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HomeMy WebLinkAboutAudit Report Richmond County Board of Education June30,1998 Augusta Richmond GA DOCUMENT NAME: I-l 0'0 IT !j2""pcwt R ICI4fY>O,-,JD ~O>jN"'I 5DA-eb of E"l)\)c.A"oo0 --:r-o.vE: '30 ,q q cr I DOCUMENT TYPE: RepDl<. 'T YEAR: I q 9 ~ BOX NUMBER: '7 FILE NUMBER: I Lf? 4 i NUMBER OF PAGES: to tf ~d,#/~-2 ~tj r ~ . RICHMOND COUNTY BOARD OF EDUCATION MARY L OGLESBY President 2083 Heckle Street Augusta, Georgia 30904-4295 (706) 737-7200 CHARLES G. LARKE, Ed.D. Superintendent C. GENE SPIRES, CPA Controller June 1, 1999 u. S. Department of Justice Richmond County Board of Commissioners 530 Greene Street Augusta, GA 30911 This is to advise you that a Single Audit has been performed of the Richmond County Board of Education for the fiscal year ended June 30, 1997. The audit was performed by the Georgia Department of Audits and was conducted in accordance with Office of Management and Budget (OMB) Circular A-133 which establishes the audit requirements for States, Local Governments, and Non-Profit Organizations that expend $300,000 or more in Federal financial assistance. The "Schedule of Expenditures of Federal Awards" as reflected in the audit report included the following financial information relating to the Federal Awards provided to this School District by our organization: CFDA NAME OF FEDERAL PROGRAM NUMBER EXPENDITURES 1 Juvenile Delinquency Prevention and 16.548 $163,894.54 Intervention 1998 Grant The Single Audit Report included no prior year or current year findings or questioned costs relating to Federal financial assistance programs funded through the Richmond County Board of Commissioners. Sincerely, e,~ C. GENE SPIRES, CPA Controller CGS/smb Enclosure ..,.i .' ..... AUDIT REPORT roCHMONDCOUNTYBOARDOFEDUCATION AUGUSTA, GEORGIA YEAR ENDED JUNE 30, 1998 STATE OF GEORGIA DEPARTMENT OF AUDITS AND ACCOUNTS 254 WASHINGTON STREET ATLANTA, GEORGIA 30334-8400 AUDIT REPORT RICHMOND COUNTY BOARD OF EDUCATION AUGUSTA, GEORGIA , YEAR ENDED JUNE 30, 1998 RICHMOND COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - Page SECTION I FINANCIAL INDEPENDENT AUDITOR'S COMBlNED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION - SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS EXlllBITS GENERAL PURPOSE FINANCIAL STATEMENTS COMBINED STATEMENTS - OVERVIEW A COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUP B COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS C COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (NON-GAAP BASIS) GENERAL AND. SPECIAL REVENUE FUNDS D NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS 2 4 6 7 ADDmONAL FINANCIAL INFORMATION COMBINING STATEMENTS SPECIAL REVENUE FUND E COMBINING llALANCE SHEET 24 F COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 26 CAPITAL PROJECTS FUND G COMBINING BALANCE SHEET 28 H COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 29 DEBT SERVICE FUND I COMBINING BALANCE SHEET 30 ] COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES 31 FIDUCIARY FUND TYPES K COMBINING BALANCE SHEET 32 L COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES EXPENDABLE TRUST FUNDS 34 M COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABll..ITIES AGENCY FUNDS 35 IDCHMOND COUNTY BOARD OF EDUCATION - TABLE OF CONTENTS - Page SECTION I FINANCIAL ADDmONAL FINANCIAL INFORMATION SCHEDULES 1 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 2 SCHEDULE OF STATE REVENUE 3 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS 4 SCHEDULE OF EXPENDITURES LOTIERY PROGRAMS ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS 5 OVERALL 6 BY PROGRAM 36 38 40 41 43 44 SECTION n COMPLIANCE AND INTERNAL CONTROL REPORTS REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE wrrn GOVERNMENT AUDITING STANDARDS REPORT ON COMPLIANCE wrrn REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE wrrn OMB CIRCULAR A-133 SECTION ill AUDITEE'S RESPONSE TO PIDOR YEAR FINDINGS AND QUESTIONED COSTS SUMMARY SCHEDULE OF PIDOR YEAR FINDINGS AND QUESTIONED COSTS SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS SECTION I FINANCIAL DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.W., Suite 214 Atlanta, Georgia 30334-8400 :UTmF. L VICKERS STATE AUDITOR (404) 656-2174 March 2, 1999 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Richmond County Board of Education INDEPENDENT AUDITOR'S COMBINED REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION - SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Ladies and Gentlemen: We have audited the accompanying general purpose financial statements of the Richmond County Board of Education, as of and for the year ended June 30, 1998, as listed in the table of contents. These general purpose fmancial statements are the responsibility of the Richmond County Board of Education's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. Except as discussed in paragraphs three and four, 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. Those standards require that we plan and perform the audit to obtain reaso~ble 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. We did not observe the taking of either the purchased foods inventory or consumable supplies inventory at June 30, 1998, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. Governmental Accounting Standards Board Technical Bulletin 98-1, Disclosures About Year 2000 Issues, requires disclosure of certain matters regarding the year 2000 issue. Richmond County Board of Education has included such disclosures in the significant commitments section of the Notes to the Financial Statements. 98ARL-13A Because of the unprecedented nature of the year 2000 issue, its effects and the success of related remediation efforts will not be fully determinable until year 2000 and thereafter. Accordingly, insufficient audit evidence exists to support Richmond County Board of Education's disclosures with respect to the year 2000 issue made in the Notes to the Financial Statements. Further, we do not provide assurance that Richmond County Board of Education is or will be year 2000 ready, that Richmond County Board of Education's year 2000 remediation efforts will be successful in whole or in part, or that parties with which Richmond Comty Board of Education does business will be year 2000 ready. As 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: ... 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. ... 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. ... The Board did not recognize as expenditures, in the year ended June 30, 1998, a portion of salaries and the corresponding employer's cost of related benefits earned for contractual services completed prior to June 30, 1998. Also funds received, subsequent to June 30, 1998, from the Georgia Department of Education 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, 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. The aggregate effects on the general purpose financial statements of these variances or omissions have not been determined, but are believed to be material. In our opinion, except for the effects of such adjustments, if any, on the General Fund and the Special Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to the accuracy of the consumable supplies and food service inventories as discussed in the third paragraph, and except for the effects of such adjustments, if any, as might have been determined to be necessary had we been able to examine sufficient evidence regarding year 2000 disclosures as discussed in the fourth paragraph and 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 of the Richmond County Board of Education as of June 30, 1998, and the results of its operations for the year then ended, in conformity with generally accepted accounting p~ciples. In accordance with Government Auditing Standards. we have also issued our report dated March 2, 1999, on our consideration of the Richmond 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. 98ARL-13A Our audit was performed for the purpose of forming an opinion on the general purpose financial statements of the Richmond County Board of Education taken as a whole. The accompanying combining statements (Exhibits E through M) and the financial schedules (Schedules 1 through 6), 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 information has been subjected to the auditing procedures applied in the audit of the general pwpose financial statements and in our opinion, except for the effect of adjustments, if any, on the General Fund and the Spe~ial Revenue Fund, as might have been determined to be necessary had we been able to satisfy ourselves as to '>-the accuracy of the consumable supplies and food service inventories as discussed in the third paragraph, and except for the . effects of such adjustments, if any, as might have been determined to be necessary had we been able to examine sufficient evidence regarding year 2000 disclosures as discussed in the fourth paragraph and except for the effects of the matters referred to in the fifth paragraph, such information is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated Section 50-6-24. Respectfully submitted, ~,,-~,;r: d:/~ Claude L. Vickers State Auditor CLV:gp 98ARL-13A RICHMOND COUNTY BOARD OF EDUCATION NOll VJil03 dO crnvoa A.LNflOJ ONOWHJnI EXHIBIT "A" FIDUCIARY ACCOUNT GROUP DEBT FUND TYPES GENERAL TOTALS SERVICE TRUST AND LONG-TERM /Memorandum Only) FUND AGENCY FUNDS DEBT JUNE 30. 1998 JUNE 30.1997 $ 2,840,748,03 $ 88.123.27 $ 22.553.374,11 $ 20.038,254.81 8,258,109,43 102.709,509.91 117.389.492.38 4.633.557.45 12.076,213.87 6.145,867.74 12.960,70 2,245.357.65 2,185.752.41 126,139.55 426.844.36 104,397.49 154.504,50 $ 15,532.414,91 15.532,414,91 8,262.437.74 106,547,585,09 106,547,585.09 131,687,562.26 19,228,822.61 19,228,822,61 13,138.506,39 790,713,11 790,713,11 766.929,04 $ 15.532,414.91 $ 88,123,27 $ 142.099,535,72 $ 281.914.528,30 $ 298.209,112,33 $ 881.229,93 6.555,016,15 $ 5,381.888,55 1.828,018.88 1,n6.906.40 54.418.44 2,717,790.02 6n,45O.83 982.831.07 454,106.02 12.960.70 $ 31,413.21 31,413.21 38.2n.29 $ 19.228.822.61 19.228,822.61 13.138.506.39 790.713.11 790,713,11 766.929,04 122.080,000,00 122.080.000,00 137,950,000,00 $ 31,413.21 $ 142.099.535,72 $ 155,095.834,98 $ 160.251.443,66 $ 91.78 $ 15.532,414.91 $ 15.532.414,91 6,262,437.74 1,995,939,27 2.329,313,16 2,245,357.65 2,185.752.41 126,139.55 426.844,36 104,397.49 154.504,50 87,434,038.41 109,498.327,48 2.171.869.50 333.594.28 0,00 $ 56,710,06 16.874.942.26 17.100.397.24 $ 15,532.414,91 $ 56,710,06 $ 126.818.693,32 $ 137.957.668,67 $ 15.532.414,91 $ 88.123,27 $ 142,099,535,72 $ 281,914.528,30 $ 298,209,112,33 .3. RICHMOND COUNlY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES AlL GOVERNMENTAl FUND TYPES AND EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30. 1998 GENERAL FUND GOVERNMENTAl FUN[ SPEC~ CAPITAL REVENUE PROJECTS FUND FUND REVENUES State Funds $ 111,580,409.16 $ 7.784,758.03 $ 474.108.01 Federal Funds 1,352.628.32 20,572.116.51 Taxes 53.960,050.38 Other Funds 3.100.827.81 3.067,490.65 4.532.711.2! Total Revenues $ 169.993.915.67 $ 31.424.365.19 $ 5.006.819.2! EXPENDITURES Current Instruction $ 111,388.423.67 $ 12.112,409.55 Support Services Pupil Services 6.180.272.33 2,862,701.85 Improvement of Instructional SelVices 4,242.928.85 1.221.438.96 Educational Media Services 4,854,088.32 47,278.87 General Administration 1.827,349.55 273,677.63 School Administration 12,650.194.68 141,626.73 Business Administration 1.145.462.72 Maintenance and Operation of Plant 17.561,694.21 663,449.95 Student Transportation Services 7.351.137.04 19.705.54 Central Support Services 2.318,299.59 Other Support Services 193.722.38 780,453.53 Food Services Operation 6,559.45 12,491.129.78 Community SelVices Operations 239,585.10 393,361.72 Capital Outlay 763.688.24 2,232.03 $ 30.107.925.4 Debt Service Principal 1,202.229.77 75,OOO.ll Interest 714.995.36 Paying Agent Fees Total Expenditures $ 172.640.631.26 $ 31.009.466,14 $ 30.182.925,o1i1 Excess of Revenues over (under) Expenditures $ -2.646.715.59 $ 414.899.05 $ -25.176.106.1 OTHER FINANCING SOURCES fUSES) Accrued Interest on Bonds Sold Proceeds from General Obligation Bonds Par Value Capital Leases $ 1.149,056.56 $ 6,218.489.~ Operating Transfers In $ 388,808.59 85,026.l Operating Transfers Out -473,835.56 -11.959.1 Total Other Financing Sources (Uses) $ 675.221.00 $ 388,808.59 $ 6.291.557.: Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ -1,971.494.59 $ 803,707.64 $ -18,884,548: FUND BALANCE JULY 1 (Restated - See Note 1) 17.753.771.71 3.528.356.98 110.345.656.1 Consumable Supplies Inventory - Net Change in Period 4,930.59 Food Inventory - Net Change in Period Donated Commodities -300,704.81 Purchased Food -50.107.01 Reimbursement for Prior Year Expenditures 1,250.790.53 -1.250.790, FUND BALANCE JUNE 30 $ 17.037,998.24 $ 3.981.252.80 $ 90.210,317, The notes to the general purpose financial statements are an integral part of this statement. -4- EXHIBIT "B" TYPES FIDUCIARY TOTALS DEBT FUND TYPE (Memorandum Only) SERVICE EXPENDABLE YEAR ENDED FUND TOTAL TRUST FUNDS JUNE 30. 1998 JUNE 30. 1997 $ 119,839,275.19 $ 119,839,275.19 $ 116.528,515.49 21,924,744.83 21.924,744.83 20.700.153.84 $ 32.195.290.03 86.155.340,41 86,155.340.41 56.997,966.99 669.939.08 11.370.968,83 $ 3,048.42 11.374.017.25 9.004.405.70 $ 32,865.229.11 $ 239.290.329.26 $ 3.048,42 $ 239.293.3n.68 $ 203.231.042.02 $ 123.500.833.22 $ 123.500.833.22 $ 118,013.258.13 9.042.974.18 9.042.974.18 8.208.659.73 5.464,367.81 5.464.367.81 3.949.517.55 4.901.367.19 4,901,367.19 4,604.768.40 2.101.027.18 2,101.027.18 2,880.5n.54 12.791.821.41 12.791.821.41 11.790.579.95 1.145.462,72 1.145.462.72 2.923,199.06 18.225.144.16 18,225.144.16 17.278.974.36 7.370.842.58 7.370,842.58 6.802.445.67 2.318.299.59 $ 700.00 2.318,999.59 1.902.982.97 974.175,91 974,175.91 825.903.29 12.497.689.23 12,497,689.23 13.295.993.87 632.946.82 632,946.82 676.831.10 30.873,845,68 30,873,845.68 11.673.050.12 $ 15.870.000.00 17.147,229.77 17.147,229.77 3.058.303.10 7.726.632.50 8,441,627.86 8.441.627.86 4.106.691.32 10.578,48 10.578,48 10.578.48 7 .295.04 $ 23.607.210.98 $ 257.440.233,79 $ 700.00 $ 257.440.933,79 $ 211.999.031.20 $ 9.258.018.13 $ -18.149.904,53 $ 2.348,42 $ -18.147.556,11 $ -8.767,989.18 $ 407.312.74 115.000.000.00 $ 7.367.545.99 S 7,367,545.99 742.645.99 $ 11.959.04 485,794.60 485.794.60 4,681,553.91 -485.794.60 -485.794.60 -4.681.553.91 $ 11.959,04 $ 7.367.545.99 $ 7.367.545.99 $ 116.149.958.73 $ 9.269.977,17 $ -10.782.358.54 $ 2.348.42 S -10.780,010.12 $ 107,381.969.55 6.262.437,74 137.890.223.03 54.361.64 137.944,584.67 30,550,103.05 4,930.59 4,930.59 33,487.48 -300,704.81 -300,704.81 -1.687.90 -50,107.01 -50,107.01 -6,203.51 0.00 S 15.532.414,91 $ 126.761.983.26 $ 56,710.06 $ 126,818.693.32 $ 137.957,668,67 - 5- RICHMOND COUNTY BOARD OF EDUCATION COMBINED STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL - (NON-GAAP BASIS) GENERAL AND SPECIAL REVENUE FUNDS YEAR ENDED JUNE 30. 199B EXHIBIT "C. GENERAL FUND SPECIAL REVENUE FUND ACTUAL ACTUAL (BUDGET (BUDGET BUDGET BASIS) BUDGET BASIS) REVENUES State Funds $ 107.212,805.60 $ 111,580,409.16 $ 8,217,232,00 $ 7,784.75B.03 Federal Funds 1.004,000.00 1.352,628.32 23.591,586.15 20,572,116.51 Taxes 53,446.n2.00 53,960,050.3B Other Funds 1,936.612.36 3,100,827.B1 3.895,450.99 3,067,490.65 Total Revenues $ 163,600,189.96 $ 169,993,915.67 $ 35,704,269.14 $ 31,424,365,19 EXPENDITURES Current Instruction $ 10B,534.655.14 $ 111,3BB,423,67 $ 12,491.872.43 $ 12,112.409.55 Support Services Pupil Services 6,196.436.37 6.180,272.33 3.793,On.86 2,B62,701.85 Improvement of Instructional Services 4,332,763.53 4,242.92B.85 1,725,205.19 1,221.438.96 Educational Media Services 4,684.646.00 4,854.0B8,32 52,007.00 47,278.87 General Administration 2,021,273.00 1,827,349.55 304.8B2.26 273,6n.63 School Administration 12,112,719.00 12.650,194.68 172,075.62 141.626.73 Business Administration 1,113,243.00 1.145,462,72 Maintenance and Operation of Plant 1B.440,417.00 17.561,694.21 729.125.31 663,449.95 Student Transportation Services 7,267,375.56 7,351,137.04 37,851.00 19.705.54 Central Support Services 2,350,383.00 2,318,299.59 Other Support Services 25,112.00 193,722.38 401,884.70 7BO,453.53 Food Services Operation 8.532.00 6,559.45 15.512,214.00 12.491,129.7f Community Services Operations 24,300.00 239,585.10 890.660.77 393,361.7~ Capital Outlay 939,600.00 763,68B.24 2.232.0; Debt Service 1.99B.230.00 1.917,225.13 Total Expenditures $ 170,049,685.60 $ 172,640.631.26 $ 36,110,856.14 $ 31,009,466.1. Excess of Revenues over (under) Expenditures $ ~,449,495.64 $ -2,646,715.59 $ -406.587.00 $ 414.899.0~ OTHER FINANCING SOURCES (USES) Other Sources $ 6,B17,325.64 $ 1,149,056.56 $ 406,287.00 $ 3B8,808.5! Other Uses -367 ,530.00 -473,835.56 Total Other Financing Sources (Uses) $ 6,449.795.64 $ 675,221.00 $ 406.287.00 $ 3BB,BOB.5! Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ 300.00 $ -1,971,494.59 $ -300.00 $ 803,707.6 FUND BALANCE JULY 1 1997 (Restated - See Note 1) 0.00 16,B91,044.n 0.00 2,947,OOB.1 Reimbursement for Prior Year Expenditures 1.250,790.53 FUND BALANCE JUNE 30.1998 $ 300.00 $ 16,170,340.71 $ -300.00 $ 3,750,715.1 The notes to the general purpose financial statements are an integral part of this statement. -6- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES REPORTING ENTITY The Richmond County Board of Education (Board) 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 Board is a primary government and consists of all the organizations that compose its legal entity. FUND ACCOUNTING The 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. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a fmancial 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 fmancial resources. General 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. Although "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 fmancial statements. To conform to generally accepted accounting principles~ these accounts should be recorded in the general purpose financial statements. The 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: GOVERNMENTAL FUND TYPES - are used to account for all or most of a Board's educational activities. Governmental Fund Types include: GENERAL 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. SPECIAL 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 received primarily from the Georgia Department of Education and from the Federal government to accomplish specific educational objectives. / - 7 - RICHMOND COUNTY BOARD OF EDUCATION EXlllBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CAP IT AL PROJECTS FUND - the fund used to account for financial resources to be used for the acquisition or construction of major capital facilities. DEBT SERVICE FUND - the fund used to account for the accumulation of resources for, and the payment of, generallong-tenn principal, interest and paying agent fees. FIDUCIARY FUND TYPES - the funds 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. These funds include: EXPENDABLE TRUST FUNDS Davidson Trust Fund - the fund used to account for the principal and earnings which may be expended to provide financial assistance to needy students of Davidson Fine Arts Magnet School. Nora Coxwell Scholarship Fund - the fund used to account for the principal and earnings which may be expended to provide scholarships for selected students. Roberta McKenzie Scholarship Fund - the fund used to account for the principal and earnings which may be expended to provide scholarships for selected students. AGENCY FUNDS - the funds used to account for assets held in a fiduciary capacity for other funds, governments, or individuals. ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP - A financial reporting device used to account for general obligation debt outstanding, material accrued compensated absences and material capital lease obl!gations. BASIS OF ACCOUNTING The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental and expendable trust 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 (Le., revenues and otheI financing sources) and decreases (Le., expenditures and other financing uses) in net current assets. Theil reported fund balance is considered a measure of available spendable resources. Liabilities which are expected to be financed from available spendable resources are reported as liabilitie~ in the governmental funds. Other liabilities, which are not expected to be financed from available spendabl( resources, are reported in the General Long-Term Debt Account Group. - 8 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Agency funds are purely custodial in nature and do not involve measurement of results of operations. Governmental and expendable trust funds are accounted for using the modified accrual basis of accounting under which: Revenues are recognized when susceptible to accrual (Le., when they become both measurable and available). "Measurable" means the amount of the transaction can be detennined and "available" means collectible within the current period or soon enough thereafter to 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. Expenditures are generally recognized when the related fund liability is incurred. A departure from the above definitions is the accounting treatment afforded the fmal 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 of the Board were employed for a one hundred and ninety day period beginning hi 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 of these 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 ended 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. Agency funds are accounted for using the modified accrual basis of accounting in recognizing assets and liabilities. RESTATEMENT OF PRIOR YEAR FUND BALANCE In fiscal year 1998, Richmond County Board of Education implemented GASB Statement 31, "Accounting and Financial Reporting for Certain Investments and for External Investment Pools". The statement requires certain investments to be reported at fair value rather than at cost. The beginning fund balance of the General Fund has been decreased by $13,084.00 for this change in accounting principle. - 9- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BUDGET The Richmond 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 fund type level. The budget for governmental funds was prepared on a basis other than generally accepted accounting principles. The 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. The Statement of Revenues, 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 fund balance as reflected on Exhibit "B" of this report: General Fund Special Revenue Fund FUND BALANCE JULY 1, 1997 (Restated) $17,753,771.71. $ 3,528,356.98 Adjustments Inventories - July 1, 1997 Consumable Supplies Food Donated Commodities Purchased Foods -862,726.94 Fund Balance July 1, 1997 (Budget Basis) -426,844.36 -154.504.50 $16,891,044.77 $ 2,947,008.12 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses -1,971,494.59 803,707.64 Reimbursement for Prior Year Expenditures 1.250.790.53 FUND BALANCE JUNE 30, 1998 (Budget Basis) $16.170.340.71 $ 3.750.715.76 - 10- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS , JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CASH AND CASH EQUIVALENTS COMPOSmON 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. INVESTMENTS COMPOSmON OF INVESTh1ENTS Investments made by the Board in nonparticipating interest-eaming 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. 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 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: (1) Obligations issued by the State of Georgia or by other states, (2) Obligations issued by the United States government, (3) Obligations fully insured or guaranteed by the United States government or a United States government agency, (4) Obligations of any corporation of the United States government, (5) Prime banker's acceptances, (6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services, (7) Repurchase agreements, and (8) Obligations of other political subdivisions of the State of Georgia. RECEIVABLES Receivables consist of 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 - 11 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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. PROPERTY TAXES The Augusta-Richmond County Commission Council fixed the property tax levy for the 1997 tax year (calendar year) on August 19, 1997 (levy date). Taxes were due on November 16, 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 Augusta-Richmond 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. In addition, the clerk of the Superior Court of Richmond County collects recording taxes for the Board of Education, withholds 6% of taxes collected as a fee for tax collection and remits the balance to the Board. Tax millage rates levied for the 1997 tax year (calendar year) for the Richmond County Board of Education were as follows (a mill equals $1 per thousand dollars of assessed value): School Operations School Bonds 18.61 mills 1.96 mills 2O..S.1 mills SALES TAXES Special Purpose Local Option Sales Tax is to be used for capital outlay for educational purposes and or debt service. Special Purpose Local Option Sales Tax collected by the State and remitted to the Board during the fiscal year amounted to $26,579,677.70 and was recorded in the Debt Service Fund. The State will terminate collection of this tax once an additional $123,420,322.30 has been collected or on June 30, 2002 whichever occurs first. INVENTORIES CONSUMABLE SUPPLIES Inventories of athletic, custodial and instructional supplies are recorded as expenditures under the consumption method and are valued at cost (weighted average). These inventories are recorded as assets at the time of purchase. Inventories of maintenance and transportation supplies are recorded as expenditures at the time of purchase and are valued on the Combined Balance Sheet at cost (weighted average). Inventories reported on the balance sheet are equally offset by a reservation of fund balance which indicates that these amounts do not constitute "available spendable resources" even though they are a component of net current assets. - 12 - RICHMOND COUNTY BOARD OF EDUCATION EXlllBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FOOD 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 (fIrst-in, first-out). 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. COMPENSATED ABSENCES Compensated 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. GENERAL OBLIGATION BONDS The Board issues general obligation bonds 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 during 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 is recorded in the General Long-Term Debt Account Group. RESERVED FUND BALANCE For Encumbrances - This reserve constitutes the unperformed portion of purchase orders, contracts and other commitments for goods and services at year end. Encumbrances outstanding are reported as a reservation of fund balance and do not constitute expenditures or liabilities in the current year because the commitments will be honored during the subsequent year. INTERFUND TRANSACTIONS The Board has the following types of interfund transactions: Reimbursements 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. - 13- RICHMOND COUNTY BOARD OF EDUCA nON EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Operating transfers are recorded for all interfund transactions other than reimbursements. MEMORANDUM ONLY - TOTAL COLUMNS Total 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. . Note 2: DEPOSITS AND INVESTMENTS COLLA TERALIZA nON OF DEPOSITS Official Code of Georgia Annotated (OCGA) Section 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate 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. OCGA Section 45-8-11 provides an officer holding public funds may, in his discretion, waive the requirement for security in the case of operating funds placed in demand deposit checking accounts. Acceptable security for deposits consists of anyone of or any combination of the following: (1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia, (2) Insurance on accounts provided by the Federal Deposit Insurance Corporation, (3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia, (4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia, . (5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose, (6) Industrial revenue bonds and bonds of development authorities created by the laws of the State oj Georgia, and - 14- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "0" , NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 2: DEPOSITS AND INVESTMENTS (7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. CATEGORIZATION OF DEPOSITS At June 30, 1998, the bank balances were $25,250,724.24. The amounts of the total bank balances are classified into three categories of credit risk: Category 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. Category 2 - Cash collateralized with securities held by the pledging financial institution's trust department or agent in the Board's name. . Category 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.) The Board's deposits are classified by risk category at June 30, 1998, as follows: Risk Category Bank Balance 1 2 3 $ 100,328.82 25,150,395.42 0.00 Total $25.250.724.24 CATEGORIZATION OF INVESTMENTS Investments are classified as to risk by the three categories described below: Category 1 - Insured or registered, or securities held by the Board or the Board's agent in the Board's name. Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Board's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Board's name. Funds 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. - 15 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT liD" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 2: DEPOSITS AND INVESTMENTS At June 30, 1998, the carrying value of the Board's total investments was $102,709,509.91. The investments are classified as to risk categories as follows: Tvoe of Investment Carrying Amount Fair Value Total Risk Cate20ries 2 3 $ 68,135,014.96 $ 23,648,975.72 $ 762.143.00 $ 762 14300 $ 91.783.990.68 $ U. S. Government Repurchase Agreements Common Stock 0.00 $ 68,135,014.96 $ 68,135,014.96 23,648,975.72 23,648,975.72 762.143.00 762.143.00 . 0.00 $ 92,546,133.68 $ 92,546,133.68 Local Government Investment Pools 10.163.376.23 10.163.376.23 Total Investments $10270950991 $10270950991 The 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 (primary Liquidity Portfolio) does not provide for investment in derivatives or similar investments. A description of the Primary Liquidity Portfolio is as follows: The Primary Liquidity Portfolio consists of Georgia Fund 1, which is a combination local and state government investment pool, and Fund 6. Georgia Fund 1 is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia Fund 1 operates in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940 and is considered to be a 2a-7 like pool. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety of capital, 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 of the shares. Participation in the pool is voluntary and deposits consist of funds from local governments; operating and trust funds of Georgia's state agencies, colleges and universities; and current operating funds of the State of Georgia's General Fund. Investments in Georgia Fund 1 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 1 may not exceed 60 days. Fund 6 maintains a duration of approximately one year. The weighted average maturity for Georgia Fund 1 on June 30, 1998 was 29 days. The average investmen1 duration for Fund 6 on June 30, 1998 was .96 years. - 16- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 3: NON-MONETARY TRANSACTIONS The 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 Note 4: RISK MANAGEMENT The 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; natmal disaster and unemployment compensation. The Board has obtained commercial insurance for risk ofloss associated with torts, 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. The Board has established a limited risk management program for workers' compensation claims. The Board accounts for all claims except School Food Services Fund 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. These losses may include an estimate of claims that have been incurred but not reported. An excess coverage insurance policy covers individual claims in excess of $225,000.00 loss per occurrence, up to the statutory limit. Changes in the workers' compensation claims liability during the last two fiscal years are as follows: Beginning Claims and of Year Changes in Claims End of Year Liabilitv Estimates Paid Liabilitv 1997 $ 0.00 $ 135.360.95 $ 135.360.95 $ 0.00 1998 $ 0.00 $ 133.024.04 $ 133.024.04 $ 0.00 The 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. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: Beginning Claims and of Year Changes in Claims End of Year Liabilitv Estimates Paid Liabilitv 1997 $ 7.884.18 $ 15.630.92 $ 20.080.26 $ 3.434.84 1998 $ 3.434.84 $ 18.274.26 $ 15.068.10 $ 6.641.00 - 17 - RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 4: RISK MANAGEMENT The Board has purchased surety bonds to provide additional insurance coverage as follows: Position Covered Amount Superintendent Administrative Assistant Each Principal Business Manager Each Bookkeeper Each Lunchroom Manager Athletic Business Manager $ 50,000.00 $ 10,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 3,000.00 $ 1,000.00 Note 5: GENERAL LONG-TERM DEBT CAPITAL LEASES The Richmond County Board of Education has entered into various lease agreements as lessee for school buses, operating vehicles, office equipment and equipment upgrades at various schools. 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. The Richmond County Board of Education entered into a lease agreement on April 1 , 1994, with Richmond County Public Facilities, Incorporated (RCPF), for the acquisition and construction of school facilities. Under the terms of the lease agreement, the Board will make semi-annual payments through November 1,2009. GENERAL OBLIGATION DEBT OUTSTANDING General Obligation Bonds currently outstanding are as follows: Puroose Interest Rates Amount General Government - Series 1996 General Government - Refunding - Series 1993 General Government - Refunding - Series 1991 3.65% - 5.55% 2.50% - 4.70% 4.50% - 6.30% $10 1,000,000.00 15,185,000.00 5.895.000.00 $122.080.000.00 The changes in General Long-Term Debt during the fiscal year ended June 30, 1998, were as follows: - 18 - RICHMOND COUNTY BOARD OF EDUCATION EXlllBIT "D" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 5: GENERAL LONG-TERM DEBT Capital Leases RCPF Other $ 12,200,000.00 $ 938,506.39 $ 766,929.04 $137,950,000.00 $151,855,435.43 Total Balance July 1, 1997 Additions Annual Leave Earned and Utilized (Net) Current Year Leases Deductions Payments 7,367,545.99 675.000.00 602.229,77 $ 11.52500000 $ 7.70382261 $ 790713 11 $122.08000000 $142.099.535.72 Balance June 30, 1998 Compensated Absences General Obligation Bonds 23,784.07 23,784.07 7,367,545.99 15.870.000.00 17.147.229.77 At June 30, 1998, payments due by fiscal year which includes principal and interest for these items are as follows: Caoital Leases RCPF Other Fiscal Year Ended June 30 1999 2000 2001 2002 2003 2004 . 2008 2009.2013 2014 - 2018 2019 - 2023 2024 - 2028 $ 1,342,070.00 $ 1,340,575.00 1,341,035.00 1,338,225.00 1,337,297.50 6,661,772.50 2,648,877.50 1,398,701.06 $ 1,205,820.33 1,205,820.33 1,056,676.27 803,225:41 4,016,127.05 General Obligation Bonds 9,158,333.75 9,275,518.75 9,398,471.25 9,526,030.00 9,646,520.00 46,206,783.75 38,058,895.00 41,277,275.00 44,684,676.25 25.014.527.50 Total Debt $ 11,899,104.81 11,821,914.08 11,945,326.58 11,920,931.27 11,787,042.91 56,884,683.30 40,707,772.50 41,277,275.00 44,684,676.25 25.014.527.50 Deduct: Imputed Interest 4.484.852.50 $ 16,009,852.50 $ 9,686,370.45 $242.24703125 $26794325420 Total Principal and Interest Net Present Value of Future Minimum Lease Payments 1.982.547.84 $ 11 525 00000 $ 7 703.822.61 Note 6: ON-BEHALF PAYMENTS The Board has recogniZed revenues and expenditures in the amount of $3,227,898.76 for health insurance and retirement contributions paid on the Board's behalf by the following State Agencies. Georgia Department of Education Paid to the State Merit System of Personnel Administration For Health Insurance of Non-Certified Personnel In the amount of $2,542,594.37 - 19- RICHMOND COUNTY BOARD OF EDUCATION EXHIBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 6: ON-BEHALF PAYMENTS Paid to the Teachers Retirement System of Georgia For Teachers Retirement System (TRS) Employer's Cost In the amount of $207,437.39 Office 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 $477,867.00 Note 7: SIGNIFICANT COMMITMENTS The following is an analysis of significant outstanding construction or renovation contracts executed by the Board as of June 30, 1998. Proiect Unearned Executed. Contracts B-97 -002 B-97 -009 B-97 -006 B-97-033 B-97-01O B-97-035 B-97 -003 B-97 -004 B-97-005 B-97-012 B-97 -020 B-97-036 B-98-029 B-97-030 B-99-041 B-97-016 B-98-031 B-97-032 B-97-017 B-97-011, B-97-014 B-97-015 B-98-025, B-98-026, B-98-028, B-99-038, B-99-039, B-99-040 B-97 -027 $ 9,835,806.59 270,243.50 4,794,741.99 304,215.36 337,172.50 354,140.16 4,727,439.26 2,426,349.29 2,439,978.99 3,802,036.64 3,889,883.15 232,472.94 92,357.82 92,786.46 126,454.26 1,770,856.66 1,822,714.50 51,300.72 117,993.72 651,004.33 325,929.71 118,497.80 393,634.50 - 20- RICHMOND COUNTY BOARD OF EDUCA nON EXHIBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 7: SIGNIFICANT COMMITMENTS Proiect Unearned Executed Contracts B-97-037 B-97-013 B-97 -001 B-97 -008 B-97-018 B-97-023 B-97 -008 B-97 -002 B-97 -008 B-97 -008 B-97 -008 CP-9718A CP-9730 95/94S-721-049 95/94S-721-051 9804 (A) 9804 (B) 9804 (D) 9804 (F) $ 408,292.50 3,000,730.30 162,714.01 22,600.07 300,684.49 815,208.75 472.92 2,408.99 830.73 2,921.59 97,587.10 49,000.00 161,655.80 499.83 110,377.03 30,189.00 54,000.00 62,000.00 43.811.00 $44.303.994.96 The amounts described in this note are not reflected in the general purpose financial statements. General Obligation Bonds have already been sold to provide a funding source for these projects. Additional funds will be provided through collection of an authorized Special Purpose Local Option Sales Tax. At June 30, 1998, the Board did not have any outstanding contractual commitments for the purpose of making computer systems and other electronic equipment year 2000 compliant. The year 2000 issue is the result of shortcomings 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 financial accounting system, student information system, instructional computer equipment, heating and air conditioning control equipment, telephone systems, time dependent controls, security systems, environmental systems and elevators. The following stages have been identified as necessary to implement a year 2000 compliant systems. Awareness Stage - Encompasses establishing a budget and project plan for dealing with the year 2000 issue. - 21 - RICHMOND COUNTY BOARD OF EDUCATION EXlllBIT liD" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 7: SIGNIFICANT COMMITMENTS Assessment Stage - The actual process of identifying all of its systems and individual components 01 the systems to check for compliance. Remediation Stage - When changes are made to systems and equipment. Validationffesting Stage - The process of ensuring that the changes made to systems and equipment will produce a year 2000 compliant system. It will be necessary for the Board to progress through all four of these stages for each computer andJOI electronic system, not already year 2000 compliant, in order to assure that these systems will not be adversel) affected. As of June 30, 1998, the environmental systems were detennined to be at the Awareness Stage; the financial accounting system, student information system, instructional computer equipment, heating and ail: conditioning control equipment, telephone systems, time dependent controls, security systems and elevators were determined to be at the Assessment Stage. Note 8: CONTINGENT LIABILITIES Amounts received or receivable principally from the Federal government are subject to audit and review b) grantor agencies. This could result in requests for reimbursement to the grantor agency for any expenditures which are disallowed un4er grant terms. The Board believes that such disallowances, if any, will b( immaterial to its overall.fmancial position. Note9: SUBSEOUENTEVENTS In the subsequent fiscal year, the Richmond County Board of Education issued $90,115,000.00 in Genera Obligation Refunding bonds to advance refund $101,000,000.00 of outstanding bonds. The proceeds frOD these bonds will be used to provide for future debt service payments on a portion of the 1996 Bond issue no scheduled to be retired by SPLOST Funds. Note 10: ACCUMULATED EMPLOYEES' LEA VB Administrative and other clerical personnel earn two days of vacation leave each month with a maximUD accumulation of twenty-four days less required vacation days to be taken during the year. Maintenance anl other twelve-month employees earn vacation leave ranging from ten days to twenty-two days per yea depending upon the employee's length of service with a maximum accumulation of 22 days. Vacation leav vests with the employee and unused accumulated vacation leave up to the maximum accumulation is paid 13 the current rate of pay, to employees upon retirement or termination of employment. See Note 1 Compensated Absences - 22- RICHMOND COUNTY BOARD OF EDUCATION EXIllBIT "0" NOTES TO THE GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30. 1998 Note 1 0: ACCUMULATED EMPLOYEES' LEAVE The Board also has an attendance incentive program that provides for payments not to exceed 20% of the employee's daily rate of pay based on days absent from work. No liability has been recorded for the June 30, 1998, attendance incentive liability as this amount is deemed immaterial to the general purpose financial statements. Note 11: RETIREMENT PLANS TEACHERS RETIREMENT SYSTEM OF GEORGIA (TRS) TRS 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 fmancial audit report and a copy can be obtained from the Georgia Department of Audits and Accounts. TRS CONTRIBUTIONS REQUIRED AND MADE Employees of the Board who are covered by TR.S are required by State statute to contribute 5% of their gross earnings to TRS. The Board makes monthly employer contributions to TR.S 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: Percentage Required Fiscal Year Contributed Contribution 1998 100% $13,417,601.86 1997 100% $12,429,937.42 1996 100% $11,423,487.55 - 23- RICHMOND COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET . SPECIAL REVENUE FUND JUNE 30. 1998 ASSETS SCHOOL FOOD SERVICES LOTTERY FEDERAL FUND PROGRAMS PROGRAMS $ 4,196,255.22 $ 524,110.26 290,009.76 $ 2,757,510.67 Cash and Cash Equivalents Accounts Receivable Inventories Consumable Supplies Food Donated Commodities Purchased Food 126,139.55 104,397.49 Total Assets $ 4,716,802.02 $ 524,110.26 $ 2,757,510.67 LIABILITIES AND FUND EQUITY LIABILITIES Cash Overdraft $ 1,791,518.07 Accounts Payable $ 262,978.57 $ 115,309.58 232,013.03 Salaries Payable 682,512.40 408,800.68 733,979.57 Expired Grant Balances Payable Total Liabilities $ 945,490.97 $ 524,110.26 $ 2,757,510.67 FUND EQUITY Fund Balances Reserved For Continuation of Federal Programs For Encumbrances For Inventories Consumable Supplies Food Donated Commodities $ 126,139.55 Purchased Food 104,397.49 Unreserved Undesignated 3,540,n4.01 $ 0.00 $ o.oe Total Fund Equity $ 3,n1 ,311.05 $ 0.00 $ o.oe Total Liabilities and Fund Equity $ 4,716,802.02 $ 524,110.26 $ 2,757,510.6~ See notes to the general purpose financial statements. - 24- EXHIBIT "E" OTHER ATHLETIC TOTALS PROGRAMS FUND JUNE 30, 1998 JUNE 30, 1997 $ 0.00 $ 189,258.07 $ 4,909,623.55 $ 3,722,696.87 3,047,520.43 4,862,336.06 20,683.68 20,683.68 19,955.12 126,139.55 426,844.36 104,397.49 154,504.50 $ 0.00 $ 209,941.75 $ 8,208,364.70 $ 9,186,336.91 $ 1,791,518.07 $ 3,198,933.21 610,301.18 627,721.88 1,825,292.65 1,776,906.40 54,418.44 $ 4,227,111.90 $ 5,657,979.93 $ 91.78 $ 119,200.66 $ 119,200.66 135,583.70 20,683.68 20,683.68 19,955.12 126,139.55 426,844.36 104,397.49 154,504.50 $ 0.00 70,057.41 3,610,831.42 2,791,377.52 $ 0.00 $ 209,941.75 $ 3,981,252.80 $ 3,528,356.98 209,941.75 $ 8,208,364.70 $ 9,186,336.91 $ 0.00 $ - 25- RICHMOND COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUND YEAR ENDED JUNE 30.1998 SCHOOL FOOD SERVICES LOTTERY FEDERAL FUND PROGRAMS PROGRAMS REVENUES State Funds $ 896,580.00 $ 4,618,466.03 $ 2,106,112.00 Federal Funds 10,071,600.37 10,500,516.14 Other Funds 2,n1,On.55 Total Revenues $ .13,739,257.92 $ 4,618,466.03 $ 12,606,628.14 EXPENDITURES Current Instruction $ 3,874,211.10 $ 8,096,044.48 Support Services Pupil Services 369,547.69 2,462,704.34 Improvement of Instructional Services 10,783.09 1,191,447.58 Educational Media Services 47,278.87 General Administration $ 8,472.57 289.23 264,915.83 School Administration 141,626.73 Maintenance and Operation of Plant 17,715.83 363,634.92 239,052.21 Student Transportation Services 19,705.54 Other Support Services 319,222.93 Food Services Operation 12,491,129.78 Community Services Operations 393,361.72 Capital Outlay Total Expenditures $ 12,910,679.90 $ 4,618,466.03 $ 12,781,998.51 Excess of Revenues over (under) Expenditures $ 828,578.02 $ 0.00 $ -175,370.37 OTHER FINANCING SOURCES Operating Transfers In 175,278.59 Excess of Revenues and Other Financing Sources over (under) Expenditures $ 828,578.02 $ 0.00 $ -91.78 FUND BALANCE JULY 1 3,293,544.85 0.00 91.78 Food Inventory - Net Change in Period Donated Commodities -300,704.81 Purchased Food -50,107.01 FUND BALANCE JUNE 30 $ 3,n1,311.05 $ 0.00 $ 0.00 See notes to the general purpose financial statements. - 26- EXHIBIT "F" OTHER PROGRAMS ATHLETIC FUND TOTALS YEAR ENDED JUNE 30,1998 JUNE 30, 1997 $ 163,600.00 $ $ 7,784,758.03 $ 7,985,308.28 20,572,116.51 19,744,049.31 296,413.10 3,067,490.65 3,126,097.73 296,413.10 $ 31,424,365.19 $ 30,855,455.32 $ 163,600.00 $ $ 142,153.97 $ 12,112,409.55 $ 11,988,480.22 2,237.74 $ 28,212.08 2,862,701.85 2,585,731.47 19,208.29 1,221,438.96 803,417.75 47,278.87 72,715.23 273,677.63 745,061.37 141,626.73 147,115.59 43,046.99 663,449.95 775,474.13 19,705.54 105,274.95 461,230.60 780,453.53 721,357.61 12,491,129.78 13,287,531.29 393,361.72 371,492.47 2,232.03 2,232.03 138,105.60 $ 163,600.00 $ 534,721.70 $ 31,009,466.14 $ 31,741,757.68 $ 0.00 $ -238,308.60 $ 414,899.05 $ -886,302.36 213,530.00 388,808.59 395,117.21 $ 0.00 $ -24,778.60 $ 803,707.64 $ -491,185.15 , 0.00 234,720.35 3,528,356.98 4,027,433.54 -300;704.81 -1,687.90 -50,107.01 -6,203.51 $ 0.00 $ 209,941.75 $ 3,981,252.80 $ 3,528,356.98 - 27- RICHMOND COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET CAPITAL PROJECTS FUND JUNE 30.1998 EXHIBIT -G- GEORGIA STATE FINANCING AND BOND INVESTMENT TOTALS ASSETS REGULAR PROCEEDS COMMISSION JUNE 30.1998 JUNE 30. 1997 Cash and Cash Equivalents $ 248,315.12 $ 248,315.12 $ 1.453,640.01 Investments $ 91.n4.968.81 91,n4.968.81 109.799.447.n Accounts Receivable 2.194.369.50 $ 826.475.00 3.020.844.50 382.867.00 Total Assets $ 2.442,684.62 $ 91,n4,968.81 $ 826.475.00 $ 95,044.128.43 $ 111.635,954.78 LIABILITIES AND FUND EQUITY LIABILITIES Total Uabilities $ 636.664.33 $ 492.880.72 $ 1,129.545.05 $ 145,780.63 3.644.98 3.644.98 2.717,790.02 2,717,790.02 6n,450.83 982.831.07 982,831.07 454.106.02 12,960.70 $ 4.340.930,40 $ 492.880.72 $ 4.833.811.12 $ 1.290,298.18 Cash Overdraft Accounts Payable Contracts Payable Retalnages Payable Due to Other Funds FUND EQUITY Fund Balances Reserved For Purposes of Bond Issue For Purposes of Capital Lease For State Capital OuUay Projects Unreserved Undesignated Total Fund Equity $ 87,434.038.41 $ 87,434,038,41 $ 109,498.327.48 $ 2,171.869.50 2,171,869.50 $ 333.594.28 333,594.28 270.815.12 0,00 0.00 270.815,12 847.329,12 $ 2.442.684.62 $ 87.434.038.41 $ 333.594.28 $ 90.210.317.31 $ 110.345.656.60 Total Uabilities and Fund Equity $ 2.442,684.62 $ 91.n4.968.81 $ 826,475.00 $ 95,044.128.43 $ 111.635,954.7e See notes to the general purpose financial statements, - 28- RICHMOND COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES CAPITAl PROJECTS FUND YEAR ENDED JUNE 30 1998 EXHIBIT -Ii" GEORGIA STATE FINANCING AND TOTAlS BOND INVESTMENT YEAR ENDED REGULAR PROCEEDS COMMISSION JUNE 30. 1998 JUNE 30. 1997 REVENUES State Funds $ 30,500,00 $ 443.608,00 $ 474,108.00 $ 4,241.079.00 Other Funds 33.895,07 $ 4.498.816,22 4.532.711,29 3.250.086.35 Total Revenues $ 64.395.07 $ 4.498.816.22 $ 443.608.00 $ 5.006.819,29 $ 7.491.165,35 EXPENDITURES Current Support Services Business Administration $ 1.970.300.00 Capital Outlay Land and Land Improvements $ 819.318,82 $ 2.251,45 $ 821.570,27 237.275,71 Building and Building Improvements $ 3,648,894,33 19.796.614.07 4,744.145.64 28,189.654.04 10.185.262,04 Equipment 963.634,67 2,725,00 130.341,43 1,096,701.10 Debt Service Principal 75.000,00 75.000,00 Total Expenditures $ 4.687.529,00 $ 20.618,857,89 $ 4,876.738,52 $ 30.182.925,41 $ 12.392.837.75 Excess of Revenues over (under) Expenditures $ -4.623.133,93 $ -16,119.841.67 $ -4,433.130,52 $ -25.176.106,12 $ -4.901.672,40 OTHER FINANCING SOURCES (USESl Proceeds from General Obligation Bonds Par Value $ 109.853.048,18 Capital Leases $ 6.218,489,43 $ 6.218.489,43 Operating Transfers In $ 4.766.724.80 4,766,724.80 5.502.292.70 Operating Transfers Out $ -4.693.656,87 -4.693.656,87 -1.215.856.00 Total Other Finencing Sources (Uses) $ 6.218.489,43 $ -4.693,658,87 $ 4.766.724,80 $ 6.291.557.36 $ 114.139.484,86 Excess of Revenues and Other Financing Sources over (under) Expenditures and Other Financing Uses $ 1.595.355.50 $ -20,813.498.54 $ 333.594.28 $ -18,884,548.76 $ 109.237.812,46 FUND BAlANCE JUL V 1 847.329.12 109.498.327,48 0.00 110.345,656.60 1,107.844,14 Reimbursement for Prior Vear Expenditures -1.250,790,53 -1.250.790,53 FUND BALANCE JUNE 30 $ 2.442.884,62 $ 87.434.038.41 $ 333.594,28 $ 90.210.317,31 $ 110.345.656,60 See notes to the general purpose financial statements, - 29- RICHMOND COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET DEBT SERVICE FUND JUNE 30. 1998 EXHIBIT "I" SPECIAL PROPERTY PURPOSE TAXES FOR LOCAL OPTION TOTALS ASSETS BOND DEBT SALES TAX JUNE 30, 1998 JUNE 30. 1997 Cash and Cash Equivalents $ 2.633,880.50 $ 6,867.53 $ 2,640,748.03 $ 2,875,681.08 . Investments 9,021.87 8,249,087.56 8,258,109.43 3.364.310.63 Accounts Receivable 114.776.67 4,518.780.78 4,633.557.45 22.446.03 Total Assets $ 2,757,679.04 $ 12,774,735.87 $ 15.532.414.91 $ 6.262,437.74 FUND EaUITY Fund Balances Reserved For Debt Service Unreserved Undesignated $ 2,757,679.04 $ 12,774,735.87 $ 15,532,414.91 $ 6,262,437.74 0.00 0.00 0.00 0:00 Total Fund Equity $ 2,757.679.04 $ 12.774.735.87 $ 15.532,414.91 $ 6.262,437.74 See notes to the general purpose financial statements. - 30- RICHMOND COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BAlANCES DEBT SERVICE FUND YEAR ENDED JUNE 30.1998 EXHIBIT. .r SPECIAL PROPERTY PURPOSE TOTALS TAXES FOR LOCAL OPTION YEAR ENDED BOND DEBT SALES TAX JUNE 30.1998 JUNE 30.1997 REVENUES Taxes $ 5,615,612.33 $ 26,579,6n.70 $ 32,195,290.03 $ 2,796,832.80 Other Funds 350.568.40 319.370.68 669.939.08 186.615.18 Total Revenues $ 5,966.180.73 $ 26.899.048.38 $ 32.865,229.11 $ 2.983,447.98 EXPENDITURES Debt Service Principal $ 1.870,000.00 $ 14.000.000.00 $ 15.870.000.00 $ 1.785.000.00 Interest 7,602,319.99 124,312.51 7,726.632.50 3,358,785.83 Paying Agent Fees 10,578.48 10,578,48 7.295.04 Total Expenditures $ 9,482,898.47 $ 14.124,312.51 $ 23.607.210,98 $ 5.151..080,87 Excess of Revenues over (under) Expenditures $ -3.516,717.74 $ 12.n4.735.87 $ 9,258.018.13 $ -2,167.632,89 OTHER FINANCING SOURCES Accrued Interest on Bonds Sold $ 407,312.74 Proceeds from General Obligation Bonds Par Value 5.146,951.84 Operating Transfers In $ 11 ,959.04 $ 11.959.04 Total Other Financing Sources $ 11 ,959.04 $ 11 ,959.04 $ 5.554.264.58 Excess of Revenues and Other Financing Sources over (under) Expenditures $ -3,504,758.70 $ 12,n4,735.87 $ 9,269,9n.17 $ 3.386,631.69 FUND BAlANCE JULY 1 6,262.437.74 0.00 6.262.437,74 2.875.806.05 FUND BALANCE JUNE 30 $ 2.757.679.04 $ 12.n4.735.87 $ 15.532.414.91 $ 6,262.437.74 See notes to the general purpose financial statements, - 31 - RICHMOND COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET FIDUCIARY FUND TYPES JUNE 30.1998 ASSETS Cash and Cash Equivalents LIABILITIES AND FUND EaUITY LIABILITIES Funds Held for Others FUND EaUITY Fund Balances Unreserved Undesignated Total Liabilities and Fund Equity See notes to the general purpose financial statements. - 32- DAVIDSON TRUST FUND $ 32,068.33 $ $ 32,068.33 $ $ 32,068.33 $ EXPENDABLE TRUSl NORA COXWELL SCHOLARSHIP FUND 23,898.31 23.898.3 23,898.3 FUNDS ROBETTA MCKENZIE SCHOLARSHIP FUND AGENCY FUNDS $ 743.43 $ $ 743.43 $ 743.43 $ 31,413.21 $ $ 31,413.21 $ 0.00 31,413.21 $ EXHIBIT "K" . TOTALS JUNE 30, 1998 JUNE 30, 1997 88,123.27 $ 92,638.93 31,413.21 $ 38.2n.29 56,710.06 54,361.64 88,123.27 $ 92.638.93 - 33- RICHMOND COUNlY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES FIDUCIARY FUND TYPE - EXPENDABLE TRUST FUNDS YEAR ENDED JUNE 30. 1998 EXHIBIT -L NORA ROBETTA DAVIDSON COXWELL MCKENZIE TOTALS TRUST SCHOLARSHIP SCHOLARSHIP YEAR ENDED FUND FUND FUND JUNE 30. 1998 JUNE 30. 199i REVENUES Other Funds $ 1.732,15 $ 1.276.55 $ 39.72 $ 3.048.42 $ 2.819.0l EXPENDITURES Current Support Services Central Support $ 700.00 $ 0.00 $ 0.00 $ 700.00 $ 0.01 Total Expend"ures $ 700.00 $ 0.00 $ 0.00 $ 700.00 $ 0.01 Excess of Revenues over (under) Expend"ures $ 1,032.15 $ 1,276.55 $ 39.72 $ 2,348.42 $ 2.819.01 FUND BALANCE JULY 1 31.036,18 22.621.75 703.71 54,361.64 51.542.5 FUND BALANCE JUNE 30 $ 32.068.33 $ 23.898.30 $ 743,43 $ 56.710.06 $ 54.361.6 See notes to the general purpose financial statements. - 34- RICHMOND COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES .FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30, 1998 LIABILITIES Funds Held for Others 38.26 $ . 677.88 $ $ PERFORMANCE BONDS ASSETS Cash and Cash Equivalents 37,599.41 $ 35,636.56 $ 42,538.90 $ $ LIABILITIES Funds Held for Others 37,599.41 $ 35.636,56 $ 42,538.90 $ $ TOTALS-AGENCY FUNDS ASSETS Cash and Cash Equivalents $ 38,277.29 $ 35,674.82 $ 42.538.90 $ LIABILITIES Funds Held for Others $ 38.277 .29 $ 35,674.82 $ 42.538.90 $ See notes to the general purpose financial statements. - 35- 0.00 $ EXHIBIT "MOO 716.14 30,697.07 30,697.07 31,413.21 31,413.21 ~-;:t;.~ RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 1998 SCHEDULE "1" PASS- THROUGH ENTITY FEDERAl. FUNDING AGENCY CFDA 10 REVENUE EXPENDITURES PROGRAM/GRANT NUMBER NUMBER IN PERIOD IN PERIOD Agriculture. U. S. Department of Direct Summer Food Service Program 1997 Grent 10,559 $ 205.959,00 $ 205.959.00 1998 Grant 10.559 213.591,12 213.591.12 Pass-Through From Georgia Department of Education FoodandN~~nProgram Food Services School Breakfast Program 1998 Grant 10.553 NlA 1.936.115.34 (2) National School Lunch Program 1998 Grant 10.555 NlA 6.975.799.47 11.814.683,63 (3) Food Distribution Program (1) 10,550 NlA 676.446.15 676,446,15 Pass- Through From Office of School Readiness Food and Nutrit~n Program Child and Adult Care Food Program 1998 Contract 10,558 N/A 63.689.29 (2) Total U, S, Department of Agriculture $ 10.071.600.37 $ 12.910.679,90 Education. U, S. Department of Direct Impact Aid 1998 Grant 84.041 $ 819.123.56 (5) Pass- Through From Georgia Department of Education Elementary and Secondary Education Act TItle I Grants to Local Educational Agencies 1997 Grant 84,010 NlA 323.497.64 $ 323.497.64 1998 Grant 84,010 NlA 6.710.313,95 6.710.313,95 Tille I! Eisenhower Professional Development 1997 Grant 84.281 NlA 101.645.67 101.737.45 1998 Grant 84.281 N/A 124.828.64 124.828,64 Tille VI Innovative Programs 1998 Grant 84.298 N/A 218.937,39 218.937.37 Individuals with Disabilities Education Act Part B - Special Education F~w Through 1998 Grant 84,027 N/A 790.705.81 790.705,81 Preschool 1998 Grant 84.173 N/A 373.839,92 373.839.92 Georgia Learning Resources System 1998 Grant 84.027 N/A 178.803,04 269.275.04 (3) Severely Emotionally Disturbed 1998 Grant 84.027 N/A 372.711.89 2.388.351.89 (3) Safe and Drug-Free Schools 1998 Grant 84,186 N/A 663.783.00 663.783.00 Special Education - Special Education Personnel Development. Trtle VI-D Georgia Learning Resource Center 1998 Grant 84,029 N/A 407,86 407.86 Stewart B. McKinney Homeless Assistance Act Education for Homeless Children and Youth 1998 Grant 84.196 NlA 15.851,41 15.851.41 Vocational Education - Basic Grants to States High School Program Basic Grant 1998 Grant 84,048 N/A 347.576,54 522,855,13 (3] Total U. S, Department of Education $ 11.042.026,32 $ 12.504.385.11 .36 - RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30.1998 SCHEDULE "1" FUNDING AGENCY PROGRAM/GRANT Justice. U. S, Department of Pass-Through From Richmond County Board of Commissioners Juvenile Delinquency Prevention and Intervention 1998 Grant Labor. U. S. Department of Pass-Through From RichmoncllBurke Training Authority Job Training Partnership Act 08-98-20-13-245 08-98-20-31-245 08-97-20-11-245 Total U. S, Department of Labor OTHER FEDERAL ASSISTANCE Defense. U. S. Department of Direct Defense Activity for Non-Traditional Support Troops to Teachers 1998 Grant Department of the Air Force R.O.T,C. Program 1998 Grant Department of the Army R.O,T.C. Program 1998 Grant Department of the Navy R.O,T.C. Program 1998 Grant National Science Center 1998 Grant Total U, S, Department of Defense Total Federal Financial Assistance N/A - Not Available CFDA NUMBER 16.548 17.250 17.250 17.250 PASS- THROUGH ENTITY 10 NUMBER N/A .N/A N/A Notes to the Schedule of Exoenditures of Federal Awards FEDERAL REVENUE IN PERIOD EXPENDITURES IN PERIOD N/A $ 22.309,48 $ 163.894.54 (3) $ 114.645.04 $ 22.181,14 140.787.20 114.645,04 22.181.14 140.787,20 $ 2n.613,38 $ 2n.613,38 $ 198.155.86 $ 79.205.92 36.346.13 (4) 145.561.43 (4) 123.048,58 (4) 8.083.30 8.680,80 $ 511.195,30 $ 87.866,72 $ 21.924.744.83 $ 25.944.439.65 (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 currant fiscal year, (2) Expenditures for the Child and Adult Care Food Program and the School Breakfast Program were not maintained separately and are included in the 1998 National School Lunch Program. (3) expenditures for this program include State. anillor Other Funds, expenditures are not maintained by fund source, (4) expenditures on this program were not maintained by fund source, (5) Funds eamed on this program do not require reporting of expenditures. Major Programs are identified by an asterisk r) in front of the CFDA number. The Board did not provide Federal Assistance to any Subrecipient. The accompanying schedule of expenditures of Federal awards includes the Federal grant activity of the Richmond County Board of Education and is presented on the modified accrual basis of accounting which is the same basis of accounting used in the presentation of the general purpose financial statements, See notes to the general purpose financial statements, - 37- RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1998 SCHEDULE -r AGENCYIFUNDING GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND TOTAL GRANTS Education, 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 Limited English Speaking Middle School Incentive Program Special Instructional Assistance In-School Suspension Counselors Grades 4 and 5 Technology Training Local Fair Share Educational Equalization Funding Grant Food Services Vocational Education Other State Programs Ad Valorem Tax Adjustment. Alternative Program At-Risk Summer School Program Environmental Science Program Georgia Leadership Academy Georgia Learning Resources System Health Insurance Innovative Programs Mentor Teacher Program Pay for Performance Program Preschool Handicapped Program Remedial Summer School Program Severely Emotionally Disturbed . Teachers'Retirement Lottery Programs Alternative School Program Applied Technology Labs Instructional Technology Georgia Peace Officers Standards and Training Council Law Enforcement Program $ 73,227,458.00 $ 73.227,458.00 7,321,454.00 7,321,454.00 2,548.711.00 2,548,711.00 3,020,101.00 3,020,101.00 923,776.00 923,776.00 18,922,391.00 18,922,391.00 2,305,784.00 2,305.784.00 569.142.00 569.142.00 136,472.00 136,472.00 2,499,258.00 2,499,258.00 2,624,336.00 2.624,336.00 672,659.00 672,659.00 308,082.00 308,082.00 548,005.00 548.005.00 -15.434,268.00 -15,434,268.00 6.089,205.00 6,089,205.00 $ 896,580.00 896,580.00 100.000.00 100,000.00 764,829.00 764,829.00 163.600.00 163,600.00 147,748.53 147,748.53 1,980.39 1,980.39 . 765.79 765.79 90,472.00 90,472.00 2,542,594.37 2,542,594.37 4.022.05 4,022.05 34,968.00 34,968.00 146.000.00 146,000.00 519,838.00 519,838.00 57,673.30 57 ,673.30 2,015.640.00 2,015,640.00 207,437.39 207,437.39 4.132.00 4,132.00 26.858.00 26,858.0C 979,318.00 979,318.0C 3,000.00 3,OOO.OC $ 30,500.00 30,500.0C 241,853.00 241,853.01 Community Affairs, Georgia Department of Governor's Emergency Funds (1) Local Assistance Grants Georgia State Financing and Investment Commission Reimbursement on Construction Projects 443,608.00 443,608.0l .36 - RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30. 1998 AGENCY/FUNDING GOVERNMENTAL FUND TYPES SPECIAL CAPITAL GENERAL REVENUE PROJECTS FUND FUND FUND GRANTS Office of School Readiness Pre-Kindergarten Program $ 3,608,158.03 Office of Treasury and Fiscal Services Public School Employees Retirement $ 4n,867.00 CONTRACTS Education, Georgia Department of Governor's School Leadership Institute 983.23 Office of Planning and Budget Georgia Council for the Arts Georgia Challenge Program 39,868.11 OTHER Education, Georgia Department of Special Education Administrator's Conference Relations with Other Agencies 2,080.00 4,335.00 SCHEDULE "2" TOTAL $ 3,608,158.03 4n,867.00 983.23 39,868.11 2,080.00 4,335.00 (1) Purchase Equipment for Richmond County String Orchestra Program $ 111.580,409.16 $ 7.784,758.03 $ 474,108.00 $ 119,839.275.19 See notes to the general purpose financial statements, - 39- RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS YEAR ENDED JUNE 30. 1998 PROJECT ORIGINAL ESTIMATED COST (1) CURRENT ESTIMATED COST (2) AMOUNT EXPENDED IN CURRENT YEAR (3) The general obligation debt of the district will first be retired from the proceeds of the special use tax. This will Include a large portion of the bond issue of $115,000,000.00 entitled "Richmond County General Obligation School Bond Series 1996" and certain other previously outstanding general Obligation bonds at an estimated cost of $124,750,000.00. The principal and interest on these bonds come due on May 1st and November 1st of each year. May 1,1998 will be the first time the principal will come due to be retired, In part, by the sales tax. $ 124,755,000.00 $ 124,755,000.00 $ 14,124,312.51 $ Once the application of the above funds to retirement of debt, the school board will construct, as provided in the election, a middle school, and/or an elementary school, which expenditures shall include acquiring, constructing and equipping these school buildings. In addition. to the construction of the middle and/or elementary school. the balance of the special sales tax. if any, shall be utilized to renovate, repair, improve and equip existing school buildings and other buildings and facilities. 25,245.000.00 25.245,000.00 SCHEDULE "3" AMOUNT EXPENDED IN PRIOR YEARS 0.00 $ 150,000.000.00 $ 150.000,000.00 $ 14,124.312.51 $ 0.00 (1) The Board's original cost estimate as specified In the resolution calling for the imposition of the Local Option Sales Tax. (2) The Board's current estimate of total cost for each project. Includes all cost from project Inception to completion. (3) The voters of Richmond County approved the imposition of a 1 % sales tax to fund the above projects. See notes to the general purpose financial statements. - 40- EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services General Administration Maintenance and Operation of Plant Total Expenditures RECAP: Salaries and Benefits PnH<indergarten Program Other Expenditures Altemative School Program Applied Technology Labs Instructional Technology PnH<indergarten Program See notes to the general purpose financial statements, RICHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES LOTTERY PROGRAMS YEAR ENDED JUNE 30. 1998 ALTERNATIVE SCHOOL PROGRAM $ 4.132,00 $ $ 4.132,00 $ $ 2.525,063.09 4.132,00 26.858.00 979.318,00 1.083.094,94 $ 4,618.466.03 APPLIED TECHNOLOGY LABS 26.858.00 $ 26.858.00 $ - 41 - INSTRUCTIONAL TECHNOLOGY 691.108.82 $ 288.209.18 979.318.00 $ PRE-KINDERGARTEN PROGRAM SCHEDULE -4- TOTAL 3,152.112.28 $ 3.874.211.10 389.547.69 10.783,09 289.23 75,425,74 369.547.69 10,783.09 289.23 363.634,92 3,608,158,03 $ 4,618,466.03 RICHMOND COUNTY BOARD OF EDUCATION . ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - OVERALL GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 1998 Minimum Expenditure Requirements (Total Allotment) Expenditures on Combined Program Basis Salaries Operations Less: Expenditures for Media Center Programs in Excess of Total Media Allotment Expenditures per Audit Amount of Underexpenditure for Total Allotment See notes to the general purpose financial statements. - 43 - FOURTEEN WEIGHTED AND MEDIA CENTER PROGRAMS $ 86,117,724.00 $ $ 99,334,057.95 5,142,939.67 $ $ 104,476,997.62 -1,714,n1.73 $ 102,762,225.89 $ 0.00 $ SCHEDULE "5" 100% TEST FOR OPERATIONS PORTION OF FOURTEEN WEIGHTED PROGRAMS 2,457,376.00 4,368,443.05 0.00 RICHMOND COUNTY BOARD OF EDUCATION ANALYSIS OF MINIMUM EXPENDITURE REQUIREMENTS - BY PROGRAM GENERAL FUND - QUALITY BASIC EDUCATION PROGRAMS YEAR ENDED JUNE 30. 1998 ALLOTMENTS FROM DEPARTMENT OF EDUCATION REQUIRED ORIGINAL ~ ORIGINAL MID-TERM GENERAL AND CAREER EDUCATION PROGRAMS Kindergarten (*) $ 8.145.025.00 $ 7,330,522.50 $ 0.00 Grades 1 - 3 (.) 21,108,850.00 18.997.965.00 Sub- Total- K-3 $. 29,253,875.00 90 $ 26,328.487.50 $ 0.00 Grades 4 - 5 (*) 9,195,447.00 90 8.275.902.30 Grades 6 - 8 (*) 15,617,400.00 90 14,055,660.00 Grades 9 - 12 (*) 9.940.379.00 90 8.946,341.10 High School Laboratories (*) 6.097.809.00 90 5,488,028.10 Vocational Education Laboratories (*) 3,122,548.00 90 2.810,293.20 Total General and Career Education Programs $ 73.227.458.00 $ 65.904.712.20 $ 0.00 SPECIAL EDUCATION PROGRAMS Regular Programs $ 6.930.150.00 $ 6,237,135.00 $ 0.00 Category I (*) Category II (.) Category III (*) Category IV (*) Sub-Total- Regular $ 6,930,150.00 90 $ 6,237,135.00 $ 0.00 Category VI (Gifted) (*) 391,304.00 90 352,173.60 Total Special Education Programs $ 7,321.454.00 $ 6.589,308.60 $ 0.00 REMEDIAL EDUCATION PROGRAM M $ 2;548.711.00 90 $ 2.293,839.90 $ 0.00 Total Fourteen Weighted Programs $ 83.097.623.00 $ 74,787.860.70 $ O.DC MEDIA CENTER PROGRAMS Salaries $ 2,440.029.00 90 $ 2.196.026.10 $ O.O( Operations 580.072,00 90 522,064.80 Total Media Center Programs $ 3,020,101.00 $ 2,718.090.90 $ 0.01 Total Fourteen Weighted and Media Center Programs $ 86,117.724.00 $ 77,505,951.60 $ 0,01 STAFF DEVELOPMENT PROGRAMS Cost of Instruction $ 268.350.00 $ 268.350.00 $ 0.0 Professional Development 655.426.00 655.'426.00 0.0 923.776.00 100 $ 923.776.00 $ 0.0 Total Staff Development Programs $ (.) Identifies Fourteen Weighted Programs. See notes to the general purpose financial statements. - 44 - SCHEDULE "6" TOTAL REQUIRED ACTUAL EXPENDITURES SAlARIES OPERATIONS TOTAL AMOUNT OF UNDEREXPENDITURE . FOR REQUIRED ALLOTMENT $ 7.330,522.50 $ 8.079,392.70 $ 273,313.53 $ 8.352.706.23 18,997.965.00 22.757 .054.33 1.016.067.56 23.773,121.89 $ 26,328,487.50 $ 30.836.447.03 $ 1,289,381.09 $ 32.125,828.12 $ 0.00 8.275.902.30 10.038.919.83 471.123.89 10.510,043.72 0.00 14,055.660.00 17,244.613.50 1,153,036.93 18,397,650.43 0.00 8.946,341.10 12.105.819.88 671,583.10 12.m,402.98 0.00 5.488,028.10 7.976.728.00 130.339.62. 8.107,067.62 0.00 2,810,293.20 4.227.792.60 418,584.91 4.646.3n.51 0.00 $ 65.904,712.20 $ 82,430.320.84 $ 4.134,049.54 $ 86.564.370.38 $ 6,237,135.00 $ 706,660.00 $ 33.449.04 $ 740.109.04 2.749,727.07 21.895.28 2.771,622.35 5,354.823.82 101,000.45 5,455.824.27 768.415.73 33,112.33 801.528.06 $ 6,237.135.00 $ 9,579.626.62 $ 189,457.10 $ 9.769.083.72 0.00 352.173.60 430.490.03 17.697.67 448,187.70 0.00 $ 6.589.308,60 $ 10,010.116,65 $ 207.154.77 $ 10,217.271.42 $ 2.293.839.90 $ 2.933.244.35 $ 27,238.74 $ 2,960,483.09 0.00 $ 74.787,860.70 $ 95,373,681.84 $ 4.368.443.05 S 99.742.124.89 $ 2.196,026.10 $ 3,960,376.11 $ 3.960,376.11 0.00 522,064.80 $' 774.496,62 774,496.62 0.00 $ 2.718.090.90 $ 3.960.376.11 $ 774,496.62 $ 4,734,872.73 $ 77 ,505.951,60 $ 99,334.057.95 $ 5.142,939.67 $ 104,476,997.62 .$ 0,00 $ 268.350.00 $ 344.514.38 $ 344,514.38 655.426.00 579.484,96 579.484,96 $ 923.776,00 $ 923.999.34 $ 923.999.34 $ 0.00 - 45 - l'- <-. S~'MOdffiI 10ULNO:::> 'lVIDI3.I.NI CINV 3:::>NVIldWO:::> II NOll:::>3S ;';l~ DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214 Atlanta. Georgia 30334-8400 ~LAUDE L. VICKERS STATE AUDIlOR (404) 656-2174 March 2, 1999 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Richmond County Board of Education REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Ladies and Gentlemen: We have audited the financial statements of Richmond County Board of Education as of and for the year ended June 30, 1998, and have issued our report thereon dated March 2, 1999. This report was qualified for certain scope limitations and various departures from generally accepted accounting principles, as identified in the auditor's report on the general purpose financial statements. Except as discussed in paragraphs two and three, 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. We did not observe the taking of either the purchased foods inventory or consumable supplies inventory at June 30, 1998, nor could we satisfy ourselves as to the accuracy of the amounts stated as inventories through alternative procedures. We were unable to examine sufficient audit evidence regarding year 2000 disclosures as required by Governmental Accounting Standards Board Technical Bulletin 98-1, Disclosures About Year 2000 Issues. This bulletin requires disclosure of certain matters regarding the year 2000 issue in order for financial statements to be prepared in conformity with generally accepted accounting principles. ComDliance As part of obtaining reasonable assurance about whether Richmond County Board of Education's financial statements are free of material 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 of financial statement amounts. However, providing an opinion on compliance with those 98YB-40 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 I Auditing Standards. Internal Control Over Financial ReDorting I In planning and performing our audit, we. considered Richmond 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 operatiot;lthat we consider to be a reportable condition. Reportable conditions involve matters coming to our attentiori relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect Richmond County Board of Education's ability to record, process, summarize and report financial data consistent with assertions of management in the financial statements. The reportable condition is described in the accompanying Schedule of Findings and Questioned Costs as items FS- 7211-98-02. A 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 reportabl~ 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 also considered to be a material weakness. This report is intended for the information of management, the Federal COeni7.ant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~...4~ ~..~ Claude L. Vickers State Auditor CLV:gp 98YB-40 DEPARTMENT OF AUDITS AND ACCOUNTS 254 Washington Street, S.w., Suite 214 Atlanta, Georgia 30334-8400 LAUDE L. VICKERS STATE AlJDIlOR (404) 656-2174 March 2, 1999 Honorable Roy E. Barnes, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Richmond County Board of Education REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 Ladies and Gentlemen: Compliance We have audited the compliance of Richmond County Board of Education with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-i33 Compliance Supplement that are applicable to each of its major Federal programs for the year ended June 30, 1998. Richmond 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 Richmond County Board of Education's management. Our responsibility is to express an opinion on Richmond County Board of Education's compliance based on our audit. We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to fmancial audits contained in Government Auditing Standards. issued by the Comptroller General of the United States; and OMB Circular A-I33, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-B3 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 Richmond 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 Richmond County Board of Education's compliance with those requirements. 98SA-I0 In our opinion, the Richmond 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. . Internal Control Over Comoliance I The management of Richmond 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 Richmond County Board of Education's internal 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-133. . Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A 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 of risk 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. This report is intended for the information of management, the Federal COgni7.ant agency, Federal awarding agencies and pass through entities. This restriction is not intended to limit the distribution of this report which is a matter of public record. Respectfully submitted, ~"..4 -;r: ~ ,,/ Claude L. Vickers State Auditor CLV:gp 98SA-I0 &LSOJ aaNOlls:mo QNV SONlaNI.:! mr"3A ~OnId O~ 3SNOdSffiI S,3:irn:anv ill NOllJ3S IDCHMOND COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998 PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS 7211-93-04 FS-7211-97-01 No Further Action Warranted Unresolved - See Corrective Action/Responses CORRECTIVE ACTIONIRESPONSES GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Finding Control Number: FS-7211-97-01 The Richmond County Board of Education does not maintain a system-wide General Fixed Assets Account Group. The Board of Education does maintain a fixed asset property listing for all State and Federal Programs, a property inventory of all the schools' equipment as well as a schedule of all buildings required for insurance purposes. Due to budgeting limitations, it is not economically feaSible to increase the administrative staff to expand our scope. . PRIOR YEAR FEDERAL AWARD FINDINGS AND OUESTIONED COSTS FINDING CONTROL NUMBER AND STATUS 7211-93-07 7211-95-04 Previously Reported Corrective Action Implemented Previously Reported Corrective Action Implemented S~SOJ oaNollsanb <INV SDNIONId AI NOllJ3S IDCHMONDCOUNTYBOARDOFEDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998 I SUMMARY OF AUDITOR'S RESULTS 1. Type of Report Issued on the Financial Statements The auditor's opinion on the Richmond County Board of Education's financial statements was qualified for various scope limitations and departures from generally accepted accounting principles. 2. Reportable Conditions in Internal Control Disclosed bv the Audit of the Financial Statements The audit report for the Richmond County Board of Education disclosed a financial statement reportable condition related to the following control category. General Fixed Assets The reportable condition described above is considered to be a material weakness. 3. Noncompliance Material to the Financial Statements The audit of the Richmond County Board of Education disclosed no instances of noncompliance that were deemed to be material to the fmancial statements. 4. Reportable Conditions in Internal Control Over Maior Programs The audit report for the Richmond County Board of Education did not disclose any reportable conditions in internal control over major programs. 5. Type of Report Issued on Compliance for Maior Programs The auditor's opinion on the Richmond County Board of Education's report on compliance with requirements applicable to major programs was unqualified. 6. Audit Findings Reauired to be Reported bv Section .510(a) ofOMB Circular A-133 The Richmond County Board of Education's audit did not disclose audit findings required to be reported by section .510(a) ofOMB Circular A-133. 7. Maior Programs Federal awards audited as major programs are as follows: 10.553 Food and Nutrition Program -Food Services - School Breakfast Program 10.555 Food and Nutrition Program.- Food Services - National School Lunch Program 10.559 Summer Food Service Program 8. Type "A" Program Dollar Threshold The dollar threshold for type "A" programs was $765,124.43. 9. Low Risk Auditee The Richmond County Board of Education was audited as a low risk auditee based on a waiver granted by the U. S. Department of Education. - 1 - roCHMONDCOUNTYBOARDOFEDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998 II FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS GENERAL LEDGER Failme to Transfer Local Matching Funds Nonmaterial Noncompliance Finding Control Number: FS-7211-98-0 1 The Richmond County Board of Education received approval for State capital outlay project funding, througlJ Georgia State Financing and Investment Commission. Both the instructions in Chapter 41 of the Financial Management for Georgia Local Units of Administration (FMGLUA) and the agreement signed by the Richmond County Board of Education to receive this funding require that the Richmond County Board oj Education transfer required local matching funds to the Capital Projects Fund by June 30, 1998, and designau those funds by project name and number. This transfer was not made by the Richmond County Board oj Education at June 30, 1998. This condition occurred because management claimed not to be aware ofth( provisions ofFMGLUA. A correcting audit adjustment was necessary to transfer $332,667.00 from the Bone Proceeds Fund to GSFIC Project No. 99-721-088 as required. Management's Response: The reason the transfer did not take place on or before June 30, 1998, was an oversight. While the applicatiOI fo'r State funds was filed during fiscal year 1998, no construction had started. It will start in fiscal year 1999 GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - -Material Weakness Repeated From Prior Year Finding Control Number: FS-7211-98-02 The Richmond County Board of Education did not maintain a system-wide General Fixed Assets AccoUD Group within the formal accounting records as required by generally accepted accounting principles. Thi condition results in the general purpose financial statements of the Board being incomplete and not il accordance with generally accepted accounting principles. Appropriate action should be taken by the Boarl to establish accounting controls and procedures to provide for the maintenance of a General Fixed Asset Account Group. These subsidiary records should include an inventory of land, buildings, and equipmeIl owned by the Board and should include, but may not be limited to, date acquired, acquisition cost, estimate, replacement cost, location and description. Detailed records should be maintained of all additions an deletions to the General Fixed Assets Account Group. -2- roCHMOND COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND OUESTIONED COSTS YEAR ENDED JUNE 30. 1998 II FINANCIAL STATEMENT FINDINGS AND OUESTIONED COSTS . GENERAL FIXED ASSETS Failure to Maintain General Fixed Assets Account Group Reportable Condition - Material Weakness Repeated From Prior Year Finding Control Number: FS-7211-98-02 Management's Response: The Richmond County Board of Education does not maintain a system-wide General Fixed Assets Account Group. The Board of Education does maintain a fixed asset property listing for all State and Federal Programs, a property inventory of all schools' equipment as well as a schedule of all buildings required for insurance purposes. Due to budgeting limitations, it is not economically feasible to increase the administrative staff to expand our scope. ill FEDERAL AWARD FINDINGS AND OUESTIONED COSTS No matters were reported. - 3 - CONTROLLER #10 (REV 5-99)