r\n2015 \r\n \r\n2014 \r\n \r\n2013 \r\n \r\n$ 19,764,366.97 $ 17,695,182.98 $ 16,362,109.23 \r\n \r\n19,764,366.97 17,695,182.98 16,362,109.23 \r\n \r\n$ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 \r\n \r\n$ 150,299,368.59 $ 144,097,581.27 $ 143,401,483.17 \r\n \r\n13.15% \r\n \r\n12.28% \r\n \r\n11.41% \r\n \r\n- 36 - \r\n \r\n SCHEDULE \"3\" \r\n \r\n2012 \r\n \r\n2011 \r\n \r\n2010 \r\n \r\n2009 \r\n \r\n2008 \r\n \r\n2007 \r\n \r\n2006 \r\n \r\n$ 14,443,215.27 $ 13,964,970.70 $ 13,544,690.10 $ 13,411,983.74 $ 12,619,182.30 $ 11,731,367.51 $ 10,692,756.94 \r\n \r\n14,443,215.27 13,964,970.70 13,544,690.10 13,411,983.74 12,619,182.30 11,731,367.51 10,692,756.94 \r\n \r\n$ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 \r\n \r\n$ 140,498,203.02 $ 135,846,018.48 $ 139,062,526.69 $ 144,525,686.85 $ 135,982,567.89 $ 126,415,598.17 $ 115,722,477.71 \r\n \r\n10.28% \r\n \r\n10.28% \r\n \r\n9.74% \r\n \r\n9.28% \r\n \r\n9.28% \r\n \r\n9.28% \r\n \r\n9.24% \r\n \r\n- 37 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION \r\nSCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA \r\nFOR THE YEAR ENDED JUNE 30 \r\n \r\nContractually required contribution Contributions in relation to the contractually required contribution Contribution deficiency (excess) School District's covered-employee payroll Contributions as a percentage of covered-employee payroll \r\n \r\n2015 \r\n \r\n2014 \r\n \r\n2013 \r\n \r\n$ 91,406.16 $ 74,802.06 $ 53,504.66 \r\n \r\n91,406.16 \r\n \r\n74,802.06 53,504.66 \r\n \r\n$ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 \r\n \r\n$ 416,239.34 $ 405,211.59 $ 359,091.68 \r\n \r\n21.96% \r\n \r\n18.46% \r\n \r\n14.90% \r\n \r\n- 38 - \r\n \r\n SCHEDULE \"4\" \r\n \r\n2012 \r\n \r\n2011 \r\n \r\n2010 \r\n \r\n2009 \r\n \r\n2008 \r\n \r\n2007 \r\n \r\n2006 \r\n \r\n$ 35,683.88 $ 29,845.78 $ 29,313.50 $ 27,150.80 $ 25,866.31 $ 29,050.90 $ 20,541.92 \r\n \r\n35,683.88 \r\n \r\n29,845.78 \r\n \r\n29,313.50 27,150.80 25,866.31 \r\n \r\n29,050.90 20,541.92 \r\n \r\n$ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 $ \r\n \r\n0.00 \r\n \r\n$ 306,826.14 $ 286,702.98 $ 281,589.82 $ 260,814.60 $ 248,475.60 $ 279,067.24 $ 197,328.72 \r\n \r\n11.63% \r\n \r\n10.41% \r\n \r\n10.41% \r\n \r\n10.41% \r\n \r\n10.41% \r\n \r\n10.41% \r\n \r\n10.41% \r\n \r\n- 39 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION \r\nFOR THE YEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"5\" \r\n \r\nTeachers' Retirement System \r\n \r\nChanges of assumptions: In 2010 and later, the expectation of retired life mortality was changed to the RP2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience. \r\nMethod and assumptions used in calculations of actuarially determined contributions: The actuarially determined contribution rates in the schedule of contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2015 reported in that schedule: \r\n \r\nValuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation rate Salary increases Investment rate of return \r\n \r\nJune 30, 2012 Entry age Level percentage of payroll, open 30 years Seven-year smoothed market 3.00% 3.75  7.00%, including inflation 7.50%, net of pension plan investment \r\nexpense, including inflation \r\n \r\nEmployees' Retirement System \r\n \r\nChanges of assumptions: There were no changes in assumptions or benefits that affect the measurement of the total pension liability since the prior measurement date. \r\nMethod and assumptions used in calculations of actuarially determined contributions: The actuarially determined contribution rates in the schedule of contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the contractually required contributions for year ended June 30, 2015 reported in that schedule: \r\n \r\nValuation date Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation rate Salary increases \r\nInvestment rate of return \r\n \r\nJune 30, 2012 Entry age Level dollar, open 30 years Seven-year smoothed market 3.00% 2.725%  4.625% for FY 2012-2013, 5.45% - 9.25% for FY2014+ 7.50%, net of pension plan investment \r\nexpense, including inflation \r\n \r\n- 40 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION GENERAL FUND \r\nSCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL \r\nYEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"6\" \r\n \r\nREVENUES \r\nProperty Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous \r\nTotal Revenues \r\nEXPENDITURES \r\nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation \r\nDebt Service \r\nTotal Expenditures \r\nExcess of Revenues over (under) Expenditures \r\nOTHER FINANCING SOURCES (USES) \r\nOther Sources Other Uses \r\nTotal Other Financing Sources (Uses) \r\nNet Change in Fund Balances \r\nFund Balances - Beginning \r\nFund Balances - Ending \r\n \r\nNONAPPROPRIATED BUDGETS \r\n \r\nORIGINAL (1) \r\n \r\nFINAL (1) \r\n \r\nACTUAL AMOUNTS \r\n \r\nVARIANCE OVER/UNDER \r\n \r\n$ 53,500,000.00 $ 54,043,000.00 $ 53,970,799.02 $ \r\n \r\n22,069,016.00 \r\n \r\n22,117,016.00 \r\n \r\n23,134,169.08 \r\n \r\n148,558,993.30 149,562,483.58 149,688,465.56 \r\n \r\n26,458,133.00 \r\n \r\n27,198,628.00 \r\n \r\n27,263,821.21 \r\n \r\n8,353,761.00 \r\n \r\n8,564,714.00 \r\n \r\n8,503,018.59 \r\n \r\n71,500.00 \r\n \r\n79,200.00 \r\n \r\n86,428.41 \r\n \r\n5,027,044.00 \r\n \r\n5,856,407.00 \r\n \r\n5,533,199.92 \r\n \r\n-72,200.98 1,017,153.08 \r\n125,981.98 65,193.21 -61,695.41 7,228.41 \r\n-323,207.08 \r\n \r\n264,038,447.30 267,421,448.58 268,179,901.79 \r\n \r\n758,453.21 \r\n \r\n174,800,428.30 \r\n8,676,155.00 7,287,666.00 3,647,448.00 1,488,516.00 17,917,479.00 2,175,535.00 18,724,624.00 11,041,363.00 2,773,469.00 1,188,218.15 2,024,203.00 \r\n860,000.00 18,196,221.70 \r\n270,801,326.15 \r\n-6,762,878.85 \r\n \r\n173,797,738.58 \r\n8,764,058.00 7,817,486.00 3,619,403.00 1,511,471.00 17,954,271.00 2,155,394.00 18,965,963.00 10,729,892.00 2,976,361.00 \r\n732,461.81 2,354,203.00 \r\n903,000.00 18,435,030.04 \r\n270,716,732.43 \r\n-3,295,283.85 \r\n \r\n173,621,978.73 \r\n8,473,480.10 7,738,246.41 3,615,891.69 1,384,646.44 17,752,669.21 1,988,021.53 18,946,544.94 11,588,406.13 2,999,860.74 1,824,236.90 2,414,539.95 \r\n902,286.17 16,679,966.57 \r\n379,438.17 \r\n270,310,213.68 \r\n-2,130,311.89 \r\n \r\n175,759.85 \r\n290,577.90 79,239.59 3,511.31 \r\n126,824.56 201,601.79 167,372.47 \r\n19,418.06 -858,514.13 \r\n-23,499.74 -1,091,775.09 \r\n-60,336.95 713.83 \r\n1,755,063.47 -379,438.17 \r\n406,518.75 \r\n1,164,971.96 \r\n \r\n3,051,000.00 -3,206,000.00 \r\n-155,000.00 -6,917,878.85 36,433,428.16 \r\n \r\n2,954,000.00 -3,096,000.00 \r\n-142,000.00 -3,437,283.85 36,433,428.16 \r\n \r\n1,487,350.29 \r\n1,487,350.29 -642,961.60 \r\n69,999,882.23 \r\n \r\n-1,466,649.71 3,096,000.00 1,629,350.29 2,794,322.25 33,566,454.07 \r\n \r\n$ 29,515,549.31 $ 32,996,144.31 $ 69,356,920.63 $ 36,360,776.32 \r\n \r\nNotes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual \r\n \r\n(1) Original and Final Budget amounts do not include the Restricted Other - Property Tax Rollback fund balance in the beginning or ending fund balances. \r\n \r\nThe accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 41 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"7\" \r\n \r\nFUNDING AGENCY PROGRAM/GRANT \r\nAgriculture, U. S. Department of Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program \r\nTotal Child Nutrition Cluster \r\nOther Programs Pass-Through From Georgia Department of Education Food Services Child Nutrition Discretionary Grants Limited Availability Fresh Fruit and Vegetable Program \r\nTotal Other Programs \r\nTotal U. S. Department of Agriculture \r\nEducation, U. S. Department of Impact Aid Cluster Direct Impact Aid \r\nSpecial Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants \r\nTotal Special Education Cluster \r\nOther Programs Pass-Through From Georgia Department of Education ARRA - Race-to-the-Top Incentive Grants Career and Technical Education - Basic Grants to States Education for Homeless Children and Youth English Language Acquisition Grants Improving Teacher Quality State Grants Migrant Education - State Grant Program Title I Grants to Local Educational Agencies \r\nTotal Other Programs \r\nTotal U. S. Department of Education \r\nDefense, U. S. Department of Direct R.O.T.C. Program P.L. 102-375 \r\nTotal Expenditures of Federal Awards \r\nN/A = Not Available \r\n \r\nCFDA NUMBER \r\n \r\nPASSTHROUGH \r\nENTITY ID \r\nNUMBER \r\n \r\nEXPENDITURES IN PERIOD \r\n \r\n* 10.553 * 10.555 \r\n \r\nN/A \r\n \r\n(2) \r\n \r\nN/A $ 15,614,440.65 (1) \r\n \r\n15,614,440.65 \r\n \r\n10.579 \r\n \r\nN/A \r\n \r\n10.582 \r\n \r\nN/A \r\n \r\n33,000.00 40,717.84 \r\n \r\n73,717.84 \r\n \r\n15,688,158.49 \r\n \r\n84.041 \r\n \r\n(3) \r\n \r\n84.027 \r\n \r\nN/A \r\n \r\n84.173 \r\n \r\nN/A \r\n \r\n4,676,343.00 157,546.00 \r\n4,833,889.00 \r\n \r\n84.395 \r\n \r\nN/A \r\n \r\n84.048 \r\n \r\nN/A \r\n \r\n84.196 \r\n \r\nN/A \r\n \r\n84.365 \r\n \r\nN/A \r\n \r\n* 84.367 \r\n \r\nN/A \r\n \r\n84.011 \r\n \r\nN/A \r\n \r\n84.010 \r\n \r\nN/A \r\n \r\n22,762.02 234,115.00 \r\n31,894.28 105,995.94 991,736.64 \r\n47,199.29 6,434,489.68 \r\n \r\n7,868,192.85 \r\n \r\n12,702,081.85 \r\n \r\n(4) (3) \r\n \r\n$ 28,390,240.34 \r\n \r\n- 42 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \r\nYEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"7\" \r\n \r\nNotes to the Schedule of Expenditures of Federal Awards \r\n(1) Includes the Federally assigned value of donated commodities for the Food Donation Program in the amount of $960,986.54. \r\n(2) Expenditures for the funds earned on the School Breakfast Program ($2,766,456.54) were not maintained separately and are included in the 2015 National School Lunch Program. \r\n(3) Funds earned on the Impact Aid Program and P.L. 102-375, in the amounts of $1,387,227.26 and $573,909.83, respectively, do not require reporting of expenditures. \r\n(4) Expenditures for this program were supported by $329,247.23 in Federal assistance and the balance from State and/or Local Funds. \r\nMajor Programs are identified by an asterisk (*) in front of the CFDA number. \r\nThe School District did not provide Federal Assistance to any Subrecipient. \r\nThe accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Houston County Board of Education and is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 43 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"8\" \r\n \r\nAGENCY/FUNDING \r\nGRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program Classroom Technology Enhancement \r\nEducation, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle Grades (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Categorical Grants Pupil Transportation Regular Nursing Services Vocational Supervisors Education Equalization Funding Grant Food Services Vocational Education Amended Formula Adjustment Other State Programs Math and Science Supplements Preschool Handicapped Program Teacher of the Year Teachers' Retirement Technology for Connections to Classrooms Bonds \r\nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \r\nOffice of the State Treasurer Public School Employees' Retirement \r\nCONTRACT Human Services, Georgia Department of Family Connection \r\n \r\nGOVERNMENTAL FUND TYPES \r\n \r\nCAPITAL \r\n \r\nGENERAL \r\n \r\nPROJECTS \r\n \r\nFUND \r\n \r\nFUND \r\n \r\nTOTAL \r\n \r\n$ 3,680,116.58 1,500.00 \r\n \r\n$ 3,680,116.58 1,500.00 \r\n \r\n9,601,788.00 466,013.00 \r\n22,171,113.00 1,156,929.00 9,937,269.00 673,976.00 \r\n17,459,240.00 14,202,756.00 \r\n5,024,866.00 18,027,370.00 13,246,981.00 \r\n41,297.00 1,210,188.00 1,155,950.00 3,125,944.00 \r\n912,446.00 533,917.00 \r\n3,031,479.00 6,188,388.00 7,117,800.00 \r\n1,499,845.00 512,473.00 52,272.00 \r\n18,567,637.00 417,151.00 569,020.00 \r\n-12,206,194.00 \r\n145,014.84 373,228.00 \r\n5,580.25 76,645.26 106,822.63 \r\n \r\n9,601,788.00 466,013.00 \r\n22,171,113.00 1,156,929.00 9,937,269.00 673,976.00 \r\n17,459,240.00 14,202,756.00 \r\n5,024,866.00 18,027,370.00 13,246,981.00 \r\n41,297.00 1,210,188.00 1,155,950.00 3,125,944.00 \r\n912,446.00 533,917.00 \r\n3,031,479.00 6,188,388.00 7,117,800.00 \r\n1,499,845.00 512,473.00 52,272.00 \r\n18,567,637.00 417,151.00 569,020.00 \r\n-12,206,194.00 \r\n145,014.84 373,228.00 \r\n5,580.25 76,645.26 106,822.63 \r\n \r\n$ \r\n \r\n2,219,896.40 \r\n \r\n2,219,896.40 \r\n \r\n556,644.00 \r\n \r\n556,644.00 \r\n \r\n45,000.00 \r\n \r\n45,000.00 \r\n \r\nSee notes to the basic financial statements. \r\n \r\n$ 149,688,465.56 $ \r\n \r\n2,219,896.40 $ 151,908,361.96 \r\n \r\n- 44 - \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \r\nYEAR ENDED JUNE 30, 2015 \r\n \r\nSCHEDULE \"9\" \r\n \r\nPROJECT \r\n \r\nORIGINAL ESTIMATED \r\nCOST (1) \r\n \r\nCURRENT ESTIMATED COSTS (2) \r\n \r\nAMOUNT EXPENDED IN CURRENT YEAR (3) (4) (5) \r\n \r\nAMOUNT EXPENDED IN PRIOR YEARS (3) (4) (5) \r\n \r\nTOTAL COMPLETION \r\nCOST \r\n \r\nEXCESS PROCEEDS NOT \r\nEXPENDED \r\n \r\nESTIMATED COMPLETION \r\nDATE \r\n \r\n2012 SPLOST (1) Acquiring instructional and administrative \r\ntechnology equipment (2) Acquiring safety and security equipment (3) Adding to, renovating, repairing, improving, \r\nand equipping existing school buildings and other buildings and facilities (4) Acquiring, constructing, and equipping two \r\nreplacement elementary schools (5) Acquiring, constructing, and equipping a \r\ncentral transportation (bus) facility (6) Acquiring, constructing, and equipping \r\nstadium and tennis facilities (7) Acquiring any necessary property, both \r\nreal and personal (8) Paying (Legal and Administrative) expenses \r\nincident to accomplishing the foregoing \r\n \r\n$ 20,000,000.00 $ 1,918,481.33 $ 16,196,185.34 $ 18,114,666.67 \r\n \r\n1,830,051.00 \r\n \r\n1,505,050.21 \r\n \r\n1,505,050.21 \r\n \r\n43,679,546.00 7,957,408.23 29,349,615.33 37,307,023.56 \r\n \r\n26,508,184.00 \r\n \r\n-253,456.79 (5) 26,761,640.72 (5) 26,508,183.93 \r\n \r\n5,800,000.00 \r\n \r\n102,600.00 \r\n \r\n0.00 \r\n \r\n102,600.00 \r\n \r\n15,250,000.00 \r\n \r\n134,397.50 \r\n \r\n0.00 \r\n \r\n134,397.50 \r\n \r\n1,225,000.00 \r\n \r\n265,462.07 \r\n \r\n747,884.54 \r\n \r\n1,013,346.61 \r\n \r\n475,588.00 \r\n \r\n5,480.00 \r\n \r\n456,808.22 \r\n \r\n462,288.22 \r\n \r\nJune 30, 2017 June 30, 2017 \r\nJune 30, 2017 November 30, 2014 \r\nJune 30, 2017 June 30, 2017 June 30, 2017 June 30, 2017 \r\n \r\n$ 125,000,000.00 $ 114,768,369.00 $ 10,130,372.34 $ 75,017,184.36 $ 85,147,556.70 \r\n \r\n(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. \r\n \r\n(2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. \r\n \r\n(3) The voters of Houston County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects. \r\n \r\n(4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows: \r\n \r\nPrior Years \r\n \r\n$ 3,034,660.81 \r\n \r\nCurrent Year \r\n \r\n1,317,631.26 \r\n \r\nTotal \r\n \r\n$ 4,352,292.07 \r\n \r\n(5) Expenditures incurred in prior years were reimbursed to the School District by the Houston County Commissioners and the City of Perry in fiscal year 2015. \r\n \r\nSee notes to the basic financial statements. \r\n \r\n- 45 - \r\n \r\n (This page left intentionally blank) \r\n \r\n SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS \r\n \r\n (This page left intentionally blank) \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 16, 2016 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \r\nLadies and Gentlemen: \r\nWe have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Houston County Board of Education as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise Houston County Board of Education's basic financial statements and have issued our report thereon dated March 16, 2016. \r\nInternal Control Over Financial Reporting \r\nIn planning and performing our audit of the financial statements, we considered Houston County Board of Education's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Houston County Board of Education's internal control. Accordingly, we do not express an opinion on the effectiveness of the Houston County Board of Education's internal control. \r\nA deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. \r\n \r\n2015YB-10 \r\n \r\n (This page left intentionally blank) \r\n \r\n Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nCompliance and Other Matters \r\nAs part of obtaining reasonable assurance about whether Houston County Board of Education's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. \r\nPurpose of this Report \r\nThe purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, not to provide an opinion on the effectiveness of the Houston County Board of Education's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Houston County Board of Education's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nGSG:as 2015YB-10 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n (This page left intentionally blank) \r\n \r\n Greg S. Griffin \r\nSTATE AUDITOR \r\n(404) 656-2174 \r\n \r\nDEPARTMENT OF AUDITS AND ACCOUNTS \r\n270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 \r\nMarch 16, 2016 \r\n \r\nHonorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education \r\nand Superintendent and Members of the Houston County Board of Education \r\nINDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133 \r\nLadies and Gentlemen: \r\nReport on Compliance for Each Major Federal Program \r\nWe have audited Houston County Board of Education's compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. Houston County Board of Education's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs. \r\nManagement's Responsibility \r\nManagement is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs. \r\nAuditor's Responsibility \r\nOur responsibility is to express an opinion on compliance for each of Houston County Board of Education's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the Houston County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. \r\nWe believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of Houston County Board of Education's compliance. \r\n2015SA-10 \r\n \r\n (This page left intentionally blank) \r\n \r\n Opinion on Each Major Federal Program \r\nIn our opinion, the Houston County Board of Education complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. \r\nReport on Internal Control over Compliance \r\nManagement of Houston County Board of Education is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Houston County Board of Education's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Houston County Board of Education's internal control over compliance. \r\nA deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. \r\nOur consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. \r\nThe purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose. \r\nRespectfully submitted, \r\n \r\nGSG:as 2015SA-10 \r\n \r\nGreg S. Griffin State Auditor \r\n \r\n (This page left intentionally blank) \r\n \r\n SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \r\nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2015 \r\nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. \r\n \r\n (This page left intentionally blank) \r\n \r\n SECTION IV FINDINGS AND QUESTIONED COSTS \r\n \r\n (This page left intentionally blank) \r\n \r\n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS \r\nYEAR ENDED JUNE 30, 2015 \r\n \r\nI SUMMARY OF AUDITOR'S RESULTS \r\n \r\nFinancial Statements \r\n \r\nType of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information \r\n \r\nUnmodified \r\n \r\nInternal control over financial reporting:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nNoncompliance material to financial statements noted: \r\n \r\nNo \r\n \r\nFederal Awards \r\n \r\nInternal Control over major programs:  Material weakness identified?  Significant deficiency identified? \r\n \r\nNo None Reported \r\n \r\nType of auditor's report issued on compliance for major programs: All major programs \r\n \r\nUnmodified \r\n \r\nAny audit findings disclosed that are required to be reported in \r\n \r\naccordance with OMB Circular A-133, Section 510(a)? \r\n \r\nNo \r\n \r\nIdentification of major programs: \r\n \r\nCFDA Numbers \r\n \r\nName of Federal Program or Cluster \r\n \r\n10.553, 10.555 84.367 \r\n \r\nChild Nutrition Cluster Improving Teacher Quality State Grants \r\n \r\nDollar threshold used to distinguish between Type A and Type B programs: \r\n \r\n$917,418.74 \r\n \r\nAuditee qualified as low-risk auditee? \r\n \r\nYes \r\n \r\nII FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS \r\n \r\nNo matters were reported. \r\n \r\nIII FEDERAL AWARD FINDINGS AND QUESTIONED COSTS \r\n \r\nNo matters were reported. \r\n \r\n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1997-h98","title":"Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1998","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, Houston County, 32.45901, -83.66624"],"dcterms_creator":["Georgia. Department of Audits"],"dc_date":["1998-06-30"],"dcterms_description":["Began with: Fiscal year 2015; ceased with: Fiscal year 2020.","Report year covers fiscal year.","Chronology appears also as year ended June 30, 2015-year ended June 30, 2020.","Fiscal year 2015, released in 2016? (received 6/27/16 via FTP from Georgia Dept. of Audits and Accounts); title from PDF cover (Georgia Government Publications database, viewed April 11, 2023).","Fiscal year 2020, released in 2021? (Georgia Government Publications database, viewed April 11, 2023)."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Dept. of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Auditors' reports--Georgia","Financial statements--Georgia","Houston County (Ga.). Board of Education--Appropriations and expenditures"],"dcterms_title":["Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1998"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1997-h98"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1997-h98"],"dcterms_temporal":null,"dcterms_rights_holder":["\u0026copy; Georgia Department of Audits"],"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"AUDIT REPORT HOUSTON COUNTY BOARD OF EDUCATION \nPERRY, GEORGIA YEAR ENDED JUNE 30, 1998 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \n \nSECTION I \n \nFINANCIAL \n \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \n \nEXHIBITS \n \nGENERAL PURPOSE FINANCIAL STATEMENTS \n \nCOMBINED STATEMENTS - OVERVIEW \n \nA \n \nCOMBINED BALANCE SHEET \n \nALL FUND TYPES AND ACCOUNT GROUP \n \n2 \n \nB \n \nCOMBINED STATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES \n \nALL GOVERNMENTAL FUND TYPES \n \n4 \n \nC \n \nCOMBINED STATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES - BUDGET AND ACTUAL \n \n(NON-GAAP BASIS) \n \nGENERAL AND SPECIAL REVENUE FUNDS \n \n6 \n \nD NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \n7 \n \nADDmONAL FINANCIAL INFORMATION \n \nCOMBINING AND INDNIDUAL FUND STATEMENTS \n \nSPECIAL REVENUE FUND \n \nE \n \nCOMBINING BALANCE SHEET \n \n24 \n \nF \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n25 \n \nCAPITAL PROJECTS FUND \n \nG \n \nCOMBINING BALANCE SHEET \n \n26 \n \nH \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n28 \n \nDEBT SERVICE FUND \n \nI \n \nCOMBINING BALANCE SHEET \n \n30 \n \nJ \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n31 \n \nK \n \nFIDUCIARY FUND TYPE \n \nSTATEMENT OF CHANGES IN ASSETS AND LIABILITIES \n \nAGENCY FUND \n \n32 \n \nSCHEDULES \n \n1 SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION \n \n33 \n \n2 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \n \n34 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \n \nSECTION I \n \nFINANCIAL \n \nADDmONAL FINANCIAL INFORMATION \n \nSCHEDULES \n \n3 SCHEDULE OF STATE REVENUE \n \n36 \n \n4 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS \n \n37 \n \n5 SCHEDULE OF EXPENDITURES \n \nLOTTERY PROGRAMS \n \n38 \n \nANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS \n \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS \n \n6 \n \nOVERALL \n \n39 \n \n7 \n \nBY PROGRAM \n \n40 \n \nSECTIONll \nCOMPLIANCE AND INTERNAL CONTROL REPORTS \nREPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nREPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 \n \nSECTIONffi AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS \n \nSECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS \n \n SECTION I FINANCIAL \n \n RUSSELL W. HINTON \nSTATE AUDITOR (404) 658-2174 \n \n254 Washington Street, S.W.. Suite 214 Atlanta, Georgia 30334-8400 \nMay 6, 1999 \n \nHonorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education \nand Superintendent and Members of the Houston County Board of Education \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATIONSCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \nLadies and Gentlemen: \nWe have audited the accompanying general purpose financial statements of the Houston County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose financial statements are the responsibility of the Houston County Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. \nWe conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in 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 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. \nAs described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: \n* The general purpose financial statements of the Board did not contain a General Fixed Assets \nAccount Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. \n \n98ARL-13B \n \n  The Board did not report compensated absences within the general purpose financial statements as required by generally accepted accounting principles. \n School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. \n The Board did not recognize as expenditures, in the year ended June 30, 1998, a portion of salaries and the corresponding employer's cost ofrelated benefits eamed for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department ofEducation for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were improperly recorded in the year ended June 30, 1998. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed. \n The Board has received $16,684,090.89 in local option sales tax collections for which revenue recognition has been deferred to future periods by the Board. Ifthese amounts had been recorded as revenue as required by generally accepted accounting principles, the Board's fund balance would have increased by a like amount. \nThe aggregate effects on the general purpose financial statements ofthese variances or omissions have not been determined, but are believed to be material. \nIn our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements referred to above present fairly, in all material respects, the financial position ofthe Houston County Board of Education as ofJune 30, 1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. \nIn accordance with Government Auditing Standards, we have also issued our report dated May 6, 1999, on our consideration of the Houston County Board of Education's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. \nThe year 2000 supplementary information on Schedule \"1\" is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally ofinquiries of management regarding the methods of measurement and presentation ofthe supplementary information. However we did not audit the information and do not express an opinion on it. In addition, we do not provide assurance that Houston County Board of Education is or will become year 2000 compliant, that the Board's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Houston County Board of Education does business are or will become year 2000 compliant. \nOur audit was performed for the purpose of forming an opinion on the general purpose financial statements ofthe Houston County Board of Education taken as a whole. The accompanying combining and individual \n98ARL-13B \n \n fund statements (Exhibits E through K) and the financial schedules (Schedules 2 through 7), which includes the Schedule of Expenditures of Federal Awards as required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are presented for purposes of additional analysis and are not a required part of the general purpose financial statements. Such \ninformation bas been subjected to the auditing procedures applied in the audit ofthe general purpose financial statements and in our opinion, except for the effects of the matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements \ntaken as a whole. \nA copy of this report bas been filed as a permanent record in the office of the State Auditor and made \navailable to the press ofthe State, as provided for by Official Code of Georgia Annotated Section 50-6-24. \nRespectfully submitted, \n~w.4i-~ \nRussell W. Hinton State Auditor \nRWH:jb 98ARL-13B \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \n HOUSTON COUNTY BOARD OF EDUCATION \nCOMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP \nJUNE 30 1998 \n \ncash and Cash Equivalents Investments \nInvastmants Hald by Trustae Accounts Receivable Inventories \nConsumable SupplJas Food \nDonatacl Comm_ Purchasad Food Amount Availablaln Dab! Sarvioa Fund Amount to be Providad in Future Y88JS Fer Paymant of: \nBondDabl Copilal Lao.. Agreamonts Trust cartificates \n \nGENERAL FUND \n$ 3,458,770.39 21,124,831.39 \n879,095.28 \n474,556.91 \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \n1,499,227.85 \n \n214,767.19 24,935,309.64 \n \n588,621.57 \n \n934,157.53 \n \n222,424.22 75,570.15 \n \n$ 25937053.95 $ 2,385843.79 $ 26084234.36 \n \nLIABILITIES AND FUND EQUITY \nLIABILITIES \nAccounts Payable Salaries Payable Claims Payable \nContJacls Payable Retainages Payable Deferred Revenue \nFiscal Year 1998 FlsceJ Yea, 1999 FlsceJ Yea, 2000 Deferred Compensation Plan capital Lea.. Agreements General Obligation Bonds Payable IntergovemmenJaI ContracIs Trust cartificates \nTotal Uabllities \nFUND EQUITY \nFund Balances Reserved For Bus Replacement Funds For Continuation of Federal Programs For Debt SarvJoa For Inventories Consumable Supplies Food Donatacl Commoditias Purchased Food For Purpose of Bond Issue For Purpose of Trust Certificates For State CapiJaI Outley Projects Unreserved Designated for Self-Insurance Undesignated \nTotal Fund Equity \n \n19,983.67 $ 40,213.00 \n348,854.14 \n \n211,034.95 905,088.50 \n \n10,832,300.65 6,051,790.24 \n \n15,694.00 1,139,903.23 \n \n$ 17093121.70 $ 1116123.45 $ 1155597.23 \n \n$ \n \n182.86 \n \n474,558.91 \n1,218,722.49 7150652.85 8843932.25 \n \n222,424.22 75,570.15 $ 24,578,928.21 \n143,830.74 \n \n971563.11 1289720.34 \n \n205880.18 24928637.13 \n \nTotal Liabilities and Fund Equity The notes to the general purpose financial statements are an integral part of this statement \n-2- \n \n25937053.95 $ 2385843.79 $ 28 084 234.36 \n \n EXHIBIT \"A\" \n \nOEBT SERVICE \nFUND \n \nFIDUCIARY FUND TYPES AGENCY FUND \n \n$ 1,393,323.76 4,922,338.n \n2,281,706.13 \n \n6,843,271.75 \n \nACCOUNT GROUP GENERAL \nLONGTERM DEBT \n8,597,368.66 \n \nTOTALS (Memorandum Only) \nJUNE 30 1998 JUNE30 1997 \n \n6,566,089.19 $ 50,982,279.80 6,843,271.75 4,683,580.49 \n \n8,234,038.38 84,941,381.39 \n6,518,589.75 1,223,691.26 \n \n474,558.91 \n \n435,844.02 \n \n222,424.22 75,570.15 8,597,368.66 \n \n192,101.07 65,001.31 2,221,n8.62 \n \n32,469,980.42 1,814,987.38 \n11 842650.92 \n \n32,469,980.42 1,814,987.38 11842650.92 \n \n40,711,604.24 2,530,805.47 11 701 617.14 \n \n8597368.66 $ 6843,271.75 \n \n84 724 987.38 $ 124 572 759.89 $ 126 n6 452.65 \n \n6,843,271.75 \n \n1,814,987.38 41,045,000.00 11 865 000.00 \n \n6843271.75 $ 84 724 987.38 \n \n246,692.62 945,301.50 348,854.14 \n1,139,903.23 \n10,632,300.85 6,051,790.24 6,843,271.75 1,814,987.38 41,045,000.00 11 865 000.00 \n80933101.51 \n \n200,526.03 720,302.65 306,479.41 357,996.14 44,756.43 \n11,437,001.11 5,517,215.10 \n6,518,589.75 2,530,805.47 42,580,000.00 12 055 000.00 \n82 268 672.09 \n \n8,597,368.66 \n0.00 8597368.66 \n \n162.86 8,597,368.66 \n474,558.91 \n222,424.22 75,570.15 \n24,578,926.21 \n143,830.74 \n1,218,722.49 8328096.14 \n43 639 658.38 \n \n85,485.49 \n2,221,778.62 \n435,844.02 \n192,101.07 65,001.31 32,818,842.60 53,923.95 522,310.n \n1,373,843.28 6738849.45 \n44 507 780.56 \n \n8597368.66 $ 6843271.75 $ 84 724,987.38 $ 124572 759.89 $ 126,n6452.65 \n \n3 \n \n HOUSTON COUNJY BOARD OF EDUCATION \nCOMBINED STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES \nALL GOVERNMENTAL FUND TYPES \nYEAR ENDED JUNE 30 1998 \n \n~ \nSlate Funds Federal Funds Taxes Other Funds \nTotal Revenues \nEXPENDITURES \nCurrent Instruction Support Services Pupil Services Improvement of Instructionel Services Educational Media Services General Administration School Administration Business Administration Meintenance end Operation of Plant Student Transportation Services central Support Services Other Support Services Food Services Operation Community Services Operations \nCap~alOutiay \nDebt Service Principel Interest Paying Agent Fees \nTotal Expend~ures \nExcess of Revenues over (under) Expend~ures \nOTHER FINANCING SOURCES IUSES) \nAccrued Interest on Bonds Sold Prooeeds from General Obligation Bonds \nPar Value Premium on Bonds Sold Capital Leases Operating Transfers In Operating Transfers Out \nTolal Other Financing Sources (Uses) \nExcess of Revenues and Other Financing Sources over (under) Expend~ures and Other Financing Uses \nFUND BALANCE JULY 1 \nFood Inventory - Net Change in Period Donated Commodities Purchased Food \nSupplies Inventory - Net Change In Period \nFUND BALANCE JUNE 30 \nThe notes to the general purpose financial statements are an integral part of this statement. \n-4- \n \nGENERAL FUND \n \nSPECIAL REVENUE \nFUND \n \n$ 68,769,033.59 1,093,642.27 \n30,795,852.52 3,495,943.29 \n \n3,114,901.57 7,079,174.42 \n2,810,212.68 \n \n$ 104,155,471.67 $ 13,004,288.67 \n \n$ 67,160,935,31 $ \n4,754,178.34 4,801,087.13 2,764,308.43 \n325,164.62 6,429,916.93 \n850,890.80 8,693,860.38 2,341,695.04 1,378,674,63 \n449,405.14 4,523.91 \n500,128.66 \n \n5,236,906.78 \n359,360.71 255,245,n \n199.99 151,283.55 \n2,216.54 \n11,500.00 37,155,73 \n172,832.64 7,037,065.98 \n \n442,m.91 72,564.53 \n \n47,683.41 1,866.91 \n \n$ 100,970,110.76 $ 3,185,360.91 $ \n \n13,313,318.01 -309,029.34 \n \n$ \n \n82,173.00 \n \n1,n6,668,64 \n \n$ -1,694,513.64 \n \n$ 1,490,84727 $ \n \n-309,029,34 \n \n7,314,372,09 \n \n1,537,857.69 \n \n38,712.89 \n \n30,323.15 10,568.84 \n \n$ 8,843,93225 $ 1,269 720.34 \n \n EXHIBIT\"B\" \n \nCAPITAL PROJECTS \nFUND \n \nDEBT SERVICE \nFUND \n \nTOTALS (MemQrandum Only) \nYEAR ENDED JUNE 30, 1998 JUNE 30, 1997 \n \n$ 4,875,167,74 \n \n$ 76,759,102,90 \n \n8,172,816.69 \n \n$ 10,988,796.59 \n \n41,763,649,11 \n \n1,795,301.81 \n \n144,397.97 \n \n8,245,855,75 \n \n$ 6.670,469,55 $ 11,111,194,56 $ 134.941 .424,45 \n \n66,880,399.23 7,058,854.55 \n31,314,061,34 7.239.971,35 \n112.493,286,47 \n \n$ 16,048,127.17 307,529.n $ 57,716.50 \n16.413.373,44 $ $ -9,742,903,89 $ \n \n$ 72,397,642.09 $ 86,719,512,64 \n \n5,113,539.05 5,056,332.90 2,764,506.42 \n476,448.17 6,432,133.47 \n850,890.80 8,705,360.38 2,378,851.n 1,378,674.63 \n622,237.78 7,041,589.89 \n500,128.68 16,048,127,17 \n \n4,649,510,05 4,264,474,68 2,716,647.50 \n503,213.71 6,025,324.05 1,620,506.68 7,864,495.71 2,374,482,84 1,357,695,41 \n899,273,82 5,714,721,83 \n3,248,472.52 \n \n1,725,000,00 3,548,221,67 \n3,300,83 \n \n2,522,991,09 3,678,369.61 \n3,300,63 \n \n1,562,399,72 1,239,046,26 \n9,179,48 \n \n5.274,522.30 $ 135,971.324,51 110,788,936,88 \n \n5,836,672.26 $ -1,029.900,06 \n \n1.704.349.59 \n \n$ 1,256,686.64 $ -18.917,78 \n$ 1.237,768,86 $ \n \n$ \n \n206,964.73 \n \n$ 538,917.78 \n \n82,173.00 1,795,604,42 -1.795.604,42 \n \n33,950,000.00 3,171.65 \n648,643.51 -648.643.51 \n \n538,917,78 $ \n \n82.173,00 $ 34,160,136.38 \n \n$ -8,505,135,03 33,433,n2,16 \n \n6,375,590.04 $ -947,727,06 $ 35,864,485.97 \n \n2,221,n8.62 \n \n44,507,780,56 \n \n8,582,902,64 \n \n30,323,15 10,568,84 38,712,89 \n \n-24,561,49 -15,800,51 100,753,75 \n \n$ 24928837.13 $ 8597386,66 $ 43,639,658.38 \n \n44.507,780,56 \n \n-5- \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF RE\\fENUES EXPENDITURES AND CHANGES IN FUND BALANCES \nBUDGET AND ACTUAL - INON-GMP BASIS\u003e GENERAL AND SPECIAL RE\\fENUE FUNDS \nYEAR ENDED JUNE 30 1998 \n \nEXHIBIT\"C\" \n \n~ \nState Funds FedeT1lI Funds Taxes Other Funds \nTotal Revenues \nEXPENDmJRES \nCulT1lnt Instruction Support 5ervloes Pupil 5ervloes Improvement of Instructional 5ervlces Educational Media 5ervloes General Administration School Admlnlstretlon Business Administration Maintenance and Operation of Plant Student Transportatll;m Services \nce_1 Support Services \nOther Support 5ervloes Food Services Operation Community services Operations Debt5ervlce \nTotal Expenditures \nExcess of Revenues over (under) Expenditures \nOTHER FINANCING SOURCES rUSES) \nOther Sources Other Uses \nTotal Other Finsnclng Sources (Uses) \nExcess of Revenues and Other Financing Sources over (under) Expenditures end Other Financing lJses \nFUND BALANCE JULY 1 1997 \n \nGENERAL FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \n67,665.407.84 1,035.000.00 28,944,125.00 2.191,331.00 \n99,835.683.84 \n \n68.789,033.59 1.093,842.27 \n30.528,727.20 3.495,843.29 \n103,885.346.35 \n \n68.266.728.36 $ 67,160,935.31 \n \n4.693,507.00 4.743,596.96 2.846,252.00 \n323,908.90 6,424,344.39 \n924,194.00 8.589,546.00 2.760,381.80 1,891,B70.00 \n392.127.09 3,200.00 \n654.196.00 \n \n4.754.176.34 4.601.067.13 2.784.308.43 \n325.164.62 6.429.916.93 \n650,890.80 8.693,880.38 2.341,696.04 1,376,674.83 \n449,405.14 4,523.91 \n500.126.66 515.342.44 \n \n102,533.648.50 10D.970.110.76 \n \n-2.697.784.88 \n \n2,915.235.59 \n \n14,122,125.60 -14,110,746.60 \n11,377.00 \n \n12,424,112.08 -14,116.625.70 \n-1.694.513.84 \n \n-2,686,407.66 $ 24,074,753.55 \n \n1.220,721.95 23.632,744.28 \n \nFUND BALANCE JUNE 30 1996 \n \n$ 21.388.345.69 $ 25.053,486.23 \n \nSPECIAL RE\\fENUE FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \n3,155.739.32 7,B19.083.56 \n2,791.424.00 \n$ 13.568.246.66 \n \n3,114,901.57 7,079,174.42 \n2,810.212.68 \n13.004,288.67 \n \n5.515,140.68 \n \n5,236,908.78 \n \n404,092.00 383.625.78 \n1.155.00 152.601.51 \n2,11B.00 \n \n359,360.71 255.246.77 \n199.99 151.263.55 \n2,216.54 \n \n11,500.00 69.005.00 \n \n11.500.00 37,155.73 \n \n186.683.00 6,649,168.00 \n \n172,632.84 7.037,085.98 \n \n49,550.32 \n \n13.375,484.97 13,313,316.01 \n \n190.761.91 $ -309.029.34 \n \n614,148.00 $ 671.668.46 \n \n-671 ,868.00 \n \n-671.668.48 \n \n$ \n \n~7.720.00 \n \n0.00 \n \n$ 133,081.91 1.403,655.39 \n \n-309,029.34 1,280,755.31 \n \n1,536.917.30 $ 971,725.97 \n \nThe notes to the general purpose financial statements are an integral part of this statement -B- \n \n HOUSTON COUNTY BOARD OF EDUCAnON \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nREPORTING ENTITY \nThe Houston County Board of Education (Board) was established under the laws ofthe State of Georgia and operates under the guidance of a school board elected by the voters and a Superintendent appointed by the Board. The Board is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the Board is a primary government and consists ofall the organizations that compose its legal entity. \nFUND ACCOUNTING \nThe Board uses funds and an account group to report on its financial position and the results ofits 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. \nGeneral Fixed Assets 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 Board. To confonn 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. \nAlthough \"school activity accounts\" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To confonn to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements. \nThe general purpose financial statements account for all State, Federal, Taxes and Other funds under control of the Board, 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: \nGOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include: \nGENERAL FUND - the fund used to account for all financial resources ofthe Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education. \n \n-7- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIllBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30. 1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nSPECIAL REVENUE FUND - the fund used to account for the proceeds ofspecific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are received primarily from the Georgia Department of Edueation and from the Federal government to accomplish specific educational objectives. \nCAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. \nDEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees. \nFIDUCIARY FUND TYPE - the funds used to account for assets held by a govermnent unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes: \nAGENCY FUND - the fund used to account for assets held in a fiduciary capacity for other funds, govermnents' or individuals. \nACCOUNT GROUP \nGENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding and material capital lease obligations. \nBASIS OF ACCOUNTING \nThe 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 generally are 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. \nLiabilities 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. \nAgency funds are purely custodial in nature and do not involve measurement of results of operations. \nGovermnental funds are accounted for using the modified accrual basis ofaccounting under which: \n \n- 8- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nRevenues are recognizee! when susceptible to accrual (i.e., when they become both measurable and available). \"Measurable\" means the amount ofthe transaction can be detennined 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 property taxes, local option sales taxes, intergovernmental grants and investment income. \nA departure from the above definitions is the accounting treatment afforded the local option sales taxes. Georgia Laws 1982, House Resolution Nos. 699 and 700, proposed to amend the Constitution of the State ofGeorgia so as to provide for a local sales and use tax for the Houston County Board ofEducation whereby this tax would limit the amount ofad valorem taxes to be imposed, levied and collected for use by the Board. These resolutions were subsequently approved by the voters of Houston County in the General Election held November 2, 1982. Section I, Part 2B, of House Resolution 700 states: \n\"The maximum allowable mill rate for each government in each year shall be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the local government in the immediately preceding year from any local sales and use tax.\" \nThe Board's legal counsel has advised that the effect of this legislation places the sales tax collected in trust with the Board of Education for use in the following year upon the reduction of the mill rate. Accordingly, the Board has elected to record the amount of sales tax received for use in a subsequent period as a liability (unearned revenue) rather that as revenue. To conform to generally accepted accounting principles, the sales tax collections should be recorded as revenue when measurable and available. \nExpenditures are generally recognized when the related fund liability is incurred. \nA departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1998, a substantial number of personnel ofthe Board were employed for a one hundred and ninety day period beginning in late August 1997 and ending in early June 1998. Personnel contracts for this employment period specifY that compensation be paid in twelve equal monthly payments beginning in September 1997 and ending in August 1998. State grants to fund the State's share ofthese contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As of June 30, 1998, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1998, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1998. Also, the State's portion of the compensation paid in July and August 1998 was received and recorded as revenue in the fiscal year subsequent to June 30, 1998. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1997, were recorded in the year \n \n-9- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXlDBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30,1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nended June 30, 1998. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed. \nAgency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities. \nRESTATEMENT OF PRIOR YEAR FUND BALANCE \nIn prior years, the activities for the Board's Family Connections Program was reported as a Special Revenue fund. This fund had a fund balance of $5,599.90 at June 30,1997. For fiscal year 1998, this fund has been reported as a part of the General Fund. The fund balance at July I, 1997 has been restated as appropriate. \nBUDGET \nThe Houston County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. \nThe budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting ofthe Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \nThe Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual . and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, \nthe following adjustments have been made to fund balance as reflected on Exhibit \"B\" of this report: \n \n- 10- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POUCIES \n \nFUND BALANCE JULY 1, 1997 \nA\u003cljustments Deferred - Sales Tax - July 1, 1997 Inventories - July 1, 1997 Food Donated Commodities Purchased Foods Supplies \nFund Balance July 1, 1997 (Budget Basis) \nExcess ofRevenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \nAdjustments Deferred - Sales Tax July 1, 1997 June 30,1998 \nFUND BALANCE JUNE 30, 1998 (Budget Basis) \nCASH AND CASH EQUIVALENTS \n \nGeneral Fund \n$ 7,314,372.09 \n \nSpecial Revenue \nFund \n$ 1,537,857.69 \n \n16,954,216.21 \n \n-435.844.02 $ 23,832,744.28 \n \n-192,101.07 -65,001.31 \n$ 1,280,755.31 \n \n1,490,847.27 \n \n-309,029.34 \n \n-16,954,216.21 16,684,090.89 \n$ 25 053 466 23 \n \n$ 97172597 \n \nCOMPOSmON OF DEPOSITS Cash and cash equivalents consist of deposits in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. \n \nINVESTMENTS \n \nCOMPOSmON OF INVESTMENTS Investments made by the Board in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year are reported at fair value. The Official Code of Georgia Annotated Section 36-83-4 authorizes the Board to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: \n \n(1) Obligations issued by the State of Georgia or by other states, \n \n(2) Obligations issued by the United States government, \n \n- 11  \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXlDBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30. 1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOlJNrING POLICIES \n \n(3) Obligations fully insured or guaranteed by the United States government or a United States government agency, \n \n(4) Obligations of any corporation of the United States government, \n \n(5) Prime banker's acceptances, \n \n(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services, \n \n(7) Repurchase agreements, and \n \n(8) Obligations of other political subdivisions ofthe State of Georgia. \n \nINVESTMENTS HELD BY TRUSTEE \n \nInvestments held by trustee consist of contributions from employees who have elected to participate in the Board's deferred compensation plan. See Note 9 - Deferred Compensation Plan \n \nRECEIVABLES \n \nReceivables consist ofgrant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \n \nPROPERTY TAXES \n \nThe Houston County Board ofCommissioners fixed the property tax levy for the 1997 tax year (calendar year) on October 7,1997 (levy date). Taxes were due on December 30,1997. The lien date for property taxes was January 1, 1997. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1998. The Houston County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance oftaxes collected to the Board. \n \nThe tax millage rate levied for the 1997 tax year (calendar year) for the Houston County Board of Education was as follows (a mill equals $1 per thousand dollars of assessed value): \n \nSchool Operations \n \n~mills \n \n- 12- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIllBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30,1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n \nSALES TAXES \n \nLocal Option Sales Tax revenue during the fiscal year amounted to $11,437,001.11 and was recorded in the General Fund. Local Option Sales Tax is to be used for the maintenance and operation of the Board. See Note 1- Basis of Accounting \n \nSpecial Purpose Local Option Sales Tax is to be used for debt service. Special Purpose Local Option Sales Tax revenue during the fiscal year amounted to $10,917,803.31 and was recorded in the Debt Service Fund. The State will tenninate collection ofthis tax once an additional $42,987,512.35 has been collected or on June 30, 2002 whichever occurs first. \n \nINVENTORIES \n \nFOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (weighted average). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute \"available spendable resources\" even though they are a component of net current assets. \n \nSUPPLY INVENTORIES \n \nInventories of consumable supplies and materials are recorded as purchases for resale (contra-revenue \n \naccount) at the time of purchase and are reported on the Combined Balance Sheet at cost (weighted average). \n \nThe supply inventories reported on the balance sheet are equally offset with a reservation of fund balance \n \nwhich indicates that they do not constitute \"available spendable resources\" even though they are a component \n \nof net current assets. \n \n. \n \nCOMPENSATED ABSENCES \n \nCompensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed inunaterial to the general purpose financial statements. \n \nHowever, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources is material to the general purpose financial statements and has not been recorded in the General Long-Term Debt Account Group as required by generally accepted accounting principles. \n \n- 13- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nGENERAL OBLIGATION BONDS \nThe Board issues general obligation bonds and trust certificates to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized in the financial statements dining the year bonds are issued. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds and trust certificates is recorded in the General Long-Term Debt Account Group. \nINTERFUND TRANSACTIONS \nThe Board has the following types of interfund transactions: \nReimbursements 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. \nOperating transfers are recorded for all interfund transactions other than reimbursements. \nMEMORANDUM ONLY - TOTAL COLUMNS \nTotal colunms on the general purpose financial statements are captioned \"Memorandum Only\" to indicate that they are presented only to facilitate financial analysis. Data in these colunms do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data . comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. Certain reclassifications have been made to the comparative data to conform to the current year classifications. \n. Note 2: DEPOSITS AND INVESTMENTS \nCOLLATERALIZATION OF DEPOSITS Official Code ofGeorgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance, or by collateral. The aggregate of the face value ofsuch surety bond and the market value ofsecurities pledged shall be equal to not less than 110 percent ofthe public funds being secured after the deduction ofthe amount ofdeposit 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. \nAcceptable security for deposits consists of anyone of or any combination of the following: \n \n- 14- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXlDBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 2: DEPOSITS AND INVESTMENTS \n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State ofGeorgia, \n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \n(4) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities of the State of Georgia, \n(5) Bonds ofany public authority created by the laws ofthe State of Georgia, providing that the statute that created the authority authorized the use ofthe bonds for this purpose, \n(6) Industrial revenue bonds and bonds ofdevelopment authorities created by the laws ofthe State of Georgia, and \n(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. \nCATEGORIZATION OF DEPOSITS At June 30,1998, the bank balances were $10,882,659.18. The amounts of the total bank balances are classified into three categories ofcredit risk: \nCategory 1 - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. \nCategory 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. \nCategory 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.) \nThe Board's deposits are classified by risk category at June 30, 1998, as follows: \n \n- 15- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 2: DEPOSITS AND INVESTMENTS \n \nRisk Category 1 2 3 Total \nCATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: \n \nBank Balance $ 1,562,712.34 \n9,319,946.84 0.00 \n$1088265918 \n \nCategory I - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. \nCategory 2 - Uninsured or unregistered, with sectnities held by the counterparty's trust department or agent in the Board's name. \nCategory 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. \n \nFunds invested in an investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. \n \nAt June 30, 1998, the carrying value ofthe Board's total investments was $57,733,653.65. The investments are classified as to risk categories as follows: \n \nType ofinvestment \nU. S. Government Repurchase Agreements \nTotal \nLocal Government Investment Pools \nUnclassified \n \nRisk CateKPri.. 2 \n \nCarrying \nAmount \n \nFair \nValue \n \n$ $ 24 935309 64 \n \n0.00 \n \n360,081.83 $ 360,081.83 $ 360,081.83 \n \n24935 309.64 24 935 309.64 \n \n$ 24 935 309 64 $ \n \n000 $ 369 OK! 83 $ 25,295,391.47 $ 25,295,391.47 \n \n25,594,990.43 25,594,990.43 \n \nDeferred Compensation Plan Pooled Investments \nTotal Investments \n \n6.843 271 75 6843.271 75 \n$ 57 733 653 65 $ 57 733 653 65 \n \nThe carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy ofthe State of Georgia, Office of Treasury and Fiscal Services for the Local Government \n \n- 16 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 2: DEPOSITS AND lNVESlMENTS \nInvestment Pool (Primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description ofthe Primary Liquidity Portfolio is as follows: \nThe Primary Liquidity Portfolio consists of Georgia Fund I, which is a combination local and state government investment pool, and Fund 6. Georgia Fund I is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund I operates in a manner consistent with Rule 2a-7 ofthe Investment Company Act of 1940 and is considered to be a 2a-7like pool. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety ofcapital, investment income, liquidity and diversification while maintaining principal ($1.00 per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on $1.00 per share. Pooled cash and cash equivalents and investments are reported at cost which approximates fair value. The pool does not issue any legally binding guarantees to support the value ofthe shares. Participation in the pool is voluntary and deposits consist offunds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating fundsof the State of Georgia's General Fund. \nInvestments in Georgia Fund I and Fund 6 are directed toward short-term instruments such as U. S. Treasury obligations, securities issued or guaranteed as to principal and interest by the U. S. Government or any of its agencies or instrumentalities, banker's acceptances and repurchase agreements. The weighted average maturity of Georgia Fund I may not exceed 60 days. Fund 6 maintains a duration of approximately one year. The weighted average maturity for Georgia Fund I on June 30, 1998 was 29 days. The average investment duration for Fund 6 on June 30, 1998 was .96 years. \nNote 3: NON-MONETARY TRANSACTIONS \nThe Board receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories \nNote 4: RISK MANAGEMENT \nThe Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster and unemployment compensation. \nThe Board has obtained commercial insurance for risk ofloss associated with assets, errors or omissions and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any ofthe past three years. \nThe Board has elected to self-insure for all losses related to torts. The Board has not experienced any losses related to this risk in the past three years. \n- 17 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIDBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30. 1998 \n \nNote 4: RISK MANAGEMENT \n \nThe Board has established a limited risk management program for workers' compensation claims. A premium is charged when needed by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Board accounts for claims with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess 0[$250,000.00 loss per occurrence, up to the statutory limit. \n \nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \n \nBeginning of Year Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEnd ofYear Liability \n \n1997 1998 \n \n$ 307,952.61 $ 131.802.48 $ 133,275.68 $ 306.479.41 $ 306.479.41 $ 247,818.62 $ 205,443.89 $ 348.854.14 \n \nThe Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the same fund that the employee's salary and benefits were paid, Claims are accounted for with expenditure and liability being reported when it is probable that a loss has occurred, and the amount ofthat loss can be reasonably estimated, \n \nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \n \nBeginning ofYear Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEnd ofYear Liability \n \n1997 1998 \n \n$ \n \n0.00 $ \n \n19,698.00 $ \n \n19698.00 $ \n \n0.00 \n \n$ \n \n0.00 $ \n \n15,116.00 $ \n \n15,116.00 $ \n \n0.00 \n \nThe Board has purchased surety bonds to provide additional insurance coverage as follows: \n \nPosition Covered \n \nSuperintendent All Employees (Blanket Bond) \n \n$ 50,000.00 $250,000.00 - $ 500,000.00 \n \n- 18 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 5: GENERAL LONG-TERM DEBT \n \nCAPITAL LEASES The Houston County Board ofEducation entered into an agreement on April 1, 1996, with the Georgia School Boards Association (GSBA), Incorporated for the lease of buses and portable classrooms. Under the terms of the lease agreement, the Board will make semi-annual payments through August 1,2002. The lease includes an annual renewal clause. \n \nThe Houston County Board of Education has entered into various lease agreements as lessee for buses, vehicles, a computer mainframe and portable buildings. Theses lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. \n \nGENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: \n \nPurpose \n \nInterest Rates \n \nAmount \n \nGeneral Government - Refunding - Series 1993 General Government - Series 1996 \n \n2.75% - 5.60% $ 8,040,000.00 \n \n4.00% - 7.50% \n \n33.005,000.00 \n \n$ 41 04500000 \n \nINTERGOVERNMENTAL CONTRACTS TRUST CERTIFICATES OUTSTANDING Intergovernmental Contracts Trust Certificates currently outstanding are as follows: \n \nPurpose \n \nInterest Rates \n \nAmount \n \nGeneral Government - Series 1994 \n \n4.40% - 6.00% $ 11.865.000.00 \n \nThe changes in General Long-Term Debt during the fiscal year ended June 30, 1998, were as follows: \n \nBalance July 1. 1997 Additions Deductions Balance June 30, 1998 \n \nCapital Leases \n \nGSBA \n \nOther \n \nIntergovernmental Conlnlct \nTrust Certificates \n \nGeneral Obligation \nBonds \n \nIotal \n \n2,281,391.34 $ 249,414.13 $ 12,055,000.00 $ 42,580,000.00 $ 57,165,805.47 \n \n82.173.00 \n \n82.173.00 \n \n570767.11 \n \n227223.98 \n \n190000.00 1535000.00 2522991.09 \n \n1 71962423 $ 194363 15 5]] 86590000 $ 4t 04599999 $ 54 724 987 38 \n \n- 19- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 5: GENERAL LONG-TERM DEBT \nAt June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as \nfollows: \n \nFiscal Vear Ended June 30 \n1999 2000 2001 2002 2003 20042008 2009-2013 2014 - 2016 \n \nCapital Leases \n \nQSBA \n \nOther \n \nInteJgovemmen1al GencraI \n \nContract \n \nObligation \n \nTrust Certificates Bonds \n \nTotal \nDebt \n \n$ 649,537.21 $ 586,030.55 248,258.76 248,258.76 194,365.50 \n \n67,888.79 $ 873,205.00 $ 3,800,356.15 $ 5,390,987.25 \n \n44,600.23 \n \n863,605.00 3,811,646.25 5,305,882.03 \n \n863,705.00 3,817,992.50 4,929,956.26 \n \n863,205.00 3,823,730.00 4,935,193.76 \n \n856,985.00 3,806,980.00 4,858,330.50 \n \n4,231,175.00 19,082,367.50 23,313,542.50 \n \n9,655,993.75 14,013,730.00 23,669,723.75 \n \n1 945 100.00 12 483 825.00 14428 915.00 \n \nTotal Principal and Interest $ 1,926,450.78 $ 112,489.02 $ 20 1S2 97375 $ 64 640 627 50 $ 86 832 541 05 \n \nDeduct: Imputed Interest \n \n215826.55 \n \n8125.87 \n \nNet Present Value of Future Minimum Lease Payments $ 171062423 $ 104 36315 \n \nNote 6: ON-BEHALF PAYMENTS \n \nThe Board has recognized revenues and expenditures in the amount ofSl,107,512.35 for health insurance and retirement contributions paid on the Board's behalfby the following State Agencies. \n \nGeorgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of $804,306.8I \n \nPaid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $88,504.54 \n \nOffice of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of$214,701.00 \n \nNote 7: SIGNIFICANT COMMITMENTS \n \nThe following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1998, together with funding available: \n- 20- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"0\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30.1998 \n \nNote 7: SIGNIFICANT COMMITMENTS \n \nUnearned Executed Contracts \n \nFunding Available From State \n \n95/96-676-009 96/96S-676-031 98/97S-676-038 Bonaire Elementary School Roof Centerville Elementary School Renovation Elberta Center Roof Houston County High School Addition Miller Elementary School Renovation Northside Middle School Roof Parkwood Elementary School Renovation Perry High School Roof Shirley Hills Elementary School Renovation Tucker Elementary School Renovation Tucker Elementary School Roof Warner Robins High School Roof Warner Robins Middle School Roof Westside Elementary School Renovation \n \n$ 3,410,391.44 647,481.87 \n4,251,672.84 205,752.00 \n1,817,221.00 160,627.00 343,615.78 \n1,003,149.20 176,467.00 \n1,048,349.41 310,897.00 \n1,637,251.80 960,096.66 17,374.84 304,939.00 176,467.00 458,371.13 \n \n$ 1,229,795.26 \n \n$1693012497 $ ) 22979526 \n \nThe amounts described in this note are not reflected in the general purpose financial statements. \n \nNote 8: CONTINGENT LIABILITIES \n \nAmounts 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 Board believes that such disallowances, if any, will be immaterial to its overall financial position. \n \nThe Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the general purpose financial statements. \n \nNote 9: DEFERRED COMPENSATION PLAN \n \nThe Board offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Board employees, permits them to defer a portion oftheir salary \n \n- 21 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXlDBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1998 \n \nNote 9: DEFERRED COMPENSATION PLAN \nuntil future years. Participation in the plan is optional. The deferred compensation is not available to employees until tennination, retirement, death or unforeseeable emergency. \nAll amounts ofcompensation deferred under the plan, all property and rights purchased with those amounts, \nand all income attributable to those amounts, property or rights are (until paid or made available to the \nemployee or other beneficiary) solely the property and rights ofthe Board subject only to the claims ofthe Board's general creditors. Participants' rights under the plan are equal to those of general creditors of the Board in an amount equal to the fair market value ofthe deferred account for each participant. \nIt is the opinion ofthe Board that the Board has no liability for losses under the plan but does have the duty \nof due care that would be required of an ordinary prudent investor. The Board believes it is unlikely that it \nwill use the assets to satisfy the claims of general creditors in the future. \nInvestments are managed by the plan's trustees, Hartford Life, Prudential Retirement Services, Incorporated and Variable Annuity Life Insurances. Under these plans, participants select from an investment option, or combination of investment options, determined by the Board. \nOn August 20, 1996, Federal laws governing Internal Revenue Code Section 457 plans were changed to require all assets and income of the plan to be held in trust for the exclusive benefit ofthe participants and their beneficiaries. The Board is required to comply with this requirement by January 1,1999. \nNote 10: ACCUMULATED EMPLOYEES' LEAVE \nEmployees retiring under either the Teachers Retirement System ofGeorgia or the Public School Employees Retirement System will be paid for unused leave up to the one hundred days maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Houston County Board of Education, contiguous with retirement, in order to qualify. \nEmployees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years ofemployment with the Board, contiguous to a voluntary termination. See Note 1 - Compensated Absences \nNote 11: HOUSTON COUNTY SCHOOL DISTRICT BUILDING AUTHORITY \nThe Houston County School District Building Authority was created by House Bi112038 during the 1994 session of the Georgia General Assembly. The purpose ofthe Authority is to acquire, construct, own and convey real property and personal property for the benefit of the Houston County Board of Education. The members or the Authority consist of the Chairman of the Houston County Board of Education, the Superintendent ofthe Houston County Board ofEducation and the Chairman ofthe Board of Commissioners of Houston County. \n \n- 22- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30. 1998 \n \nNote 11: HOUSTON COUNTY SCHOOL DISTRICT BUILDING AUTHORITY \n \nThe Houston County School District Building Authority is a component unit ofthe Houston County Board ofEducation and as such the Authority's financial activity has been blended with the Houston County Board ofEducation's general purpose financial statements. \n \nNote 12: RETIREMENT PLANS \n \nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \n \nTRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local- school SYStems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer defined benefit pension plan. TRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. The Teachers Retirement System of Georgia issues a separate stand alone financial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts. \n \nTRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees in accordance with State statute and as advised by their independent actuary. The required employer contribution rate is 11.81% and employer contributions for the current fiscal year and the preceding two fiscal years are as follows: \n \nFiscal Year \n \nPercentage Contributed \n \nRequired Contribution \n \n1998 1997 1996 \n \n100% 100% 100% \n \n$ 7,946,025.55 $ 7,316,177.12 $ 6,706,287.97 \n \n- 23- \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING BAlANCE SHEET SPECIAL REVENUE FUND JUNE3Q 1998 \n \nEXHIBIT\"E\" \n \n~ \ncash and Cash Equivalents \nAccounts Re\u003c:elvable \nInvanlorias Food Donatad Commodllles Purchased Food \n \nSCHOOL FOOD \nSERVICES FUND \n \nLOTTERY PROGRAMS \n \n$ 1,336,781.04 $ 300,079.22 \n \n43,679.54 \n \nFEDERAL PROGRAMS \n544,942.03 \n \nTOTALS JUNE 30, 1998 JUNE 30, 1997 \n \n1,636,860.26 \n \n1,855,560.35 \n \n588,621.57 \n \n434,036.71 \n \n222,424.22 75,570.15 \n \n222,424.22 75.570.15 \n \n192,101.07 65,001.31 \n \nTotal Assets \n \n$ 1,678,454.95 $ 300,079.22 $ 544,942.03 $ 2,523,476.20 $ 2,346,701.44 \n \nL1ABIL!T!ES AND FUND EQUITY \nLIABILITIES \nGash Overdraft Accounts Payable Salaries Payable \nTotal liabilities \nFUNPEOUITY \nFund Balances Reserved For Continuation of Federal Programs For Inventories Food Donated COmmod~les Purchased Food Unreserved Undeslgnaled \nTotal Fund Equity \n \n$ \n \n64,149.23 \n \n344,748.24 \n \n$ 408.897.47 \n \n222,424.22 75,570.15 \n971,563.11 $ \n1,269,557.48 $ \n \n62,411.52 237,867.70 300,079.22 \n$ \n0.00 0.00 $ \n \n137,632.41 64,474.20 322,672.56 \n544,779.17 \n \n137,632.41 211,034.95 905.088.50 \n1,253,755.86 $ \n \n37,559.18 160,227.19 611,057.36 \n808,843.75 \n \n162.86 $ \n \n182.86 \n \n222,424.22 75,570.15 \n \n0.00 \n \n971,563.11 \n \n162.86 $ 1,269,720.34 \n \n192,101.07 65,001.31 \n1,280,755.31 \n1,537,857.69 \n \nTotal Liabilities and Fund Equity \n \n1,878,454.95 $ 300,079.22 \n \n544,942.03 $ 2,523,476.20 $ 2,346,701.44 \n \nSee notes to the general purpose financial statements. \n \n-24- \n \n see notes to the general purpose financial statements. \n \n- 25- \n \n HOUSION COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30 1998 \n \nASSETS Cash and Cash EqUiValents Investments Accounts Receivable \nTotal Assets \nLIABILITIES AND FUND EQUITY LIABILITIES \ncash Overdraft Accounts Payable Contracts Payable Retainages Payable \nTotal Liabilities FUND EQUITY \nFund Balances Reserved For Purposes of Bond Issue For Purposes of Trust Certificates For State Capital Outlay Projects Unreserved Undesignated Total Fund Equity \nTotal Liabilities and Fund Equity \n \nREGULAR \n \nBOND PROCEEDS \n \nGEORGIA STATE FINANCING AND \nINVESTMENT \nCOMMISSION \n \n$ \n \n205,880.18 $ \n \n26,420.18 $ \n \n260,392.60 \n \n24,935,309.64 \n \n309,232.50 \n \n$ \n \n205,880.18 $ 24,961,729.82 $ \n \n569,625.10 \n \n$ \n \n10,682.00 $ \n \n5,012.00 \n \n372,121.61 \n \n545,536.10 \n \n$ \n \n382,803.61 $ \n \n550,548.10 \n \n$ 24,578,926.21 \n \n$ \n \n205,880.18 \n \n$ 0.00 \n \n$ \n \n205,880.18 $ 24,578,926.21 $ \n \n19,077.00 0.00 \n19,077.00 \n \n$ \n \n205.880.18 $ 24,961,729.82 $ \n \n569,625.10 \n \nSee notes to the general purpose financial statements. -26- \n \n EXHIBIT\"G\" \n \nTRUST CERTIFICATE \nFUND \n \n$ \n \n0,00 \n \n$ \n \nLOTTERY PROJECT \n \nTOTALS \n \nJUNE 30, 1998 \n \nJUNE 30,1997 \n \n$ \n \n492,692,96 $ \n \n648.225.56 \n \n24.935,309,64 \n \n32,902,808.53 \n \n624,925,03 \n \n934,157,53 \n \n292,450,64 \n \n$ \n \n0,00 $ \n \n624,925,03 $ 26,362,160,13 $ 33,843A84,73 \n \n$ \n \n277,925,77 $ \n \n277,925,77 \n \n15,694,00 $ \n \n6,960,00 \n \n357,996,14 \n \n222,245,52 \n \n1,139,903,23 \n \n44,756,43 \n \n$ \n \n500,171,29 $ 1A33,523,00 $ \n \n409,712,57 \n \n$ 24,578,926,21 $ 32,818,842,60 \n \n53,923,95 \n \n$ \n \n124,753,74 \n \n143.830,74 \n \n522,310,77 \n \n$ \n \n0,00 \n \n0,00 \n \n205,880.18 \n \n38,694.84 \n \n$ \n \n0.00 $ \n \n124,753.74 $ 24,928,637.13 $ 33,433,m.16 \n \n$ \n \n0.00 $ \n \n624,925.03 $ 26,362,160.13 $ 33,843,484.73 \n \n-27 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \nCOMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES \nCAPITAL PROJECTS FUND \nYEAR ENDED JUNE 30 1998 \n \nREGULAR \n \nBOND PROCEEDS \n \nGEORGIA STATE FINANCING AND \nINVESTMENT \nCOMMISSION \n \nREVENUES \n \nState Funds Other Funds \n \n$ 2,739,739.00 \n \n$ \n \n2,863.93 $ 1,792,053.17 \n \nTotal Revenues \n \n$ \n \n2,863.93 $ 1,792,053.17 $ 2,739,739.00 \n \nEXPENDITURES \n \nCurrent Support Services Business Administration \nCapital OuUay Salaries Employee Benefits Land and Land Improvements BUilding and BUilding Improvements \nDebt Service Principal Interest \n \n$ \n \n6,650.00 \n \n508.73 \n \n$ \n \n2,897.50 \n \n342.662.23 \n \n4.942,102.78 $ 8,462.552.05 \n \n307.529.77 57.716.50 \n \nTotal Expenditures Excess of Revenues over (under) Expenditures OTHER FINANCING SOURCES (USES\u003e \n \n$ \n \n715.067.23 $ 4,945.000.28 $ 8,462,552.05 \n \n$ -712.203.30 $ -3.152.947.11 $ -5,722,813.05 \n \nPremiums on Bonds Sold Proceeds from General Obligation Bonds \nPar Value Operating Transfers In Operating Transfers Out \n \n$ \n \n879,388.64 \n \n$ 5.464,267.28 \n \n$ -5,086,96928 \n \nTotal Other Financing Sources (Uses) \n \n$ \n \nExcess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ \n \nFUND BALANCE JULY 1 \n \n879.388.64 $ -5,086.969.28 $ 5.464.267.28 \n \n167,185.34 $ 38,694.64 \n \n-8,239.916.39 $ 32,818,842.60 \n \n-258.545.77 277,622.77 \n \nFUND BALANCE JUNE 30 \n \n$ \n \n205,880.18 $ 24,578,926.21 $ \n \n19,077.00 \n \nSee notes to the general purpose financial statements. \n \n-28- \n \n EXHIBIT\"H\" \n \nTRUST CERTIFICATE \nFUND \n \nLOTTERY PROJECT \n \nTOTALS \n \nYEAR ENDED \n \nJUNE 30, 1998 \n \nJUNE 30, 1997 \n \n$ 2,135,428.74 $ 4,875,167.74 $ \n \n352,539.00 \n \n$ \n \n364.71 \n \n1,795,301.81 \n \n1,246,765.32 \n \n$ \n \n364.71 $ 2,135,428.74 $ 6,670,469.55 $ 1,599,304,32 \n \n$ \n \n709,111.07 \n \n$ \n \n6,650.00 \n \n8,000.00 \n \n508.73 \n \n612.00 \n \n2,897.50 \n \n290,435.34 \n \n$ \n \n35,390.88 $ 2,255,363.00 \n \n16,038,070.94 \n \n2,695,538.87 \n \n307,529.77 57,716.50 \n \n$ \n \n35,390.88 $ 2,255,363.00 $ 16,413,373.44 $ 3,703,697.28 \n \n$ \n \n-35,006.17 $ -119,934.26 $ -9,742,903.89 $ -2,104,392.96 \n \n$ \n \n-18,917.78 \n \n$ \n \n-18,917.78 \n \n$ \n \n3,171.65 \n \n$ 6,343,655.92 -5,105,887.06 \n \n33,950,000.00 742,531.22 -983,327.29 \n \n$ 1,237,768.86 $ 33,712,375.58 \n \n$ \n \n-53,923.95 $ -119,934.26 $ -8,505,135.03 $ 31,607,982.62 \n \n53,923.95 \n \n244,688.00 \n \n33,433,772.16 \n \n1,825,789.54 \n \n$ \n \n0.00 $ \n \n124,753.74 $ 24,928,637.13 $ 33,433,772.16 \n \n-29- \n \n HOUSTON COUNTY BOARp OF EDUCATION COMBINING BALANCE SHEET PEBT SERVICE FUNp \nJUNE 30 1998 \n \nEXHIBIT\"'\" \n \nASSETS Cash and Cash Equivalents Investments Accounts Receivable \n \nPROPERTY TAXES \nFOR DEBT \n \nSPECIAL PURPOSE LOCAL OPTION SALES TAX \n \nTOTALS \n \nJUNE 30, 1998 \n \nJUNE 30, 1997 \n \n$ \n \n454,3n.22 $ \n \n938,946.54 $ 1,393,323.76 $ 2,188,373.54 \n \n1,897.90 \n \n4,920,440.87 \n \n4,922,338.n \n \n1,934.54 \n \n892.28 \n \n2,280,813.85 \n \n2,281,706.13 \n \n31,470.54 \n \nTotal Assets \n \n$ \n \n457,167.40 $ 8,140,201.26 $ 8,597,368.66 $ 2,221,n8.62 \n \nFUND EQUITY \nFund Balances Reserved For Debt Service Unreserved Undesignated \n \n$ \n \n457,167.40 $ 8,140,201.26 $ 8,597,368.66 $ 2,221,778.62 \n \n0.00 \n \n0.00 \n \n0.00 \n \n0.00 \n \nTotal Fund EqUity \n \n$ \n \n457,167.40 $ 8,140,201.26 $ 8,597,368.66 $ 2,221 ?78.62 \n \nSee notes to the general purpose financial statements. - 30- \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES \nPEBT SERVICE FUNp YEAR ENDED JUNE 30 1998 \n \nEXHIBIT\"J\" \n \nREVENUES \nTaxes Other Funds \nTotal Revenues \nEXPENDITURES \nDebt Service Principal Interest Paying Agent Fees \nTotal Expendttures \nExcess of Revenues over (under) Expendttures \nOTHER FINANCING SOURCES \nAccnJed Interest on Bonds Sold Operating Transfers In \nTotal Other Financing Sources \nExcess of Revenues and Other Financing Sources over (under) Expenditures \nFUND BALANCE JULY 1 \n \nPROPERTY TAXES \nFOR DEBT \n \nSPECIAL PURPOSE LOCAL OPTION SALES TAX \n \nTOTALS \n \nYEAR ENDED \n \nJUNE 30, 1998 \n \nJUNE 30, 1997 \n \n$ \n \n48,993,28 $ 10,917,803,31 $ 10,966,796,59 $ 1,527,005,15 \n \n35,969,48 \n \n108,428,49 \n \n144,397,97 \n \n73,693,85 \n \n$ \n \n64,962,76 $ 11,026,231,80 \n \n11,111,194,56 $ 1,600,699,00 \n \n$ \n \n190,000,00 $ \n \n2,196,321,02 \n \n2,170.74 \n \n$ 2,388,491.76 $ \n \n$ -2,303,529.00 $ \n \n1,535,000,00 $ 1,349,900,65 \n1,129.89 \n2,886,030.54 $ \n8,140,201.26 $ \n \n1,725,000,00 $ 3,546,221,67 \n3,300.63 \n5,274,522.30 $ \n5,836,672.26 $ \n \n745,000,00 1,165,020.00 \n9,179.46 \n1.919,199.46 \n-318,500.46 \n \n$ \n \n538,917,78 \n \n$ \n \n538,917.78 \n \n$ \n \n206,964.73 \n \n$ \n \n538,917.78 \n \n545,357.29 \n \n$ \n \n538,917.78 \n \n752,322.02 \n \n-1,764,611.22 $ 2221,778.62 \n \n8,140,201.26 $ 0.00 \n \n6,375.590.04 2,221,778,62 \n \n433,821.56 1,787.957.06 \n \nFUND BALANCE JUNE 30 \n \n$ \n \n457,167.40 $ 8,140,201.26 $ 8,597,388,88 $ 2,221,778.82 \n \nSee notes to the general purpose financial statements. \n \n-31- \n \n HOUSTON COUNTY BOARP OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES \nFIDUCIARY FUND TYPE - AGENCY FUND YEAR ENPED JUNE 30 1998 \n \nEXHIBIT \"I\u003c\" \n \nPEFERRED COMPENSATION PLAN \nASSETS Investments Held by Trustee \n \nBALANCE JULY 1, 1997 \n \nADDITIONS \n \nDEDUCTIONS \n \nBALANCE JUNE 30, 1998 \n \n$ 6,518,589.75 $ \n \n542,644.52 $ \n \n217,962.52 $ 6,843,271.75 \n \nLIABILITIES Deferred Compensation Plan \n \n$ 6,518,589.75 $ \n \n542,644.52 $ \n \n217,962.52 $ \n \n6,843,271.75 \n \nSee notes to the general purpose financial statements. \n \n- 32- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nSCHEDULE \"1\" \n \nSCHEDULE OF REOUIRED SUPPLEMENTARY INFORMATION \n \nYEAR 2000 DISCLOSURES \n \nYEAR ENDED JUNE 30. 1998 \n \nAt June 30, 1998, the Houston County Board ofEducation had no outstanding contractual commitments for the purpose ofmaking computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result ofshortcomings in many electronic data processing systems and other equipment that make operations beyond year 1999 troublesome. The year 2000 issue is of primary concern for the Board's instructional computer equipment, fmancial accounting, student information and emergency management systems. The following stages have been identified as necessary to implement a year 2000 compliant systems. \nAwareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 issue. \nAssessment Stage - The actual process of identifying all of its systems and individual components of the systems to check for compliance. \nRemediation Stage - When changes are made to systems and equipment. \nValidationffesting Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system. \nIt will be necessary for the Board to progress through all four of these stages for each computer and/or electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversely affected. As ofJune 30, 1998, the instructional computer equipment was determined to be at the Assessment Stage; and the financial accounting, student information and emergency management systems were determined to be at the Remediation Stage. \n \nSee notes to the general purpose financial statements. - 33- \n \n HOUSTON COUNTY BOARD OF EDUCATION \nSCHEDULE OF EXPENPITURES OF FEDERAL AWARPS \nYEAR ENDEP JUNE 30 1998 \n \nSCHEDULE \"2\" \n \nFUNDING AGENCY PROGRAMIGRANT \n \nCFDA NUMBER \n \nAgricuHure, U. S. Department of Pass-Through from Gaorgla Department of Education Food and Nutrition progrem Food Services School Breakfast progrem 1998 Grant National School Lunch Program 1998 Grant Food Distribution Program (1) Pass-Through from OffIce of School Readiness Food and Nutrition Program Child and MuH Care Food Program 1998 Contract \n \n10.553 10.555 10.550 \n10.558 \n \nTotal U. S. Department of AgricuHure \n \nEducation, U. S. Department of \n \nDirect \n \nImpact Aid \n \n1998 Grant Pass-Through from Georgia Department of Education \n \n\" 84.041 \n \nElementary and Secondary Education Act \n \nnlel \n \nGranls to Local Educational Agencies 1997 Grant 1997 Summer Program 1998 Grant \nTrtlell \n \n 84.010 84.010 84.010 \n \nEisenhower Professional Development \n \n1997 Grant \n \n84281 \n \n1998 Grant \n \n84281 \n \nTrtleVl \n \nInnovative Education Program Strategies \n \n1998 Grant \n \n84298 \n \nGoals 2000 \n \nStata and Local Education Systemic Improvement Granls \n \n1997 Grant \n \n84.276 \n \n1998 Grant \n \n84.276 \n \nIndividuals with Disabililies Education Act \n \nPart B - Spacial Education \n \nFlow Through \n \n1998 Grant \n \n84.027 \n \nPraschool \n \n1998 Grant \n \n84.173 \n \nSafe and Drug-Free Schools \n \n1998 Grant \n \n84.186 \n \nVocational Education - Basic Grants to States \n \nHigh School Program \n \nBasic Grant \n \n1998 Grant \n \n84.048 \n \nTech-Prep Education \n \n1998 Grant \n \n84.243 \n \nTotal U. S. Department of Education \n \nPASSTHROUGH \nENTITY 10 \nNUMBER \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \nN1A \n \n$ \n \n588,673.06 \n \n(2) \n \nN1A \n \n2,414,604.19 $ 6,603,053.87 (3) \n \nN1A \n \n434,012.11 \n \n434,012.11 \n \nN1A \n \n48.721.39 \n \n12l \n \n$ 3,486,010.75 $ 7,037,065.98 \n \n$ \n \n825,775.08 \n \n(5) \n \nN1A \n \n-4,704.36 $ \n \n-4,704.36 \n \nN1A \n \n17,870.47 \n \n17,870.47 \n \nN1A \n \n2,195,722.03 \n \n2,195,722.03 \n \nN1A \n \n9,742.61 \n \n9,742.61 \n \nN/A \n \n45,034.22 \n \n45,034.22 \n \nN1A \n \n91,636.00 \n \n91,636.00 (6) \n \nN1A \n \n55,857.65 \n \n55,867.65 \n \nN1A \n \n17,100.00 \n \n16,937.14 \n \nN1A \n \n786,709.99 \n \n785,709.99 \n \nN1A \n \n106,806.81 \n \n106,806.81 \n \nN1A \n \n115,210.48 \n \n115,210.48 (6) \n \nN1A \n \n152,177.n \n \n152,ln.n \n \nN1A \n \n5,000.00 \n \n5,000.00 \n \n$ 4,418,936.75 $ 3.593,000.81 \n \n-34- \n \n HOUSTON COUNJY BOARP OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS \nYEAR ENDED JUNE 30 1998 \n \nSCHEDULE \"2\" \n \nFUNDING AGENCY PROGRAMIGRANT \nOTHER FEPERAL ASSISTANCE \nDefense, U. S. Departmenl of Direct P. L. 102-484 Departmenl of Ihe Air Force RO.T.C. Program \n \nCFDA NUMBER \n \nPASSTHROUGH \nENTITY 10 \nNUMBER \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \n$ \n \n121,879.85 \n \n(5) \n \n145,987.34 \n \n(4) \n \n267,867.19 \n \nTotal Federal Financial Asslstanoe \n \n$ 8,172]816.69 $ 10,630,066.79 \n \nNlA=Not Available \n \nNotes to the Schedyle of Expendnures of Federal Awards \n \n(1) The amounts shown for Ihe Food Dislribution Program rapresents the Federally assigned value of nonmonetary \nassistance for donated commodities received andlor consumed by Ihe system dUring the cunent fiscal year. (2) Expendilures for Ihe Child and AduH Care Food Program and the School Breakfasl Program were not maintained \nseparately and are included in the 1998 National School Lunch Program. (3) Expendilures for this program include State, andlor Other Funds. \nExpendilures are nol maintained by fund source. (4) Expendilures on Ihis program were nol mainlsined by fund source. (5) Funds earned on Ihis program do not require reporting of expendHures. \n(6) Includes Federal Assistance of $1 ,719.28 provided to subreclpients. \n \nMajor Programs are identified by an asterisk (') in fronl of the CFDA number. \n \nThe aocompanying schedule of expendilures of Federal awards includes Federal granlactivHy of the Houston County Board of Education and is presented on Ihe modified accrual basis of aocounting which is Ihe same basis of aocounting used in the presentation of Ihe general purpose financial statements. \n \nSee notes to the general purpose financial statements. \n \n-35- \n \n HQUSTON CPUm BOARD OF EpUCATION \nSCHEDULE OF STATE REVENUE \nyEAR ENDED JUNE 30 1998 \n \nSCHEDULE \"3\" \n \nAGENCYlFUNDING \nGRANTS Education. Gecrgia Department 01 Quality Basic Education General and career Education Programs SpecIal Education Programs Remedial Educetion Program Media Center Programs Steff Development Programs Indirect COlI Pupil Tranapor1atioo Regular Bus Replecement Middle School IncentiVe Program SpeciaiinstructJOO8I Assistance l..school Suspensloo Mid-term Adjustment Migrant MId-term Adjustment Counselora Grades 4 end 5 Technology Training Local FaIr Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Ad Valorem Tax Adjusbnent Alternative Program Appranticeship Program AWUsk Summer School Program Environmental SCience Program Governor's Emergency Funds (1) Health Insurance Innovative Programs Mentotlng Program Mentor Teacher Program PSATExarns Preschool Handicapped Program Remedial Summer SChool Program Teachers' Retirement Lottery Programs Alternative School Program Exceptional Growth-Cepital Outiey InstIUctional Technology AssIstive Technology Classroom Technology \nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \nHuman Resources, Georgia Department of Family Connection Single Parent Grant \nomce of Planning and Budget Georgia Challenge Program Services \nOffice of School Readiness Pre-Kindergarten Program \nOffice of Treasury and Fiscal services Public School Employees Retirement \n(1) Gecrgie SChool of Excellence payments \n \nGOVERNMENTAL FUND lYPES \n \nSPECIAl. \n \nCAPITAL \n \nGENERAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nFUND \n \nTOTAL \n \n40,958,318.00 7,354,688.00 1.303,447.00 1,893.958.00 511,538.00 \n10,859.743.00 \n1,098,740.00 341.359.00 \n1,495,014.00 1,246.369.00 \n512,496.00 1,284.548.00 \n554.00 187.014.00 230,739.00 -6.732.973.00 4,291.023.00 \n69.388.00 \n460.365.00 152.840.00 110.000.00 \n50,657.23 3,497.60 4,000.00 \n604.306.61 5.000.00 \n10.160.66 34.958.00 \n809.32 242.324.00 \n19,968.04 58.504.54 \n \n466,006.00 \n4,132.00 23,503.00 525,101.00 \n \n$ 40.958.318.00 7.354.888.00 1,303.447.00 1,893,958.00 511,538.00 \n10,859.743.00 \n \n1,098.740.00 341,359.00 \n1,495,014.00 1,248,369.00 \n512,496.00 1,284,548.00 \n554.00 167,014.00 230,739.00 ...732,973.00 4,291,023.00 466,006.00 69,386.00 \n \n480,385.00 152,840.00 110,000.00 \n50,657.23 3.497.60 4,000.00 804,306.61 5,000.00 10,160.68 34,968.00 \n609.32 242,324.00 \n19,968.04 88.604.54 \n \n2.135.428.74 \n \n4,132.00 2,135,428.74 \n \n23,503.00 525,101.00 \n \n50,000.00 35,419.17 15.532.82 \n214,701.00 \n \n2.096.159.57 \n \n2.739.739.00 \n \n2,738,739.00 50,000.00 35,419.17 15,532.62 \n2.096.159.57 214701.00 \n \n68.769,033.59 \n \n3114901.57 $ 4875167.74 $ 76:759,102.90 \n \nSee notes to the general purpose financial statements. \n \n-36- \n \n HOUSTON COUNTY BOARD OF EPUCATION SCHEDULE OF APPROVEP LOCAL OPTION SALES TAX PROJECTS \nYEAR ENDED JUNE 30 1998 \n \nSCHEDULE \"4\" \n \n~ \n \nORIGINAL ESTIMATED \nCOST (1) \n \nCURRENT ESTIMATED \nCOST (2) \n \nProviding Iunds to finance repayment 01 \n \ngeneral obligation bond indebtedness 01 \n \nthe Houston County School District for \n \nHouston County School District General \n \nObligation Bond Series 1993 and 1996, by \n \npayment 01 principal and intarest as ~ \n \nbeoomes due or by payment of principal \n \nby scheduled maturity or optional and \n \nmandatory redemption prior to maturity \n \nfor bonds ooming due on March 1, 1998 \n \nthrough Saptember 1, 2016, In the \n \nmaximum amount of $53,905,315.66 \n \n$ \n \n5M05,315.66 $ \n \n53,905,315.66 \n \nAMOUNT EXPENDED IN CURRENT \nYEAR \n \nAMOUNT EXPENDED IN PRIOR \nYEARS \n \n2,866,030.54 $ \n \n0.00 \n \n(1) The Board's original oost estimate as specified In the resolution calling for the imposition of the Local Option Sales Tax. \n(2) The Board's Clment estimate of total oost for each project. Includes al! 0001 from project incaption to oompletion. \n \nSee notes to the general purpose financial statements. \n \n-37- \n \n HOUSTON COUNJY BOARD DE EDUCATION SCHEDULE DE EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30 1999 \n \nSCHEDULE \"S\" \n \nEXPENDITURES \nCunent lnslnJctlon SuPIlOIl Services Pupil S8JVices Improvement of InstructIonaI8ervices General AdminlstraUon Maintenance and Operation 01 Plant Student Transpor1ll1ion sarvioaa Other Support arvIoaa \nDabtSorvioa Principal Intarast \n \nALTERNATIVE SCHOOL PROGRAM \n \nINSTRUCTIONAL TECHNOLOGY \n \nASSISTIVE \n \nCLASSROOM \n \nTECHNOLOGY TECHNOLOGY \n \nPRE-KINDERGARTEN PROGRAM \n \n4,132.00 \n \n23,503.00 $ \n \n525,101.00 \n \n1,879,101.25 \n240,351.04 17,174.00 73,441.09 11,500.00 20,812.20 4,229.87 \n47,883.41 1888.91 \n \nTOTAL \n2,231,837.25 \n240,351,04 17,174,00 73,441,09 11,500.00 20,812.20 4,229.87 \n47,883.41 1,888.91 \n \nTotal Expandiluras \n \n4132.00 $ \n \n23.503.00 \n \n525.101.00 \n \n2096,159.57 \n \n2,648[895.57 \n \nRECAP: \nSalari.. and Banafils Pre-Klndargarian Program \nothar Expandiluras Allemattve SChool Program Instructional Technology Assistive Technology C1asaroom Tachnology PrH\u003ctndergarten Program \n \n1,948,827.23 \n4,132.00 \n23,503.00 525,101.00 149,332.34 \n \n2,648,895.57 \n \nSee notes to the general purpose financial statements. \n \n-38- \n \n HOUSTON COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL \nGENERAL FUND - QUALITY BASIC EDUCATION pROGRAMS YEAR ENDED JUNE 30 1998 \n \nSCHEDULE \"6\" \n \nMinimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis \nSalaries Operations \nLess: Expend~ures for Media Center Programs in Excess of Total Media Allotment \nExpend~ures per Aud~ \nAmount of Underexpenditure for Total Allotment \n \nFOURTEEN WEIGHTED AND MEDIA CENTER \nPROGRAMS \n \n100\".4\u003e TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS \n \n$ \n \n52,363,693.00 $ \n \n1,425,315.80 \n \n$ \n \n62,516,289.10 \n \n2,941\u003e,395.60 $ \n \n2,634,883.96 \n \n$ \n \n65,462,684.70 \n \n-1,011,260.34 \n \n$ \n \n64,451.424.36 \n \n$ \n \n0.00 $ \n \n0.00 \n \nSee notes to the general purpose financial statements. - 39 - \n \n HOUSTON COUNTY BOARD OF EDUCATION ANALYSIS Of MINIMUM EXPENDITURE REQUIREMENTS _BY PROGRAM \nGENERAL FUND QUALITY BASIC EDUCATION PROGRAMS \nYEAR ENDED JUNE 30 1998 \n \nGENERA!. AND CAREER EDUCATION PROGRAMS \nKindergarten (') \nGrad.. 13r) \nSUb-Total K-3 Grades4-5(') Grades 8  8 r) \nGrad.. 9-12(') \nHigh School Laboratories rl \nVocational Education Labonltories (') \nTotal General 8nd Career Education Programs SPECIAL EDUCATION PROGRAMS \nRegular Programs category I r) Category II (') Category III (') Category IV rl \nCategory V C') \nSuI\u003e-Total Regular \nCategory VI (Gifted) (') \nTotal Special Education Programs REMEDIAL EDUCATION PROGRAM rJ \nTotal fou_n Weighted Programs \nMEDIA CENTER PROGRAMS Salaries Operations \nTotal Madia center Programs \n \nTotal Fourteen Weighted and Madia canter Programs \n \nSTAfF DEVELOPMENT PROGRAMS \nCost of Instruction Professional Development \n \nTotal Staff Development Programs r) Identifies Fourteen Weighted Programs. See notes to the general purpose financial statements. \n \n- 40 - \n \nALLOTMENTS fROM DEPARTMENT OF EDUCATION \n \nREQUIRED \n \nORIGINAL --1L \n \nORIGINAL \n \nMID-TERM \n \n4,051,042.00 \n \n3,645,937.80 $ \n \n11,012,418.00 \n \n9,911,178.20 \n \n15,063,480.00 90 $ 13,557,114.00 \n \n4,975,630.00 90 \n \n4,478,067.00 \n \n9,176,259.00 90 \n \n8,258,633.10 \n \n5,979,411.00 90 \n \n5,381,469.90 \n \n3,732,164.00 90 \n \n3,358,947.80 \n \n2,031,394.00 90 \n \n1,828,254.60 \n \n40,958,318.00 \n \n36,862,486.20 \n \n-48,647.70 35,745.00 -12,902.70 7,837.70 25,965.80 79,490.20 72,044.00 74,954.00 179,762.00 \n \n8,027,927.00 \n \n5,425,134.30 $ \n \n506,399.00 \n \n6,027,927.00 90 1,326,759.00 90 7,354,686.00 1,303,447.00 90 49,616,451.00 \n \n5,425,134.30 1,194,083.10 6,619,217.40 $ 1,173,102.30 $ 44,654,605.90 $ \n \n506,399.00 204,092.00 710,491.00 142,382.00 1,032,635.00 \n \n1,382,929.00 311,029.00 \n1,693,958.00 \n \n90 90 \n$ \n \n1,244,636.10 $ 279,926.10 \n1,524,662.20 \n \n13,762.00 6,867.00 \n20,649.00 \n \n51,310,409.00 \n \n46.179.368.10 $ 1.053.284.00 \n \n148,431.00 363,107.00 \n \n148,431.00 363,107.00 \n \n611,536.00 100 $ \n \n511,536.00 \n \n4,405.00 0.00 \n4,405.00 \n \n SCHEDULE\"r \n \nTOTAL REQUIRED \n \nACTUAL EXPENDITURES \n \nSALARIES \n \nOPERATIONS \n \nTOTAL \n \nAMOUNT OF UNDEREXPENDITURE \nFOR REQUIRED ALLOTMENT \n \n$ 3,597,290.10 \n \n4,756,779.85 \n \n185,404.62 $ 4,942,184.47 \n \n9,946,921.20 \n \n10,958,972.79 \n \n570,510.39 \n \n11,529,483.18 \n \n13,544,211.30 $ 15,715,752.84 $ \n \n755,915.01 $ 16,471,667.65 $ \n \n0.00 \n \n4,470,229.30 \n \n6,552,531.32 \n \n382,824.02 \n \n6,935,355.34 \n \n0.00 \n \n8,232,847.30 \n \n12,967,668.39 \n \n658,687.90 \n \n13,626,356.29 \n \n0.00 \n \n5,480,960.10 \n \n6,714,499.43 \n \n339,432.15 \n \n7,053,931.58 \n \n0.00 \n \n3,430,991.60 \n \n4,407,334.39 \n \n109,488.27 \n \n4,516,802.66 \n \n0.00 \n \n1,903,208.60 \n \n2,400,503.36 \n \n184,074.30 \n \n2,584,577.66 \n \n0.00 \n \n37,042,248.20 \n \n48,758,289.53 \n \n2,430,401.65 $ 51,188,691.18 \n \n5,931,533.30 \n \n18,357.59 $ 1,296,135.86 5,262,537.56 \n756,413.96 173,796.16 \n \n4,812.96 $ 9,964.76 71,852.10 19,554.83 \n \n23,170.54 1,306,101.62 5,334,389.66 \n775,968.78 173,796.16 \n \n$ 5,931,533.30 $ 7,507,242.12 \n \n106,184.84 \n \n7,613,426.76 \n \n0.00 \n \n1,398,175.10 \n \n2,335,207.05 \n \n80,207.05 \n \n2,415,414.10 \n \n0.00 \n \n$ 7,329,708.40 \n \n9,842,449.17 \n \n186,391.69 \n \n10,028,840.86 \n \n$ 1,315,484.30 \n \n1,501,194.70 \n \n18,090.62 \n \n1,519,285.32 \n \n0.00 \n \n$ 45,687,440.90 \n \n60,101 ,933.40 $ 2,634,883.96 $ 62,736,817.36 \n \n1,258,398.10 \n \n2,414,355.70 \n \n2,414,355.70 \n \n0.00 \n \n286,813.10 \n \n311,511.84 \n \n311,511.84 \n \n0.00 \n \n1,545,211.20 $ 2,414,355.70 \n \n311,511.84 $ 2,725,867.34 \n \n47,232,552.10 \n \n62,516,289.10 $ 2,946,395.60 $ 6M82,684.70 $ \n \n0.00 \n \n152,636.00 363,107.00 \n5151943.00 \n \n$ \n \n389,293.17 \n \n126,649.63 \n \n389,293.17 126,649.83 \n \n515,943.00 \n \n515.943.00 \n \n0.00 \n \n- 41 - \n \n SECTIONll COMPUANCE AND IN1ERNAL CONTROL REPORTS \n \n RUSSELL W. HINTON \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.w.. Suite 214 Atlanta. Georgia 30334-8400 \nMay 6, 1999 \n \nHonorable Roy E. Barnes, Governor Members ofthe General Assembly Members of the State Board of Education \nand Superintendent and Members ofthe Houston County Board of Education \nREPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nLadies and Gentlemen: \nWe have audited the financial statements ofHouston County Board of Education as of and for the year ended June 30, 1998, and have issued our report thereon dated May 6, 1999. This report was qualified for various departures 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 the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. \nCompliance \nAs part of obtaining reasonable assurance about whether Houston County Board of Education's financial statements are free ofmaterial misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination offinancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. \nInternal Control Over Financial Reporting \nIn planning and performing our audit, we considered Houston County Board of Education's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. However, we noted a certain matter involving the internal control over financial reporting and its \n98YB-40 \n \n operation that we consider to be a reportable condition. Reportable conditions involve matters corning to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Houston County Board of Education's ability to record, process, summarize and report financial data consistent with assertions ofmanagement in the financial statements. The reportable condition is described in the accompanying Schedule ofFindings and Questioned Costs as item FS-6761-98-01. \nA material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the 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 over financial reporting would not necessarily disclose all matters in the internal control that might be reportable conditions and accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. However, the reportable condition described above is considered to be a material weakness. \nThis report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter of public record. \nRespectfully submitted, \n~W.~~ \nRussell W. Hinton State Auditor \nRWH:jb 98YB-40 \n \n RUSSELL W. IIJNTON \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nMay 6, 1999 \n \nHonorable Roy E. Barnes, Governor Members ofthe General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members of the Houston County Board ofEducation \nREPORT ON COMPLIANCE WITH REOUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULARA-133 \nLadies and Gentlemen: \nCompliance \nWe have audited the compliance of Houston County Board of Education with the types of compliance requirements described in the U.S. Office ofManagement and Budget (OME) Circular A-133 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 3D, 1998. Houston County Board of Education's major Federal programs are identified in the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major Federal programs is the responsibility of Houston County Board of Education's management. Our responsibility is to express an opinion on Houston County Board of Education's compliance based on our audit. \nWe conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States; and OMB Circular A-133, Audits ofStates, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major Federal program occurred. An audit includes examining, on a test basis, evidence about the Houston County Board of Education's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Houston County Board of Education's compliance with those requirements, \n \n98SA-IO \n \n In our opinion, the Houston County Board of Education complied, in all material respects, with the requirements referred to above that are applicable to each of its major Federal programs for the year ended June 30,1998. \nIntemal Control Over Compliance \nThe management of Houston County Board of Education is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to Federal programs. In planning and performing our audit, we considered Houston County Board ofEducation's intemal control over compliance with requirements that could have a direct and material effect on a major Federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-l33. \nOur consideration ofthe internal control over compliance would not necessarily disclose all matters in the intemal control that might be material weaknesses. A material weakness is a condition in which the design or operation ofone or more ofthe internal control components does not reduce to a relatively low level ofrisk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major Federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. \nThis report is intended for the information of management, the Federal cognizant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution ofthis report which is a matter ofpublic record. \nRespectfully submitted, \n\u003c,lA4* ./It ~.~ Russell W. Hinton State Auditor \nRWH:jb 98SA-10 \n \n SECTIONm AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS \n \n HOUSTON COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE \nSUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30, 1998 \n \nPRIOR YEAR FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS \n \nFINDING CONTROL NUMBER AND STATUS \n \n6761-93-02 FS-6761-97-01 \n \nFurther Action Not Warranted Umesolved-See Corrective Action/Responses \n \nCORRECTIVE ACTIONIRESPONSES \n \nGENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-6761-97-01 \n \nThe Board recognizes the need for this account group; however, we do not currently have the manpower\"or fiscal resources to implement and maintain a fixed asset program which will meet the requirements of the Department of Audits. \n \nPRIOR YEAR FEDERAL AWARD FINDINGS AND OUESTIONED COSTS \n \nFINDING CONTROL NUMBER AND STATUS \n \n6761-94-02 \n \nPreviously Reported Corrective Action Implemented \n \n SECTION IV FINDINGS AND QUESTIONED COSTS \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS \nYEAR ENDED JUNE 30. 1998 \nSUMMARY OF AUDITOR'S RESULTS \n1. Type of Report Issued on the Financial Statements The auditor's opinion on the Houston County Board ofEducation's financial statements was qualified for various departures from generally accepted accounting principles. \n2. Reportable Conditions in Internal Control Disclosed by the Audit of the Financial Statements The audit report for the Houston County Board of Education disclosed a financial statement reportable condition related to the following control category. \nGeneral Fixed Assets \nThe reportable condition described above is considered to be a material weakness. \n3. Noncompliance Material to the Financial Statements The audit of the Houston County Board of Education disclosed no instances of noncompliance that were deemed to be material to the financial statements. \n4.. Reportable Conditions in Internal Control Over Major Programs The audit report for the Houston County Board of Education did not disclose any reportable conditions in internal control over major programs. \n5. Type of Report Issued on Compliance for Major Programs The auditor's opinion on the Houston County Board of Education's-report on compliance with requirements applicable to major programs was unqualified. \n6. Audit Findings Required to be Reported by Section .510(a) ofOMB Circular A-B3 The Houston County Board ofEducation's audit did not disclose audit findings required to be reported by section .51O(a) ofOMB Circular A-B3. \n7. Maior Programs Federal awards audited as major programs are as follows: 84.010 Elementary and Secondary Education Act - Title I, Grants to Local Educational Agencies 84.041 Impact Aid \n8. Type \"A\" Program Dollar Threshold The dollar threshold for type \"A\" programs was $329,939.00. \n9. Low Risk Auditee The Houston County Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education. \n-I- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nSCHEDULE OF FINDINGS AND OUESTIONED COSTS \n \n. \n \nYEAR ENDED JUNE 30. 1998 \n \nn FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS \nGENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated from Prior Year Finding Control Number. FS-6761-98-0l \nThe Houston County Board of Education did not maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance ofa General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. \nill FEDERAL AWARD FINDINGS AND OUESTIONED COSTS \nNo matters were reported. \n \n-2- \n \n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1996-h97","title":"Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1997","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. 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Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1996-h97"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1996-h97"],"dcterms_temporal":null,"dcterms_rights_holder":["\u0026copy; Georgia Department of Audits"],"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":null},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1995-h96","title":"Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1996","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, Houston County, 32.45901, -83.66624"],"dcterms_creator":["Georgia. Department of Audits"],"dc_date":["1996-06-30"],"dcterms_description":["Began with: Fiscal year 2015; ceased with: Fiscal year 2020.","Report year covers fiscal year.","Chronology appears also as year ended June 30, 2015-year ended June 30, 2020.","Fiscal year 2015, released in 2016? (received 6/27/16 via FTP from Georgia Dept. of Audits and Accounts); title from PDF cover (Georgia Government Publications database, viewed April 11, 2023).","Fiscal year 2020, released in 2021? (Georgia Government Publications database, viewed April 11, 2023)."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Dept. of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Auditors' reports--Georgia","Financial statements--Georgia","Houston County (Ga.). Board of Education--Appropriations and expenditures"],"dcterms_title":["Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1996"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1995-h96"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1995-h96"],"dcterms_temporal":null,"dcterms_rights_holder":["\u0026copy; Georgia Department of Audits"],"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"GA A8oo .RI \nt:d-b \nH\u003ci? -. \n1995 -9t::, \n \nAUDIT REPORT HOUSTON COUNTY BOARD OF EDUCATION \nPERRY, GEORGIA YEAR ENDED JUNE 30, 1996 \n \nSTATE OF GEORGIA DEPARTMENT OF AUDITS \n254 WASHINGTON STREET \nATLANTA, GEORGIA 30334 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \n \nSECTION I \n \nFINANCIAL \n \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE  FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \n \nEXHIBITS \n \nGENERAL PURPOSE FINANCIAL STATEMENTS \n \nCOMBINED STATEMENTS - OVERVIEW \n \nA \n \nCOMBINED BALANCE SHEET \n \nALL FUND TYPES AND ACCOUNT GROUP \n \n2 \n \nB \n \nCOMBINED STATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES \n \nALL GOVERNMENTAL FUND TYPES \n \n4 \n \nC \n \nSTATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES - BUDGET AND ACTUAL \n \n(NON-GAAP BASIS) \n \nGENERAL AND SPECIAL REVENUE FUNDS \n \n5 \n \nD NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \n6 \n \nADDITIONAL FINANCIAL INFORMATION \n \nCOMBINING AND INDIVIDUAL FUND STATEMENTS \n \nSPECIAL REVENUE FUND \n \nE \n \nCOMBINING BALANCE SHEET \n \n24 \n \nF \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n26 \n \nCAPITAL PROJECTS FUND \n \nG \n \nCOMBINING BALANCE SHEET \n \n28 \n \nH \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n30 \n \nI \n \nFIDUCIARY FUND TYPE \n \nSTATEMENT OF CHANGES IN ASSETS AND LIABILITIES \n \nAGENCY FUND \n \n32 \n \nSCHEDULES \n \n1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \n \n33 \n \n2 CASH AND CASH EQUIVALENTS \n \n35 \n \n3 INVESTMENTS \n \n36 \n \n4 ACCOUNTS RECEIVABLE \n \n37 \n \n5 DEBT SERVICE REQUIREMENTS TO MATURITY \n \n38 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \nV \n \nSECTION I \n \nFINANCIAL \n \nADDITIONAL FINANCIAL INFORMATION \n \nSCHEDULES \n \nSCHEDULE OF REVENUE \n \n6 \n \nSTATE \n \n40 \n \n7 \n \nTAXES AND OTHER \n \n42 \n \nSCHEDULE OF EXPENDITURES BY OBJECT \n \n8 \n \nGENERAL AND SPECIAL REVENUE FUNDS \n \n43 \n \n9 \n \nLOTTERY PROGRAMS \n \n44 \n \nANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS \n \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS \n \n10 \n \nOVERALL \n \n47 \n \n11 \n \nBY PROGRAM \n \n48 \n \n12 SCHEDULE OF COMPENSATION OF BOARD MEMBERS \n \n50 \n \nSECTION II \nCOMPLIANCE \nCOMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nSINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nSINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nSINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \nSECTION III INTERNAL CONTROL REPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nSECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \n \n SECTION I FINANCIAL \n \n V \nCLAUDE L. VICKERS \nSTATE AUDITOR (404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board of Education \nand Superintendent and Members of the Houston County Board ofEducation \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARYINFORMATIONSCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \nLadies and Gentlemen: \nWe have audited the general purpose financial statements (Exhibits A through D) of the Houston County Board of Education, as of and for the year ended June 30, 1996, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. \nWe 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 the Office of Management 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. \nAs described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: \n* The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. \n96ARL-13 \n \n * The Board did not report compensated absences within the general purpose financial statements as required by generally accepted accounting principles. \nV \n* School activity accounts maintained at the individual schools are not included in the general purpose :financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. \n* The Board did not recognize as expenditures, in the year ended June 30, 1996, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1996. Also funds received, subsequent to June 30, 1996, from the Georgia Department ofEducation for the State's share of these unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1995, were improperly recorded in the year ended June 30, 1996. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed. \n* The Board has received $16,533,005.13 in local option sales tax collections for which revenue recognition has been deferred to future periods by the Board. If these amounts had been recorded as revenue as required by generally accepted accounting principles, the Board's fund balance would have increased by a like amount. \nThe aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material. \nIn our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements present fairly, in all material respects, the financial position of the Houston County Board of Education as of June 30, 1996, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. In accordance \nwith Government Auditing Standards, we have also issued a report dated April 1O; 1997, on our consideration \nof the Board's internal control structure and a report dated April 10, 1997, on its compliance with laws and regulations. \nOur audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the Houston County Board pfEducation taken as a whole. The combining and individual fund statements (Exhibits E through I) and the financial schedules (Schedules 1 through 12 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Houston County Board of Education. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. \n96ARL-13 \n \n A copy ofthis report has been filed as a pennanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24. \nRespectfully submitted, \n \nCLV:gp 96ARL-13 \n \nClaude L. Vickers State Auditor \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT \nLOTTERY PROGRAMS YEAR ENDED JUNE 30, 1996 \n \n\\( \nEXPENDITURES \nOperating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Water, Sewer and Cleaning Services Communications Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures \nNonoperating Costs Principal Land and Land Improvements Building and Building Improvements Equipment \n \nALTERNATIVE SCHOOL PROGRAM \n \nINSTRUCTIONAL TECHNOLOGY \n \nPRE-KINDERGARTEN PROGRAM (1) \n \n$ \n \n$ \n \n6,547.00 $ \n \n54,716.18 \n \n6,934.16 \n \n22,425.00 \n \n322,690.51 \n \n1,329,198.73 335,887.46 11,733.21 \n556.56 \n11,008.00 1,065.55 \n22,498.66 341,268.43 \n5,500.00 4,055.15 \n56,578.25 10,893.10 12,604.36 \n144,000.00 \n4,570.70 \n305,777.84 \n \nTotal Expenditures \n \n$ \n \n28,972.00 $ \n \n384,340.85 $ ====2=,5=97=,1=9=6=.o=o \n \n(1) Expenditures in the amount of $326,122.00 associated with the inception of a capital lease have been excluded from this schedule. \n \nSee notes to the general purpose financial statements. - 44 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GENERAL AND SPECIAL REVENUE FUNDS \nYEAR ENDED JUNE 30, 1996 \n \nSCHEDULE \"8\" \n \nEXPENDITURES \nOperating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Property Services Insurance Communications Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures \nNonoperating Costs Principal and Interest Land and Land Improvements Building and Building Improvements Equipment \n \nGENERAL \nFUND \n \nSPECIAL REVENUE \nFUND \n \nTOTAL \n \n$ 58,953,966.34 $ \n16,651,488.48 179,211.86 240,445.63 18,100.00 201,218.22 285,490.19 11,964.04 115,050.55 179,747.00 214,893.57 \n9,078.26 332,035.79 3,242,175.30 2,291,223.29 \n1,144,776.11 200,173.87 98,495.40 \n \n5,232,220.24 $ \n1,195,021.16 53,964.59 \n183,416.14 \n17,898.00 25,850.98 \n8,486.50 25,817.90 \n42,064.96 1,127,298.29 \n5,500.00 2,513,524.73 \n123,459.90 28,450.54 53,731.03 \n \n64,186,186.58 17,846,509.64 \n233,176.45 423,861.77 \n18,100.00 219,116.22 311,341.17 \n11,964.04 115,050.55 179,747.00 223,380.07 \n25,817.90 9,078.26 \n374,100.75 4,369,473.59 2,296,723.29 2,513,524.73 1,268,236.01 \n228,624.41 152,226.43 \n \n573,208.63 285,122.35 1,477,871.14 2,827,242.97 \n \n144,000.00 4,570.70 \n1,770,792.97 \n \n717,208.63 289,693.05 1,477,871.14 4,598,035.94 \n \nTotal Expenditures \n \n$ 89,532,978.99 $ 12,556,068.63 $ 102,089,047.62 \n \nSee notes to the general purpose financial statements. - 43 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF TAXES AND OTHER REVENUE \nYEAR ENDED JUNE 30, 1996 \n \nSCHEDULE \"7'' \n \n,.. \nTaxes County Wide Bond Tax County Wide School Tax Local Option Sales Tax Railroad Car Tax Real Estate Transfer Tax \nother Sources Compensation for Loss of Assets Contributions from All Funds For Workers' Compensation Insurance Donations Georgia Power Company Sam Nunn Campaign Committee Various Sources Interest Earned Lost and Damaged Books Rents Sales Adult Meals Breakfast Lunches Supplemental School Assets Sales of Supplies and Materials Less: Purchases for Resale Shared Service Contributions Houston County lnteragency Council Tuition Other \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nDEBT SERVICE \nFUND \n \nTOTAL \n \n$ 16,374,233.95 9,506,384.56 7,269.02 106,819.15 \n \n$ 1,295,793.36 $ 1,295,793.36 \n \n16,374,233.95 \n \n9,506,384.56 \n \n564.82 \n \n7,833.84 \n \n8,300.10 \n \n115,119.25 \n \n22,332.08 \n \n447,000.00 \n \n3,000.00 \n$ 1,on,202.01 \n13,849.82 8,334.38 \n \n$ 65,000.00 170.00 49,006.90 54,730.86 448,829.40 \n \n14,095.00 888,539.93 -531,2n.10 \n \n253,821.15 27,339.15 1,673,674.91 111,n3.ao \n2,059.60 \n \n24,491.44 643,335.51 184,214.30 \n \n19,945.54 \n \n43,854.13 \n \n22,332.08 \n447,000.00 \n3,000.00 65,000.00 49,176.90 1,624,616.46 13,849.82 \n8,334.38 \n253,821.15 27,339.15 \n1,673,674.91 111,n3.B0 16,154.60 888,539.93 -531,2n.10 \n24,491.44 643,335.51 204,159.84 \n \n$ 28,789,823.51 $ 2,149,515.01 $ 562,836.30 $ 1,348,512.41 $ 32,850,687.23 \n \nSee notes to the general purpose financial statements. \n \n- 42 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 1996 \n \nSCHEDULE \"6\" \n \nAGENCY/FUNDING \nGRANTS Human Resources, Georgia Department of Family Connection \nOffice of Planning and Budget Georgia Challenge Program \nOffice of School Readiness Pre-Kindergarten Program \nOffice of Treasury and Fiscal Services Public School Employees Retirement \nCONTRACTS Education, Georgia Department of Leadership Development Programs \n \nGOVERNMENTALFUNDTYPES \n \nSPECIAL \n \nCAPITAL \n \nGENERAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nFUND \n \nTOTAL \n \n$ 50,000.00 \n \n$ \n \n50,000.00 \n \n1,189,996.00 \n \n178,024.00 \n \n$ \n \n50,000.00 \n \n50,000.00 \n \n1, 189,996.00 \n \n178,024.00 \n \n11,000.00 \n \n11,000.00 \n \n$ 57,904,961.16 $ 3,798,842.28 $ 1,623,380.00 $ 63,327,183.44 \n \n(1) School of Excellence Awards \n \nSee notes to the general purpose financial statements. \n \n- 41 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1996 \n \nSCHEDULE 6\" \n \n,.. \nAGENCY/FUNDING \nGRANTS Administrative Services, Georgia Department of Distance Leaming/Telemedicine Grant \nChildren and Youth Services, Georgia Department of Project Peace \nCommunity Affairs, Georgia Department of Local Assistance Grant \nEducation, Georgia Department of Quality Basic Education General and Career Education Programs Special Education Programs Remedial Education Program Media Center Programs Staff Development Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Program Special Instructional Assistance In-School Suspension Technology Training Counselors Grades 4 and 5 Mid-term Adjustment Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Alternative Programs Apprenticeship Program At-Risk Summer School Program Environmental Science Program Health Insurance Governor's Emergency Funds (1) Innovative Programs Mentor Teacher Program Mentoring Program Preschool Handicapped Program Remedial Summer School Program Teachers Retirement Lottery Programs Alternative School Program Instructional Technology Pre-Kindergarten Program Safe Schools Grant Technology Installation \nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects Lottery \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nGENERAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nFUND \n \nTOTAL \n \n$ \n \n1,000.00 \n \n$ \n \n1,000.00 \n \n$ \n \n19,305.98 \n \n19,305.98 \n \n40,000.00 \n \n$ \n \n5,000.00 \n \n45,000.00 \n \n34,753,693.00 5,946,9TT.OO 816,289.00 1,472,753.00 472,096.00 9,209,361.00 \n1,092,420.00 293,676.00 \n1,305,635.00 1, 167,008.00 \n381,666.00 180,355.00 \n97,723.00 884,191.00 -6,068,994.00 4,081,371.00 \n16,999.05 \n130,840.00 184,563.95 \n71,072.24 1,500.00 \nTT2,286.34 4,000.00 4,800.00 \n27,373.14 19,800.00 213,585.00 21,970.50 69,926.94 \n \n393,706.00 \n28,972.00 378,855.85 1,407,200.00 \n83,685.00 247,121.45 \n \n34,753,693.00 5,946,9TT.OO 816,289.00 1,472,753.00 472,096.00 9,209,361.00 \n1,092,420.00 293,676.00 \n1,305,635.00 1,167,008.00 \n381,666.00 180,355.00 \n97,723.00 884,191.00 -6,068,994.00 4,081,371.00 393,706.00 \n16,999.05 \n130,840.00 184,563.95 \n71,072.24 1,500.00 \nTT2,286.34 4,000.00 4,800.00 \n27,373.14 19,800.00 213,585.00 21,970.50 69,926.94 \n28,972.00 378,855.85 1,407,200.00 \n83,685.00 247,121.45 \n \n1,618,380.00 \n \n1 ,618,380.00 \n \n- 40 - \n \n SCHEDULE \"5\" \n \nGENERAL OBLIGATION BONDS \n \n1988 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n1987 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \nINTERGOVERNMENTAL CONTRACT \n \nTRUST CERTIFICATES \n \n1994 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n$ \n \n21,420.00 $ 340,000.00 $ \n \n7,590.00 $ 110,000.00 $ 690,745.00 $ \n \n200,000.00 \n \n681,945.00 \n \n190,000.00 \n \n673,205.00 \n \n200,000.00 \n \n663,605.00 \n \n200,000.00 \n \n653,705.00 \n \n210,000.00 \n \n643,205.00 631,985.00 620,285.00 608,095.00 595,135.00 \n \n220,000.cio 225,000.00 230,000.00 240,000.00 255,000.00 \n \n581,110.00 566,550.00 550,875.00 471,812.50 393,606.25 \n \n260,000.00 275,000.00 1,375,000.00 1,455,000.00 1,535,000.00 \n \n311,100.00 213,600.00 110,100.00 \n \n1,625,000.00 1,725,000.00 1,835,000.00 \n \n$ \n \n211420.00 $ 3401000.00 $ \n \n71590.00 $ 1101000.00 $ 916601663.75 $ 1212551000.00 \n \nINTERGOVERNMENTAL \nCONTRACT TRUST \nCERTIFICATES 1994 ISSUE \n$ 12,445,000.00 \n190,000.00 \n \n$ 1212551000.00 \n \nFEB 1 -AUG 1 FEB 1 \n \n- 39 - \n \n PAYMENTS DUE \"IN FISCAL YEAR \nENDING JUNE 30 \n1997 1998 1999 2000 2001 \n2002 2003 2004 2005 2006 \n2007 2008 2009 2010 2011 \n2012 2013 2014 \n \nHOUSTON COUNTY BOARD OF EDUCATION DEBT SERVICE REQUIREMENTS TO MATURITY \nJUNE 30, 1996 \n \nTOTAL DEBT SERVICE \n \nTOTAL INTEREST \n \nTOTAL PRINCIPAL \n \n1993 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n$ 1,910,020.00 $ 1,165,020.00 $ \n \n1,903,220.00 \n \n1, 123,220.00 \n \n1,904,110.00 \n \n1,089,110.00 \n \n1,906,835.00 \n \n1,051,835.00 \n \n1,911,150.00 \n \n1,011,150.00 \n \n745,000.00 $ 780,000.00 815,000.00 855,000.00 900,000.00 \n \n445,265.00 $ 441,275.00 415,905.00 388,230.00 357,445.00 \n \n95,000.00 590,000.00 615,000.00 655,000.00 690,000.00 \n \n1,911,840.00 1,914,370.00 1,913,400.00 1,918,830.00 1,920,025.00 \n \n966,840.00 919,370.00 868,400.00 813,830.00 755,025.00 \n \n945,000.00 995,000.00 1,045,000.00 1,105,000.00 1,165,000.00 \n \n323,635.00 287,385.00 248,115.00 205,735.00 159,890.00 \n \n725,000.00 770,000.00 815,000.00 865,000.00 910,000.00 \n \n1,921,860.00 1,923,950.00 1,925,875.00 1,926,812.50 1,928,606.25 \n \n691,860.00 623,950.00 550,875.00 471,812.50 393,606.25 \n \n1,230,000.00 1,300,000.00 1,375,000.00 1,455,000.00 1,535,000.00 \n \n110,750.00 57,400.00 \n \n970,000.00 1,025,000.00 \n \n1,936,100.00 1,938,600.00 1,945,100.00 \n \n311,100.00 213,600.00 110,100.00 \n \n1,625,000.00 1,725,000.00 1,835,000.00 \n \n$ 3415601703.75 $ 131130;103.75 $ 2114301000.00 $ 314411030.00 $ 817251000.00 \n \nCHANGES IN GENERAL LONG-TERM DEBT Debt Payable at July 1, 1995 Debt Retired During Period \nDebt Payable at June 30, 1996 \nMATURITY DATES Semi-Annual Interest Payment Dates Annual Debt Retirement Date \n \nTOTAL $ 22,135,000.00 $ \n705,000.00 \n \nGENERAL OBLIGATION BONDS \n \n1993 ISSUE \n \n1988 ISSUE \n \n1987 ISSUE \n \n8,820,000.00 $ 655,000.00 $ 215,000.00 \n \n95,000.00 \n \n315,000.00 \n \n105,000.00 \n \n$ 21 i4301000.oo $ \n \n8;1251000.00 $ 3401000.00 $ 11opoo.oo \n \nMAR 1 -SEPT 1 MAR 1 -SEPT 1 MAR 1 - SEPT 1 \n \nMAR 1 \n \nMAR 1 \n \nMAR 1 \n \nSee notes to the general purpose financial statements. \n \n- 38 - \n \n HOUSTON COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30.1996 \n \nChildren and Youth Services, Georgia Department of Project Peace \nDefense, U. S. Department of Department of Air Force R.O.T.C. Program \nEducation, Georgia Department of Food Services School Breakfast Program National School Lunch Program Federal Programs Elementary and Secondary Education Act Title I Grants to Local Educational Agencies Individuals with Disabilities Education Act Part B - Special Education Flow Through Preschool Safe and Drug-Free Schools \nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects Regular Lottery \nHouston County Tax Commissioner County Wide Bond Tax County Wide School Tax \nHuman Resources, Georgia Department of Family Connection \nOffice of Planning and Budget Georgia Challenge Program \nOffice of School Readiness Pre-Kindergarten Program \nVarious Sources Refunds Staff Development Charges Vendor Overpayments Rental of Facilities Returned Checks \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE PROJECTS \n \nFUND \n \nFUND \n \nDEBT SERVICE \nFUND \n \nTOTAL \n \n$ 6,404.17 \n \n$ \n \n6,404.17 \n \n$ 11,473.33 \n \n11,473.33 \n \n41,379.79 79,364.97 \n \n41,379.79 79,364.97 \n \n256,414.80 \n71,289.99 17,635.55 \n4,000.00 \n \n256,414.80 \n71,289.99 17,635.55 4,000.00 \n \n$ 285,314.00 344,352.15 \n \n285,314.00 344,352.15 \n \n429,510.41 \n \n$ 31,772.88 \n \n31,772.88 429,510.41 \n \n8,448.58 \n \n8,448.58 \n \n27,135.00 \n \n27,135.00 \n \n241,464.00 \n \n241,464.00 \n \n1,700.00 2,000.00 \n903.25 \n \n1,819.05 293.83 \n \n195.40 \n \n1,700.00 4,014.45 \n903.25 293.83 \n \n$ 472,721.99 $ 728,514.73 $ 629,861.55 $ 31,772.88 $ 1,862,871.15 !\\ \n \nSee notes to the general purpose financial statements. \n \n- 37 - \n \n HOUSTON COUNTY BOARD OF EDUCATION INVESTMENTS JUNE 30, 1996 \n \nSCHEDULE \"3\" \n \nINVESTMENT POOL \nState of Georgia, Office of Treasury and Fiscal Services Local Government Investment Pool (5.361 %) \nPORTFOLIO ACCOUNTS \nReliance Trust Company, Atlanta, Georgia \nSynovus Trust Company, Columbus, Georgia \n \n$ 15,699,041.25 \n \n$ 4,793,575.07 \n \n406,912.29 \n \n5,200,487.36 \n \n$ 20,899,528.61 \n \nSee notes to the general purpose financial statements. - 36 - \n \n HOUSTON COUNTY BOARD OF EDUCATION CASH AND CASH EQUIVALENTS JUNE 30, 1996 \nINTEREST BEARING ACCOUNTS \nC B \u0026 T of Middle Georgia, Warner Robins, Georgia \nN.O.W. Accounts (Variable) \n \nSCHEDULE \"2\" \n$ 4,082,030.42 \n \nSee notes to the general purpose financial statements. \n- 35 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \nYEAR ENDED JUNE 30, 1996 \n \nSCHEDULE \"1\" \n \nv FUNDING AGENCY PROGRAM/GRANT \nOTHER FEDERAL ASSISTANCE \nDefense, U. S. Department of Direct Department of the Air Force R.O.T.C. Program \nEnergy, U. S. Department of Direct Crude Oil Settlement \nHealth and Human Services, U. S. Department of Through Georgia Department of Medical Assistance Medicaid Assistance 1996 Grant \n \nCFDA NUMBER \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \n$ 1341723.53 \n \n(4) \n \n$ \n \n11662.00 \n \n(5) \n \n$ \n \n151339.05 \n \n(5) \n \nTotal Federal Financial Assistance \n \n$ 6,839,253.24 $ 8,788,225.10 \n \nMajor Programs are identified by an asterisk (*) in front of the CFDA number. \n \n(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary assistance for donated commodities received and/or consumed by the system during the current fiscal year. \n(2) Expenditures for the Child and Adult Care Food Program and the School Breakfast Program were not maintained separately and are included in the 1996 National School Lunch Program. \n(3) Expenditures for this program include State and/or Other Funds. Expenditures are not maintained by fund source. \n(4) Expenditures on this program were not maintained by fund source. (5) Funds earned on this program do not require reporting of expenditures. \n \nSee notes to the general purpose financial statements. \n \n- 34 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \nYEAR ENDED JUNE 30. 1996 \n \nSCHEDULE \"1\" \n \nFUNDING AGENCY PROGRAM/GRANT \nAgriculture, U. S. Department of Through Georgia Department of Education Food and Nutrition Program Child and Adult Care Food Program 1996 Contract Food Services School Breakfast Program 1996 Grant National School Lunch Program 1996 Grant Food Distribution Program (1) \nTotal U. S. Department of Agriculture \nEducation, U. S. Department of Direct P. L. 81-874 1991 Grant 1994 Grant 1995 Grant 1996 Grant Through Georgia Department of Education Elementary and Secondary Education Act Title I Grants to Local Educational Agencies 1996 Grant State School Improvement Grants 1996 Grant Title II Eisenhower Professional Development 1995 Regular 1996 Grant Title VI Innovative Education Program Strategies 1996 Grant Individuals with Disabilities Education Act Part B - Special Education Flow Through 1996 Grant Preschool 1996 Grant Safe and Drug-Free Schools 1996 Grant Vocational Education - Basic Grants to States High School Program Basic Grant 1996 Grant Consumer and Homemaking Education 1996 Grant \nTotal U. S Department of Education \n \nCFDA NUMBER \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \n10.558 $ 40,185.85 \n \n(2) \n \n* 10.553 \n \n466,401.59 \n \n(2) \n \n* 10.555 * 10.550 \n \n2,077,849.84 $ 5,643,300.53 (3) \n \n423,645.31 \n \n423,645.31 \n \n$ 3,008,082.59 $ 6,066,945.84 \n \n* 84.041 $ \n \n4,998.73 \n \n(5) \n \n* 84.041 \n \n57,040.00 \n \n(5) \n \n* 84.041 \n \n48,484.00 \n \n(5) \n \n* 84.041 \n \n845,695.00 \n \n(5) \n \n* 84.010 84.218 \n \n1,600,614.80 $ 27,527.04 \n \n1,600,614.80 27,527.04 \n \n84.281 84.281 \n \n9,673.94 50,400.00 \n \n9,673.94 48,450.92 \n \n84.298 \n \n100,287.00 \n \n100,287.00 \n \n* 84.027 84.173 84.186 \n \n588,889.99 106,935.55 \n72,936.02 \n \n588,889.99 106,935.55 \n72,936.02 \n \n84.048 \n \n159,964.00 \n \n84.049 \n \n6,000.00 \n \n$ 3,679,446.07 $ \n \n159,964.00 _. . \n6,000.00 \n2,721,279.26 \n \n- 33 - \n \n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES \nFIDUCIARY FUND TYPE - AGENCY FUND YEAR ENDED JUNE 30, 1996 \n \nEXHIBIT\"!\" \n \nDEFERRED COMPENSATION PLAN \nASSETS Investments Held by Trustee \n \nBALANCE JULY 1, 1995 \n \nADDITIONS \n \nDEDUCTIONS \n \nBALANCE JUNE 30, 1996 \n \n$ 5,911,692.29 $ 461,996.14 $ \n \n93,108.40 $ 6,280,580.03 \n \nLIABILITIES Deferred Compensation Plan \n \n$ 5,911,692.29 $ 461,996.14 $ \n \n93,108.40 $ 6,280,580.03 \n \nSee notes to the general purpose financial statements. - 32 - \n \n EXHIBIT\"H\" \n \nFINANCING AND INVESTMENT COMMISSION \n \nPROJECT \n \nPROJECT \n \nPROJECT \n \n95/96-676-40 96/96S-676-031 96/96S-676-032 \n \nLOTTERY PROJECT 96/95S-676-046 \n \nTOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995 \n \n$ \n \n0.00 $ \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ 1,618,380.00 $ 1,623,380.00 $ 3,745,117.00 \n \n562,836.30 \n \n599,633.36 \n \n- - - - - 0.00 $ \n \n0.00 $ 1,618,380.00 $ 2,186,216.30 $ 4,344,750.36 \n \n$ \n \n0.00 $ \n \n$ \n \n0.00 $ \n \n$ \n \n0.00 $ \n \n0.00 $ \n0.00 $ 0.00 $ \n \n0.00 \n \n$ \n \n17,400.00 $ \n \n1,331.11 \n \n324.25 \n \n$ 3,651,239.69 \n \n6,515.50 9,908,502.40 \n9,066.00 \n \n800.00 61.20 \n958.50 \n8,625,102.97 18,867.78 \n \n3,870.50 \n \n0.00 $ 3,651,239.69 $ 9,947,009.76 $ 8,645,790.45 \n \n0.00 $ -2,032,859.69 $ -7,760,793.46 $ -4,301,040.09 \n \n$ 150,127.00 $ \n \n52,790.00 $ 1,853,039.69 $ 3,576,979.03 $ 3,410,261.83 \n \n-2,545,962. 74 \n \n-2, 113,462.36 \n \n$ \n \n150,127.00 $ \n \n52,790.00 $ 1,853,039.69 $ 1,031,016.29 $ 1,296,799.47 \n \n$ \n \n0.00 $ 150,127.00 $ \n \n20,257.00 \n \n0.00 \n \n52,790.00 $ 0.00 \n \n-179,820.00 $ -6,729,777.17 $ -3,004,240.62 \n \n179,820.00 \n \n8,555,566.71 \n \n12,468,402.11 \n \n-908,594.78 \n \n$ 20,257.00 $ 150,127.00 $ \n \n52,790.00 $ = = = =0.= 00 $ 1,825,789.54 $ 8,555,566.71 \n \n- 31 - \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \nCAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 1996 \n \nV \n \nREGULAR \n \nTRUST CERTIFICATE \nFUND \n \nGEORGIA STATE \n \nPROJECT \n \nPROJECT \n \n94/95S-676-030 95/96-676-039 \n \nREVENUES \n \nState Funds Taxes and Other Funds \n \n$ \n \n5,000.00 \n \n114,006.90 $ \n \n$ 448,829.40 \n \n0.00 $ \n \n0.00 \n \nTotal Revenues \n \n$ 119,006.90 $ \n \n448,829.40 $ \n \n0.00 $ \n \n0.00 \n \nEXPENDITURES \n \nCapital Outlay Salaries Employee Benefits Travel Professional and Technical Services Land and Land Improvements Building and Building Improvements Equipment \nDebt Service Paying Agent Fees \n \n$ \n \n17,400.00 \n \n$ \n \n1,331.11 \n \n324.25 \n \n6,515.50 1,741,851.19 $ \n9,066.00 \n \n4,515,411.52 \n \n3,870.50 \n \n0.00 $ \n \n0.00 \n \nTotal Expenditures \n \n$ 1,776,488.05 $ 4,519,282.02 $ \n \n0.00 $ \n \n0.00 \n \nExcess of Revenues over (under) Expenditures \n \n$ -1,657,481.15 $ -4,070,452.62 $ \n \n0.00 $ \n \n0.00 \n \nOTHER FINANCING SOURCES (USES) \n \nOperating Transfers In Operating Transfers Out \n \n$ 1,521,022.34 $ -2,545,962.74 \n \nTotal Other Financing Sources \n \n(Uses) \n \n$ 1,521,022.34 $ -2,545,962.74 \n \nExcess of Revenues and Other Financing \n \nSources over (under) Expenditures and \n \nOther Financing Uses \n \n$ -136,458.81 $ -6,616,415.36 $ \n \n0.00 $ \n \n0.00 \n \nFUND BALANCE JULY 1 \n \n619,733.41 \n \n7,653,742.30 \n \n0.00 \n \n82,014.00 \n \nResidual Equity Transfer \n \nFUND BALANCE JUNE 30 \n \n$ 483,274.60 $ 1,037,326.94 $ \n \nSee notes to the general purpose financial statements. - 30 - \n \n0.00 $ 82,014.00 \n \n EXHIBIT\"G\" \n \nFINANCING AND INVESTMENT COMMISSION \n \nPROJECT \n \nPROJECT \n \nPROJECT \n \n95/96-676-40 96/96S-676-031 96/96S-676-032 \n \nLOTTERY PROJECT 96/95S-676-046 \n \nTOTALS JUNE 30, 1996 JUNE 30, 1995 \n \n$ 20,257.00 $ 150,127.00 $ \n \n52,790.00 \n \n$ 788,267.20 $ 723,626.41 \n \n$ 2,771,838.01 4,791,751.47 10,531,036.12 \n \n344,352.15 \n \n629,861.55 \n \n1,220,757.00 \n \n5,000.00 \n \n$ 20,257.00 $ 150,127.00 $ \n \n52,790.00 $ 3,116,190.16 $ 6,209,880.22 $ 12,480,419.53 \n \n$ 2,683,846.25 $ 3,519,597.37 $ \n \n90,147.91 \n \n164,121.31 \n \n342,196.00 \n \n700,372.00 \n \n3,020,394.72 6,622.00 \n285,060.10 612,776.00 \n \n$ 3,116,190.16 $ 4,384,090.68 $ 3,924,852.82 \n \n$ 20,257.00 $ $ 20,257.00 $ \n0.00 $ 20,257.00 $ \n \n150,127.00 $ 150,127.00 $ \n0.00 150,127.00 $ \n \n52,790.00 52,790.00 \n0.00 $ 52,790.00 $ \n \n$ 1,037,326.94 $ 7,653,742.30 \n \n305,188.00 \n \n282,091.00 \n \n$ 1,342,514.94 $ 7,935,833.30 \n \n0.00 \n \n483,274.60 \n \n619,733.41 \n \n0.00 $ 1,825,789.54 $ 8,555,566.71 \n \n$ 20,257.00 $ 150,127.00 $ \n \n52,790.00 $ 3,116,190.16 $ 6,209,880.22 $ 12,480,419.53 \n \n- 29 - \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30, 1996 \n \nASSETS Cash and Cash Equivalents Investments Accounts Receivable Prepaid Expenses \nTotal Assets \n \nREGULAR \n \nTRUST CERTIFICATE \nFUND \n \nGEORGIA STATE \n \nPROJECT \n \nPROJECT \n \n94/95S--676-030 95/96--676-039 \n \n$ 483,079.20 \n \n$ \n \n82,014.00 \n \n$ 2,019,913.46 \n \n195.40 \n \n$ 285,314.00 \n \n$ 483,274.60 $ 2,019,913.46 $ \n \n285,314.00 $ \n \n82,014.00 \n \nLIABILITIES AND FUND EQUITY \n \nLIABILITIES \n \nCash Overdraft Accounts Payable Contracts Payable Retainages Payable \n \n$ 550,437.12 $ 73,973.40 \n358,176.00 \n \n285,314.00 \n \nTotal Liabilities \n \n$ 982,586.52 $ 285,314.00 \n \nFUND EQUITY \n \nFund Balances Reserved For Purposes of Trust Certificates For State Capital Outlay Projects \n \n$ 1,037,326.94 $ \n \nUnreserved Undesignated \n \n$ 1,037,326.94 \n \n$ \n \n$ 483,274.60 \n \no. oo $ _ _ ___,;;_o;.;o;,..::...o \n \nTotal Fund Equity \n \n$ 483,274.60 $ 1,037,326.94 $ \n \n0.00 $ \n \n82,014.00 82,014.00 \n0.00 82,014.00 \n \nTotal Liabilities and Fund Equity \n \n$ 483,274.60 $ 2,019,913.46 $ \n \n285,314.00 $ \n \n82,014.00 \n \nSee notes to the general purpose financial statements. - 28 - \n \n EXHIBIT\"F\" \n \nACT TITLE VI \nINNOVATIVE EDUCATION PROGRAM STRATEGIES \n \nINDIVIDUALS WITH \n \nDISABILITIES EDUCATION ACT \n \nPARTS \n \nSPECIAL EDUCATION \n \nFLOW \n \nTHROUGH \n \nPRESCHOOL \n \nSAFE AND DRUG-FREE SCHOOLS \n \nVOCATIONAL EDUCATION \nFEDERAL \n \nTOTALS YEAR ENDED JUNE 30, 1996 JUNE 30, 1995 \n \n$ \n \n100,287.00 $ 588,889.99 $ \n \n$ \n \n100,287.00 $ 588,889.99 $ \n \n106,935.55 $ 106,935.55 $ \n \n72,936.02 $ \n \n$ 165,964.00 \n \n3,798,842.28 $ 5,746,649.98 2,149,515.01 \n \n2,031,658.10 5,267,954.04 1,795,034.13 \n \n72,936.02 $ 165,964.00 $ 11,695,007.27 $ 9,094,646.27 \n \n$ \n \n98,306.12 $ 513,146.11 $ \n \n57,695.08 \n \n14,165.01 \n \n402.88 \n \n1,561.43 \n \n1,578.00 \n \n1,941.24 381.12 \n \n$ \n \n100,287.00 $ 588,889.99 $ \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n78,944.46 $ 26,920.61 \n1,070.48 \n106,935.55 $ \n \n23,110.24 $ 158,408.85 $ 5,079,323.48 $ 2,894,287.22 \n \n277,047.44 \n \n189,309.10 \n \n48,471.72 202.55 \n \n791.15 64.00 \n \n229,067.58 111,797.74 \n \n234,803.40 494,746.41 \n69,731.06 5,744.51 \n \n1,076.51 75.00 \n \n6,700.00 \n \n347,273.24 109,630.08 \n6,700.00 75,681.75 6,071,000.99 \n \n232,797.60 23,289.50 \n6,929.92 5,303,105.23 \n \n99,975.63 4,570.70 \n \n167,585.33 4,832.89 \n \n144,000.00 \n \n72,936.02 $ 165,964.00 $ 12,556,068.63 $ 9,627,162.17 \n \n0.00 $ \n \n0.00 $ \n \n 0.00 $ -861,061.36 $ -532,515.90 \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 \n \n0.00 \n \n0.00 $ 0.00 \n \n0.00 $ 0.00 \n \n$ 326,122.00 39,497.00 $ \n$ 365,619.00 $ \n \n47,812.65 47,812.65 \n \n0.00 $ -495,442.36 $ -484,703.25 \n \n0.00 \n \n1,535,198.25 2,001,510.44 \n \n64,584.29 -2,606.10 \n \n12,177.83 22,147.52 \n-32,739.63 16,805.34 \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ 1,101,734.08 $ 1,535,198.25 \n \n.'\\ \n \n- 27- \n \n f:!OUSTON COUNTY BOARD OF EDUCATION !::QMBINING S~TEMENT QF BE~EN!,.!!;:S EXPENDITUBES At:!Q Q!:!ANG!.;S IN FUND BAl,ANC!.;S \nSPECIAi. Bs~i;N!,.!E F!,!NQ YEAR ENDED JUN!;: 30. 1996 \n \nELEMENTARY AND SECONDARY EDUCATION \n \ny \n \nTITLE I \n \nSCHOOL \n \nGRANTS TO \n \nSTATE \n \nTITLE II \n \nFOOD \n \nFAMILY \n \nLOCAL \n \nSCHOOL \n \nEISENHOWER \n \nSERVICES CONNECTION LOTTERY EDUCATIONAL IMPROVEMENT PROFESSIONAL \n \nFUND \n \nFUND \n \nPROGRAMS \n \nAGENCIES \n \nGRANTS \n \nDEVELOPMENT \n \nREVENUES \n \nState Funds Federal Funds Taxes and Other Funds \n \n$ 393,706.00 $ 3.008,082.59 2,144,345.00 \n \n69,305.98 $ 3,335,830.30 \n \n15,339.05 \n \n$ 1,600,614.80 $ \n \n5,170.01 \n \n27,527.04 $ \n \n60,073.94 \n \nTotal Revenues \n \n$ 5,546,133.59 $ 89,815.04 $ 3,335,830.30 $ 1,600,614.80 $ \n \n27,527.04 $ \n \n60,073.94 \n \nEXPENDITURES \n \nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services \nCapital Outlay Debt Service \nPrincipal \n \n$ $ 6,066,945.84 \n \n$ 2,n8,352.83 s 1,420,263.23 $ \n \n187,282.78 \n \n5,148.97 \n \n54,442.89 \n \n37,847.19 \n \n38,920.54 \n \n70,536.58 \n \n430.60 99,975.63 \n \n345,332.00 106,593.31 \n3,887.10 4,055.15 \n4,570.70 144,000.00 \n \n78.06 66,740.n \n \n8,791.64 15,334.52 $ \n3,400.88 \n \n58,015.10 109.76 \n \nTotal Expenditures \n \n$ 6,066,945.84 $ 100,406.23 $ 3,667,437.30 $ 1,600,614.80 $ \n \n27,527.04 $ \n \n58,124.86 \n \nExcess of Revenues over (under) Expenditures \n \n$ -520,812.25 $ -10,591.19 $ -331,607.00 $ \n \n0.00 $ \n \n0.00 $ \n \n1,949.08 \n \nOTHER FINANCING SOURCES \n \nCapital Leases Operating Transfers In \n \n$ 326,122.00 \n \n$ 34,012.00 \n \n5,485.00 \n \nTotal Other Financing Sources \n \n$ 34,012.00 $ 331,607.00 \n \nExcess of Revenues and Other Financing \n \nSources over (under) Expenditures \n \n$ -520,812.25 $ \n \n23,420.81 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n1,949.08 \n \nFUND BALANCE JULY 1 \n \n1,535,198.25 \n \n0.00 \n \n0.00 \n \n0.00 \n \n0.00 \n \n0.00 \n \nFood Inventory - Net Change in Period Donated Commodities Purchased Food \nSupplies Inventory - Net Change in Period \nResidual Equity Transfer \n \n64,584.29 -2,606.10 \n \nFUND BALANCE JUNE 30 \n \n$ 1,076,364.19 $ 23,420.81 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n1,949.08 \n \nSee notes to the general purpose financial statements. \n \n- 26- \n \n EXHIBIT\"E\" \n \nACT TITLE VI \nINNOVATIVE EDUCATION PROGRAM STRATEGIES \n \nINDIVIDUALS WITH \n \nDISABILITIES EDUCATION ACT \n \nPARTB \n \nSPECIAL EDUCATION \n \nFLOW \n \nTHROUGH \n \nPRESCHOOL \n \nSAFE ANO DRUG-FREE SCHOOLS \n \nVOCATIONAL EDUCATION \nFEDERAL \n \nTOTALS JUNE 30, 1996 JUNE 30, 1995 \n \n$ \n \n0.00 \n \n$ \n \n426.12 $ \n \n0.00 $ 1,062,093.39 $ 1,700,833.21 \n \n$ 71,289.99 $ \n \n17,635.55 \n \n4,000.00 \n \n728,514.73 \n \n401,296.98 \n \n216,662.56 80,801.82 \n \n152,078.27 83,407.92 \n \n$ \n \n0.00 $ 71,289.99 $ \n \n17,635.55 $ \n \n4,426.12 $ \n \n0.00 $ 2,088,072.50 $ 2,337,616.38 \n \n$ \n \n3,905.59 $ \n \n14,140.50 \n \n53,243.90 \n \n$ 71,289.99 $ \n \n843.76 3,422.61 $ 13,369.18 \n17,635.55 $ \n \n643.14 2.n0.oo \n1,003.98 \n4,426.12 \n \n$ \n \n22,062.73 $ \n \n19,838.71 \n \n197,164.26 \n \n218,307.40 \n \n766,107.45 \n \n516,168.85 \n \n1,003.98 \n \n48,103.17 \n \n$ 986,338.42 $ 802,418.13 \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ 0.00 $ \n \n0.00 $ 0.00 $ \n \n$ \n \n1,949.08 \n \n216,662.56 $ 80,801.82 \n \n152,078.27 83,407.92 \n \n$ 299,413.46 $ 235,486.19 \n \n0.00 \n \n802,320.62 1,299,712.06 \n \n0.00 $ 1,101,734.08 $ 1,535,198.25 \n \n$ ====0==00= $ 71,289.99 $ \n \n17,635.55 $ \n \n4,426.12 $====0.=00= $ 2,088,072.50 $ 2,337,616.38 \n \n 25 - \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET SPECIAL REVENUE FUND JUNE 30 1996 \n \nCash and Cash Equivalents \nAccounts Receivable \nInventories Food Donated Commodities Purchased Food \n \nSCHOOL FOOD \nSERVICES FUND \n \nFAMILY CONNECTION \nFUND \n \nLOTTERY. PROGRAMS \n \nELEMENTARY AND SECONDARY EDUCATION \n \nTITLE I \n \nGRANTS TO \n \nSTATE \n \nTITLE II \n \nLOCAL \n \nSCHOOL \n \nEISENHOWER \n \nEDUCATIONAL IMPROVEMENT PROFESSIONAL \n \nAGENCIES \n \nGRANTS \n \nDEVELOPMENT \n \n$ 1,033,024.49 $ \n \n6,749.01 $ 19,944.69 \n \n$ \n \n0.00 $ \n \n1,949.08 \n \n121,038.59 \n \n16,671.80 \n \n241,464.00 $ \n \n256,414.80 \n \n216,662.56 80,801.82 \n \nTotal Assets \n \n$ 1,451,527.46 $ \n \n23,420.81 $ 261,408.69 $ \n \n256,414.80 $ \n \n0.00 $ ===1=,9=4=9.=08= \n \nLIABILITIES AND FUND EQUITY \nLIABILITIES \nCash Overdraft Accounts Payable Salaries Payable Expired Grant Balances \nPayable \nTotal Liabilities \nFUND EQUITY \nFund Balances Reserved For Continuation of Federal Program For Inventories Food Donated Commodities Purchased Food \nUnreserved Undesignated \nTotal Fund Equity \n \n$ \n \n73,347.61 \n \n301,815.66 \n \n$ 375,163.27 \n \n$ $ 54,792.44 \n206,616.25 \n \n17,313.38 50,817.96 188,283.46 \n \n$ 261,408.69 $ 256,414.80 \n \n$ 216,662.56 80,801.82 \n$ 297,464.38 778,899.81 $ \n$ 1,076,364.19 $ \n \n23,420.81 $ 23,420.81 $ \n \n0.00 $ 0.00 $ \n \n0.00 $ 0.00 $ \n \n$ \n \n1,949.08 \n \n$ 0.00 0.00 $ \n \n1,949.08 0.00 \n1,949.08 \n \nTotal Liabilities and Fund Equity \n \n$ 1,451,527.46 $ \n \n23,420.81 $ 261,408.69 $ \n \n256,414.80 $ \n \n0.00 $ ====1='9=49==08= \n \nSee notes to the general purpose financial statements. \n \n- 24- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 13: RETIREMENT PLANS \nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS) \nPSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia in accordance with State statute. \nPSERS provides, in accordance with State statute, service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment of age 65. A member applying for service retirement with 10 years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number of years of creditable service. Options are available for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. \nRetirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. If there are more than ten years of service, the beneficiary shall receive for life half of what the employee would have received upon retirement. \nMembers 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. \nThere were 474 employees covered under PSERS for the year ended June 30, 1996. \nPSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4.00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board of Trustees. Total contributions from employees ofthe Board made during fiscal year 1996 amounted to $15,588.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1996, was $9,817,769.80. \nNote 14: SURETY BONDS \nThe School Superintendent, Mr. Tony Hinnant, is bonded in the amount of $50,000.00 with Zurich-American, Schaumburg, Illinois, their Bond No. CP06791772-00, on which premium was paid through November I, 1996. \n \n- 23 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \n. JUNE 30, 1996 \n \nNote 13: RETIREMENT PLANS \n \nTRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1996 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%. \n \nTotal contributions made during fiscal year 1996 amounted to $9,545,529.46, of which $6,706,287.97 was made by the Board and $2,839,241.49 was made by employees. These contributions represented 11.81% (Board) and 5% (employees) of covered payroll. \n \nTRS 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 ofthe 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. \n \nTotal unfunded pension benefit obligation of TRS as of June 30, 1995, was as follows: \n \nTotal pension benefit obligation \n \n$17,442,607,000.00 \n \nNet assets available for benefits, at cost \n \n15,857,066,000.00 \n \nUnfunded pension benefit obligation \n \n$ 1,585,541,000.00 \n \nThe measurement ofthe total pension benefit obligation is based on an actuarial valuation as of June 30, 1995. Net assets available to pay pension benefits were valued as of the same date. TRS does not make separate measurements of assets and pension benefit obligation for individual employers. \n \nTotal contributions from all employers to TRS for fiscal year ended June 30, 1996 were $607,275,000.00. The Board's contribution for the year ended June 30, 1996 of $6,706,287.97 was actuarially determined and represented 1.1043% of total contributions made by all participating employers. \n \nTen year historical trend information is presented in the 1996 TRS Component Unit Financial Report. This information is useful in assessing TRS's accumulation of sufficient assets to pay pension benefits as they become due. \n \n- 22 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 12: HOUSTON COUNTY SCHOOL DISTRICT BUILDING AUTHORITY \nThe Houston County School District Building Authority was created by House Bill 203 8 during the 1994 session of the Georgia General Assembly. The purpose of the Authority is to acquire, construct, own and convey real property and personal property for the benefit of the Houston County Board ofEducation. The members of the Authority consist of the Chairman of the Houston County Board of Education, the Superintendent ofthe Houston County Board ofEducation, and the Chairman ofthe Board of Commissioners of Houston County. \nThe Houston County School District Building Authority is a component unit of the Houston County Board ofEducation and as such the Authority's financial activity has been blended with the Houston County Board ofEducation's general purpose financial statements. \nNote 13: RETIREMENT PLANS \nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \nTRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS). \nTRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. A member is eligible for service retirement after 30 years of creditable 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 of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. \nRetirement benefits also include death and disability 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. \nMembers 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. \n}\\ \nThe Board's payroll for employees covered by TRS for the year ended June 30, 1996, was $56,784,825.60; total payroll was $64,203,586.58. \n- 21 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nV \nNote 9: CONTINGENT LIABILITIES \nAmounts 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 Board believes that such disallowances, if any, will be immaterial to its overall financial position. \nThe Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition of these proceedings is not presently determinable, but is not believed to be material to the general purpose financial statements. \nNote I 0: DEFERRED COMPENSATION PLAN \nThe Board offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Board employees, permits them to defer a portion of their salary until future years. Participation in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency. \nAll 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 and rights of the Board subject only to the claims of the Board's general creditors. Participants' rights under the plan are equal to those of general creditors of the Board in an amount equal to the fair market value of the deferred account for each participant. \nIt is the opinion of the Board that the Board has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The Board believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. \nInvestments are managed by the plan's trustees, Hartford Life, Prudential Retirement Services, Inc. and Variable Annuity Life Insurances. Under these plans, participants select from an investment option, or combination of investment options, determined by the Board. \nNote 11: ACCUMULATED EMPLOYEES' LEAVE \nEmployees retiring under either the Teachers Retirement System of Georgia or the Public School Employees Retirement System will be paid for unused leave up to the one hundred days maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Houston County Board of Education, contiguous with retirement, in order to qualify. \nEmployees who terminate employment may apply to sell unused leave in excess of forty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Board, contiguous to a voluntary termination. See Note 1 - Compensated Absences \n \n- 20 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 7: ON-BEHALF PAYMENTS \n \nThe Board has recognized revenues and expenditures in the amount of $1,020,237.28 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies. \n \nGeorgia Department ofEducation Paid to the State Merit System ofPersonnel Administration For Health Insurance ofNon-Certified Personnel In the amount of $772,286.34 \n \nPaid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $69,926.94 \n \nOffice of Treasury and Fiscal Services Paid to the Public School Employees Retirement System For Public School Employees Retirement (PSERS) Employer's Cost In the amount of $178,024.00 \n \nNote 8: SIGNIFICANT COMMITMENTS \n \nThe following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1996: \n \nProject \n \nUnearned Executed Contracts \n \nCenterville Elementary Roof Perdue Elementary Addition Perry Annex Tabor Middle Roof Middle School #2 96/95S-676-046 \n \n$ 13,067.00 3,000.00 15,000.00 \n31,022.00 76,676.63 676,430.76 \n \n$ 815.196.39 \n \nThe amounts described in this note are not reflected in the general purpose financial statements. \n \n- 19 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 5: GENERAL LONG-TERM DEBT \n \n~ The changes in General Long-Term Debt during the fiscal year ended June 30, 1996, were as follows: \n \nIntergovernmental \n \nGeneral \n \nCaRital Leases \n \nContract \n \nObligation \n \nGSBA \n \nOther \n \nTrust Certificates \n \nBonds \n \nTotal \n \nBalance July 1, 1995 \n \n$ \n \n0.00 $ 839,847.34 $12,445,000.00 $ 9,690,000.00 $22,974,847.34 \n \nAdditions \n \n2,662,416.00 \n \n516,498.00 \n \n3,178,914.00 \n \nDeductions \n \n670,556.15 \n \n190,000.00 \n \n515,000.00 1375.556.15 \n \nBalance June 30, 1996 \n \n$ 26624]6QQ $ 68518212 $12~55 QQQ QQ $ 2 115 QQQ,QQ $24J18JQS 12 \n \nAt June 30, 1996, payments due, by fiscal year which includes principal and interest for these items are as follows: \n \nFiscal Year Ended June 30 \n \nIntergovernmental \n \nGeneral \n \nCaRital Leases \n \nContract \n \nObligation \n \nTotal \n \nGSBA \n \nOther \n \nTrust Certificates \n \nBonds \n \nDebt \n \n1997 1998 1999 2000 2001 2002 and thereafter \n \n$ 419,170.43 $ 472,244.53 \n \n691,278.45 \n \n239,508.08 \n \n649,537.21 \n \n23,288.56 \n \n586,030.55 \n \n248,258.76 \n \n442,624.26 \n \n$ 890,745.00 871,945.00 873,205.00 863,605.00 863,705.00 \n17,552,458.75 \n \n$ 1,019,275.00 1,031,275.00 1,030,905.00 1,043,230.00 1,047,445.00 7,472.910.00 \n \n$ 2,801,434.96 2,834,006.53 2,576,935.77 2,492,865.55 2,159,408.76 \n25,467,993.01 \n \nTotal Principal and Interest $ 3,036,899.66 $ 735,041.17 $ 21 215,66315 $12 645 04Q QQ $38 332 644 58 \n \nDeduct: Imputed Interest \n \n374,483.66 \n \n49251.98 \n \nNet Present Value ofFuture Minimum Lease Payments $ 2 662416QQ $ 685 182.12 \n \nIn the subsequent fiscal year, the Board issued general obligation bonds in the amount of $33,950,000.00 dated November 15, 1996. The proceeds will be used for costs of acquiring, constructing, and equipping school buildings and other buildings and facilities useful or desirable in connection therewith, adding to, renovating, repairing, improving, and equipping existing school buildings and other buildings and facilities useful or desirable in connection therewith, acquiring any necessary property therefore, both real, personal and acquiring any necessary or desirable rights in connection therewith, to pay capitalized interest incident thereto, and to pay expenses incidental to accomplishing the foregoing. \n \nNote 6: PRIOR YEAR DEFEASEMENT OF DEBT \n \nIn fiscal year 1993, the Board defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all futJre debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 1996, $8,015,000.00 ofbonds are outstanding and are considered defeased. \n \n- 18 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXI-llBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 4: RISK MANAGEMENT \n \n1995 1996 \n \nBeginning of Year Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEndofYear Liability \n \n$ \n \n0.00 $ \n \n4,598.00 $ \n \n4,598.00 $ \n \n0.00 \n \n$ \n \n0.00 $ \n \n3,037.00 $ \n \n3,037.00 $ \n \n0.00 \n \nNote 5: GENERAL LONG-TERM DEBT \n \nCAPITAL LEASES The Houston County Board ofEducation entered into an agreement on April 1, 1996, with the Georgia School Boards Association (GSBA), Incorporated for the lease of buses and portable classrooms. Under the terms of the lease agreement, the Board will make semi-annual payments through August 1, 2002. The lease includes an annual renewal clause. \n \nThe Houston County Board of Education has entered into various lease agreements as lessee for buses, vehicles, a computer mainframe and portable buildings. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. \n \nGENERAL OBLIGATION BONDS OUTSTANDING General Obligation Bonds currently outstanding are as follows: \n \nPurpose \n \nInterest Rates \n \nAmount \n \nGeneral Government - Series 1987 General Government - Series 1988 General Government - Refunding - Series 1993 \n \n6.90% 6.30% 4.20%- 5.60% \n \n$ 110,000.00 340,000.00 \n8,725,000.00 \n \n$ 9,175,000.00 \n \nINTERGOVERNMENTAL CONTRACTS TRUST CERTIFICATES OUTSTANDING Intergovernmental Contracts Trust Certificates currently outstanding are as follows: \n \nPurpose \n \nInterest Rates \n \nAmount \n \nGeneral Government-Series 1994 \n \n4.40% - 6.00% \n \n$12,255,000.00 \n \n- 17 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 3: NON-MONETARY TRANSACTIONS \n \nThe Board receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories \n \nNote 4: RISK MANAGEMENT \n \nThe Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors or omissions; job related illness or injuries to employees; natural disaster; and unemployment compensation. \n \nThe Board has obtained commercial insurance for risk of loss associated with assets, errors or omissions and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any of the past three years. \n \nThe Board has elected to self-insure for all losses related to torts. The Board has not experienced any losses related to these risks in the past three years. \n \nThe Board has established a limited risk management program for workers' compensation claims. A premium is charged by the General Fund to each user fund on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Board accounts for claims with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. These losses include an estimate of claims that have been incurred but not reported. An excess coverage insurance policy covers individual claims in excess of $250,000.00 loss per occurrence, up to the statutory limit. \n \nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \n \nBeginning of Year Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEnd of Year Liability \n \n1995 \n \n$ 157 769.18 $ 279,240.77 $ 244,805.60 $ 192,204.35 \n \n1996 \n \n$ 192,204.35 $ 262,606.11 $ 146,857.85 $ 307,952.61 \n \nThe Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund with expenditure and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. \n \nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \n \n- 16 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \n. JUNE 30, 1996 \n \nNote 2: DEPOSITS AND INVESTMENTS \n \nCATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: \n \nCategory I - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. \nCategory 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name. \nCategory 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. \n \nFunds invested in an investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. \n \nAt June 30, 1996, the carrying amount of the Board's total investments was $27,088,275.96 and the market value of these investments, excluding investments in the amount of $20,490,783.64 in the State of Georgia, Local Government Investment Pool and $6,280,580.03 in a Deferred Compensation Plan - Pooled Investments, was $316,912.29. The investments are classified as to risk categories as follows: \n \nT)l)e of Investment \n \nRisk Categories \n \n2 \n \n3 \n \nCarrying Amount \n \nMarket Value \n \nU. S. Government \nLocal Government Investment Pools \n \n$======\"\"0=.0'0= $ \n \n000 $ 316 912 29 $ 316,912.29 $ 316 912.29 \n \n20,490,783.64 \n \n* \n \n Unclassified \n \nDeferred Compensation Plan Pooled Investments \n \n6,280,580.03 \n \n* \n \nTotal Investments \n \n$27 088 275 96 \n \n* Undetenninable \n \nThe carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy of the State of Georgia, Office of Treasury and Fiscal Services for the Local Government Investment Pool does not provide for investment in derivatives or similar investments. The investment policy of the Houston County Board of Education for its portfolio accounts does not provide for investments in ,. derivatives or similar investments. \n \n- 15 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nV \nNote 2: DEPOSITS AND INVESTMENTS \n \n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \n \n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \n \n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities ofthe State of Georgia, \n \n(5) Bonds ofany public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \n \n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \n \n(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. \n \nCATEGORIZATION OF DEPOSITS At June 30, 1996, the bank balances were $9,262,312.74. The amounts of the total bank balances are classified into three categories of credit risk: \n \nCategory I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. \nCategory 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. \nCategory 3 - Uncollateralized deposits. (This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.) \n \nThe Board's deposits are classified by risk category at June 30, 1996, as follows: \n \nRisk Category \n \nBank Balance \n \n1 \n \n$ 1,247,469.26 \n \n2 \n \n6,869,980.00 \n \n3 \n \n1,144,863.48 \n \n Total \n \n$ 9,262,312.74 \n \n- 14 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nGENERAL OBLIGATION BONDS \nThe Board issues general obligation bonds and trust certificates to provide funds for the acquisition and construction of major capital facilities. Bond premiums and discounts, as well as issuance costs, are recognized during the year bonds are issued. Issuance costs, whether or not withheld from actual net proceeds, are reported as capital project expenditures. In addition, general obligation bonds have been issued to refund existing general obligation bonds. General obligation bonds are direct obligations and pledge the full faith and credit of the government. The outstanding amount of these bonds and trust certificates is recorded in the General Long-Term Debt Account Group. \nINTERFUND TRANSACTIONS \nThe Board has the following types of interfund transactions: \nReimbursements of expenditures 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. \nOperating transfers are recorded for all interfund transactions other than reimbursements. \nMEMORANDUM ONLY - TOTAL COLUMNS \nTotal columns on the general purpose financial statements are captioned \"Memorandum Only\" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. \nNote 2: DEPOSITS AND INVESTMENTS \nCOLLATERALIZATION 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. The aggregate of the face value of such surety bond and the market value of securities shall be equal to not less than 110 percent of the public funds being secured after the deduction of the amount of deposit insurance. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts. \nAcceptable security for deposits consists of any one of or any combination of the following: \n( 1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, \n- 13 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nV \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n \nP70.103. The Houston County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the Board. \n \nTax millage rates levied for the 1995 tax year (calendar year) for the Houston County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value): \n \nSchool Operations School Bonds \n \n12.87 mills 1.00 mills \n \n13.87 mills \n \nINVENTORIES \n \nFOOD INVENTORIES  Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost (weighted average). Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations of fund balance which indicates that these amounts do not constitute \"available spendable resources\" even though they are a component of net current assets. \n \nSUPPLY INVENTORIES Inventories of consumable supplies and materials are recorded as purchases for resale (contra-revenue account) at the time of purchase and are reported on the Combined Balance Sheet at cost (weighted average). The supply inventories reported on the balance sheet are equally offset with a reservation of fund balance which indicates that they do no constitute \"available spendable resources\" even though they are a component of net current assets. \n \nCOMPENSATED ABSENCES \n \nCompensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements. \n \nHowev~r, the dollar value of accumulated compensated absences at June 30, which will be payable from future resources is material to the general purpose financial statements and has not been recorded in the General Long-Term Debt Account Group as required by generally accepted accounting principles. \n \n- 12 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nfor deposits, the highest rate ofreturn shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: \n( 1) Obligations issued by the State of Georgia or by other states, \n(2) Obligations issued by the United States government, \n(3) Obligations fully insured or guaranteed by the United States government or a United States government agency, \n(4) Obligations of any corporation of the United States government, \n(5) Prime banker's acceptances, \n(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services, \n(7) Repurchase agreements, and \n(8) Obligations of other political subdivisions of the State of Georgia. \nINVESTMENTS HELD BY TRUSTEE \nInvestments held by trustee consist of contributions from employees who have elected to participate in the Board's deferred compensation plan. See Note 11 - Deferred Compensation Plan \nRECEIVABLES \nReceivables consist ofgrant 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 general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \nPROPERTY TAXES \nThe Houston County Board of Commissioners fixed the property tax levy for the 1995 tax year (calendar year) on September 19, 1995 (levy date). Taxes were due on December 20, 1995. The lien date for property taxes was January 1, 1995. Taxes collected within the current fiscal year or within 60 days after year-end are ,.1 reported as revenue in fiscal year 1996 since their collection meets the criteria of GASB codification section \n \n- 11 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIDBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n \nGeneral Fund \n \nSpecial Revenue \nFund \n \nFUND BALANCE JULY 1, 1995 \n \n$ 5,444,534.39 $ 1,535,198.25 \n \nAdjustments Deferred - Sales Tax - July 1, 1995 Inventories - July 1, 1995 Food Donated Commodities Purchased Foods Supplies \n \n15,219,072.66 \n \n-367,242.10 \n \n-152,078.27 -83,407.92 \n \nFund Balance July 1, 1995 - Restated Budget Basis \n \n$ 20,296,364.95 $ 1,299,712.06 \n \nExcess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \n \n$ -1,544,960.40 $ -495,442.36 \n \nAdjustments Deferred - Sales Tax July 1, 1995 June 30, 1996 \n \n-15,219,072.66 16,533,005.13 \n \n$ -231,027.93 $ -495 442.36 \n \nFUND BALANCE JUNE 30, 1996 (Budget Basis) CASH AND CASH EQUIVALENTS \n \n$20,065 337 02 $ 804,269.70 \n \nCOMPOSITION OF DEPOSITS Cash and cash equivalents consist of deposits (including N.O.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds in one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State. \n \nINVESTMENTS \n \nCOMPOSITION OF INVESTMENTS Investments made by the Board are stated at cost. The Official Code of Georgia Annotated Section 3G-83-4 authorizes the Board to invest its funds. In selecting among avenues of investment or among institutional bids \n \n- 10 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nof the Board were employed for a one hundred and ninety day period beginning in late August 1995 and ending in early June 1996. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1995 and ending in August 1996. State grants to fund the State's share of these contracts were disbursed from the Georgia Department of Education to the Board in the same twelve months. As ofJune 30, 1996, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1996, had not been made. Payments for these two months were made and recorded as expenditures by the Board subsequent to June 30, 1996. Also, the State's portion of the compensation paid in July and August 1996 was received and recorded as revenue in the fiscal year subsequent to June 30, 1996. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1995, were recorded in the year ended June 30, 1996. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed. \nAgency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities. \nBUDGET \nThe Houston County Board of Education's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. \nThe budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \nThe Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit \"B\" of this report: \n \n- 9- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nmeasurement focus, only current assets and current liabilities generally are 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 of available spendable resources. \nLiabilities 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. \nAgency funds are purely custodial in nature and do not involve measurement of results of operations. \nGovernmental funds are accounted for using the modified accrual basis of accounting under which: \nRevenues 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 property taxes, local option sales taxes, intergovernmental grants and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end. \nA departure from the above definitions is the accounting treatment afforded the local option sales taxes. Georgia Laws 1982, House Resolution Nos. 699 and 700, proposed to amend the Constitution of the State of Georgia so as to provide for a local sales and use tax for the Houston County Board of Education whereby this tax would limit the amount of ad valorem taxes to be imposed, levied and collected for use by the Board. These resolutions were subsequently approved by the voters of Houston County in the General Election held November 2, 1982. Section I, Part 2B, of House Resolution 700 states: \n\"The maximum allowable mill rate for each government in each year shall be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the local government in the immediately preceding year from any local sales and use tax.\" \nThe Board's legal counsel has advised that the effect of this legislation places the sales tax collected in trust with the Board of Education for use in the following year upon the reduction of the mill rate. Accordingly, the Board has elected to record the amount of sales tax received for use in a subsequent period as a liability (unearned revenue) rather than as revenue. To conform to generally accepted accounting principles, the sales tax collections should be recorded as revenue when measurable and available. \nExpenditures are generally recognized when the related fund liability is incurred. \nA departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share of these contracts. During fiscal year 1996, a substantial number of personnel \n- 8- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nAlthough \"school activity accounts\" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements. \nThe general purpose financial statements account for all State, Federal, Taxes and Other funds under control ofthe Board, 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: \nGOVERNMENTAL FUND TYPES - are used to account for all or most ofa Board's educational activities. Governmental Fund Types include: \nGENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education. \nSPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. \nCAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. \nDEBT SERVICE FUND-the fund used to account for the accumulation of resources for, and the payment of, general long-term principal, interest and paying agent fees. \nFIDUCIARY FUND TYPE - the agency fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes: \nAGENCY FUNDS - the funds used to account for assets held for other funds, governments, or individuals. \nACCOUNT GROUP \nGENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for general obligation bonds outstanding, material capital lease obligations and intergovernmental contract trust certificates. \n}\\ \nBASIS OF ACCOUNTING \nThe 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 \n- 7- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1996 \n \nV \nNote I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nThe Houston County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board and Superintendent, both elected by the voters. With the exception ofthe departures from generally accepted accounting principles disclosed in these notes, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to governmental units and unless otherwise disclosed in these notes, the financial statements present all of the fund types and account groups of the Board. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards. \nThe more significant of the Board's accounting policies are described below. \nREPORTING ENTITY \nIn evaluating how to define the governmental unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, \"Defining the Financial Reporting Entity\". The primary government consists of all the organizations that compose the legal entity of the Houston County Board of Education. \nBased upon the application of the above criteria, the Houston County Board of Education is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Houston County, Georgia. The Board is not included in any other governmental \"reporting entity\" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards. \nBoard members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval. \nFUND ACCOUNTING \nThe Board 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. \nA 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. \nGeneral Fixed Assets 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 Board. 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. \n- 6- \n \n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES \nBUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS \nYEAR ENDED JUNE 30, 1996 \n \nEXHIBITc \n \nGENERAL FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \nREVENUES \n \nState Funds Federal Funds Taxes and Other Funds \n \n$ 56,926,651.74 $ 57,904,961.16 \n \n1, 126,240.00 \n \n1,092,603.26 \n \n30,531,952.00 30,103,755.98 \n \nTotal Revenues \n \n$ 88,584,843.74 $ 89,101,320.40 \n \nEXPENDITURES \n \nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services \nCapital Outlay Debt Service \n \n$ 55,993,940.58 $ 56,356,708.82 \n \n3,345,769.00 4,064,863.79 2,617,566.00 \n332,528.00 5,388,905.00 \n859,293.00 7,254,512.00 2,494,906.36 1,732,950.00 \n292,994.00 \n \n3,377,454.82 4,008,548.85 2,612,235.90 \n334,054.80 5,425,947.08 \n920,885.46 7,429,733.19 3,809,039.54 1,217,923.31 \n297,145.82 \n \n1,370,722.00 612,228.00 \n \n1,372,684.71 1,797,408.06 \n573,208.63 \n \nTotal Expenditures \n \n$ 86,361,177.73 $ 89,532,978.99 \n \nExcess of Revenues over (under) Expenditures \n \n$ 2,223,666.01 $ -431 ,658.59 \n \nOTHER FINANCING SOURCES {USES) \n \nOther Sources Other Uses \n \n$ 10,586,142.00 $ 13,438,769.96 -13,043,868.00 -13,238,139.30 \n \nTotal Other Financing Sources (Uses) \n \n$ -2,457,726.00 $ \n \n200,630.66 \n \nExcess of Revenues and Other Financing Sources \n \nover (under) Expenditures and Other Financing \n \nUses \n \n$ -234,059.99 $ -231,027.93 \n \nFUND BALANCE JULY 1, 1995 \n \n20,814,725.43 20,296,364.95 \n \nSPECIAL REVENUE FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \n$ 3,810,791.64 $ 3,798,842.28 \n \n5,923,823.00 \n \n5,746,649.98 \n \n2,203,808.00 \n \n2,149,515.01 \n \n$ 11,938,422.64 $ 11,695,007.27 \n \n$ 5,130,341.16 $ 5,079,323.48 \n \n268,188.00 288,782.94 \n \n277,047.44 229,067.58 \n \n114,039.00 \n \n111,797.74 \n \n166,228.00 154,308.00 \n6,700.00 93,220.00 6,049,680.00 162,720.69 \n4,570.00 \n \n347,273.24 109,630.08 \n6,700.00 75,681.75 6,071,000.99 99,975.63 \n4,570.70 144,000.00 \n \n$ 12,438,777.79 $ 12,556,068.63 \n \n$ -500,355.15 $ -861 ,061.36 \n \n$ \n \n39,497.00 $ 365,619.00 \n \n$ \n \n39,497.00 $ 365,619.00 \n \n$ -460,858.15 $ -495,442.36 \n \n1,632,327.00 \n \n1,299,712.06 \n \nFUND BALANCE JUNE 30, 1996 \n \n$ 20,580,665.44 $ 20,065,337.02 \n \n$ 1,171,468.85 $ 804,269.70 \n \nThe notes to the general purpose financial statements are an integral part of this statement. -5- \n \n 1::!OUSTQN COUNTY BOARD OF EDUCATION \n~QMBINED STATEMENI OF REVEN!,.!ES, EXPE!::jQITUBES AND CHANGES IN FUND !;!ALANCES \n\u0026.I. GQY!;;RNMENTB!,, FU!::!D TYPI; YEAA ENDED JUNE 30, 1996 \n \nEXHIBIT\"B\" \n \nTOTALS \n \nSPECIAL \n \nCAPITAL \n \nDEBT \n \n~morandum On!Y} \n \n\\,' \n \nGENERAL \n \nREVENUE \n \nPROJECTS \n \nSERVICE \n \nYEAR ENDED \n \nFUND \n \nFUND \n \nFUND \n \nFUND \n \nJUNE 30, 1996 JUNE 30, 1995 \n \nBEVE!::!!,!ES \nState Funds Federal Funds Taxes and Other Funds \n \n$ 57,904,961.16 $ 1,092,603.26 \n28,789,823.51 \n \n3,798,842.28 $ 5,746,649.98 2,149,515.01 \n \n1,623,380.00 \n \n$ \n \n562,836.30 $ 1,348,512.41 \n \n63,327,183.44 $ 58,954,055.37 \n \n6,839,253.24 \n \n6,694,393.53 \n \n32,850,687.23 30,284,434.10 \n \nTotal Revenues \n \n$ 87,787,387.93 $ 11,695,007.27 $ 2,186,216.30 $ 1,348,512.41 $ 103,017,123.91 $ 95,932,883.00 \n \nl;XPl;!::!QIT!,.!BES \n \nCurrent \n \nInstruction \n \n$ 56,356,708.82 $ \n \nSupport Services \n \nPupil Services \n \n3,377,454.82 \n \nImprovement of Instructional \n \nServices \n \n4,008,548.85 \n \nEducational Media Services \n \n2,612,235.90 \n \nGeneral Administration \n \n334,054.80 \n \nSchool Administration \n \n5,425,947.08 \n \nBusiness Administration \n \n920,885.46 \n \nMaintenance and Operation of Plant \n \n7,429,733.19 \n \nStudent Transportation Services \n \n3,809,039.54 \n \nCentral Support Services \n \n1,217,923.31 \n \nOther Support Services \n \n297,145.82 \n \nFood Services Operation \n \nOther Operations of Non-Instructional \n \nServices \n \n1,372,684.71 \n \nCapital Outlay \n \n1,797,408.06 \n \nDebt Service \n \nPrincipal \n \n526,556.15 \n \nInterest \n \n46,652.48 \n \nEscrow Agent \n \nPaying Agent Fees \n \n5,079,323.48 \n \n$ \n \n277,047.44 \n \n229,067.58 \n \n111,797.74 \n \n347,273.24 109,630.08 \n6,700.00 75,681.75 6,071,000.99 \n \n99,975.63 4,570.70 $ 9,943,139.26 \n \n144,000.00 \n \n$ 705,000.00 1,203,260.00 \n \n3,870.50 \n \n3,573.52 \n \n61,436,032.30 $ 53,938,491.02 \n \n3,654,502.26 \n \n3,297,635.82 \n \n4,237,616.43 2,612,235.90 \n445,852.54 5,425,947.08 \n920,885.46 7,777,006.43 3,918,669.62 1,224,623.31 \n372,827.57 6,071,000.99 \n \n4,026,162.82 2,772,622.46 \n327,469.02 4,897,632.50 \n788,475.27 7,234,086.43 2,058,183.43 1,380,215.04 \n44,494.25 5,303,105.23 \n \n1,472,660.34 11,745,118.02 \n \n1,542,509.39 9,174,125.08 \n \n1,375,556.15 1,249,912.48 \n7 444.02 \n \n932,780.86 1,116,828.13 \n2,514.51 55.78 \n \nTotal Expenditures \n \n$ 89,532,978.99 $ 12,556,068.63 $ 9,947,009.76 $ 1,911,833.52 $ 113,947,890.90 $ 98,837,387.04 \n \nExcess of Revenues over (under) Expenditures \n \n$ -1,745,591.06 $ -861,061.36 $ -7,760,793.46 $ -563,321.11 $ -10,930,766.99 $ -2,904,504.04 \n \nOTHER FINANCING SOURCES (USES} \n \nCapital Leases Operating Transfers In Operating Transfers Out \n \n$ 2,852,792.00 $ -2,652,161.34 \n \n326,122.00 39,497.00 $ \n \n$ 1,723,939.34 $ 1,581,648.05 -692,923.05 \n \n3,178,914.00 $ 3,345,084.39 -3,345,084.39 \n \n110,970.00 2,393,390.20 -2,393,390.20 \n \nTotal Other Financing Sources \n \n(Uses) \n \n$ \n \n200,630.66 $ \n \n365,619.00 $ 1,031,016.29 $ 1,581,648.05 $ 3,178,914.00 $ \n \n110,970.00 \n \nExcess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \n \n$ -1,544,960.40 $ \n \n-495,442.36 $ -6,729,777.17 $ 1,018,326.94 $ \n \n-7,751,852.99 $ -2,793,534.04 \n \nFUND BALANCE JULY 1 \n \n5,444,534.39 \n \n1,535,198.25 \n \n8,555,566.71 \n \n769,630.12 \n \n16,304,929.47 19,025,694.10 \n \nFood Inventory - Net Change in Period Donated Commodities Purchased Food \nSupplies Inventory Net Change in Period \n \n-32,151.83 \n \n64,584.29 -2,606.10 \n \n64,584.29 -2,606.10 \n-32,151.83 \n \n12,177.83 22,147.52 \n38,444.06 \n \nFUND BALANCE JUNE 30 \n \n$ 3,867,422.16 $ 1,101,734.08 $ 1,825,789.54 $ 1,787,957.06 $ 8,582,902.84 $ 16,304,929.47 \n \nThe notes to the general purpose financial statements are an integral part of this statement. -4- \n \n EXHIBIT\"A\" \n \nDEBT SERVICE \nFUND \n \nFIDUCIARY FUND TYPE AGENCY FUND \n \nACCOUNT GROUP GENERAL \nLONG-TERM DEBT \n \nTOTALS (Memorandum Onl~ JUNE 30, 1996 JUNE 301 1995 \n \n$ 1,754,360.58 \n \n$ 6,813,360.59 $ 5,260,637.98 \n \n1,823.60 \n \n20,899,528.61 \n \n27,763,802.54 \n \n$ 6,280,580.03 \n \n6,280,580.03 \n \n5,911,692.29 \n \n31,772.88 \n \n1,862,871.15 \n \n2,279,346.80 \n \n5,000.00 \n \n335,090.27 \n \n216,662.56 80,801.82 \n \n$ \n \n1,787,957.06 \n \n1,787,957.06 \n \n367,242.10 \n152,078.27 83,407.92 \n769,630.12 \n \n8,087,591.54 3,348,205.19 11,554,451.40 \n \n8,087,591.54 3,348,205.19 11,554,451.40 \n \n8,920,369.88 839,847.34 \n12,445,000.00 \n \n$ 1,787,957.06 $ 6,280,580.03 $ 24,778,205.19 $ 61,267,100.22 $ 64,798,055.24 \n \n$ 6,280,580.03 $ \n$ 6,280,580.03 $ \n \n$ 2,731,330.17 $ 2,296,768.31 \n \n799,479.59 \n \n518,009.96 \n \n860,221.29 \n \n626,795.94 \n \n1,003.98 \n \n48,103.17 \n \n285,060.10 \n \n700,372.00 \n \n612,776.00 \n \n6,280,580.03 \n \n5,911,692.29 \n \n3,348,205.19 9,175,000.00 12,255,000.00 \n \n10,795,118.76 5,737,886.37 3,348,205.19 9,175,000.00 12,255,000.00 \n \n9,506,384.56 5,712,688.10 \n839,847.34 9,690,000.00 12,445,000.00 \n \n24,778,205.19 $ 52,684,197.38 $ 48,493,125.77 \n \n$ 1,787,957.06 \n \n$ \n \n1,949.08 \n \n1,787,957.06 $ \n \n57,412.45 \n \n769,630.12 88,314.40 \n \n335,090.27 \n \n367,242.10 \n \n216,662.56 80,801.82 \n1,037,326.94 305,188.00 \n \n152,078.27 83,407.92 7,653,742.30 282,091.00 \n \n$ 1,787,957.06 \n \n$ 3,822,388.18 $ 9,396,506.11 \n \n1,112,959.65 \n \n910,701.77 \n \n3,647,555.01 \n \n5,997,721.59 \n \n}\\ \n \n$ 1,787,957.06 \n \n$ 8,582,902.84 $ 16,304,929.47 \n \n$ 1,787,957.06 $ 6,280,580.03 $ 24,778,205.19 $ 61,267,100.22 $ 64,798,055.24 \n \n-3- \n \n l::IQUTQN COUNTY BOARD QF l;DUCATIQN COMBl!jED BALANCE SHEET \n81.L FUNQ TYPES AND ACCO!,!NT QRQUP JUNE 30, 1996 \n \n\\{ \n~ \nCash and Cash Equivalents \nInvestments \nInvestments Held by Trustee \nAccounts Receivable \nPrepaid Items \nInventories Consumable Supplies Food Donated Commodities Purchased Food \nAmount Available in Debt Service Fund \nAmount to be Provided in Future Years For Payment of: Bond Debt Capital Lease Agreements Trust Certificates \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \n$ 4,018,969.35 $ 1,040,030.66 \n \n16,105,953.54 \n \n$ 4,791,751.47 \n \n472,721.99 \n \n728,514.73 \n \n629,861.55 \n \n335,090.27 \n \n216,662.56 80,801.82 \n \nTotal Assets \n \n$ 20,932.735.15 $ 2,oss,009.n $ 5,421,613.02 \n \nLIABILITIES AND FUND EQUITY \n \nLIABILITIES \n \nCash Overdraft \n \nAccounts Payable \n \nSalaries Payable \n \nExpired Grant Balances Payable \n \nContracts Payable \n \n \n \nRetainages Payable \n \nDeferred Compensation Plan \n \nUnearned Revenue \n \nFiscal Year 1996 \n \nFiscal Year 1997 \n \nFiscal Year 1998 \n \nCapital Lease Agreements \n \nGeneral Obligation Bonds Payable \n \nIntergovernmental Contracts Trust Certificates \n \nTotal Liabilities \n \nFUND EQUITY \n \nFund Balances Reserved For Continuation of Federal Program For Debt Service For Expired Grant Balances/Questioned Costs For Inventories Consumable Supplies Food Donated Commodities Purchased Food For Purposes of Trust Certificates For State Capital Outlay Projects \n \nUnreserved Designated for Self-Insurance Undesignated \nTotal Fund El. Jity \n \nTotal Liabilities and Fund Equity The notes to the general purpose financial statements are an integral part of this statement. \n-2- \n \n$ 2,731,330.17 \n \n$ \n \n438,194.02 $ \n \n197,164.26 \n \n164,121.31 \n \n94,113.84 \n \n766,107.45 \n \n1,003.98 \n \n700,372.00 \n \n10,795,118.76 5,737,886.37 \n \n$ 17,065,312.99 $ 964,275.69 $ 3,595,823.48 \n \n$ \n \n1,949.08 \n \n$ \n \n57,412.45 \n \n335,090.27 \n \n216,662.56 80,801.82 \n$ \n \n1,037,326.94 305,188.00 \n \n$ \n \n392,502.72 $ \n \n299,413.46 $ 1,342,514.94 \n \n1,112,959.65 2,361,959.79 \n \n802,320.62 \n \n483,274.60 \n \n$ 3,867,422.16 $ 1,101,734.08 $ 1,825,789.54 \n \n$ 20,932,735.15 $ 2,066,009.77 $ 5,421,613.02 \n \n HOUSTON COUNTY BOARD OF EDUCATION - 1- \n \n SCHEDULE \"9\" \n \nSAFE SCHOOLS \nGRANT \n \nTECHNOLOGY INSTALLATION \n \nEXCEPTIONAL GROWTH CAPITAL OUTLAY \n \nTOTAL \n \n$ \n \n83,685.00 $ 247,121.45 \n \n$ 1,329,198.73 335,887.46 11,733.21 \n556.56 \n11,008.00 1,065.55 \n22,498.66 733,338.06 \n5,500.00 4,055.15 \n63,512.41 10,893.10 12,604.36 \n \n$ 3,651,239.69 \n \n144,000.00 \n4,570.70 3,651,239.69 \n650,893.35 \n \n$ \n \n83,685.00 $ 247,121.45 $ 3,651,239.69 $ 6,992,554.99 \n \n- 45 - \n \n V \nTHIS PAGE LEn BLANK \n \n HOUSTON COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1996 \n \nSCHEDULE \"1 O\" \n \nMinimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis \nSalaries Operations \nLess: Expenditures for Media Center Programs in Excess of Total Media Allotment \nExpenditures per Audit \nAmount of Underexpenditure for Total Allotment \n \nTHIRTEEN WEIGHTED AND MEDIA CENTER \nPROGRAMS \n \n100% TEST FOR \nOPERATIONS \nPORTION OF THIRTEEN WEIGHTED \nPROGRAMS \n \n$ 43,707,781.00 $ \n \n1,370,571.00 \n \n$ 52,090,927.04 3,041,968.65 $ _ _2=,_49_6..:,.,2_6_6_.3_7 \n$ 55,132,895.69 \n \n-1,089,426.41 $ 54,043,469.28 \n \n$ \n \n0.00 $=====0.=00= \n \nSee notes to the general purpose financial statements. - 47 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \nANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS \nYEAR ENDED JUNE 30, 1996 \n \nGENERAL AND CAR!;ER EDUCATION PROGRAMS Kindergarten (\") Grades 1 - 3 (j Sub-Total  K-3 Grades 4 - 5 (*) Grades 6 - 8 (\") Grades 9  12 (*) High School Laboratories (\") Vocational Education Laboratories (*) Total General and Career Education Programs \nSPECIAL EDUCATION PROGRAMS Regular Programs Category I (\") Category II (\") Category Ill (*) Category IV (*) Sub-Total - Regular Category V (Gifted) (*) Total Special Education Programs \nREMEDIAL EDUCATION PROGRAM(*} Total Thirteen Weighted Programs \nMEDIA CENTER PROGRAMS Salaries Operations Total Media Center Programs \nTotal Thirteen Weighted and Media Center Programs \n \nALLOTMENTS FROM DEPARTMENT OF EDUCATION \n \nREQUIRED \n \nORIGINAL \n \n% \n \nORIGINAL \n \nMID-TERM \n \n$ 3,282,606.00 8,808,082.00 \n$ 12,090,688.00 4,423,433.00 7,996,812.00 5,232,692.00 2,919,538.00 2,090,530.00 \n$ 34,753,693.00 \n \n$ 2,954,345.40 $ \n \n7,927,273.80 \n \n90 $ 10,881,619.20 $ \n \n90 \n \n3,981,089.70 \n \n90 \n \n7,197,130.80 \n \n90 \n \n4,709,422.80 \n \n90 \n \n2,627,584.20 \n \n90 \n \n1,881,477.00 \n \n$ 31,278,323.70 $ \n \n31,145.00 45,294.00 76,439.00 37,314.00 \n7,041.00 -33,020.00 554,917.50 -131,872.50 510,819.00 \n \n$ 4,790,912.00 \n \n$ 4,311,820.80 $ \n \n44,959.00 \n \n$ 4,790,912.00 \n \n1,156,065.00 \n \n$ 5,946,977.00 \n \n$ \n \n816,289.00 \n \n$ 41,516,959.00 \n \n90 $ 4,311,820.80 $ \n \n90 \n \n1,040,458.50 \n \n$ 5,352,279.30 $ \n \n90 $ \n \n734,660.10 $ \n \n$ 37,365,263.10 $ \n \n44,959.00 3,449.00 \n48,408.00 137,649.00 696,876.00 \n \n$ 1,177,679.00 90 $ 1,059,911.10 $ \n \n295,074.00 90 \n \n265,566.60 \n \n$ 1,472,753.00 \n \n$ 1,325,477.70 $ \n \n14,177.00 7,016.00 \n21,193.00 \n \n$ 42,989,712.00 \n \n$ 38,690,740.80 $ \n \n718,069.00 \n \nSTAFF DEVELOPMENT PROGRAMS Cost of Instruction Professional Development \nTotal Staff Development Programs (*) Identifies Thirteen Weighted Programs. See notes to the general purpose financial statements. \n \n$ \n \n116,473.00 \n \n355,623.00 \n \n$ \n \n116,473.00 $ \n \n355,623.00 \n \n3,023.00 0.00 \n \n$ \n \n472,096.00 100 $ \n \n472,096.00 $ ====3,=02=3=.0=0 \n \n- 48 - \n \n SCHEDULE 11 \n \n\" \nTOTAL REQUIRED \n \nACTUAL EXPENDITURES \n \nSALARIES \n \nOPERATIONS \n \nTOTAL \n \nAMOUNT OF UNDER EXPENDITURE \nFOR REQUIRED ALLOTMENT \n \n$ 2,985,490.40 $ 4,535,358.65 $ \n \n90,616.52 $ 4,625,975.17 \n \n7,972,567.80 \n \n9,700,797.82 \n \n311,239.91 \n \n10,012,037.73 \n \n$ 10,958,058.20 $ 14,236,156.47 $ \n \n401,856.43 $ 14,638,012.90 $ \n \n0.00 \n \n4,018,403.70 \n \n5,858,223.16 \n \n279,332.74 \n \n6,137,555.90 \n \n0.00 \n \n7,204,171.80 \n \n9,896,961.90 \n \n831,469.35 \n \n1o.728,431.25 \n \n0.00 \n \n4,676,402.80 \n \n6,261,472.22 \n \n459,336.93 \n \n6,720,809.15 \n \n0.00 \n \n3,182,501.70 \n \n3,156,193.15 \n \n124,538.83 \n \n3,280,731.98 \n \n0.00 \n \n1,749,604.50 \n \n2,085,965.41 \n \n212,785.32 \n \n2,298,750.73 \n \n0.00 \n \n$ 31,789,142.70 $ 41,494,972.31 $ 2,309,319.60 $ 43,804,291.91 \n \n$ 4,356,779.80 $ \n \n143,663.72 $ 940,910.41 4,051,102.02 643,730.47 \n \n5,007.12 $ 12,530.82 68,589.55 26,519.44 \n \n148,670.84 953,441.23 4,119,691.57 670,249.91 \n \n$ 4,356,779.80 $ 5,779,406.62 $ \n \n112,646.93 $ 5,892,053.55 \n \n0.00 \n \n1,043,907.50 \n \n1,795,863.58 \n \n62,029.24 \n \n1,857,892.82 \n \n0.00 \n \n$ 5,400,687.30 $ 7,575,270.20 $ \n \n174,676.17 $ 7,749,946.37 \n \n$ \n \n872,309.10 $ \n \n983,014.40 $ \n \n12,270.60 $ \n \n995,285.00 \n \n0.00 \n \n$ 38,062,139.10 $ 50,053,256.91 $ 2,496,266.37 $ 52,549,523.28 \n \n$ 1,074,088.10 $ 2,037,670.13 \n \n$ 2,037,670.13 \n \n0.00 \n \n272,582.60 \n \n$ \n \n545,702.28 \n \n545,702.28 \n \n0.00 \n \n$ 1,346,670.70 $ 2,037,670.13 $ \n \n545,702.28 $ 2,583,372.41 \n \n$ 39,408,809.80 $ 52,090,927.04 $ 3,041,968.65 $ 55,132,895.69 $ \n \n0.00 \n \n$ \n \n119,496.00 \n \n355,623.00 \n \n$ ==4=7=5,=11=9=.o=o \n \n$ \n \n296,655.08 $ \n \n296,655.08 \n \n178,463.92 \n \n178,463.92 \n \n$ \n \n475,119.00 $ \n \n475,1,9.00 $======0.=00= \n \n- 49 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION OF BOARD MEMBERS \nYEAR ENDED JUNE 30, 1996 \nBOARD MEMBER ADDRESS \nMr. Alan S. Talbert, Chairman (*) 115 Freeman Drive Warner Robins, Georgia 31088 \nMr. David L. Davidson (*) \nP. 0. Box207 \nBonaire, Georgia 31005 \nMr. Gillis R. Dawkins (*) 2031 Highway 41 South Perry, Georgia 31069 \nMrs. Robertiena R. Fletcher (*) 133 Stewart Drive Warner Robins, Georgia 31093 \nMr. Hubert Hutcherson 201 Clifton Drive Perry, Georgia 31069 \nMs. Shirley Lowery (*) 125 Gunsmoke Drive Warner Robins, Georgia 31093 \nMr. Gary M. Mclure (*) 113 Heather Place Centerville, Georgia 31028 \nMr. Fred Wilson (*) 114 Palm Drive Warner Robins, Georgia 31088 \n \nSCHEDULE \"12\" \n \n$ \n \n3,550.00 \n \n2,650.00 \n \n1,100.00 \n \n2,500.00 \n \n900.00 \n \n2,400.00 \n \n2,450.00 \n \n2,550.00 \n \n$ ====18,=10=0.0=0 \n \n(*) Denotes Board Members Serving as of June 30, 1996 \n \nSee notes to the general purpose financial statements. - 50 - \n \n SECTION II COMPLIANCE \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members ofthe Houston County Board ofEducation \nCOMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board ofEducation as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nWe 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. \nCompliance with laws, regulations, contracts, and grants applicable to Houston County Board of Education is the responsibility ofthe Board'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 Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. \nMaterial instances of noncompliance consist of failures to follow requirements or violations of prohibitions, contained in laws, regulations, contracts, or grants, that cause us to conclude that the aggregation of the misstatements resulting from those failures or violations is material to the general purpose financial statements. The results of our tests of compliance disclosed a material instance of noncompliance, which is described in the Schedule of Findings and Improper or Questioned Costs. \n \n96CRL-20X \n \n As also described in the Schedule of Findings and Improper or Questioned Costs, the material instance of noncompliance noted above has been corrected in the financial statements. \n.,. We considered this material instance ofnoncompliance in forming our opinion on whether the fiscal year 1996 general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated April 10, 1997 on those general purpose financial statements. \nThis 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. \nRespectfully submitted, \n \nCLV:gp 96CRL-20X \n \nClaude L. Vickers State Auditor \n \n .,, \nCLAUDE L. VICKERS \nSTATE AUDITOR (404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board of Education \nand Superintendent and Members of the Houston County Board ofEducation \n \nSINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS \n \nLadies and Gentlemen: \n \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \n \nWe have applied procedures to test the Houston County Board of Education's compliance with the following requirements applicable to each ofits Federal financial assistance programs, which are listed in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996: \n \n(1) Political Activity \n \n(5) Allowable Costs/Cost Principles \n \n(2) Civil Rights \n \n(6) Drug-Free Workplace Act \n \n(3) Cash Management \n \n(7) Audit Follow-Up/Resolution \n \n(4) Federal Financial Reports \n \n(8) Administrative Requirements \n \nOur procedures were limited to the applicable procedures described in the Office of Management and Budget's \nflCompliance Supplement for Single Audits of State and Local Governments\" and other additional procedures \nas deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Board's compliance with the requirements listed in the preceding \nparagraph. Accordingly, we do not express such an opinion. \n \n96CRL-50 \n \n 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 test, nothing came to our attention that caused us to believe that the Houston County Board of Education had not complied, in all material respects, with those requirements. However, the results of our procedures disclosed an immaterial instance ofnoncompliance with those requirements, which is described in the Schedule of Findings and Improper or Questioned Costs. \nThis 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. \nRespectfully submitted, \n \nCLV:gp 96CRL-50 \n \nClaude L. Vickers State Auditor \n \n ... \nCLAUDE L. VICKERS \nSTATE AUDITOR (404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members of the State Board ofEducation \nand Superintendent and Members of the Houston County Board of Education \n \nSINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS \n \nLadies and Gentlemen: \n \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \n \nWe have also audited the Houston County Board ofEducation's compliance with the requirements governing: \n \n(1) Types of Services Allowed or Unallowed \n \n(5) Applicable Special Tests and Provisions \n \n(2) Eligibility \n(3) Matching, Level of Effort, and/or Earmarking \n \n(6) Other Requirement Claims for Advances and Reimbursements \n \n(4) Reporting \n \nThese requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1996. The management of the Houston County Board ofEducation is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. \n \n96CRL-80 \n \n We conducted our audit of compliance in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office of Management and Bupget (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 material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. \nIn our opinion, the Houston County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1996. \nThis 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. \nRespectfully submitted, \nc::t~~ \nClaude L. Vickers State Auditor \nCLV:gp 96CRL-80 \n \n \" \nCLAUDE L. VICKERS \nSTATE AUDITOR (404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members of the Houston County Board ofEducation \nSINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nIn connection with our audit of the fiscal year 1996 general purpose financial statements of the Houston County Board of Education and with our consideration of the Board's control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, \"Audits of State and Local Governments\", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1996. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements govermng: \nTypes of Services Allowed or Unallowed \nOur procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Houston County Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion. \nWith 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 Houston County Boar-2 of Education hq_d not complied, in all material respects, with those requirements. \n96CRL-120 \n \n 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. \nRespectfully submitted, \n//~ \nClaude L. Vickers \nState Auditor \nCLV:gp 96CRL-120 \n \n SECTION III INTERNAL CONTROL \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members of the Houston County Board of Education \nREPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April 10, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nWe 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. \nThe management of the Houston County Board of Education 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 of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. \n96ICL-3 \n \n In planning and performing our audit ofthe general purpose financial statements of the Houston County Board ofEducation for the year ended June 30, 1996, we obtained an understanding of the internal control structure. \nWit!i respect to the internal control structure, we obtained an understanding of the design of relevant policies \nand procedures and whether they have been placed in operation, and we assessed control risk in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. Accordingly, we do not express such an opinion. \nWe 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 of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. \nAs described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category: \nGeneral Fixed Assets \nA material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. \nOur consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition disclosed above is also considered to be a material weakness. \nThis condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Houston County Board of Education's financial statements and this report does not affect our report thereon dated April 10, 1997. \nThis 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. \nRespectfully submitted, \n~~ \nClaude L. Vickers State Auditor \nCLV:gp 96ICL-3 \n \n ... \nCLAUDE L. VICKERS \nSTATE AUDITOR (404) 656-2174 \n \nDEPARTMENT OF AUDITS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nApril 10, 1997 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation \nand ~uperintendent and Members of the Houston County Board ofEducation \nSINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1996, and have issued our report thereon dated April I0, 1997. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Houston County Board of Education's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated April 10, 1997. \nWe 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 Houston County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. \nIn planning and performing our audit for the year ended June 30, 1996, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions on the Board's general purpose financial statements and on its compliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated April 10, 1997. \n96ICL-5 \n \n The management of the Houston County Board of Education is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are reqired 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, 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 ofinherent limitations in any internal control structure, errors, irregularities or instances of noncompliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. \n \nFor the purposes 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: \n \nGENERAL REQUIREMENTS \n \nSPECIFIC REQUIREMENTS \n \n(1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports \n \n(1) Types of Services Allowed or Unallowed \n(2) Eligibility \n(3) Matching, Level of Effort, and/or Earmarking \n \n(5) Allowable Costs/Cost Principles \n \n(4) Reporting \n \n(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution (8) Administrative Requirements \n \n(5) Applicable Special Tests and Provisions \n(6) Other Requirement Claims for Advances and Reimbursements \n \nFor all of the internal control structure 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. \n \nDuring the year ended June 30, 1996, the Houston County Board of Education expended 89% of its total Federal financial assistance under major Federal financial assistance programs. \n \nWe 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 preventing or detecting material noncompliance wi~h general requirements and specific requirements as described above that are applicable to each of the Board's major Federal financial assistance programs, which \n \n96ICL-5 \n \n are identified in the Schedule of Federal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, \nwe 90 not express such an opinion. \nOur 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 constitute material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more ofthe internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. \nThis report is intended for the information of management, the Federal cognizant audit agency and other Federal granter agencies. This restriction is not intended to limit the distribution of this report which is a matter of public record. \nRespectfully submitted, \n \nCLV:gp 96ICL-5 \n \nClaude L. Vickers State Auditor \n \n SECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \nYEAR ENDED JUNE 30, 1996 \nV \nPRIOR YEAR \nAUDIT FOLLOW-UP/RESOLUTION Inadequate Inventory Records Federal Financial Assistance Finding Resolved Audit Control Number 6761-93-03 \nThe audit report for the year ended June 30, 1995, stated that the Board's property management records for the School Food Services Fund - National School Lunch Program (CFDA 10.555) were incomplete and failed to meet the property management standards as set forth in Chapter 41 of the Financial Management for Georgia Local Units of Administration or as outlined in 7 CFR 3015.169. For the year under review, the Board installed a property management system which meets the above property management standards as required. \nAUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Finding Resolved Audit Control Number 6761-93-05 \nThe audit report for the year ended June 30, 1993, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$30,901.95 for the Staff Development - Professional Development Stipends Program. For the year under review, an adjustment was made to the Board's local fair share by the Georgia Department of Education to refund this underexpenditure as required. \nAUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $57,412.45 Audit Control Number 6761-94-01 \nThe audit report for the year ended June 30, 1994, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$57,412.45 for the Staff Development - Professional Development Stipends Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund this underexpenditure as required. The underexpenditure of $57,412.45 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. \n-1- \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \nYEAR ENDED JUNE 30, 1996 \n,, PRIOR YEAR/CURRENT YEAR \nGENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6761-93-02 \nThe audit report for the year ended June 30, 1995, noted that the management of the Houston County Board ofEducation had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate action should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory ofland, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. \nFEDERAL FINANCIAL REPORTS Delinquent Financial Reports Federal Financial Assistance Major Programs Nonmaterial Noncompliance Audit Control Number 6761-94-02 \nThe audit report for the year ended June 30, 1995, stated the Board failed to submit on a timely basis \"System Claim and Requisition for Reimbursement\" (DE 0107) for the School Breakfast Program (CFDA 10.553), National School Lunch Program (CFDA 10.555), and Food Distribution Program (CFDA 10.550) in accordance with regulations established by the Georgia Department of Education. \nFor the year under review, it was noted that the \"School Nutrition Claim Data\" (DE form O106) and \"System Claim and Requisition for Reimbursement\" (DE form 0107) were not submitted on a timely basis. The delay occurred because management neglected the specific requirements imposed by the Georgia Department of Education. Procedures should be established to ensure that Federal financial reports are submitted by the required filing date. \n- 2- \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \nYEAR ENDED JUNE 30, 1996 \nV \nCURRENT YEAR GENERAL LEDGER Failure to Transfer Local Matching Funds Financial Statements Material Noncompliance Finding Resolved Audit Control Number 6761-96-01 For the year under review, the Board received approval for state capital outlay project funding, through Georgia State Financing and Investment Commission, for the 1996 fiscal year. Both the instructions in Chapter 41 ofthe Financial Management for Georgia Local Units of Administration and the agreement signed by the Board to receive this funding require that the Board transfer required local matching funds to the Capital Projects Fund by June 30, 1996, and designate those funds by project name and number. Transfers were not made by the Board at June 30, 1996, and correcting audit adjustments were necessary to transfer $150,127.00 to GSFIC Project No. 96/96S-676-03 l and $52,790.00 to GSFIC Project No. 96/96S-676-032, respectively, from the General Fund to the respective Capital Projects Fund as required. The failure to transfer these local matching funds was an oversight on the part ofthe Board. However, subsequent to June 30, 1996, the Board physically transferred the required local matching funds to the Capital Projects Fund and designated those funds by project name and number. \nNote: The Houston County Board ofEducation was provided an opportunity to include pertinent comments from the Board's management concerning these audit findings, conclusions and recommendations. The Board has elected not to provide comments for inclusion in this report. \n- 3- \n \n "},{"id":"dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1994-h95","title":"Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1995","collection_id":"dlg_ggpd","collection_title":"Georgia Government Publications","dcterms_contributor":["Georgia. Department of Audits and Accounts, issuing body."],"dcterms_spatial":["United States, Georgia, Houston County, 32.45901, -83.66624"],"dcterms_creator":["Georgia. Department of Audits"],"dc_date":["1995-06-30"],"dcterms_description":["Began with: Fiscal year 2015; ceased with: Fiscal year 2020.","Report year covers fiscal year.","Chronology appears also as year ended June 30, 2015-year ended June 30, 2020.","Fiscal year 2015, released in 2016? (received 6/27/16 via FTP from Georgia Dept. of Audits and Accounts); title from PDF cover (Georgia Government Publications database, viewed April 11, 2023).","Fiscal year 2020, released in 2021? (Georgia Government Publications database, viewed April 11, 2023)."],"dc_format":["application/pdf"],"dcterms_identifier":null,"dcterms_language":["eng"],"dcterms_publisher":["Atlanta, Ga. : Dept. of Audits and Accounts"],"dc_relation":null,"dc_right":["http://rightsstatements.org/vocab/InC/1.0/"],"dcterms_is_part_of":null,"dcterms_subject":["Auditors' reports--Georgia","Financial statements--Georgia","Houston County (Ga.). Board of Education--Appropriations and expenditures"],"dcterms_title":["Audit report, Houston County Board of Education, Perry, Georgia, year ended June 30, 1995"],"dcterms_type":["Text"],"dcterms_provenance":["University of Georgia. Map and Government Information Library"],"edm_is_shown_by":["https://dlg.galileo.usg.edu/do:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1994-h95"],"edm_is_shown_at":["https://dlg.galileo.usg.edu/id:dlg_ggpd_y-ga-ba800-b-pr1-be26-bh8-b1994-h95"],"dcterms_temporal":null,"dcterms_rights_holder":["\u0026copy; Georgia Department of Audits"],"dcterms_bibliographic_citation":null,"dlg_local_right":null,"dcterms_medium":["state government records"],"dcterms_extent":null,"dlg_subject_personal":null,"iiif_manifest_url_ss":null,"dcterms_subject_fast":null,"fulltext":"GA Aioo \n.RI \nE;;1(o \nH8 1994-95 \nSTATE OF GEORGIA DEPARTMENT OF AUDITS \n254 WASHINGTON STREET ATLANTA, GEORGIA 30334 \n \n AUDIT REPORT HOUSTON COUNTY BOARD OF EDUCATION \nPERRY, GEORGIA YEAR ENDED JUNE 30, 1995 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \n \nSECTION I \n \nFINANCIAL \n \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \n \nEXHIBITS \n \nGENERAL PURPOSE FINANCIAL STATEMENTS \n \nCOMBINED STATEMENTS-OVERVIEW \n \nA \n \nCOMBINED BALANCE SHEET \n \nALLFUNDTYPESANDACCOUNTGROUP \n \n2 \n \nB \n \nCOMBINED STATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES \n \nALL GOVERNMENTAL FUND TYPES \n \n4 \n \nC \n \nSTATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES - BUDGET AND ACTUAL \n \n(NON-GAAP BASIS) \n \nGENERAL AND SPECIAL REVENUE FUNDS \n \n7 \n \nD NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \n8 \n \nADDITIONAL FINANCIAL INFORMATION \n \nCOMBINING AND INDIVIDUAL FUND STATEMENTS \n \nSPECIAL REVENUE FUND \n \nE \n \nCOMBINING BALANCE SHEET \n \n26 \n \nF \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES \n \nAND CHANGES IN FUND BALANCES \n \n28 \n \nCAPITAL PROJECTS FUND \n \nG \n \nCOMBINING BALANCE SHEET \n \n30 \n \nH \n \nCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND \n \nCHANGES IN FUND BALANCES \n \n32 \n \nFIDUCIARY FUND TYPE \n \nI \n \nSTATEMENT OF CHANGES IN ASSETS AND LIABILITIES \n \nAGENCY FUND \n \n35 \n \nSCHEDULES \n \n1 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \n \n36 \n \n2 CASH AND CASH EQUIVALENTS \n \n38 \n \n3 INVESTMENTS \n \n39 \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \n \nSECTION I \n \nFINANCIAL \n \nADDITIONAL FINANCIAL INFORMATION \n \nSCHEDULES \n \n4 ACCOUNTS RECEIVABLE \n \n41 \n \n5 DEBT SERVICE REQUIREMENTS TO MATURITY \n \n42 \n \nSCHEDULE OF REVENUE \n \n6 \n \nSTATE \n \n44 \n \n7 \n \nLOCAL AND OTHER \n \n45 \n \nSCHEDULE OF EXPENDITURES BY OBJECT \n \n8 \n \nGENERAL AND SPECIAL REVENUE FUNDS \n \n47 \n \n9 \n \nLOTTERY PROGRAMS \n \n48 \n \nANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS \n \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS \n \n10 \n \nOVERALL \n \n51 \n \n11 \n \nBY PROGRAM \n \n52 \n \n12 SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS \n \n54 \n \nSECTION II \nCOMPLIANCE \nCOMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nSINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nSINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nSINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS \n \n HOUSTON COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - \nSECTION ID 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 \nSECTION IV FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \n \n SECTION I FINANCIAL \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members ofthe Houston County Board ofEducation \nINDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \nLadies and Gentlemen: \nWe have audited the general purpose financial statements (Exhibits A through D) of the Houston County Board of Education, as of and for the year ended June 30, 1995, as listed in the table of contents. These financial statements are the responsibility of the Board's management. Our responsibility is to express an opinion on these financial statements based on our audit. \nWe 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 the Office of Management 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. \nAs described in the notes to the general purpose financial statements, the Board's financial statements have been prepared using certain accounting practices and policies which, in our opinion, vary in some respects from generally accepted accounting principles. These variances are described as follows: \n* The general purpose financial statements of the Board did not contain a General Fixed Assets Account Group to account for property and equipment owned by the Board which should be included to conform to generally accepted accounting principles. \n95ARL-13* \n \n * The Board did not report compensated absences within the general purpose financial statements as required by generally accepted accounting principles. \n* School activity accounts maintained at the individual schools are not included in the general purpose financial statements. To conform to generally accepted accounting principles, these accounts should be included in the general purpose financial statements. \n* The Board did not recognize as expenditures, in the year ended June 30, 1995, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1995. Also funds received, subsequent to June 30, 1995, from the Georgia Department ofEducation for the State's share ofthese unrecorded salaries and related benefits were not recorded as revenue in the year under review. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1994, were improperly recorded in the year ended June 30, 1995. To conform to generally accepted accounting principles, revenues should be recorded when available and measurable and expenditures should be recorded when incurred, rather than when funds are received or disbursed. \n* The Board has received $15,219,072.66 in local option sales tax collections for which revenue recognition has been deferred to future periods by the Board. If these amounts had been recorded as revenue as required by generally accepted accounting principles, the Board's fund balance would have increased by a like amount. \nThe aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material. \nIn our opinion, except for the effects on the general purpose financial statements of the matters referred to in the preceding paragraph, the general purpose financial statements present fairly, in all material respects, the financial position of the Houston County Board of Education as of June 30, 1995, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued a report dated June 12, 1996, on our consideration of the Board's internal control structure and a report dated June 12, 1996, on its compliance with laws and regulations. \nOur audit was conducted for the purpose of forming an opinion on the general purpose financial statements ofthe Houston County Board ofEducation taken as a whole. The combining and individual fund statements (Exhibits E through I) and the financial schedules (Schedules 1 through 12 which includes the Schedule of Federal Financial Assistance) are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Houston County Board of Education. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effects ofthe matters referred to in the third paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. \n95ARL-13* \n \n A copy ofthis report has been filed as a pennanent record in the office ofthe State Auditor and made available to the press ofthe State, as provided for by Official Code of Georgia Annotated Section 5~-6-24. \nRespectfully submitted, \ntf~ \nClaude L. Vickers State Auditor \nCLV:dt 95ARL-13* \n \n HOUSTON COUNTY BOARD OF EDUCATION - 1- \n \n HOUSTON COUNTY BOARD OF EDUCATION \nALL FUCNODMTBYINPEEDS ABANLDAANCCCEOSUHNETEGTROUP \nJUNE30 1995 \n \n~ \nCash and Cash Equivalents \nlnwstmenls \nlnYastments Held by TNA98 \nAccounls Receivable \nPr-.,.ldlllams \nInventories Consumable Supplies Food Oonated Commodities Pun:hasedFood \nAmount Available in Debt Service Fund \nAmountto be Provided in Future Years For Payment cl: Bond Debt Capital Lease Agreements Trust Certificates \nTolal Assets \nLIABILITIES AND FUND EQUITY \nLIABILITIES \nCash Overdraft Accounts Payable Salaries Payable Expired Grant Balances Payable Contrac:ts Payable Retainages Payable Deferred Compensation Plan Unearned Revenue \nF\"iscal Year 1995 Fiscal Year 1996 Fisca1Year1997 Capital Lease Agreements General Obligation Bonds Payable Intergovernmental Contracts Trust Certificates \nTolal Liabilities \nfUNDEaurrv \nFund Balanc:.s Reserved For Bus Replacement Funds \nFor Continuation ot Federal Programs \nForOebtSelvice For Expired Grant Balances/Questioned Costs For Inventories \nConsumable Supplies Food \nDonated Commodities Purchased Food \nFor Purposes ot Trust Certificates \nFor State Capital Outlay Projects \nUnreserved Designated for Self Insurance Program Undesignated \nTocal Fund Equity \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nS 2,829,78921 S 1,680,994.50 \n \n17,228,594.54 \n \nS 10,531,036.12 \n \n641,688.85 367,242.10 \n \n..01,296.98 \n \n1,220,757.00 5,000.00 \n \n152,07827 83,..07.92 \n \ns s s 21,067,31 .70 \n \n213111m.e1 11.156,793.12 \n \n$ 2,296,768.31 \n \nS \n \n293,080.56 $ \n \n218,307.\u003cW \n \n6,622.00 \n \n110,627.09 \n \n516,168.85 \n \n48,103.17 \n \n285,060.10 \n \n612,776.00 \n \n9,506,384.56 5,712,688.10 \n \n$ 15,622,780.31 $ \n \n782,579.42 $ 3,201,226.41 \n \n$ \n \n88,314.\u003cW \n \n367,242.10 \n \n$ \n \n152,07827 \n \n83,..07.92 \n \n$ 7,653,742.30 \n \n282,091.00 \n \n$ \n \n455,556.50 $ \n \n235,486.19 $ 7,935,833.30, \n \n910,701.77 4,078,276.12 \n \n1,299,712.06 \n \n619,733.41 \n \n$ 5,444,534.39 $ 1,535,198.25 $ 8,555,566.71 \n \nTolal Liabilities and Fund Equity \n \n$ 21,067,314.70 $ 2,317,777.67 $ 11,756,793.12 \n \nThe notes to the general purpose financial statements are an integral part of this statement -2- \n \n EXHIBIT\"A\" \n \nDEBT \nSERVICE FUND \n \nFIOUCIARY FUNDTYPES TRUST AND AGENCY FUNDS \n \nACCOUNT GROUP GENERAL \nLONG-TERM DEBT \n \nTOTALS (Memorandum On~} JUNE 301 1995 JUNE 301 1994 \n \n$ 7-49,854.27 \n \n$ 5,260,637.98 $ 3,742,388.62 \n \n4,171.88 \n \n27,763,802.54 28,199,9-49.66 \n \n$ 5,911,692.29 \n \n5,911,692.29 \n \n5,622,410.77 \n \n15,603.97 \n \n2,279,346.80 \n \n1,191,051.09 \n \n5,000.00 \n \n367,242.10 \n \n328,798.0,4 \n \n152,078.27 83,407.92 \n \n139,900.44 61,260.40 \n \n$ \n \n769,630.12 \n \n769,630.12 \n \n521,106.85 \n \n$ \n \n7691630.12 $ \n \ns s 1e11 1692.29 \n \n8,920,369.88 839,647.34 \n12,445,000.00 \n \n8,920,369.88 839,647.34 \n12,445,000.00 \n \n9,6-48,893.15 1,181,658.20 \n12,445,000.00 \n \n2219741647.34 $ 64.7981055.24 $ 6310821417.22 \n \n$ 5,911,692.29 \ns s 5,911,692.29 $ \n \n$ 2,296,768.31 S 265,816.60 \n \n518,009.96 \n \n3n,380.40 \n \n626,795.94 \n \n473,040.42 \n \n48,103.17 \n \n693.80 \n \n285,060.10 \n \n150,563.10 \n \n612,776.00 \n \n25,000.00 \n \n5,911,692.29 \n \n5,622,410.77 \n \n839,647.34 9,690,000.00 \n12,445,000.00 \n \n9,506,364.56 5,712,688.10 \n839,647.34 9,690,000.00 \n12,445,000.00 \n \n8,659,334.46 4,690,825.37 \n1,181,658.20 10,170,000.00 12,445,000.00 \n \n22,974,647.34 $ 48,493,125.77 $ 44,056,n3.12 \n \n$ 769,630.12 \n \ns 769,630.12 \n0.00 \ns 769,630.12 \n \ns \n \n7691630.12 $ \n \n51911 !692.29 $ \n \n$ \n \n28,259.36 \n \n5,066.46 \n \n$ 769,630.12 \n \n575,452.13 \n \n88,314.40 \n \n88,314.40 \n \n367,242.10 \n \n328,798.0,4 \n \n152,078.27 83,407.92 7,653,742.30 282,091.00 \n \n139,900.44 61,260.40 11,324,875.39 306,838.50 \n \ns 9,396,506.11 $ 12,858,765.12 \n \n910,701.77 5,997,n1.59 \n \n790,820.40 5,376,108.58 \n \ns 16,304,929.47 $ 19,025,694.10 \n \n221974,647.34 $ 64,798,055.24 $ 63,082,417.22 \n \n-3 - \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES \nALL GOVERNMENTAL FUND TYPES 1EAR ENDED JUNE 30 1995 \n \nBEYENUES \nState Funds Federal Funds Local and Other Funds \nTotal Revenues \nEXPENDITURES \nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services \nCapital Outlay Debt Service \nPrincipal Interest Escrow Agent Paying Agent Fees \nTotal Expenditures \nExcess of Revenues over (under) Expenditures \nQT!::ll;;R FINANCING SQ!,,1RCES (USES) \nAccrued Interest on Bonds Sold Proceeds from General Obligation Bonds \nPar Value Discount on Bonds Sold Capital Leases Operating Transfers In Operating Transfers Out \nTotal Other Financing Sources (Uses) \nExcess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \nFUND BALANCE JULY 1 \nFood Inventory - Net Change in Period Donated Commodities Purchased Food \nSupplies Inventory - Net Change in Period Residual Equity Transfer (Note 12) \n \nGENERAL FUND \n \nSPECIAL REVENUE \nFUND \n \nCAPITAL PROJECTS \nFUND \n \ns s 53.1n.280.27 2,031,658.10 $ \n \n1,426,439.49 5,267,954.04 \n \n26,627,243.34 \n \n1,795,034.13 \n \ns 81,230,963.10 $ 9,094,646.27 $ \n \n3,745,117.00 599,633.36 \n4,344,750.36 \n \ns 51,044.203.80 $ 2,894,287.22 \n \n3,108,326.72 3,791,359.42 2;277,876.05 \n257,737.96 4,891,887.99 \n788,475.27 7,001.288.83 2,034,893.93 1,360,215.04 \n37,564.33 \n1,374,924.06 523,501.74 \n \n189,309.10 234,803.40 494,746.41 69,731.06 \n5,744.51 \n232,797.60 23,289.50 \n6,929.92 5,303,105.23 \n167,585.33 4,832.89 $ \n \n452,780.86 61,009.38 \n \n8,645,790.45 \n \n$ 79,026,045.38 $ 9,627,162.17 $ 8,645,790.45 $ 2,204,917.72 $ -532,515.90 $ -4,301,040.09 \n \n$ \n \n110,970.00 \n \n$ \n \n-1,869,001.16 \n \n$ -1,758,031.16 $ \n \n47,812.65 $ 47,812.65 $ \n \n1,821,188.51 -524,389.04 \n1,296,799.47 \n \n$ \n \n446,886.56 $ -484,703.25 $ -3,004;240.62 \n \n4,034,674.70 2,001,510.44 12,468,402.11 \n \n71,183.69 891,789.44 \n \n12,177.83 22,147.52 -32,739.63 16,805.34 \n \n-908,594.78 \n \nFUND BALANCE JUNE 30 \n \n$ 5,444,534.39 $ 1,535,198.25 $ 8,555,566.71 \n \nThe notes to the general purpose financial statements are an integral part of this statement. -4- \n \n EXHIBIT\"B\" \n \nDEBT SERVICE \nFUND \n \nTOTALS (Memorandum Only) \nYEAR ENDED JUNE 301 1995 JUNE 30, 1994 \n \n$ 58,954,055.37 $ 51 ;l.07,775.96 \n \n6,694,393.53 \n \n6,781,515.31 \n \n$ 1,262,523.27 30,284,434.10 28.111.532.94 \n \n$ 1,262,523.27 $ 95,932,883.00 $ 86,100,824.21 \n \n$ 53,938,491.02 $ 50,074,004.73 \n \n3;1.97,635.82 4,026,162.82 2,772,622.46 \n327,469.02 4,897,632.50 \n788,475.27 7,234,086.43 2,058,183.43 1,380,215.04 \n44,494.25 5,303,105.23 1,542,509.39 9,174,125.08 \n \n2,964,454.80 3,752,380.51 1,983,854.15 \n325,051.58 4,545,944.34 1,053,924.33 7,149,362.64 2,375,897.90 \n774,452.29 29,308.79 4,190,772.84 1,274,185.38 5,375,797.01 \n \n$ 480,000.00 1,055,818.75 2,514.51 55.78 \n \n932,780.86 1,116,828.13 \n2,514.51 55.78 \n \n826,182.08 646,537.54 \n7,996.25 \n \n$ 1,538,389.04 $ 98,837,387.04 $ 87,350,107.16 \n \n$ -275,865.77 $ -2,904,504.04 $ -1,249,282.95 \n \n$ \n \n54,345.28 \n \n12,445,000.00 \n \n-282,432.05 \n \n$ \n \n110,970.00 \n \n669,537.00 \n \n$ 524,389.04 \n \n2,393,390.20 \n \n2,698,064.39 \n \n-2,393,390.20 \n \n-2,698,064.39 \n \n$ 524,389.04 $ \n \n110,970.00 $ 12,886,450.23 \n \n$ 248,523.27 $ -2,793,534.04 $ 11,637,167.28 \n \n521,106.85 19,025,694.10 \n \n7,357,986.67 \n \n12,177.83 22,147.52 38,444.06 \n0.00 \n \n-12,538.25 -3,468.55 46,546.95 \n \n$ 769,630.12 $ 16,304,929.47 $ 19,025,694.10 \n \n.5. \n \n .\\B\\'-~y_ \n~~~ \n \n HOUSTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES \nBUDGET AND ACTUAL - (NON-GAAP BASIS) \nGENERAL AND SPECIAL REVENUE FUNDS \nYEAR ENDED JUNE 30. 1995 \n \nEXHIBITc \n \nREVENUES \nState Funds Federal Funds Local and Other Funds \nTotal Revenues \nEXPENDITURES \nCurrent Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Food Services Operation Other Operations of Non-Instructional Services \nCapital Outlay Debt Service \nTotal Expenditures \nExcess of Revenues over (under) Expenditures \nOTHER FINANCING SOURCES (USES) \nOther Sources Other Uses \nTotal Other Financing Sources (Uses) \nExcess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \nFUND BALANCE JULY 1. 1994 \nAdjustments Residual Equity Transfer (Note 12) \n \nGENERAL FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \n$ 53,063,907.10 $ s3,1n,2ao.21 \n \n1,564,945.00 \n \n1,426,439.49 \n \n28,474,230.00 28,496,156.17 \n \n$ 83,103,082.10 $ 83,099,875.93 \n \n$ 52,299,319.63 $ 51,044,203.80 \n \n3,158,492.00 3,862,531.00 2,728,759.57 \n271,222.00 4,705,344.00 \n805,299.00 7,485,892.84 2,367,573.00 1,767,787.00 \n36,907.00 \n \n3,108,326.72 3,791,359.42 2,2n,a1s.os \n257,737.96 4,891,887.99 \n788,475.27 7,001,288.83 2,034,893.93 1,380,215.04 \n37,564.33 \n \n982,332.00 402,078.00 \n \n1,374,924.06 523,501.74 513,790.24 \n \n$ 80,873,537.04 $ 79,026,045.38 \n \n$ 2,229,545.06 $ 4,073,830.55 \n \n$ 9,781,654.00 $ 9,889,393.54 -11,628,023.00 -11,647,424.70 \n$ -1,846,369.00 $ -1,758,031.16 \n \n$ 383,176.06 $ 2,315,799.39 \n \n18,147,234.36 11,088,ns.12 \n \n83,895.23 \n \n891,789.44 \n \nSPECIAL REVENUE FUND \n \nACTUAL \n \n(BUDGET \n \nBUDGET \n \nBASIS) \n \n$ 1,450,560.74 $ 2,031,658.10 4,439,334.39 5,267,954.04 2,154,719.27 1,795,034.13 \n$ 8,044,614.40 $ 9,094,646.27 \n \n$ 2,986,174.88 $ 2,894,287.22 \n \n182,958.80 194,666.83 \n71,574.56 5,961.00 \n \n189,309.10 234,803.40 494,746.41 \n69,731.06 5,744.51 \n \n21,174.00 58,798.36 \n \n232,797.60 23,289.50 \n \n9,432.00 4,849,3n.OO \n489,951.08 4,782.00 \n \n6,929.92 5,303,105.23 \n167,585.33 4,832.89 \n \n$ 8,874,850.51 $ 9,627,162.17 $ -830,236.11 $ -532,515.90 \n \n$ 45,999.00 $ 47,812.65 \n \n$ 45,999.00 $ 47,812.65 \n \n$ -784,237.11 $ -484,703.25 \n \n2,808.725.11 1,767,609.97 \n \n27,033.61 \n \n16,805.34 \n \nFUND BALANCE JUNE 30, 1995 \n \n$ 18,614,305.65 $ 20,296,364.95 \n \n$ 2,051,521.61 $ 1,299,712.06 \n \nThe notes to the general purpose financial statements are an integral part of this statement. -7- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nThe Houston County Board ofEducation (Board) was established under the laws of the State of Georgia and operates under the guidance of a school board and Superintendent, both elected by the voters. With the exception ofthe departures from generally accepted accounting principles disclosed in these notes, the financial statements of the Board have been prepared in conformity with generally accepted accounting principles as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards. \nThe more significant ofthe Board's accounting policies are described below. \nREPORTING ENTITY \nIn evaluating how to define the government unit for financial reporting purposes, management has considered the criteria set forth in GASB Codification of Governmental Accounting and Financial Reporting Standards, Section 2100, \"Defining the Financial Reporting Entity\". The primary government consists of all the organizations that compose the legal entity ofthe Houston County Board ofEducation. \nBased upon the application of the above criteria, the Houston County Board ofEducation is determined to be the lowest level of government exercising oversight responsibility and control over all activities related to public education in Houston County, Georgia. The Board is not included in any other governmental \"reporting entity\" as defined by GASB Codification of Governmental Accounting and Financial Reporting Standards. \nBoard members were elected by the public and have decision making authority, the power to designate management, except for the Superintendent who was also elected, the ability to significantly influence operations, and primary accountability for fiscal matters. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval. \nFUND ACCOUNTING \nThe Board 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. \nA 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. \nGeneral Fixed Assets 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 Board. 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. \n \n- 8- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nAlthough \"school activity accounts\" are maintained at the individual schools, neither the assets, liabilities and fund equity, nor the revenues, expenditures and changes in fund balances of these accounts are reflected in these financial statements. To conform to generally accepted accounting principles, these accounts should be recorded in the general purpose financial statements. \nThe general purpose :financial statements account for all State, Federal, Local and Other Funds under control ofthe Board, 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: \nGOVERNMENTAL FUND TYPES - are used to account for all or most of a Board's general activities. Governmental Fund Types include: \nGENERAL FUND - the fund used to account for all financial resources of the Board except those required to be accounted for in another fund. These transactions relate to resources obtained and used for services provided by a board of education. \nSPECIAL REVENUE FUND - the fund used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditures for specified purposes. These funds are primarily received from the Georgia Department of Education and from the Federal government to accomplish specific objectives and are required to be accounted for separately. Also included are proceeds received from State, Federal, Local and Other sources for operations of the school food services fund. This fund could be accounted for as an enterprise fund~ however, the Board chooses not to provide for depreciation, but to maintain the fund on a modified accrual basis and to report the fund as a special revenue fund under governmental fund types, which is acceptable under generally accepted accounting principles for governmental entities. \nCAPITAL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. \nDEBT SERVICE FUND - the fund used to account for the accumulation ofresources for, and the payment of, general long-term principal, interest and paying agent fees. \nFIDUCIARY FUND TYPE - the agency fund used to account for assets held by a government unit in a trustee capacity or as an agent for individuals, private organizations, other government units and/or other funds. This fund includes: \nAGENCY FUNDS - the funds used to account for assets held for other funds, governments, or individuals. \nACCOUNT GROUP \nGENERAL LONG-TERM DEBT ACCOUNT GROUP - used to account for general obligation bonds outstanding, material capital lease obligations, and intergovernmental contract trust certificates. \n- 9- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 1; SUM:MARY OF SIGNIFICANT ACCOUNTING POLICIES \nBASIS OF ACCOUNTING \nThe 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 generally are 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 of available spendable resources. \nLiabilities 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. \nAgency funds are purely custodial in nature and do not involve measurement of results of operations. \nGovernmental funds are accounted for using the modified accrual basis ofaccounting under which: \nRevenues 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 property taxes, local option sales taxes, intergovernmental grants and investment income. Property taxes are considered available if they are collected and remitted by the collecting agent to the Board within 60 days after fiscal year-end. \nA departure form the above definitions is the accounting treatment afforded the local option sales taxes. Georgia Laws 1982, House Resolution Nos. 699 and 700, proposed to amend the Constitution of the State ofGeorgia so as to provide for a local sales and use tax for the Houston County Board ofEducation whereby this tax would limit the amount ofad valorem taxes to be imposed, levied and collected for use by the Board. These resolutions were subsequently approved by the voters ofHouston County in the General Election held November 2, 1982. Section I, Part 2B, ofHouse Resolution 700 states: \n\"The maximum allowable mill rate for each government in each year shall be reduced by the mill rate which would yield on the digest for that year an amount equal to the amount received by the local government in the immediately preceding year from any local sales and use tax.\" \nThe Board's legal counsel has advised that the effect of this legislation places the sales tax collected in trust with the Board ofEducation for use in the following year upon the reduction of the mill rate. Accordingly, the Board has elected to record the amount of sales tax received for use in a subsequent period as a liability (unearned revenue) rather than as revenue. To conform to generally accepted accounting principles, the sales tax collections should be recorded as revenue when measurable and available. \nExpenditures are generally recognized when the related fund liability is incurred. \n- 10 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nA departure from the above definitions is the accounting treatment afforded the final two payments on General Fund teachers' and bus drivers' contracts, and the resources available from the Georgia Department of Education for the State's share ofthese contracts. During fiscal year 1995, a substantial number of personnel of the Board were employed for a one hundred and ninety day period beginning in late August 1994 and ending in early June 1995. Personnel contracts for this employment period specify that compensation be paid in twelve equal monthly payments beginning in September 1994 and ending in August 1995. State grants to fund the State's share of these contracts were disbursed from the Georgia Department ofEducation to the Board in the same twelve months. As ofJune 30, 1995, compensation under these employment contracts had been earned, but two of the twelve monthly payments, due for July and August 1995, had not been made. Payments for these two months were made and recorded as expenditures by the_ Board subsequent to June 30, 1995. Also, the State's portion ofthe compensation paid in July and August 1995 was received and recorded as revenue in the fiscal year subsequent to June 30, 1995. Conversely, the similar expenditures and related revenues for contractual services completed prior to June 30, 1994, were recorded in the year ended June 30, 1995. Generally accepted accounting principles require that revenues be recorded when available and measurable and that expenditures be recorded when incurred, rather than when funds are received or disbursed. \nAgency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities. \nBUDGET \nThe Houston County Board ofEducation's budget is a complete financial plan for the Board's fiscal year and is based upon estimates of expenditures together with probable funding sources. There is no statutory prohibition regarding overexpenditure of the budget at any level. The budget for all governmental funds is prepared by fund, function and object. The legal level of budget control was established by the Board at the aggregate level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. \nThe budget process begins when the Board's administration prepares a tentative budget for the Board's approval. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper ofgeneral circulation in the locality. At the next regular meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final school budget. This final budget is then submitted, in accordance with provisions of the Quality Basic Education Act, OCGA Section 20-2-167, to the Georgia Department ofEducation. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end. \nThe Statement ofRevenues, Expenditures and Changes in Fund Balances - Budget and Actual presents actual and budgeted data for the General Fund and Special Revenue Fund. To facilitate comparison with the budget, the following adjustments have been made to actual revenues, expenditures and fund balance as reflected on Exhibit \"B\" of this report: \n \n- 11 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n \nFUND BALANCE JULY 1, 1994 \nAdjustments Deferred - Sales Tax - July 1, 1994 Inventories - July 1, 1994 Food Donated Commodities Purchased Foods Supplies \nFund Balance July 1, 1994 - Restated Budget Basis \nExcess ofRevenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \nAdjustments Deferred - Sales Tax July 1, 1994 June 30, 1995 \nResidual Equity Transfers \nFUND BALANCE JUNE 30, 1995 (Budget Basis) \nCASH AND CASH EQUIVALENTS \n \nGeneral Fund \n \nSpecial Revenue \nFund \n \n$ 4,034,674.70 $ 2,001,510.44 \n \n13,350,159.83 \n \n-296,058.41 \n \n-139,900.44 -61,260.40 -32,739.63 \n \n$17,088,776.12 $ 1,767,609.97 \n \n$ 446,886.56 $ -484,703.25 \n \n-13,350, 159.83 15,219,072.66 \n$ 2,315,799.39 $ -484,703.25 \n$ 891,789.44 $ 16,805.34 \n$ 20,296,364,95 $ 1,299,712.Q6 \n \nCOMPOSITION OF DEPOSITS Cash and cash equivalents consist ofdeposits (including N.O.W. accounts) in authorized financial institutions. Georgia Laws authorize the Board to deposit its funds 1n one or more solvent banks, insured Federal savings and loan associations, or insured State chartered building and loan associations. The placement of proceeds from bond issues in certificates of deposit is limited to financial institutions located within this State. \n \nINVESTMENTS \n \nCOMPOSITION OF INVESTMENTS Investments made by the Board are stated at cost. The Official Code of Georgia Annotated Section 36-83-4 authorized the Board to invest its funds. In selecting among avenues of investment or among institutional bids for deposits, the highest rate ofretum shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: \n \n- 12 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n(I) Obligations issued by the State of Georgia or by other states, \n(2) Obligations issued by the United States government, \n(3) Obligations fully insured or guaranteed by the United States government or a United States government agency, \n(4) Obligations of any corporation of the United States government, \n(5) Prime banker's acceptances, \n(6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services, \n(7) Repurchase agreements, and \n(8) Obligations of other political subdivisions of the State of Georgia. \nINVESTMENTS HELD BY TRUSTEE \nInvestments held by trustee consist of contributions from employees who have elected to participate in the Board's deferred compensation plan. See Note 9 - Deferred Compensation Plan \nRECEIVABLES \nReceivables consist ofgrant 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 general purpose financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables. \nPROPERTY TAXES \nThe Houston County Board ofCommissioners fixed the property tax levy for the 1994 tax year (calendar year) on September 6, 1994 (levy date). Taxes were due on December 20, 1994. The lien date for property taxes was January I, 1994. Taxes collected within the current fiscal year or within 60 days after year-end are reported as revenue in fiscal year 1995 since their collection meets the criteria of GASB codification section P70.103. The Houston County Tax Commissioner bills and collects the property taxes for the Board of Education, withholds 2.5% of taxes collected as a fee for tax collection, and remits the balance of taxes collected to the Board. \n \n- 13 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATE:MENTS \n \nJUNE 30, 1995 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \n \nThe tax millage rates levied for the 1994 tax year (calendar year) for the Houston County Board ofEducation were as follows (a mill equals $1 per thousand dollars of assessed value): \n \nSchool Operations School Bonds \n \n12.87 mills 1.00 mills \n \n13.87 mills \n \nINVENTORIES \n \nFOOD INVENTORIES Inventories of donated food commodities used in the preparation of meals are reported on the Combined Balance Sheet at their Federally assigned value. Purchased foods inventories are reported on the Combined Balance Sheet at cost. Donated food commodities are recorded as revenues and expenditures at the time commodity items are received. Purchased foods inventories are recorded as expenditures at the time of purchase. The inventories reported on the balance sheet for donated food commodities and for purchased foods are equally offset by reservations offund balance which indicates that these amounts do not constitute \"available spendable resources\" even though they are a component of net current assets. \n \nSUPPLY INVENTORIES Inventories ofconsumable supplies and materials are recorded as purchases for resale (contra-revenue account) at the time of purchase and are reported on the Combined Balance Sheet at cost. The supply inventories reported on the balance sheet are equally offset with a reservation of fund balance which indicates that they do no constitute \"available spendable resources\" even though they are a component of net current assets. \n \nPREPAID ITEMS \n \nPayments made to vendors for services that will benefit periods subsequent to June 30, 1995, are recorded as prepaid expenditures. \n \nCOMPENSATED ABSENCES \n \nCompensated absences represent obligations of the Board relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. No liability has been recorded in the individual funds for the current portion of this obligation as this amount is deemed immaterial to the general purpose financial statements. \n \nHowever, the dollar value ofaccumulated compensated absences at June 30, which will be payable from future resources is material to the general purpose financial statements and has not been recorded in the General Long-Term Debt Account Group as required by generally accepted accounting principles. \n \n- 14 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES \nGENERAL OBLIGATION BONDS \nThe Board issues general obligation bonds and trust certificates to provide funds for the acquisition and construction ofmajor capital facilities. General obligation bonds are direct obligations and pledge the full faith and credit ofthe government. The outstanding amount ofthese bonds and trust certificates is recorded in the General Long-Term Account Group. \nINTERFUND TRANSACTIONS \nThe Board has the following types ofinterfund transactions: \nReimbunements 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. \nResidual equity transfen are recorded for nonrecurring or nonroutine permanent transfers ofequity. \nOperating transfen are recorded for all interfund transactions other than residual equity transfers and reimbursements. \nMEMORANDUM ONLY - TOTAL COLUMNS \nTotal columns on the general purpose financial statements are captioned \"Memorandum Only\" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. \nNote 2: DEPOSITS AND INVESTMENTS \nCOLLATERALIZATION OF DEPOSITS Official Code ofGeorgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee ofinsurance,. or by collateral. The aggregate of the face value of such surety bond and the market value ofsecurities shall be equal to not less than 110 percent of the 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. \nAcceptable security for deposits consists of any one of or any combination of the following: \n \n- 15 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 2: DEPOSITS AND INVESTMENTS \n \n(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State ofGeorgia, \n \n(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, \n \n(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, \n \n(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities \n \nofthe State of Georgia, \n \n \n \n(5) Bonds ofany public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, \n \n(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and \n \n(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 Banlc, 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. \n \nCATEGORIZATION OF DEPOSITS At June 30, 1995, the bank balances were $7,135,045.63. The amounts of the total bank balances are classified into three categories of credit risk: \n \nCategory I - Cash that is insured (e.g., Federal depository insurance) or collateralized with securities held by the Board or by the Board's agent in the Board's name. \nCategory 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. \nCategory 3 - Uncollateralized deposits. {This includes any bank balance that is collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the Board's name.) \n \nThe Board's deposits are classified by risk category at June 30, 1995, as follows: \n \n- 16 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT D 11 11 \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 2: DEPOSITS AND INVESTMENTS \n \nRisk Category 1 2 3 Total \nCATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: \n \nBank Balance \n$ 944,205.05 6,190,840.58 0.00 \n$7,135,045.63 \n \nCategory 1 - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. \nCategory 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name. \nCategory 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. \n \nFunds invested in an investment pool managed by another government are not required to be categorized unless the investing entity owns specific, identifiable investment securities in the pool. \n \nAt June 30, 1995, the carrying amount of the Board's total investments was $33,581,144.05 and Local Government Investment Pool was $296,028.24. The investments are classified as to risk categories as follows: \n \nType of Investment \nU. S. Government Securities Local Government \nInvestment Pools \nUnclassified \nDeferred Compensation Plan Pooled Investments \nTotal Investments \n Undetenninable \n \nCarrying Amount \n$ 296,028.24 $ \n27,373,423.52 \n \nMarket Value \n296,028.24 \n* \n \n5,911,692.29 \n \n* \n \n$ 33 581,144.05 \n \nThe carrying amounts shown above includes amounts maintained in an investment pool by the State of Georgia, Office of Treasury and Fiscal Services in which the Board owns no identifiable securities. The investment policy of the State of Georgia, Office of Treasury and Fiscal Services for the Local Government \n \n- 17 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 2: DEPOSITS AND INVESTMENTS \n \nInvestment Pool does not provide for investment in derivatives or similar investments. The investment policy of the Houston County Board of Education for its portfolio accounts does not provide for investment in derivatives or similar investments. \n \nNote 3: NON-MONETARY TRANSACTIONS \n \nThe Board receives food commodities from the United States Department of Agriculture (USDA) for school breakfast and lunch programs. These commodities are recorded at their Federally assigned value. See Note 1 - Inventories \n \nNote 4: RISK MANAGEMENT \n \nThe Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction ofassets; errors or omissions; job related illnesses or injuries to employees; natural disaster; and unemployment compensation. \n \nThe Board has obtained commercial insurance for risk of loss associated with torts, assets, errors and omissions and natural disaster. The Board has neither significantly reduced coverage for these risks nor incurred losses (settlements) which exceeded the Board's insurance coverage in any ofthe past three years. \n \nThe Board has established a limited risk management program for workers' compensation claims. A premium is charged by the General Fund to each user fund on the basis of the percentage ofthat fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The Board accounts for claims with expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. These losses include an estimate of claims that have been incurred but not reported. An excess coverage insurance policy covers individual claims in excess of $250,000.00 loss per occurrence, up to the statutory limit. \n \nChanges in the workers' compensation claims liability during the last two fiscal years are as follows: \n \nBeginning ofYear Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEnd of Year Liability \n \n1994 1995 \n \n$ 122,157.90 $ 210,340.29 $ 174,729.01 $ 157,769.18 $ 157,769.18 $ 279,240.77 $ 244,805.60 $ 192,204.35 \n \nThe Board is self-insured with regard to unemployment compensation claims. The Board accounts for claims within the General Fund with expenditures and liability being reported when it is probable that a ioss has occurred, and the amount ofthat loss can be reasonably estimated. \n \n- 18 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D11 \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 4: RISK MANAGEMENT \n \nChanges in the unemployment compensation claims liability during the last two fiscal years are as follows: \n \nBeginning ofYear Liability \n \nClaims and Changes in Estimates \n \nClaims Paid \n \nEndofYear Liability \n \n1994 1995 \n \n$ \n \n0.00 $ \n \n6,294.77 $ \n \n6,294.77 $ \n \n0.00 \n \n$ \n \n0.00 $ \n \n4,598.00 $ \n \n4,598.00 $ \n \n0.00 \n \nRESTATEMENT OF PRIOR YEAR BALANCE \n \nIn prior years, the risk financing activities for the Board's worker's compensation liabilities were reported as an expendable trust fund. This fund had a fund balance of$790,820.40 at June 30, 1994. For fiscal year 1995, this fund has been reported as part ofthe General Fund. The fund balance at July 1, 1994 has been restated as appropriate. \n \nNote 5: GENERAL LONG-TERM DEBT \n \nCAPITAL LEASES The Houston County Board of Education has entered into various lease agreements as lessee for buses, vehicles and a computer main frame. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value ofthe future minimum lease payments as ofthe date of their inception. \n \nThe changes in General Long-Term Debt during the fiscal year ended June 30, 1995, were as follows: \n \nBalance July 1, 1994 Additions Deletions Balance Jwie 30, 1995 \n \nCapital Leases \n \nTrust Certificates \n \nGeneral Obligation Bonds \n \nTotal \n \n$ 1,181,658,20 $ 12,445,000.00 $ 10,170,000.00 $23,796,658.20 \n \n110,970.00 \n \n110,970.00 \n \n452,780.86 \n \n480,000.00 \n \n932,780.86 \n \n$ 832 84:Z 34 $ 12 445 000 00 $ 2,62QOOOOO $ 22 274 84:Z 34 \n \nAt June 30, 1995, payments due, by fiscal year which includes principal and interest for these items are as follows: \n \n- 19 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 5: GENERAL LONG-TERM DEBT \n \nFiscal Year Ended June 30 \n19% 1997 1998 1999 2000 200 l and thereafter \nTotal Principal and Interest \nDeduct: Imputed Interest \nNet Present Value ofFuture Minimum Lease Payments \n \nCapital Leases \n \nIntergovernmental Contract \nTrust Certificates \n \nGeneral Obligation \nBonds \n \nTotal Debt \n \ns 513,790.24 s 888,725.00 S 1,019,535.00 s 2,422,050.24 \n \n268,537.58 \n \n890,745.00 1,019,275.00 \n \n2,178,557.58 \n \n129,614.35 \n \n871,945.00 1,031,275.00 \n \n2,032,834.35 \n \n873,205.00 1,030,905.00 \n \n1,904,110.00 \n \n863,605.00 1,043,230.00 \n \n1,906,835.00 \n \n18.416,163.75 8,520355.00 26,936,518.75 \n \ns 911,942.17 s 22 804 388 75 S 13 664 575 00 s 37380905 92 \n \n72,094.83 \n \ns 839 84734 \n \nNote 6: PRIOR YEAR DEFEASEMENT OF DEBT \n \nIn fiscal year 1993, the Board defeased certain general obligation bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the Board's general purpose financial statements. At June 30, 1995, $8,015,000.00 ofbonds are outstanding and are considered defeased. \n \nNote 7: SIGNIFICANT COMMITMENTS \n \nThe following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1995: \n \nProject \nPerry Annex Perry Middle School Renovations Midole School # 1 \n94/94S-676-030 Middle School # 2 \n \nUnearned Executed Contracts \n$ 3,180.00 83,540.00 \n3,750,583.66 4,286,794.93 \n \n$8,124,098.59 The amounts described in this note are not reflected in the general purpose financial statements. \n \n- 20 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D11 \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 8: CONTINGENT LIABILITIES \nAmounts 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 granter agency for any expenditures which are disallowed under grant terms. The Board believes that such disallowances, if any, will be immaterial to its overall financial position. \nThe Board is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine Board operations. The ultimate disposition ofthese proceedings is not presently determinable, but are not believed to be material to the general purpose financial statements. \nNote 9: DEFERRED COMPENSATION PLAN \nThe Board offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all Board employees, permits them to defer a portion of their salary until future years. Participation in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency. \nAll amounts ofcompensation 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 and rights of the Board subject only to the claims of the Board's general creditors. Participants' rights under the plan are equal to those of general creditors of the Board in an amount equal to the fair market value of the deferred account for each participant. \nIt is the opinion of the Board that the Board has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The Board believes it is unlikely that it  will use the assets to satisfy the claims of general creditors in the future. \nInvestments are managed by the plan's trustees, Hartford Life, Prudential Retirement Services, Inc. and Variable Annuity Life Insurances. Under these plans, participants select from an investment option, or combination of investment options, determined by the Board. \nNote 10: ACCUMULATED EMPLOYEES' LEAVE \nEmployees retiring under either the Teachers Retirement System of Georgia or the Public School Employees Retirement System will be paid for unused leave up to the one hundred days maximum accumulation, at $22.50 per day. The employee must have a minimum of five consecutive years of employment with the Houston County Board ofEducation, contiguous with retirement, in order to qualify. \n \n- 21 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT D 11 11 \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 10: ACCUMULATED EMPLOYEES' LEAVE \nEmployees who terminate employment may apply to sell of unused leave in excess offorty-five days but not to exceed one hundred days at $22.50 per day. The employee must have a minimum offive consecutive years ofemployment with the Board, contiguous to a voluntary termination. See Note 1 - Compensated Absences \nNote 11: HOUSTON COUNTY SCHOOL DISTRICT BUILDING AUTHORITY \nThe Houston County School District Building Authority was created by House Bill 2038 during the 1994 session of the Georgia General Assembly. The purpose of the Authority is to acquire, construct, own and convey real property and personal property for the benefit ofthe Houston County Board ofEducation. The members of the Authority consist of the Chairman of the Houston County Board of Education, the Superintendent ofthe Houston County Board ofEducation, and the Chairman of the Board of Commissioners ofHouston County. \nThe Houston County School District Building Authority is a component unit of the Houston County Board ofEducation and as such the Authority's financial activity has been blended with the Houston County Board ofEducation's general purpose financial statements. \nNote 12: RESIDUAL EQUITY TRANSFER \nDuring fiscal year 1994, local funds were transferred to Capital Projects Fund for the Georgia State Financing and Investment Commission Project No. 93/94-676-049, with the understanding that if additional state funds were approved during the 1995 General Assembly, these monies could be returned to the General Fund. During the year ended June 30, 1995, the additional state funds in the amount of$984,677.00 were received by this project. The Board transferred the remaining balance of $908,594.78 in this project to the General Fund. \nDuring fiscal year 1995, the Board began reporting the Family Connection Fund as a separate fund within ~he Special Revenue Fund rather than within the General Fund as in previous years. The Family Connection Fund June 30, 1994 fund balance of$16,805.34 was transferred to the Special Revenue Fund. \nNote 13: RETIREMENT PLANS \nTEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) \nTRS PLAN DESCRIPTION Substantially all teachers, administrative and clerical personnel employed by local school systems are covered by the Teachers Retirement System of Georgia (TRS), which is a cost-sharing multiple employer public employee retirement system (PERS). \nTRS provides service retirement, disability retirement and survivors benefits for its members in accordance with State statute. A member is eligible for service retirement after 30 years of creditable service, regardless ofage, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after \n- 22 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 13: RETIREMENT PLANS \n25 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. \nRetirement benefits also include death and disability 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 IO years of service) and compensation up to the time of disability or death. \nMembers become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. \nThe Board's payroll for employees covered by TRS for the year ended June 30, 1995, was $51,908,560.20; total payroll was $58,487,444.43. \nTRS CONTRIBUTIONS REQUIRED AND MADE Employees ofthe Board who are covered by TRS are required by State statute to contribute 5% oftheir gross earnings to TRS. The Board makes monthly employer contributions to TRS at rates adopted by the TRS Board ofTrustees in accordance with State statute and as advised by their independent actuary. For fiscal year 1995 that rate for employer contributions was 11.81%. The interest rate assumption (rate of return on investments) was 7.50%. \nTotal contributions made during fiscal year 1995 amounted to $8,725,827.59, ofwhich $6,130,399.58 was made by the Board and $2,595,428.01 was made by employees. These contributions represented 11.81% (Board) and 5% (employees) of covered payroll. \nTRS 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 ofthe 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. \n \n- 23 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXIIlBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 13: RETIREMENT PLANS \n \nTotal unfunded pension benefit obligation ofTRS as ofJune 30, 1994, was as follows: \n \nTotal pension benefit obligation \n \n$15,313,743,000.00 \n \nNet assets available for benefits, at cost \n \n14.~54, 785,000.00 \n \nUnfunded pension benefit obligation \n \n$ 1,058,958.000 00 \n \nThe measurement ofthe total pension benefit obligation is based on an actuarial valuation as ofJune 30, 1994. 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. \n \nTotal contributions from all employers to TRS for fiscal year ended June 30, 1995 were $565,117,811.00. The Board's contribution for the year ended June 30, 1995 of$6,130,399.58 was actuarially determined and represented 1.0848% oftotal contributions made by all participating employers. \n \nTen year historical trend information is presented in the 1995 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. \n \nPUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA (PSERS) \n \nPSERS PLAN DESCRIPTION Substantially all bus drivers, maintenance, custodial, and lunchroom personnel employed by local school systems are covered by the Public School Employees Retirement System of Georgia (PSERS). All employer's contributions are made by the State of Georgia in accordance with State statute. \n \nPSERS provides in accordance with State statute service retirement, disability retirement and survivors benefits for its members. A member is eligible for normal service retirement after 10 years of service and attainment ofage 65. A member applying for service retirement with 10 years of service and retires between the ages of 60 and 65 receives a reduced benefit. Monthly retirement benefits paid to members are equal to $8.00 per month multiplied by the number ofyears of creditabl@ service. Options are available for distribution ofthe member's monthly pension at a reduced rate to a designated beneficiary on the member's death. \n \nRetirement provisions include death and disability benefits. Disability benefits are the same as if the employee had retired at age 65 as long as the employee has 15 or more years of creditable service. Death benefits are dependent upon the number ofyears of service. Ifthere are less than ten years of service, a lump sum refund of the employee's contributions and interest are made to the beneficiary. Ifthere are more than ten years of service, the beneficiary shall receive for life half of what the employee would have received upon retirement. \n \nMembers become fully vested after ten years of service. If a member terminates with less than ten years of service, no vesting ofemployer contributions occurs, but the member's contributions are refunded with interest. \n \n- 24 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nEXHIBIT \"D\" \n \nNOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS \n \nJUNE 30, 1995 \n \nNote 13: RETIREMENT PLANS \nThere were 453 employees covered under PSERS for the year ended June 30, 1995. \nPSERS CONTRIBUTIONS REQUIRED AND MADE Covered employees are required by State statute to contribute $4. 00 a month for the nine month school year. Unlike TRS, the Board makes no contribution to PSERS. The State of Georgia is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS' Board ofTrustees. Total contnbutions from employees ofthe Board made during fiscal year 1995 amounted to $15,084.00. Total contribution for all school systems made by the State of Georgia to PSERS for fiscal year ended June 30, 1995, was $9,162,000.00. \nNote 14: SURETY BONDS \nThe School Superintendent, Mr. Tony Hinnant, is bonded in the amount of$50,000.00 with Zurich-American, Schaumburg, Illinois, their Bond No. CP06791772-00, on which premium was paid through November 1, 1995. \n \n- 25 - \n \n ASSEIS \ncash and cash Equivalents \nAccounts Receivable \nInventories Consumable Supplies Food Donated Commodities Purchased Food \n \nl::IQ!.!SIQN QQUNIY a~BQ QF EQUQATIQt::! QQMBINlt::!~ aALANQE SHE~T \n~PEQIAL BEVENUE E!.!ND \nJUNE 30 1995 \n \nELEMENTARY \n \nSCHOOL FOOD \nSERVICES FUND \n \nFAMILY CONNECTION \nFUND \n \nLOTTERY PROGRAMS \n \nDRUG-FREE SCHOOLS AND COMMUNITIES \nACT \n \nCHAPTER 1 EDUCATION OF \nDEPRIVED CHILDREN \n \n$ 1,638,269.55 \n \n$ 46,100.81 $ \n \n2,744.36 $ \n \n9,192.00 \n \n63,465.43 $ 5,873.65 \n \n1,835.84 \n \n231,042.61 \n \n152,078.27 83,407.92 \n \nTotal Assets \n \n$ 1,937,221.17 $ 5,873.65 $ 47,936.65 $ \n \n2,744.36 $ \n \n240,234.61 \n \nLIABILITIES ANQ FUND EQUITY \nLIABIUTJES \ncash OVerdraft \nAccounts Payable Salaries Payable Expired Grant Balances Payable \nTotal Liabilities \nFUNDEOUITY \nFund Balances Reserved For Continuation of Federal Programs For Inventories Consumable Supplies Food Donated Commodities Purchased Food \nUnreserved Undesignated \nTotal Fund Equity \n \n$ $ 147,356.78 \n254,666.14 \n$ 402,022.92 $ \n \n5,873.65 $ \n5,873.65 $ \n \n2,387.03 $ 3,451.44 42,098.18 \n47,936.65 $ \n \n557.31 $ 2,187.05 \n2,744.36 $ \n \n50,998.49 188,945.78 \n290.34 \n240,234.61 \n \n$ 152,078.27 83,407.92 \n \n$ 235,486.19 \n \n1,299,712.06 .$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 \n \n$ 1,535,198.25 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 \n \nTotal Liabilities and Fund Equity \n \n$ 1,937,221.17 $ 5,873.65 $ 47,936.65 $ \n \n2,744.36 $ \n \n240,234.61 \n \nSee notes to the general purpose financial statements. \n \n-26- \n \n EXHIBIT\"E\" \n \nAND SECONDARY EDUCATION ACT \n \nTITLE 11- \n \nINDIVIDUALS WITH \n \nEISENHOWER DISABILITIES EDUCATION ACT \n \nCHAPTER2 \n \nMATHEMATICS \n \nTITLE VI, B \n \nJOB TRAINING \n \nINNOVATIVE BLOCK GRANT - AND SCIENCE \n \nFLOW \n \nPRESCHOOL PARTNERSHIP \n \nTOTALS \n \nPROGRAM FLOW THROUGH EDUCATION THROUGH \n \nPROGRAM \n \nACT \n \nJUNE 30, 1995 JUNE 30, 1994 \n \n$ 4,526.49 $ \n \n0.00 \n \n$ \n \n0.00 $ 1,700,833.21 $ 1,978,044.82 \n \n$ \n \n2,461.06 $ 79,698.04 $ 16,920.35 \n \n401,296.98 \n \n677,800.59 \n \n152,078.27 83,407.92 \n \n32,739.63 \n139,900.44 61,260.40 \n \n$ \n \n4,526.49 $ \n \n0.00 $ \n \n2,461.06 $ 79,698.04 $ 16,920.35 $ \n \n0.00 $ 2,337,616.38 $ 2,889,745.88 \n \n$ \n \n351.10 \n \n1,841.42 \n \n2,333.97 \n \n$ \n \n4,526.49 \n \n$ \n \n2,461.06 $ \n \n8,458.80 $ \n \n3,045.20 \n \n14,233.95 \n \n2,422.74 \n \n53,624.61 \n \n11,452.41 \n \n3,380.68 \n \n$ \n \n2,461.06 $ 79,698.04 $ 16,920.35 \n \n$ \n \n19,838.71 $ 163,445.57 \n \n218,307.40 \n \n253,960.91 \n \n516,168.85 \n \n470,135.16 \n \n48,103.17 \n \n693.80 \n \n$ 802,418.13 $ 888,235.44 \n \n$ \n \n5,066.46 \n \n32,739.63 \n \n$ 152,078.27 83,407.92 \n \n139,900.44 61,260.40 \n \n$ 235,486.19 $ 238,966.93 \n \n$ _ _ _0_.00_$ _ _ _--\"o~.00~$ _ _~0_.00_$ _ _ _0~.00_$ _ _ _0_.00_$ _ _--'0-.0-0'- 1,299,712.06 1,762,543.51 \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ _ _ _0_.00_$ 1,535,198.25 $ 2,001,510.44 \n \n$ \n \n4,526.49 s _ _ _ _o-.oo_s \n \n2,461.06 $ \n \n79,698.04 $ \n \n--~= 16,920.35 $ \n \n0.00 $ 2,337,616.38 $ 2,889,745.88 \n \n-27- \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBININQ SI~Tl;Ml;NT OF Ri;Vl;NUES, 1;iPENDIIUBES AND CHANQES IN FUND !;!A~NCl;S \nSPl;CIAL Bi;~i;NUE EUND YEAB ENDED JUNE 30 1995 \n \nREVENUES \nState Funds FederaiFunds Local and Other Funds \nTotal Revenues \nEXPENDITURES \nCurrent Instruction Support Services Pupil Services Improvement cl Instructional Services Educational Mecfia Services General Aclminlslration School Administration Maintenance and Operation cl Plant Student Transportation Services Other Support Services Food Services Operation Other Operations cl Non-Instructional Services Capital Outlay \nTotal Expenditures \nExcess cl Revenues over (under) Expenditures \nQTHER EINANCINQ SQURCES \nOperating Transfers In Operating Transfers Out \nTotal Other Financing Sources (Uses) \nExcess cl Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses \nFUND BALANCE JULY 1 \nFood Inventory - Net Change in Period Donated Commodities Purchased Food \nSupplies Inventory - Net Change in Period Residual Equity Transfer \n \nSCHOOL FOOD \nSERVICES FUND \n \nFAMILY CONNECTION \nFUND \n \nELEMENTARY \n \nLOTTERY PROGRAMS \n \nDRUG-FREE SCHOOLS AND COMMUNITIES \nACT \n \nCHAPTER 1 EDUCATION OF \nDEPRIVED CHILDREN \n \n$ 359,318.00 $ 2,683,620.40 1,794,884.13 \n \n58,924.36 $ 1,613,415.74 \n \n49,505.63 \n \n$ \n \n150.00 \n \n$ 4,837,822.53 $ 108,579.99 $ 1,613,415.74 $ \n \n85,336.34 $ 1,549,959.94 85,336.34 $ 1,549,959.94 \n \n$ 747,524.97 $ \n \n100,698.99 27,108.42 494,746.41 \n \n$ 5,300,653.98 $ 167,585.33 \n \n5,744.51 227,064.74 \n1,050.96 2,192.60 2,451.25 \n4,832.89 \n \n$ 5,300,653.98 $ 167,585.33 $ 1,613,415.74 $ \n \n$ -462,831.45 $ -59,005.34 $ \n \n0.00 $ \n \n33,648.58 $ \n50,782.09 259.77 \n \n1,451,330.46 \n6,165.96 20,166.08 \n67,560.12 \n \n645.90 \n \n4,737.32 \n \n85,336.34 $ 0.00 $ \n \n1,549,959.94 0.00 \n \n$ 42,200.00 $ 42,200.00 \n \n$ -462,831.45 $ -16,805.34 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 \n \n1,996,443.98 \n \n0.00 \n \n0.00 \n \n0.00 \n \n0.00 \n \n12,177.83 22,147.52 -32,739.63 \n \n16,805.34 \n \nEUNQ BALANQE JUNE 30 \n \n$ 1,535,198.25 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 \n \nSee notes to the general purpose financial statements. \n \n-28- \n \n EXHIBIT\"P \n \nAND SECONDARY EDUCATION ACT \nCHAPTER2 INNOVATIVE BLOCK GRANT PROGRAM FLOW THROUGH \n \nTITLE II EISENHOWER MATHEMATICS AND SCIENCE EDUCATION \n \nINDIVIDUALS WITH \n \nDISABILITIES EDUCATION ACT \n \nTITLE VI, B \n \nFLOW \n \nPRESCHOOL \n \nTHROUGH \n \nPROGRAM \n \nJOB TRAINING PARTNERSHIP \nACT \n \nTOTALS YEAR ENDED JUNE 30, 1995 JUNE 30, 1994 \n \n$ 63,765.03 $ $ 63,765.03 $ \n \n100,455.00 $ \n \n'46,709.45 $ 598,548.36 $ 95,120.35 $ \n \n100,455.00 $ \n \n46,709.45 $ 598,548.36 $ 95,120.35 $ \n \n$ -5,066.46 \n \n2,031,658.10 $ 758,473.71 5,267,954.04 5,122,574.94 1,795,034.13 1,673,733.20 \n \n-5,066.46 $ 9,094,6'46.27 $ 7,554,781.85 \n \n$ $ 69,243.18 \n134.50 \n$ 69,3n.68 $ $ -5,612.65 $ \n \n100,111.93 $ \n343.07 \n100,455.00 $ 0.00 $ \n \n$ \n'46,552.24 157.21 \n \n511,746.57 $ 57,268.23 20,951.39 \n5,598.36 2,983.81 \n \n49,924.71 $ 25,175.92 \n1,410.89 18,608.83 \n \n'46,709.45 $ 0.00 $ \n \n598,548.36 $ 0.00 $ \n \n95,120.35 $ 0.00 $ \n \n0.00 $ 2,894,287.22 $ 2,688,020.34 \n \n189,309.10 234,803.40 494,7'46.41 69,731.06 \n5,744.51 232,797.60 \n23,289.50 6,929.92 5,303,105.23 167,585.33 4,832.89 \n \n50,514.38 178,793.93 \n3,405.68 69,707.59 \n6,532.n 14,815.13 28,412.35 25,019.34 4,1so,n2.84 \n \n0.00 $ 9,627,162.17 $ 7,255,994.35 \n \n-5,066.46 $ -532,515.90 $ 298,787.50 \n \n$ \n \n5,612.65 \n \n$ 5,612.65 \n \n$ \n \n47,812.65 $ \n \n5,443.48 \n \n-158,700.00 \n \n$ \n \n47,812.65 $ -153,256.52 \n \n$ \n \n0.00 $ \n \n0.00 \n \n0.00 $ 0.00 \n \n0.00 $ 0.00 \n \n0.00 $ 0.00 \n \n0.00 $ 0.00 \n \n-5,066.'46 $ -484,703.25 $ 145,530.98 5,066.'46 2,001,510.44 1,839,2'46.63 \n \n12,1n.83 22,147.52 -32,739.63 16,805.34 \n \n12,538.25 -3,468.55 32,739.63 \n \n$ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ \n \n0.00 $ 1,535,198.25 $ 2,001,510.44 \n \n 29- \n \n HOUSTON COUNTY BOARD Of EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE30 1995 \n \nASSETS \nC8sh and C8sh Equivalents Investments Accounts Receivable Prepaid Expenses \nTotal Assets \nLIABILITIES AND FUND EQUITY LIABILITIES \nCash OVerdraft Accounts Payable Contracts Payable Retainaiges Payable \nTotal Liabilities FUND EOUlTY \nFund Balances Reserved For Debt Service For Purposes of Trust Certif:cates For State Capital Outlay Projects \nUnreserved Undesignated Total Fund Equity \nTotal Liabilities and Fund Equity \n \nREGULAR \n \nTRUST CERTIFICATE \nFUND \n \nGEORGIA STATE FINANCING \n \nPROJECT \n \nPROJECT \n \n93J94..676-049 941955-676-030 \n \n$ 621,355.41 \n \n$ \n \n0.00 \n \n$ 9,612,237.80 \n \n$ \n \n738,978.32 \n \n285,314.00 \n \n5,000.00 \n \ns s 626 355.41 9 612 237.eo s_ _ _ _o_.oo_ s 1 024 292_32 \n \n1 \n \n11 \n \n11 \n \n$ 1,667,2.07.50 $ 6,622.00 \n \n291,288.00 \n \n$ \n \n6,622.00 $ 1,958,495.50 \n \n$ \n \n417,744.22 \n \n285,060.10 321,488.00 \n \n$ 1,024,292.32 \n \n$ 7,653,742.30 \n \n$ 7,653,742.30 \n \n$ 619,733.41 \n \n0.00 $ \n \n$ 619?33,41 $ 7,653?42.30 $ \n \n0.00 $ \n \n0.00 \n \n0.00 $ \n \n0.00 \n \ns s 626,355.41 9 612,237.eo s_ _ _ _o_.oo_ s 1 024 292_32 \n \n1 \n \n11 \n \nSee notes to the general purpose financial statements. \n \n- 30- \n \n EXHIBIT G\" \n \nAND INVESTMENT COMMISSION \n \nPROJECT \n \nPROJECT \n \n95196-676-038 95196-676-039 \n \nPROJECT 95/96-676-40 \n \n$ \n \n82,014.00 $ \n \n20,257.00 \n \nLOTTERY PROJECT 96/95S-678-047 \n \nTOTALS JUNE 3011995 JUNE 3011994 \n \n$ \n \n723,626.41 $ 1,307,544.56 \n \n$ \n \n179,820.00 10,531,036.12 11,843,091.67 \n \n$ \n \n935,443.00 \n \n1,220,757.00 \n \n28,980.00 \n \n51000.00 \n \n$ \n \n935.443.00 $ \n \n82.014.00 $ \n \n20.257.00 $ \n \n119.820.00 s 12r45or419_53 $ 131119.616.23 \n \n$ \n \n935,443.00 \n \n$ \n \n9351443.00 \n \n$ 3,020,394.72 $ 6,622.00 \n285,060.10 6121n6.oo \n$ 3,924,852.82 $ \n \n463,871.00 71,780.02 150,563.10 251000.00 \n7111214.12 \n \n$ \n \n54,345.28 \n \n$ 7,653,742.30 11,324,875.39 \n \n$ \n \n82,014.00 $ \n \n20,257.00 $ \n \n179,820.00 \n \n282,091.00 \n \n306,838.50 \n \n$ \n \n82,014.00 $ \n \n20,257.00 $ \n \n179,820.00 $ 7,935,833.30 $ 11,686,059.17 \n \n$ \n \n0.00 \n \n0.00 \n \n0.00 \n \n0.00 \n \n619,733.41 \n \n782,342.94 \n \n$ \n \n0.00 $ \n \n82,014.00 $ \n \n20,257.00 $ \n \n179,820.00 $ 8,555,566.71 $ 12,468,402.11 \n \n$ \n \n935.443.00 $ \n \n82,014.00 $ \n \n20,257.00 $ \n \n179,820.00 $ 12.480,419.53 $ 13,179.616.23 \n \n- 31 - \n \n HOUSTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT Of REVENUES EXPENDJTURES AND CHANGES IN FUND BALANCES \nCAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 1995 \n \nREVENUES \nStateFWlds Local and Other Funds \nTotal ReventMS \nEXPENDIJURES \nCun9nt \nSupport Services Businna Administration \nCapital Outlay Salaries \nEmployee Benefits Professional and Technical Services Rental d Equipment Other Purchaaed Services \nSupplies \nBuilding and Building Improvements Equipment Dl.aandFeN \nTotal Expenditures \nExcess d Revenues over (under) Expenditures \nOTHER FINANCING SOURCES CUSES\u003e \nAccrued Interest on Caltilicates Sold Proceeds from Sale dTrust Certificates \nPar Value Discount on Certificates Sold Operating Transfers In Operating Transfers Out \nTotal Other Financing Sources (Uses) \nExcess d R - and Other F1n11nclng Sources over (under) Expenditures and Other Financing Uses \nFUND BALANCE JULY 1 \nResidual Equity Transfer \n \nREGULAR \n \nTRUST CERTIFICATE \nFUND \n \nGEORGIA STATE FINANCING \n \nPROJECT \n \nPROJECT \n \n93194-676-049 ~ 6 - 0 3 0 \n \n$ \n \n$ \n \n381186.14 $ \n \n5611-447.22 \n \n$ \n \n381186.1-4 $ \n \n5611-447.22 $ \n \n0.00 $ 2,809,674.00 0.00 $ 218091674.00 \n \n$ \n \n800.00 \n \n61.20 \n \n$ \n \n958.50 \n \n1,899,984.20 18,867.78 \n \n3,206,415.73 $ 26,848.22 $ 3,491,854.82 \n \n$ 11919.713.18 $ \n$ -1 1ss1 1527.04 s \n \n312071374.23 $ 216451927.01 $ \n \n261848.22 $ -261848.22 $ \n \n314911854.82 -6821180.82 \n \n$ 1,718,917.51 \n \ns $ 984,6n.oo \n \n$ 110791551.36 \n \n-491234.00 \n \n$ 1-7181917.51 $ 110791551 .36 $ 9351443.00 $ \n \n375,342.32 3751342.32 \n \n$ -162,609.53 $ -3,725,478.37 $ 908,594.78 $ \n \n782,342.94 \n \n11,379,220.67 \n \n0.00 \n \n-9081594.78 \n \n-306,838.50 306,838.50 \n \nFUND BALANCE JUNE 30 \n \n$ 619,733.41 $ 7,653,742.30 $ \n \n0.00 $ \n \n0.00 \n \nSee notes to the general purpose financial statements. \n \n-32- \n \n EXHIBIT\"H\" \n \nAND INVESTMENT COMMISSION \n \nPROJECT \n \nPROJECT \n \n~6-038 \n \n~ \n \nPROJECT ~6-\u003cW \n \nLOTTERY PROJECT 96195S-678-047 \n \nTOTALS \n \nYEAR ENDED \n \nJUNE 301 1995 \n \nJUNE 301 1994 \n \n$ 935,443.00 $ $ 935,443.00 $ \n \n0.00 $ 0.00 $ \n \n0.00 $ 0.00 $ \n \n0.00 $ 0.00 $ \n \n3,745,117.00 $ 599,633.36 \n4,344,750.36 $ \n \n1,095,078.00 904,746.39 \n1,999,824.39 \n \n$ \n \n0.00 $ \n \n$ \n \n0.00 $ \n \n$ 935,443.00 $ \n \n0.00 $ \n0.00 $ 0.00 $ \n \n0.00 $ \n0.00 $ 0.00 $ \n \n$ \n \n376,567.95 \n \n0.00 $ \n \n800.00 61.20 958.50 \n \n8,625,102.97 18,867.78 \n \n15,899.99 2,391.55 355,969.04 8,748.42 \n221.50 958,132.06 3,515,252.41 76,864.77 \n30.00 \n \n0.00 $ 8,645,790.45 $ 51310,077.69 \n \n0.00 $ -4,301,040.09 $ -3,310,253.30 \n \n$ \n \n49,234.00 $ \n \n-984,677.00 \n \n$ -935,443.00 $ \n \n$ \n \n0.00 $ \n \n0.00 \n \n82,014.00 $ 82,014.00 $ 82,014.00 $ \n0.00 \n \n20,257.00 $ 20,257.00 $ \n \n$ \n \n54,345.28 \n \n179,820.00 $ 3,410,261.83 -2. 113,462.36 \n \n12,445,000.00 -282,432.05 2,645,624.53 -363,636.00 \n \n179,820.00 $ 1,296,799.47 $ 14,498,901.76 \n \n20,257.00 $ 0.00 \n \n179,820.00 $ -3,004,240.62 $ 11,188,648.46 \n \n0.00 \n \n12,468,402.11 \n \n1,279,753.65 \n \n-908,594.78 \n \n$ \n \n0.00 $ \n \n82,014.00 $ \n \n20,257.00 $ 179,820.00 $ 8,555,566.71 $ 12,468,402.11 \n \n-33- \n \n D \\C\\ V\\{.c_ \nP'(j G~ \n \n DEFERRED COMPENSATION PLAN \nASSETS \nInvestments Held by Trustee \n \nHOUSTON COUNTY BOARD Of EDUCATION \nSTATEMENT OF CHANGES IN ASSETS AND LIABILITIES \nADUQIARYFUNDTYPE-AGENCYFUNP YEAR ENDED JUNE 30. 1995 \n \nEXHIBITT \n \nBALANCE JULY1,1994 \n \nADDITIONS \n \nDEDUCTIONS \n \nBALANCE JUNE 30, 1995 \n \n$ 5,622,410.TT $ 450,418.67 $ 161,137.15 $ 5,911,692.29 \n \nLIABILITIES Deferred Compensation Plan \n \n$ 5,622,410.TT $ 450,418.67 $ 161,137.15 $ 5,911,692.29 \n \nSee notes to the general purpose financial statements. \n \n-35- \n \n l::IQ!.!STQN ~!.!!ID'.: aQABQ QF ft'!!.!QAIIQN SQl::lft'!!.!Lf QF FfQfBAL EINANQ!AL ASSISTANQf \nYEAB fNQfQ J!.!NE 30. 1995 \n \nSCHEDULE 1 \n \nFUNDING AGENCY PRQGBAM/GRANT \nAgriculture, U. S. Department of Through Georgia Department of Education Food and Nutrition Program Child and Adult care Food Program 1995 Contract Food Services School Breakfast Program 1994 Grant 1995Grant National School Lunch Program 1994Grant 1995Grant Food Distribution Program (1) \nTotal U.S. Department of Agriculture \nEducation, U. S. Department of Direct P. L. 81-874 1995Grant Through Georgia Department of Education Drug-Free Schools and Communities Act 1994 Grant 1994 carry-Over 1995Grant Elementary and Secondary Education Act Chapter 1 Education of Deprived Children 1994 Regular 1994Summer 1994 carry-Over 1995 Regular Chapter2 Block Grant - Flow Through 1995 Regular Innovative Programs 1994 Regular 1995 Regular Trtlell Eisenhower Mathematics and Science Education 1994 Regular 1995 Regular Individuals with Disabilities Education Act Title VI, B Flow Through 1994 Regular 1994 carry-Over 1995 Regular Special Projects Preschool Program 1993 Carry-Over 1994 Regular 1994 Carry-Over 1995 Regular \n \nCFDA NUMBER \n \nAWARDS IN PERIOD \n \nFEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS) \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \n10.558 $ \n \n8,192.75 $ \n \n6,783.94 $ \n \n8,192.75 \n \n(2) \n \n* 10.553 * 10.553 \n \n359,913.54 \n \n* 10.555 * 10.555 * 10.550 \n \n1,940, 179.21 375,334.90 \n \n$ 216831620.40 $ \n \n21,376.06 \n \n340,097.84 \n \n359,913.54 \n \n(2) \n \n18,279.04 1,898,035.89 \nNIA \n \n1,940,179.21 $ 4,925,319.08 (3) \n \n3751334.90 \n \n3751334.90 \n \n212841572.77 $ 2,683,620.40 $ 513001653.98 \n \n* 84.041 $ 929,309.00 $ \n \n84.186 84.186 84.186 \n \n12,942.00 78,203.00 \n \n929,309.00 $ 929,309.00 \n \n3,633.22 12,942.00 72,394.34 \n \n12,942.00 $ 72,394.34 \n \n(5) \n12,942.00 72,394.34 \n \n* 84.010 * 84.010 * 84.010 * 84.010 \n \n3,345.00 115,078.00 1,476,918.00 \n \n84.151 \n84.151 84.151 \n \n100,455.00 66,099.00 \n \n243,221.16 3,121.85 \n113,571.00 1,203,000.00 \n \n-485.18 3,121.85 113,571.00 1,433,752.27 \n \n-485.18 3,121.85 113,571.00 1,433,752.27 \n \n100,455.00 \n13,601.00 66,099.00 \n \n100,455.00 63,765.03 \n \n100,455.00 69,377.68 (3) \n \n84.164 84.164 \n \n46,435.00 \n \n14,781.00 34,300.00 \n \n9,948.39 36,761.06 \n \n9,948.39 36,761.06 \n \n* 84.027 * 84.027 * 84.027 * 84.027 \n84.173 84.173 84.173 84.173 \n \n47,231.00 578,322.00 \n40,067.00 81,900.00 \n \n84,592.55 47,231.00 475,000.00 \n2,820.41 \n3,461.00 6,908.74 40,067.00 38,133.00 \n \n47,231.00 551,317.36 \n40,067.00 55,053.35 \n \n47,231.00 551,317.36 \n40,067.00 55,053.35 \n \n- 36 - \n \n HOUSTON COUNJY BOARD OF EDUCATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE \nYEAR ENDED JUNE 30. 1995 \n \nFUNDING AGENCY PROGRAM/GRANT \nEducation, u. s. Department of \nThrough Georgia Department of Education \nVocational Education  Basic Grants to States \nHigh School Program BaaicGrant 1994Grant 1995Grant \n \nCFDA NUMBER \n \nAWARDS IN PERIOD \n \nFEDERAL FUNDS RECEIVED IN PERIOD(NET OF REFUNDS) \n \nFEDERAL REVENUE IN PERIOD \n \nEXPENDITURES IN PERIOD \n \n84.048 \n \n$ \n \n14,344.03 \n \n84.048 $ 1421867.42 \n \n141272.81 $ 1421867.42 \n \n{4) \n \nTotal U.S. Department of Education \n \n$ 3.7191171.42 $ \n \n315371259.11 $ 316121070.89 $ 215451507.12 \n \nHealth and Human Services, U. S. Department of \n \nThrough Georgia Department of Human Resources \nChild care Services Contract \n \n1995Grant \n \n93.037 $ \n \n7,290.00 \n \n$ \n \n6,330.00 \n \n(4) \n \nDe\\'elopmental Disabilities Basic Support \n \nand Advocacy Grants \n \n1994Grant \n \n93.630 \n \n$ \n \n51022.97 \n \nlabor, u. s. Department of \nThrough Middle Georgia Consortium Job Training Partnership Id. 07-1-12\"\"3-153 \n \n$ \n \n71290.00 $ \n \n17.250 \n \n$ \n \n51022.97 $ \n \n61330.00 \n \n-51066.46 $ \n \n-51066.46 \n \nQTHER EEtU;RAL ASSISTAHCE \nDefense, U. s. Department of \nDirect P.L. 102-368 Department of the AJr Fon:e R.O.T.C. Program 1994Grant 1995Grant \n \n$ 216,629.00 $ \n \n216,629.00 $ 216,629.00 \n \n(5) \n \n1311304.07 \n \n33,076.17 \n \n991298.80 \n \n1311304.07 \n \n(4) \n \n$ 3471933.07 $ \n \n3491003.97 $ 3471933.07 \n \nHealth and Human SerYic:es, U. S. Department of Through Georgia Department of Medical Assistance Medicaid Assistance 1995Grant \n \n$ 491505.63 $ \n \n47 444.31 $ 491505.63 \n \n(5) \n \nTotal Federal Financial Assistance \n \n$ 618071520.52 $ \n \nMajor Programs are identified by an a\u0026teriak (*) in front of the CFDA number. \n \n612181236.67 $ 616941393.53 $ 718461161.10 \n \n(1) The amounts shown for the Food Distribution Program represents the Federally assigned value of nonmonetary aMiatance for donated commodities received and/or consumed by the system during the current fl\u0026Cal year. \n(2) Expenditures for the School Breakfast Program and Child and Adult Care Food Program were not maintained separately and are included in the 1995 National School Lunch Program. \n(3) Expenditures for this program include State, and/or Local and Other Funds. Expenditures are not maintained by fund source. \n(4) Expenditures on this program were not maintained by fund source. (5) Funds earned on this program do not require reporting of expenditures. \n \nSee notes to the general purpose financial statements. \n \n- 37 - \n \n HOUSTON COUNTY BOARD OF EDUCATION CASH AND CASH EQUIVALENTS JUNE 30, 1995 \nINTEREST BEARING ACCOUNTS \nBank South, Atlanta, Georgia \nN.O.W. Accounts (Variable) \n \nSCHEDULE \"2\" $ 2,963,869.67 \n \nSee notes to the general purpose financial statements. \n \n- 38 - \n \n HOUSTON COUNTY BOARD OF EDUCATION INVESTMENTS JUNE 30, 1995 \n \nSCHEDULE \"3\" \n \nINVESTMENT POOL \nState of Georgia, Office of Treasury and Fiscal Services Local Government Investment Pool (6.032%) \nPORTFOLIO ACCOUNTS \nBank South, Atlanta, Georgia \nColumbus Bank and Trust, Columbus, Georgia \n \n$ 27,373,423.52 \n \n$ \n \n4,350.78 \n \n386,028.24 \n \n390,379.02 \n \n$ 27,763,802.54 \n \nSee notes to the general purpose financial statements. \n \n- 39 - \n \n B\\40\\.,L ft 40 \n \n HOUSTON COUNTY BOARD OF EDUCATION ACCOUNTS RECEIVABLE JUNE 30 1995 \n \nSCHEDULE 4 \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE \n \nPROJECTS \n \nFUND \n \nFUND \n \nDEBT SERVICE \nFUND \n \nTOTAL \n \nChildren and Youth Services, Georgia Department of Project Peace \nDefense, u. s. Department of \nDepartment of Air Force R. 0. T. C. Program \n \n$ \n \n3,812.33 \n \n$ \n \n32,005.27 \n \n$ \n \n3,812.33 \n \n32,005.27 \n \nEducation, Georgia Department of Food Services Child and Adult Care Food Program School Breakfast Program National School Lunch Program Vocational Education state Funds Federal Funds Other State Programs Next Generation School Project Lottery Program Instructional Technology Federal Programs ESEA - Chapter 1 Education of Deprived Children ESEA - Eisenhower Mathematics and Science Education Title II Individuals with Disabilities Education Act Title VI, B - Flow-Through Title VI, B - Preschool Program \n \n80,460.03 128,594.61 \n170,000.00 \n \n1,408.81 19,815.70 42,143.32 \n1,835.84 \n231,042.61 2,461.06 \n79,698.04 16,920.35 \n \n1,408.81 19,815.70 42,143.32 \n80,460.03 128,594.61 \n170,000.00 \n1,835.84 \n231,042.61 \n2,461.06 \n79,698.04 16,920.35 \n \nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \n \n$ 1,220,757.00 \n \n1,220,757.00 \n \nHouston County Tax Commissioner County Wide Bond Tax County Wide School Tax \n \n200,469.38 \n \n$ 15,603.97 \n \n15,603.97 200,469.38 \n \nHuman Resources, Georgia Department of Child Care Services Contract \n \n6,330.00 \n \n6,330.00 \n \nMedical Assistance, Georgia Department of Medicaid Assistance \n \n2,061.32 \n \n2,061.32 \n \nVarious Sources Houston County lnteragency Council Mercer University Principals Accounts Returned Checks \n \n9,734.73 1,680.00 12,414.83 \n \n97.60 \n \n9,734.73 1,680.00 12,414.83 \n97.60 \n \n$ 641,688.85 $ 401,296.98 $ 1.220,757.00 $ 15,603.97 $ 2,279,346.80 \n \nSee notes to the general purpose financial statements. \n \n- 41 - \n \n HOUSTON CQUNJY BOARD Of EDUCATION \nDEBT SERVICE REQUIREMENTS JO MATURITY JUNE 30, 1995 \n \nPAYMENTS DUE IN FISCAL YEAR \nENDING JUNE 30 \n1996 1997 \n1998 \n1999 2000 \n2001 \n2002 2003 2004 2005 \n2006 2007 2008 2009 2010 \n2011 2012 2013 2014 \n \nTOTAL DEBT SERVICE \n \nTOTAL INTEREST \n \nTOTAL PRINCIPAL \n \nGENERAL \n \n1993 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n$ 1,908,260.00 $ 1,203.260.00 $ \n \n1,910,020.00 \n \n1, 165,020.00 \n \n1,903,220.00 \n \n1,123,220.00 \n \n1,904,110.00 \n \n1,089,110.00 \n \n1,906,835.00 \n \n1,051,835.00 \n \n705,000.00 $ 7'45,000.00 780,000.00 815,000.00 855,000.00 \n \n....S,065.00 $ 445,265.00 441,275.00 415,905.00 388,230.00 \n \n95,000.00 95,000.00 590,000.00 615,000.00 855,000.00 \n \n1,911,150.00 1,911,840.00 1,914,370.00 1,913,400.00 1,918,830.00 \n \n1,011,150.00 966,840.00 919,370.00 868,400.00 813,830.00 \n \n900,000.00 945,000.00 995,000.00 1,0'45,000.00 1,105,000.00 \n \n357,445.00 323,635.00 287,385.00 248,115.00 205,735.00 \n \n690,000.00 725,000.00 770,000.00 815,000.00 865,000.00 \n \n1,920,025.00 1,921,860.00 1,923,950.00 1,925,875.00 1,926,812.50 \n \n755,025.00 691,860.00 623,950.00 550,875.00 471,812.50 \n \n1, 165,000.00 1,230,000.00 1,300,000.00 1,375,000.00 1,455,000.00 \n \n159,890.00 110,750.00 57,400.00 \n \n910,000.00 970,000.00 1,025,000.00 \n \n1,928,606.25 1,936,100.00 1,938,600.00 1,945,100.00 \n \n393,606.25 311,100.00 213,600.00 110,100.00 \n \n1,535,000.00 1,625,000.00 1,725,000.00 1,835,000.00 \n \n$ 36,468,963.75 $ 14,333,963.75 $ 22,135,000.00 $ 3,890,095.00 $ 8,820,000.00 \n \nC~NGES IN GENER\u0026, LQN~TERM PEaT Debt Payable at July 1, 1994 Debt Retired During Period \n \nTOTAL \n \nGENERAL OBLIGATION BONDS \n \n1993 ISSUE \n \n1988 ISSUE \n \n1987 ISSUE \n \nTRUST CERTIFICATES \n1994 ISSUE \n \n$ 22,615,000.00 $ 8,910,000.00 $ \n \n945,000.00 $ 315,000.00 $ 12,445,000.00 \n \n480,000.00 \n \n90,000.00 \n \n290,000.00 \n \n100,000.00 \n \nDebt Payable at June 30, 1995 \n \n$ 22,135,000.00 $ 8,820,000.00 $ \n \n655,000.00 $ \n \n215,000.00 $ 12,445,000.00 \n \nMATURITY DATES Semi-Annual Interest Payment Dates Annual Debt Retirement Date \n \nMAR 1-SEPT 1 MAR 1 \n \nMAR 1-SEPT 1 MAR 1-SEPT 1 \n \nMAR 1 \n \nMAR 1 \n \nFEB 1-AUG 1 FEB 1 \n \nSee notes to the general purpose financial statements. \n \n- 42 - \n \n SCHEDULE \"5\" \n \nOBLIGATION BONDS \n \n1988 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n1987 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \nINTERGOVERNMENTAL CONTRACT \n \nTRUST CERTIFICATES \n \n1994 ISSUE \n \nINTEREST \n \nPRINCIPAL \n \n$ \n \n40,792.50 $ 315,000.00 $ \n \n14,677.50 $ 105,000.00 $ \n \n698,ns.oo $ \n \n190,000.00 \n \n21,420.00 \n \n340,000.00 \n \n7,590.00 \n \n110,000.00 \n \n690,745.00 \n \n200,000.00 \n \n681,945.00 \n \n190,000.00 \n \n673,205.00 \n \n200,000.00 \n \n663,605.00 \n \n200,000.00 \n \n653,705.00 643,205.00 631,985.00 620,285.00 608,095.00 \n \n210,000.00 220,000.00 225,000.00 230,000.00 240,000.00 \n \n595,135.00 581,110.00 566,550.00 550,875.00 471,812.50 \n \n255,000.00 260,000.00 275,000.00 1,375,000.00 1,455,000.00 \n \n393,606.25 311,100.00 213,600.00 110,100.00 \n \n1,535,000.00 1,625,000.00 1,ns.000.00 1,835,000.00 \n \n$ \n \n62,212.50 $ 655,000.00 $ \n \n22,267.50 $ 215,000.00 $ 10,359,388.75 $ 12,445,000.00 \n \n- 43 - \n \n HOUSTON CQUNTY BOARD OF EDUCATION \nSCHEDULE OF STATE REVENUE YEAR ENDED JUNE 3Q 1995 \n \nSCHEDULE\"6\" \n \nAGENQY,fUNPING \nGRANTS ChildNn and Youlh Selvices, o-gia Department of Projec:tPeace Educalion, Georgia Department of Quality Bale Educalion General and CarNr Education ProgntmS Special Education Programs Remedial Education Program Media C . . Programs Staff Dewlopment Programs Indirect Cost Pupil Transportation Regular Bus Replacement Middle School Incentive Special Instructional Assistance In-School Suspension School CounMlors Grades 4 and 5 Mid-term Adjustment Local Fair Share Educ:alional Equalization Funding Grant FoodSelvlces Vocational Education Olher Slate Programs Alternative Programs At-Risk Summer School Program Environmental Science Program Family Connection Governor's Emergency Funds (1) Innovative Programs \nMentor Teacher Program Next Generation Schools Prachool Handic:appI Program Remedial Summer School Program Special Education Low lnciclence Grant Teachers' Retirement \nLoaaryPrograms Algebra Classrooms Alternative School Program Distant Leaming lnstructionalTec:hnology Media Center and l.lbrary Equipment Pre-Kindergarten Program Safe Schools Grant \nGeorgia State Financing and Investment Commission Reimbursement on Construction Projects \nCONTRACTS \nEducation, Georgia Department of Consultant Georgia Education \nLudershipAcademy \n \nGOVERNMENTAL FUND lYPES \n \nSPECIAL \n \nCAPITAL \n \nGENERAL \n \nREVENUE PROJECTS \n \nFUND \n \nFUND \n \nFUND \n \nTOTAL \n \ns 28,924.36 \n \ns 31,576,988.00 \n5,502,769.00 631,961.00 \n1,348,074.00 427,057.00 \n9,116,628.00 \n1,055,123.00 303,722.00 \n1,232,318.00 995,614.00 357,786.00 75,520.00 \n1,370,858.00 -5,582,287.00 3,898,817.00 \n132,554.93 \n115,700.00 53,362.92 \n2,995.97 \n14,000.00 4,800.00 34,040.00 170,000.00 209,867.00 21,166.23 28,326.00 69,519.22 \n \n359,318.00 \n30,000.00 \n2,91724 185,182.00 \n55,991.12 97,42229 471,54723 604,034.82 196,321.04 \n \ns \n \n28,924.36 \n \n31,576,988.00 5,502,769.00 \n631,961.00 1,348,074.00 \n427,057.00 9,116,628.00 \n1,055,123.00 303,722.00 \n1,232,318.00 995,614.00 357,786.00 75,520.00 \n1,370,858.00 -5,582,287.00 3,898,817.00 \n359,318.00 132,554.93 \n115,700.00 53,362.92 2,995.97 30,000.00 14,000.00 4,800.00 34,040.00 170,000.00 209,867.00 21,166.23 28,326.00 69,519.22 \n2,91724 185,182.00 \n55,991.12 97,42229 471,54723 604,034.82 196,321.04 \n \ns 3,745,117.00 \n \n3,745,117.00 \n \n10,000.00 - - - - - - - - - - \n \n10,000.00 \n \nS 53,177,280.27 S 2,031,658.10 S 3,745,117.00 $ 58,954,055.37 \n \n(1) The purpose of these funds was for installation of fencing at High School and 1995 Georgia School of Excellence. \n \nSee notes 11D the general purpose financial statements. \n \n 44  \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF LOCAL AND OTHER REVENUE \nYEAR ENDED JUNE 30, 1995 \n \nSCHEDULE-r \n \nTaxes County Wide Bond Tax County Wide School Tax local Option Sales Tax \nRailroad car Tax \nRI Estate Transfer Tax \nOther Compensation for Loss of Assets Contributions from AU Funds \nFor Workers' Compensation Insurance Donations \nGeorgia State University Foundation \nHouston County lnteragency Council \nTRW Foundation \nother Interest Earned Lost and Damaged Books Rents Sales \nAdultMeals Breakfast Lunches other SUpplemental School Assets Sale of Supplies and Materials Less: Purchases for Resale Shared Service Contributions Middle Georgia Technical Institute \nYouth Apprenticeship Program Tuition Other \n \nGENERAL FUND \n \nGOVERNMENTAL FUND TYPES \n \nSPECIAL \n \nCAPITAL \n \nREVENUE PROJECTS \n \nFUND \n \nFUND \n \nDEBT SERVICE \nFUND \n \nTOTAL \n \n$ 15,366,343.13 8,659,334..46 6,904.83 106,618.98 \n \n$ 1,218,418.86 $ 1,218,418.86 \n \n15,366,343.13 \n \n8,659,334.46 \n \n536.52 \n \n7,441.35 \n \n8,284.54 \n \n114,903.52 \n \n5,755.39 \n \n451,360.05 \n \n5,000.00 23,304.00 \n7,500.00 $ \n1,016,356.79 11,110.15 9,786.81 \n \n150.00 $ 92,9n.89 \n \n38,186.14 553,740.67 \n \n336,135.00 824,464.28 -529,834.07 \n \n217,242.61 40,434.34 \n1,342,897.44 42,023.26 45,215.59 14,086.00 \n \n35,283.35 \n \n5,755.39 \n451,360.05 \n5,000.00 23,304.00 \n7,500.00 38,336.14 1,698,353.70 11,110.15 9,786.81 \n217,242.61 40,434.34 \n1,342,897.44 42,023.26 45,215.59 \n350,221.00 824,464.28 -529,834.07 \n \n21,889.85 223,681.65 \n81,532.04 \n \n12.00 \n \n7,706.55 \n \n21,889.85 223,681.65 \n89,250.59 \n \n$ 26,627,243.34 $ 1,795,034.13 $ 599,633.36 $ 1,262,523.27 $ 30,284,434.10 \n \nSee notes to the general purpose financial statements. \n \n- 45 - \n \n  HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT GENERAL AND SPECIAL REVENUE FUNDS \nYEAR ENDED JUNE 30, 1995 \n \nSCHEDULE \"8\" \n \nEXPENDITURES \nOperating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Compensation and Travel of Board Members Water, Sewer and Cleaning Services Repair and Maintenance Services Rents Property Services Insurance Communications Commodity Hauling Shared Services Other Purchased Services Supplies Energy Food Usage Books, Textbooks and Periodicals Dues and Fees Other Expenditures \nNonoperating Costs Principal and Interest Land and Land Improvements Building and Building Improvements Equipment \n \nGENERAL FUND \n \nSPECIAL REVENUE \nFUND \n \nTOTAL \n \n$ 54,654,765.30 $ 14,634,053.67 184,491.07 259,536.14 15,125.60 150,376.09 227,413.11 16,156.88 85,356.04 178,310.49 203,779.77 \n8,811.17 391,481.60 3,192,705.02 2,034,213.34 \n687,863.63 161,812.27 \n48,729.60 \n \n3,831,879.13 $ 887,988.29 55,799.97 100,485.38 \n6,760.00 42,742.55 16,300.00 \n8,990.85 23,817.56 40,405.34 51,722.03 748,174.14 \n2,335,539.36 60,227.81 8,124.75 11,426.15 \n \n58,486,644.43 15,522,041.96 \n240,291.04 360,021.52 \n15,125.60 157,136.09 270,155.66 \n32,456.88 85,356.04 178,310.49 212,770.62 23,817.56 49,216.51 443,203.63 3,940,879.16 2,034,213.34 2,335,539.36 748,091.44 169,937.02 60,155.75 \n \n513,790.24 55,826.10 \n113,819.63 1,207,628.62 \n \n4,832.89 1,391,945.97 \n \n513,790.24 60,658.99 \n113,819.63 2!599,574.59 \n \nTotal Expenditures \n \n$ 79,026,045.38 $ 9,627,162.17 $ 88,653,207.55 \n \nSee notes to the general purpose financial statements. \n \n- 47 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES BY OBJECT \nLOTTERY PROGRAMS YEAR ENDED JUNE 30, 1995 \n \nEXPENDITURES \nOperating Costs Salaries Employee Benefits Travel of Employees Professional and Technical Services Repair and Maintenance Services Rents Communications other Purchased Services Supplies Food Usage Books, Textbooks and Periodicals Dues and Fees other Expenditures \nNonoperating Costs Land and Land Equipment Equipment \n \nALGEBRA CLASSROOMS \n \nALTERNATIVE SCHOOL PROGRAM \n \nDISTANT LEARNING \n \nINSTRUCTIONAL TECHNOLOGY \n \n$ \n \n2,382.24 $ \n \n33,344.61 $ 55,991.12 $ \n \n535.00 \n \n27,310.97 \n \n8,137.89 \n \n124,526.42 \n \n891284.40 \n \nTotal Expenditures \n \n$ \n \n2,917.24 $ 185,182.00 $ 55,991.12 $ _=_97_,4_22==.2_9 \n \nSee notes to the general purpose financial statements. \n \n- 48 - \n \n SCHEDULE \"9\" \n \nMEDIA CENTER AND \nLIBRARY EQUIPMENT \n \nPRE-KINDERGARTEN PROGRAM \n \nSAFE SCHOOLS \nGRANT \n \nTOTAL \n \n$ \n \n$ \n \n23,763.95 \n \n447.783.28 $ 4711547.23 $ \n \n297,236.76 75,615.17 14,277.73 4,122.28 $ 16,300.00 441.56 3,789.36 \n109,053.20 1,250.40 \n22,298.49 2,175.00 3,265.98 \n \n$ 200.00 43,875.50 \n \n297,236.76 75,615.17 14,277.73 4,122.28 200.00 16,300.00 441.56 3,789.36 \n276,548.51 1,250.40 \n50,144.46 2,175.00 3,265.98 \n \n4,832.89 49 376.00 \n \n152,245.54 \n \n4,832.89 8631215.64 \n \n604,034.82 $ 196,321.04 $ 1,613,415.74 \n \n- 49 - \n \n  HOUSTON COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL \nGENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30, 1995 \n \nSCHEDULE \"1 O\" \n \nMinimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis \nSalaries Operations \nLess: Expenditures for Media Center Programs in Excess of Total Media Allotment \nExpenditures per Audit \nAmount of Underexpenditure for Total Allotment \n \nTHIRTEEN WEIGHTED AND MEDIA CENTER \nPROGRAMS \n \n100% TEST FOR OPERATIONS PORTION OF THIRTEEN WEIGHTED PROGRAMS \n \n$ 40,130,652.00 $ \n \n1,349,499.00 \n \n$ 47,798,517.81 2,257,357.36 $ _ _.:.z1,;:..90:;.:.7.l;,2:.;:;5.:.:7:.,;.03;:.. \n$ 50,055,875.17 \n \n-888,867.05 $ 49,167,008.12 \n \n$ \n \no.oo $ =====o=.o=o \n \nSee notes to the general purpose financial statements. - 51 - \n \n HOUSTON COUNTY BOARD OF EDUCATION \nANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS  BY PROGRAM GENERAL FUND QUALITY BASIC EDUCATION PROGRAMS \nYEAR ENDED JUNE 30 1995 \n \nGENERAL M:lD ~B51;8 EDUCATION ffiQGBAMS Kindergarten M Grades 1  3 M \nSUb-Total  K-3 \nGrades 4  5 M Grades 6  e M Grades 9. 12 M High School Laboratories M \nVocational Education laboratories (1 Total General and Career Education Programs \nSPECIAL EDUCATION ffiQGRAMS Regular Programs \nCategory IM \nCategory II (1 \nCategory Ill M category IV M \nSUb-Total  Regular \nCategory V (Gilled) M \nTotal Special Education Programs \nREMEDIAL EDUCATION PBQGBAM r\u003e \nTotal Thirteen Weighted Programs \nMEDIA CENTER PROGRAMS \nSalaries Operations \nTotal Media Center Programs \nTotal Thirteen Weighted and Media Center Programs \nSTAFF DE\\IELOPMENT PROGRAMS Cost d Instruction Professional Development \nTotal Staff DeYelopment C, Identifies Thirteen Weighted Programs. \n \nALLOTMENTS FROM DEPARTMENT OF EDUCATION \n \nREQUIRED \n \nORIGINAL _ L \n \nORIGINAL \n \nMID-TERM \n \n$ 2,915,898.00 \n \n$ 2,624,308.20 $ \n \n8,039,873.00 \ns 10,955,TT1.00 \n \n90 s \n \n7,235,885.70 9,860, 193.90 $ \n \n4,081,090.00 90 \n \n3,672,981.00 \n \n7,270,081.00 90 \n \n6,543,072.90 \n \n4,926,111.00 90 \n \n4,433,499.90 \n \n2,422,379.00 90 \n \n2,180,141.10 \n \n1,921,556.00 \ns 31,576,988.00 \n \n90 \n \n1,729,400.40 \n \n$ 28,419,289.20 $ \n \n176,197.00 253,292.00 429,489.00 29,309.00 160,043.00 -64, 132.00 290,321.00 32,290.00 STT,320.00 \n \n$ 4,353,146.00 \n \n$ 3,917,831.40 $ \n \n95,829.00 \n \n$ 4,353, 146.00 \n \n1,149,623.00 \n \n$ 5,502,769.00 \n \n$ \n \n631,961.00 \n \n$ 37,711,718.00 \n \n90 $ 3,917,831.40 $ \n \n90 \n \n1,034,660.70 \n \n$ 4,952,492.10 $ \n \n90 $ \n \n568,764.90 $ \n \n$ 33,940,546.20 $ \n \n95,829.00 -76,621.00 19,208.00 136,597.00 1,033,125.00 \n \ns s 1,063,582.00 90 \n284,492.00 90 \n \n957,223.80 $ 256,042.80 \n \n$ 1,348,074.00 \n \n$ 1,213,266.60 $ \n \n27,153.00 10,582.00 \n37,735.00 \n \n$ 39,059,792.00 \n \n$ 35,153,812.80 $ 1,070,860.00 \n \n$ \n \n262,197.90 \n \n164,859.10 \n \n$ \n \n262,197.90 $ \n \n164,859.10 \n \n3,950.00 0.00 \n \n$ \n \n427,057.00 100 $ \n \n427,057.00 $ \n \n3,950.00 \n \nSee notes to the general purpose financial statements. \n \n- 52 - \n \n SCHEDULE 11 \n \nTOTAL REQUIRED \n \nACTUAL EXPENDITURES \n \nSALARIES \n \nOPERATIONS \n \nTOTAL \n \nAMOUNT OF UNDEREXPENDITURE \nFOR REQUIRED ALLOTMENT \n \ns s 2,800,505.20 s 4,198,875.67 \n \ns 80,338.27 \n \n4,279,213.94 \n \n7,489, 1TT.70 \n \n8,913,451.73 \n \n279,243.51 \n \n9,192,695.24 \n \ns s 10,289,682.90 s 13,112,327.40 \n \ns 359,581.78 \n \n13,471,909.18 $ \n \n0.00 \n \n3,702,290.00 \n \n5,361,nS.34 \n \n198,467.11 \n \n5,560,245.45 \n \n0.00 \n \n6,703, 115.90 \n \n9,248,090.08 \n \n380,884.99 \n \n9,628,975.07 \n \n0.00 \n \n4,369,367.90 \n \n6,122,340.56 \n \n482,769.80 \n \n6,605,110.36 \n \n0.00 \n \n2,470,462.10 \n \n2,515,307.83 \n \n116,620.63 \n \n2,631,928.46 \n \n0.00 \n \n1,761,690.40 \n \n2,000,299.71 \n \n247,031.38 \n \n2,247,331.09 \n \n0.00 \n \ns s 29,296,609.20 \n \n38,360,143.92 $ 1,785,355.69 $ 40,145,499.61 \n \ns 4,013,660.40 \n$ \n \n109,237.16 $ 886,716.38 3,671,044.31 406,702.96 \n \n1,582.28 $ 11,123.67 55,147.24 5,159.02 \n \n110,819.44 897,840.05 3,726,191.55 411,861.98 \n \ns $ 4,013,660.40 \n \n5,073,700.81 $ \n \n73,012.21 $ 5. 146,713.02 \n \n0.00 \n \n958,039.70 \n \n1,648,617.80 \n \n37,289.13 \n \n1,685,906.93 \n \n0.00 \n \n$ 4,971,700.10 $ 6,722,318.61 $ \n \n110,301.34 $ 6,832,619.95 \n \ns \n \n705,361.90 $ \n \n791,479.56 $ \n \n11,600.00 $ \n \n803,079.56 \n \n0.00 \n \n$ 34,973,671.20 $ 45,873,942.09 $ 1,907,257.03 $ 47,781,199.12 \n \n$ \n \n984,376.80 $ 1,924,575.72 \n \n$ 1,924,575.72 \n \n0.00 \n \n266,624.80 \n \n$ \n \n350,100.33 \n \n350,100.33 \n \n0.00 \n \n$ 1,251,001.60 $ 1,924,575.72 $ \n \n350,100.33 $ 2,274,676.05 \n \n$ 36,224,672.80 $ 47,798,517.81 $ 2,257,357.36 $ 50,055,875.17 $ \n \n0.00 \n \n$ \n \n266,147.90 \n \n164,859.10 \n \n$ \n \n431,007.00 \n \n$ \n \n266,147.90 $ \n \n266,147.90 \n \n164,859.10 \n \n164,859.10 \n \n$ \n \n431,007.00 $ \n \n431,001.00 s _ _ _ _ _ _o_.oo_ \n \n- 53 - \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF COMPENSATION AND TRAVEL OF BOARD MEMBERS \nYEAR ENDED JUNE 30, 1995 \n \nSCHEDULE \"12'' \n \nBOARD MEMBER ADDRESS \nMr. Alan S. Talbert, Chairman(*) 115 Freeman Drive Warner Robins, Georgia 31088 \nMr. Zell S. Blackmon, Jr. 102 Hickory Lane Bonaire, Georgia 31005 \nMr. David L. Davidson (*) 207 Brookhaven Bonaire, Georgia 31005 \nMrs. Robertiena R. Fletcher(*) 133 Stewart Drive Warner Robins, Georgia 31093 \nMr. Hubert Hutcherson (*) 201 Clifton Drive Perry, Georgia 31069 \nMs. Shirley Lowery (*) 125 Gunsmoke Drive Warner Robins, Georgia 31093 \nMr. Gary M. Mclure (*) 113 Heather Place Centerville, Georgia 31028 \nMr. Fred Wilson(*) 114 Palm Drive Warner Robins, Georgia 31088 \n \nCOMPENSATION \n \nTRAVEL \n \n$ \n \n2,400.00 $ \n \n264.50 \n \n600.00 \n \n1,950.00 \n \n1,900.00 \n \n406.55 \n \n1,800.00 \n \n737.12 \n \n1,750.00 \n \n2,000.00 \n \n1,300.00 \n \n17.43 \n \n(*) Denotes Board Members Serving as of June 30, 1995 \n \n$ \n \n13,700.00 $ ===1=,4==2==5==.6=0 \n \nSee notes to the general purpose financial statements. \n \n- 54 - \n \n SECTION II COMPLIANCE \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members ofthe General Assembly Members of the State Board ofEducation \nand Superintendent and Members of the Houston County Board ofEducation \nCOMPLIANCE REPORT BASED ON AN AUDIT OF THE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board ofEducation as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nWe 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. \nCompliance with laws, regulations, contracts, and grants applicable to Houston County Board ofEducation is the responsibility ofthe Board'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 Board's compliance with certain provisions oflaws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. \nThe results ofour tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards. \n \n95CRL-10 \n \n 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. \nRespectfully submitted, \n~/ \nClaude L. Vickers \nState Auditor \nCLV:dt 95CRL-10 \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members ofthe Houston County Board ofEducation \n \nSINGLE AUDIT REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS \n \nLadies and Gentlemen: \n \nWe have audited the general purpose financial statements ofthe Houston County Board ofEducation as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \n \nWe have applied procedures to test the Houston County Board ofEducation'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, 1995: \n \n(1) Political Activity \n \n(5) Allowable Costs/Cost Principles \n \n(2) Civil Rights \n \n(6) Drug-Free Workplace Act \n \n(3) Cash Management \n \n(7) Audit Follow-Up/Resolution \n \n(4) Federal Financial Reports \n \n(8) Administrative Requirements \n \nOur procedures were limited to the applicable procedures described in the Office ofManagement and Budget's \"Compliance Supplement for Single Audits ofState and Local Governments\" and other additional procedures as deemed necessary. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Board's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. \n \n95CRL-70 \n \n Material instances ofnoncompliance consist offailures to follow the general requirements that caused us to conclude that the misstatements resulting from those failures are material to the Federal financial assistance programs. The results of our tests of compliance disclosed a material instance of noncompliance that is described in the Schedule ofFindings and Improper or Questioned Costs. \nWe considered this material instance ofnoncompliance in forming our opinion on whether the Houston County Board of Education general purpose financial statements are presented fairly, in all material respects, in conformity with generally accepted accounting principles, and this report does not affect our report dated June 12, 1996, on those financial statements. \nExcept as described above, the results of our procedures to determine compliance indicate that, with respect to the items tested, the Houston County Board of Education, complied, in all material respects, with the requirements listed in the second paragraph of this report, and with respect to items not tested, nothing came to our attention that caused us to believe that the Board had not complied, in all material respects with those requirements. Additionally, the results of our procedures disclosed an immaterial instance of noncompliance with those requirements which is also described in the Schedule of Findings and Improper or Questioned Costs. \nThis 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. \nRespectfully submitted, \n~~ \nClaude L. Vickers State Auditor \nCLV:dt 95CRL-70 \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members ofthe Houston County Board ofEducation \n \nSINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS \n \nLadies and Gentlemen: \n \nWe have audited the general purpose financial statements ofthe Houston County Board ofEducation as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \n \nWe have also audited the Houston County Board ofEducation's compliance with the requirements governing: \n \n(1) Types of Services Allowed or Unallowed \n \n(5) Applicable Special Tests and Provisions \n \n(2) Eligibility \n(3) Matching, Level ofEffort, and/or Earmarking \n \n(6) Other Requirement Claims for Advances and Reimbursements \n \n(4) Reporting \n \nThese requirements are applicable to the major Federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended June 30, 1995. The management of the Houston County Board ofEducation is responsible for the Board's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. \n \nWe conducted our audit ofcompliance in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office of Management and \n \n95CRL-80 \n \n 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 material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Board's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. \nIn our opinion, the Houston County Board of Education complied, in all material respects, with the requirements as disclosed in the second paragraph that are applicable to its major Federal financial assistance programs for the year ended June 30, 1995. \nThis 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. \nRespectfully submitted, \n \nCLV:dt 95CRL-80 \n \nClaude L. Vickers State Auditor \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members of the Houston County Board ofEducation \nSINGLE AUDIT REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board of Education as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nIn connection with our audit of the fiscal year 1995 general purpose financial statements of the Houston County Board of Education and with our consideration of the Board's control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget (0MB) Circular A128, \"Audits of State and Local Governments\", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1995. As required by 0MB Circular A-128, we have performed auditing procedures on the selected transactions to test compliance with the requirements governmg: \nTypes of Services Allowed or Unallowed \nOur procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Houston County Board of Education's compliance with these requirements. Accordingly, we do not express such an opinion. \nWith 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 \n95CRL-120 \n \n came to our attention that caused us to believe that the Houston County Board ofEducation had not complied, in all material respects, with those requirements. \nThis 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. \nRespectfully submitted, \nL~ \nClaude L. Vickers State Auditor \nCLV:dt 95CRL-120 \n \n SECTION III INTERNAL CONTROL \n \n CLAUDE L. VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members of the General Assembly Members of the State Board ofEducation \nand Superintendent and Members ofthe Houston County Board ofEducation \nREPORT ON INTERNAL CONTROL STRUCTURE IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board ofEducation as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. \nWe 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. \nThe management ofthe Houston County Board ofEducation 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 ofan 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 mariagement's authorization and recorded properly to permit the preparation ofgeneral purpose financial statements in accordance with generally accepted accounting principles. Because ofinherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. \n \n95ICL-3 \n \n In planning and perfonning our audit ofthe general purpose financial statements of the Houston County Board ofEducation for the year ended June 30, 1995, we obtained an understanding of the internal control structure. With respect to the internal control structure, we obtained an understanding ofthe design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide an opinion on the internal control structure. Accordingly, we do not express such an opinion. \nWe 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 entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. \nAs described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category: \nGeneral Fixed Assets \nA 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 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. \nOur consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition disclosed above is also considered to be a material weakness. \nThis condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Houston County Board ofEducation's financial statements and this report does not affect our report thereon dated June 12, 1996. \nThis 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. \nt r ~ ~ Respectfully submitted, \nClaude L. Vickers State Auditor \nCLV:dt 95ICL-3 \n \n L. CLAUDE VICKERS \nSTATE AUDITOR \n(404) 656-2174 \n \nDEPARTMENT OF AUDITS AND ACCOUNTS \n254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 \nJune 12, 1996 \n \nHonorable Zell Miller, Governor Members ofthe General Assembly Members ofthe State Board ofEducation \nand Superintendent and Members of the Houston County Board ofEducation \nSINGLE AUDIT REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS \nLadies and Gentlemen: \nWe have audited the general purpose financial statements of the Houston County Board ofEducation as of and for the year ended June 30, 1995, and have issued our report thereon dated June 12, 1996. This report was qualified for various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. We have also audited the Board's compliance with requirements applicable to major Federal financial assistance programs and have issued our opinion thereon dated June 12, 1996. \nWe 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 Houston County Board of Education complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. \nIn planning and performing our audit for the year ended June 30, 1995, we considered the Board's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions on the Board's general purpose financial statements and on its co.mpliance with requirements applicable to major Federal financial assistance programs and to report on the internal control structure in accordance with 0MB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to Federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated June 12, 1996. \n95ICL-7 \n \n The management ofthe Houston County Board ofEducation 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 ofan internal control structure are to provide management with reasonable, but not absolute, assurance that, assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose :financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection ofany evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. \n \nFor 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: \n \nGENERAL REQUIREMENTS \n \nSPECIFIC REQUIREMENTS \n \n(1) Political Activity (2) Civil Rights (3) Cash Management (4) Federal Financial Reports \n \n(I) Types of Services Allowed or Unallowed \n(2) Eligibility \n(3) Matching, Level of Effort, and/or Earmarking \n \n(5) Allowable Costs/Cost Principles \n \n(4) Reporting \n \n(6) Drug-Free Workplace Act (7) Audit Follow-Up/Resolution (8) Administrative Requirements \n \n(5) Applicable Special Tests and Provisions \n(6) Other Requirement Claims for Advances and Reimbursements \n \nFor 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. \n \nDuring the year ended June 30, 1995, the Houston County Board of Education expended 86% of its total Federal financial assistance under major Federal financial assistance programs. \n \nWe 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 preventing or detecting material noncompliance with general requirements and specific requirements as \n \n95ICL-7 \n \n descnbed above that are applicable to each ofthe Board's major Federal financial assistance programs, which are identified in the Schedule ofFederal Financial Assistance. 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. \nWe 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 Board's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations. \nAs described in the Schedule ofFindings and Improper or Questioned Costs, a reportable condition was noted in the following control category: \nAdministrative Requirements \nA material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. \nOur 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. \nThis condition was considered in determining the nature, timing, and extent of the procedures to be performed in our audit ofthe Houston County Board ofEducation's compliance with requirements applicable to its major Federal financial assistance programs for the year ended June 30, 1995, and this report does not affect our report thereon dated June 12, 1996. \nThis report is intended for the information of management, the Federal cognizant audit agency and other Federal grantor agencies and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record. \nRespectfully submitted, \n \nCLV:dt 95ICL-7 \n \nClaude L. Vickers State Auditor \n \n SECTIONN FINDINGS AND IMPROPER OR QUESTIONED COSTS \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \nYEAR ENDED JUNE 30, 1995 \nPRIOR YEAR \nAUDIT FOLLOW-UP/RESOLUTION Uncollateralized Deposits Financial Statements Finding Resolved Audit Control Number 6761-93-04 \nThe audit report for the year ended June 30, 1994, stated that the Board failed to have its bank balance fully collateralized as provided for by the Official Code of Georgia Annotated Section 45-8-12. For the year under review, audit tests of the Board's bank balances indicated that the Board complied with the State laws governing collateralization of cash deposits. \nAUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Statements Amount: $30,901.95 Audit Control Number 6761-93-05 \nThe audit report for the year ended June 30, 1993, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$30,901.95 for the StaffDevelopment - Professional Development Stipends Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund this underexpenditure, as required. The underexpenditure of$30,901.95 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. \nAUDIT FOLLOW-UP/RESOLUTION Failure to Meet Expenditure Requirements Financial Assistance Amount: $57,412.45 Audit Control Number 6761-94-01 \nThe audit report for the year ended June 30, 1994, reported that the Board had an underexpenditure of Quality Basic Education (QBE) funds of$57,412.45 for the Staff Development - Professional Development Stipends Program. For the year under review, no adjustment was made to the Board's local fair share by the Georgia Department ofEducation to refund this underexpenditure, as required. The underexpenditure of$57,412.45 should be returned to the Georgia Department ofEducation through an increase in the Board's local fair share for the QBE programs in a subsequent fiscal period. \n- 1- \n \n HOUSTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \nYEAR ENDED JUNE 30, 1995 \nPRIOR YEAR/CURRENT YEAR \nGENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Financial Statements Reportable Condition - Material Weakness Audit Control Number 6761-93-02 \nThe audit report for the year ended June 30, 1994, noted that the management ofthe Houston County Board ofEducation had chosen not to maintain a system-wide General Fixed Assets Account Group within the formal accounting records as required by generally accepted accounting principles. In the year under review, the Board did not establish a General Fixed Assets Account Group within the formal accounting records. This condition results in the general purpose financial statements of the Board being incomplete and not in accordance with generally accepted accounting principles. Appropriate actions should be taken by the Board to establish accounting controls and procedures to provide for maintenance of a General Fixed Assets Account Group. These subsidiary records should include an inventory of land, buildings and equipment owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimated replacement cost, location and description. Detailed records should be maintained of all additions and deletions to the General Fixed Assets Account Group. \nADMINISTRATIVE REQUIREMENTS Inadequate Inventory Records Federal Financial Assistance Major Program Reportable Condition - Material Weakness Material Noncompliance Audit Control Number 6761-93-03 \nThe audit report for the year ended June 30, 1994, stated that the Board's property management records for the School Food Services Fund - National School Lunch Program (CFDA I0.555) were incomplete and failed to meet the property management standards as set forth in Chapter 41 of the Financial Management for Georgia Local Units of Administration (FMGLUA) or as outlined in 7 CFR 3015. 169. For the year under review, some improvements were noted. However, property management records were still incomplete. This conditi_on occurred because management disregarded the provisions ofFMGLUA An inventory system should be implemented that provides for the identification of all equipment purchased as outlined in Chapter 41 of FMGLUA and 7 CFR 3015.169. Perpetual inventory records should include historical information regarding additions and deletions made to the equipment inventory during each fiscal year, when applicable. Periodic physical inventory counts should be made and reconciled to the property records to ensure the accuracy ofthe Board's inventory records. \n-2- \n \n HOUSTON COUNTY BOARD OF EDUCATION \n \nSCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS \n \nYEAR ENDED JUNE 30, 1995 \n \n. \n \nPRIOR YEAR/CURRENT YEAR \nFEDERAL FINANCIAL REPORTS Delinquent Financial Reports Federal Financial Assistance Major Programs Nonmaterial Noncompliance Audit Control Number 6761-94-02 \nThe audit report for the year ended June 30, 1994, stated that the Board failed to submit on a timely basis \"School Nutrition Claim Data\" (DE form 0106) and \"System Claim and Requisition for Reimbursement\" (DE form 0107) for the School Breakfast Program (CFDA 10.553), National School Lunch Program (CFDA 10.555), and Food Distribution Program (CFDA 10.550) in accordance with regulations established by the Georgia Department ofEducation. \nFor the year under review, it was noted that the \"School Nutrition Claim Data\" (DE form 0106) was submitted in a timely manner. However, the \"System Claim and Requisition for Reimbursement\" (DE form 0107) continued to be delinquent. The delay occurred because management neglected the specific limitations imposed by the Georgia Department ofEducation. Procedures should be established to ensure that Federal financial reports are submitted by the required filing date. \nCURRENT YEAR \nGENERAL LEDGER Failure to Transfer Local Matching Funds Financial Statements Nonmaterial Noncompliance Finding Resolved Audit Control Number 6761-95-01 \nThe Board received approval for state capital outlay project funding, through Georgia State Financing and Investment Commission, (GSFIC) for the 1995 fiscal year. Both the instructions in Chapter 41 of the Financial Management for Georgia Local Units ofAdministration and the agreement signed by the Board to receive this funding require that the Board transfer required local matching funds to the Capital Projects Fund by June 30, 1995, and designate those funds by project name and number. The transfer was not made by the Board at June 30, 1995 and a correcting audit adjustment was necessary to transfer $20,257.00 from the General Fund to the Capital Projects Fund GSFIC project 95/96-676-40, as required. The failure to transfer these Local Matching Funds was an oversight on the part ofthe Board. However, subsequent to June 30, 1995, the Board transferred the required Local Matching Funds to the Capital Projects Fund and designated those funds by project name and number. \nNote: The Houston County Board ofEducation was provided an opportunity to include pertinent comments from the Board's management concerning these audit findings, conclusions and recommendations. The Board has elected not to provide comments for inclusion in this report. \n \n-3- \n \n "}],"pages":{"current_page":1,"next_page":2,"prev_page":null,"total_pages":2,"limit_value":10,"offset_value":0,"total_count":11,"first_page?":true,"last_page?":false},"facets":[{"name":"type_facet","items":[{"value":"Text","hits":11}],"options":{"sort":"count","limit":16,"offset":0,"prefix":null}},{"name":"creator_facet","items":[{"value":"Georgia. Department of Audits and Accounts","hits":6},{"value":"Georgia. 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