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HomeMy WebLinkAbout94-01551 - .0 ~. J ~ 3 d ; J -... 7ti1, 9'1- IJ':{/ &JJ Vt_ , . ~ 1J38R1 BOYER & RITTER CEHTIFIEU PUBLIC ACCOUNTANTS . ~ 714. f)y-/.;rl C",,::~ -,:;.......J CARLISLE AREA SCHOOL DISTRICT CARLISLE, PENNSYLVANIA JUNE 30, 1993 n~ "', ~x::. , rna:.:.. :r:f"T1"'r- %':J~.t. ",r- .'2. t.,." ..c~~~ ~O%~ "nO::! zoZn -c::"'m "';a:-4 .... ....:c ::IC po :0 ....... c.Q N ~ -.:J ~ - "" --=- . - .. CONTENTS PAGE GENERAL PURPOSE FINANCIAL STATEMENTS Report of Independent Certified Public Accountants Combined Balance Sheet - All Fund Types and Account Groups Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund Statement of Revenues, Expenses and Changes in Retained Earnings - Proprietary Fund Type - Enterprise Cafeteria Statement of Cash Flows - Proprietary Fund Type - Enterprise - Cafeteria Notes to Financial Statements 1 2-5 6-7 8 9 10 11-23 SUPPLEMENTAL INFORMATION Report of Independent Certified Public Accountants on Supplemental Information Combining Balance Sheets Agency Funds General Fund Schedule of Revenues - Budget and Actual Schedule of Expenditures - Budget and Actual Schedule of Other Financing Uses - Budget and Actual 24 25 26-27 28-32 33 CONTENTS - CONTINUED PAGE SUPPLEMENTAL INFORMATION - CONTINUED Report of Independent Certified Public Accountants on Internal Control Structure-Related Matters Noted in a Financial Statement Audit Conducted in Accordance With Government Auditina Standards 34-35 Report of Independent Certified Public Accountants on Compliance With Laws and Regulations Based on an Audit of the General Purpose Financial Statements Performed In Accordance With Government Audltlna Standards Comments and Suggestions Report of Independent Certified Public Accountants on Schedule of Federal Financial Assistance Schedule of Federal Financial Assistance Report of Independent Certified Public Accountants on the Internal Control Structure Used In Administering Federal Financial Assistance Programs Report of Independent Certified Public Accountants on Compliance With the General Requirements Applicable to Federal Financial Assistance Programs Report of Independent Certified Public Accountants on Compliance With Specific Requirements Applicable to Major Federal Financial Assistance Program Report of Independent Certified Public Accountants on Compliance With Specific Requirements Applicable to Nonmajor Federal Financial Assistance Program Transactions 36 37 38 39-42 43-46 47-48 49-50 51 . Schedule of Findings and Questioned Costs for Federal Programs Status of Prior Year's Findings and Questioned Costs for Federal Programs 52 53-54 - - BOYER & RITTER (:EHTIFIED Pl 'Bue ,'\CCOL;:--rr.-\NTS Reoort of Indeoendent Certified Public Accountants Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the accompanying general purpose financial statements of Carlisle Area School District as of June 30, 1993, and for the year then ended. These general purpose financial statements are the responsibility of the School District's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the accompanying general purpose financial statements present fairly, in all material respects, the financial position of the Carlisle Area School District as of June 30, 1993, and the results of its operations and its cash flows of its proprietary fund type for the year then ended, in conformity with generally accepted accounting principles. As discussed in Note 14 to the general purpose financial statements, the Carlisle Area School District has been operating without an employment contract with the teachers since July I, 1992. The ultimate outcome of this uncertainty involving the negotiations cannot presently be determined. Accordingly, the accompanying general purpose financial statements do not include any adjustments that might result from the outcome of this uncertainty. 8o-r I' e;tw ,lilt September I, 1993 Camp Hill, Pennsylvania . CARLISLE AREA SCHOOL DISTRICT COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30, 1993 ASSETS GOVERNMENTAL FUND TYPES SPECIAL DEBT CAPITAL GENERAL REVENUE SERVICE PROJECTS Cash $ 113,825 $23,804 $13,030 $ 30,310 Investments 2,568,453 1,660,529 Receivables Taxes - net of allowance for uncollectible taxes of $169,137 3,119,819 Due from other funds 61,949 95,733 Subsidies Federal 65,616 State 33,833 Interest 197 Other Inventories 17 ,535 Vocational project 64,738 Land and improvements Buildings Construction-in-progress Furniture and equipment - net of accumulated depreciation in Cafeteria Fund of $496,045 Office machines Audio-visual equipment Books Amounts to be provided for retirement of general obligation bonds and notes TOTAL ASSETS ~ g3.80,\ 113.030 ~ 2 PROPRIETARY FUND TYPE ENTERPRISE 5 5,279 FIDUCIARY FUND TYPE AGENCY 545,709 ACCOUNT GROUPS GENERAL GENERAL FIXED LONG-TERM ASSETS DEBT 5 5 TOTALS (MEMORANDUM ONLY) 5 231,957 4,228,982 3,119,819 157,682 35,958 101,574 4,384 38,217 197 275 275 32,818 50,353 64,738 1,080,852 1,080,852 35,028,732 35,028,732 47,878 47,878 33,864 1,524,614 1,558,478 281,131 281,131 1,085,919 1,085,919 561,404 561,404 13.915.000 13.915.000 ~ ~ ~ 1ll..21L.2.2.2 ~ See notes to financial statements which are an Inte9ral part of this statement. 3 CARLISLE AREA SCHOOL DISTRICT COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30, 1993 . . LIABILITIES ANO FUNO EQUITY GOVERNMENTAL FUNO TYPES . SPECIAL DEBT CAPITAL GENERAL REVENUE SERVICE PROJECTS LIABILITIES Accounts payable $ 156,643 $ $ $ Deferred revenue 2,287,831 Due to other funds 95,733 17,589 . Accrued expenses Payroll 668,230 Retirement plan contributions 409,367 Payroll taxes and withholdings Due to student groucs General obligation onds and . notes payable TOTAL LIABILITIES 3,617,804 17,589 FUND EQU ITY Investment in general fixed ca assets Retained earnings Fund balances Reserved for inventory 17,535 Reserved 306,300 6,215 13,030 1,786,769 Unreserved 2.104.129 ~ Total fund balances 2.427.964 6.215 13.030 1.786.769 TOTAL FUND EQUITY 2.427.964 6.215 13.030 1.786.769 TOTAL LIABILITIES AND II FUND EQUITY ~ }23.804 ~I3.03~ 1,1.786.769 . . 4 (I . See notes to financial statements which are an integral part of this statement. 5 . ACCOUNT GROUPS . PROPRIETARY FIDUCIARY GENERAL GENERAL TOTALS FUND TYPE fUND TYPE FIXED LONG-TERM (MEMORANDUM ENTERPRISE AGENCY ASSETS DEBT ONLY\ S 26,036 S 3,397 S S S 186,076 11,974 - 2,299,805 43,646 714 157,682 7,195 675,425 11,473 420,840 6,443 1,213 7,656 40,385 40,385 13.915.000 13.915.000 106,767 45,709 13,915,000 17,702,869 39,610,530 39,610,530 5,811 5,811 17,535 2,112,314 . 2.104.129 4.233.978 5.Bll 39.610.530 43.850.319 . WL.W 1.45.702 ~ ~13.915.000 ~ . . CARLISLE AREA SCHOOL DISTRICT COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES YEAR ENDED JUNE 30, 1993 GOVERNMENTAL GENERAL $15,883,358 11,720,069 911,329 170,785 196.091 28,881,632 SPECIAL REVENUE S REVENUES Taxes State appropriations Federal appropriations Interest Activities Other TOTAL REVENUES EXPENDITURES Instructional Support services Operation of noninstructional services Special revenue Capital projects Debt service Principal Interest Bond issuance costs 31,199 31,199 17,986,776 7,676,793 486,825 29,025 26.150.394 29.025 TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES) Operating transfers in Operating transfers out Proceeds from issuance of general obligation bond TOTAL OTHER FINANCING SOURCES (USES) EXCESS OF REVENUES AND OTHER FINANCING SOURCES OVER EXPENDITURES AND OTHER FINANCING USES FUND BALANCES - JULY I, 1992 DECREASE IN RESERVE FOR INVENTORY FUND BALANCES - JUNE 30, 1993 2,731,238 2,174 (1,829,417) (1.829.417) 2,174 4,041 901,821 1,532,776 (6.633) ~ 2.427.964 L.i..W 6 FUND TYPES TOTALS DEBT CAPITAL (MEMORANDUM SERVICE PROJECTS ONLY) S S $15,BB3,35B 11,720,069 911,329 6,030 10,343 187,158 31,199 72.410 268.501 6,030 82,753 29,001,614 17,986,776 7,676,793 486,825 29,025 47,858 47,B58 4,805,000 4,805,000 673,080 673,080 126.951 126.951 5.605.031 47.858 31.832.308 (5,599,001) 34,895 (2,830,694) 1,829,417 1,602,386 3,431,803 (1,602,386) (3,431,803) 5.385.000 5.385.000 5.612.031 1. 602.386 5.385.000 13,030 1,637,281 149,488 2,554,306 1,686,305 16.633) 1-4.233.978 ~ lJ.786.769 See notes to financial statements which are an Integral part of this statement. 7 CARLISLE AREA SCHOOL DISTRICT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLEl REVENUES Taxes $15,B28,900 $15,8B3,358 $ 54,458 State appropriations 11,160,811 11,720,069 559,258 Federal appropriations 966,199 911,329 (54,870) Interest 275,000 170,785 (104,215) Other 118.800 196.091 77.291 TOTAL REVENUES 28,349,710 28,881,632 531,922 EXPENDITURES Instructional 18,288,315 17,986,776 301,539 Support services 7,699,333 7,676,793 22,540 Operation of noninstructional services 498.119 486.825 11. 294 TOTAL EXPENDITURES 26.485.767 26.150.394 335.373 EXCESS OF REVENUES OVER EXPENDITURES 1,863,943 2,731,238 867,295 OTHER FINANCING USES Operating transfers out (1.837.133) (1.829.417) 7.716 EXCESS OF REVENUES AND OTHER FINANCING SOURCES OVER EXPENDITURES AND OTHER FINANCING USES ~ 26.810 901,821 ~ 875.01.1 FUND BALANCE - JULY I, 1992 1,532,776 DECREASE IN RESERVE FOR INVENTORY (6.633) FUND BALANCE - JUNE 30, 1993 ~ See notes to financial statements which are an integral part of this statement. 8 .,.-.- ,'.,,...,~-,-- ,,-,~.....-. CARLISLE AREA SCHOOL DISTRICT STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS - PROPRIETARY FUND TYPE - ENTERPRISE - CAFETERIA YEAR ENDED JUNE 30, 1993 OPERATING REVENUES Sales Other TOTAL OPERATING REVENUES OPERATING EXPENSES Donated commodities used Food and milk Sal ari es Payroll taxes Retirement plan contributions Suppl1 es Cold storage Depreciation Miscellaneous $ 613,898 1.873 615,771 50,601 325,879 479,384 18,328 32,486 16,892 3,003 13,852 10.229 950.654 (334,883) 847 260,465 50.601 311.913 (22,970) 28.781 ~ 5.81.1 . TOTAL OPERATING EXPENSES OPERATING lOSS NONOPERATING REVENUES Interest Federal and state subsidies Value of donated commodities TOTAL NONOPERATING REVENUES NET LOSS RETAINED EARNINGS - JULY I, 1992 RETAINED EARNINGS - JUNE 30, 1993 See notes to financial statements which are an integral part of this statement. 9 CARLISLE AREA SCHOOL DISTRICT STATEMENT OF CASH FLOWS INCREASE (DECREASE) IN CASH PROPRIETARY FUND TYPE - ENTERPRISE - CAFETERIA YEAR ENDED JUNE 30, 1993 CASH FLOWS FROM OPERATING ACTIVITIES Operating loss Adjustments to reconcile operating loss to net cash used in operating activities Depreciation Value of donated commodities used Change in assets and liabilities Inventories Receivables Accounts payable Accrued expenses Payroll taxes and withholdings Deferred revenues Total adjustments NET CASH USED IN OPERATING ACTIVITIES CASH FLOWS PROVIDED BY CAPITAL FINANCING ACTIVITIES Purchase of furniture and equipment CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Federal and state subsidies Net proceeds from interfund borrowing NET CASH PROVIDED BY NONCAPITAL FINANCING ACTIVITIES CASH FLOWS FROM INVESTING ACTIVITIES Investment income NET INCREASE IN CASH CASH - JULY 1, 1992 CASH - JUNE 30, 1993 See notes to financial statements which are an integral part of this statement. 10 $(334,883) 13,852 50,601 . (125) (2,495) 12,875 1,404 370 (2.972) 73.510 (261,373) (3,165) 260,465 3.646 264,111 847 420 4.859 ~ 5.279 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the School District conform to generally accepted accounting principles applicable to governmental units. The following is a summary of the more significant policies: BASIS OF PRESENTATION - FUND ACCOUNTING The accounts of the School District are organized on the basis of funds or account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self- balancing accounts that comprise its assets, liabilities, fund balance/retained earnings, revenues, and expenditures\expenses. The various funds are summarized by type in the financial statements. The following fund types and account groups are used by the School District: GOVERNMENTAL FUND TYPES Governmental Funds are those through which most governmental functions of the School District are financed. The acquisition, use and balances of the School District's expendable financial resources and the related 1 iabl1i ties (except those accounted for in propri etary funds) are accounted for through government a 1 funds. The measurement focus is upon determination of changes in financial resources, rather than upon net income determination. General Fund - The General Fund is the general operating fund of the School District. This fund is used to account for all financial transactions except those required to be accounted for in another fund. Soecial Revenue Fund - These funds are used to account for proceeds of specific revenues (other than major capital projects) that are legally restricted to expenditures for specific purposes or used to finance specific activities as required by administrative regulation. Oebt Service Fund - This fund is used to account for the accumulation of resources for, and the payment of, interest, principal, and related costs on general obligation bonds and notes which are supported by the full faith and credit of the School District. Caoital Proiects Fund - This fund is used to account for financial resources to be used for the acqui s it ion Dr construction of major capital facilities. PROPRIETARY FUND TYPES Proprietary funds are used to account for the School District's ongoing activities which are similar to those often found in the private sector. 11 -.-- "~.,....~,..'?"f"-,,,,, CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED PROPRIETARY FUND TYPES - CONTINUED Enterorise Fund - The Cafeteria Fund accounts for all revenues and expenses pertaining to cafeteria operations since such operations are financed and operated in a manner similar to a private business enterprise. It is the intent of the governing body that the cost of providing such goods Dr services to the students on a continuing basis be financed Dr recovered primarily through user charges Dr cost reimbursement plans. FIDUCIARY FUND TYPES Fiduciary Funds are used to account for assets held by the School District in a trustee capacity or as an agent for individuals, private organizations, other governmental units and/or other funds. These funds are held by the School District which acts in an agency capacity with respect to the Payroll Wlthholdings and the Student Activity Funds. ACCOUNT GROUPS General Fixed Assets Account Grouo - This account group is used to record all property and equipment of the School District, except that which is accounted for in the Enterprise Fund. General Lana-Term Debt Account Grouo - This account group presents the balance of long-term debt which is backed by the full faith and credit of the School District. Long-term debt accounted for in the Enterprise Fund is excluded. BASIS OF ACCOUNTING GOVERNMENTAL AND FIDUCIARY FUND TYPES All governmental and fiduciary funds are accounted for using the modified accrual basis of accounting. Revenues are recorded as received in cash except for revenues susceptible to accrual and material revenues that are not received at normal times. Delinquent taxes receivable are reported on the balance sheet, net of an allowance for uncollectible taxes. Expenditures are recorded on the accrual basis except for prepaid expenses, which are not recorded, and except for interest on long-term debt, which is an expenditure when due. 12 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED BASIS OF ACCOUNTING - CONTINUED GOVERNMENTAL AND FIDUCIARY FUND TYPES - CONTINUED Fixed assets and materials and supplies are charged to operations when purchased. . Property, plant and equipment are stated at cost, or where cost is not available, at appraised values. Depreciation is not provided on property, plant and equipment contained in the General Fixed Assets Account Group. . Inventories are stated at the lower of cost (first-in, first-out method) or market. Inventory shown in the General Fund consists of expendable supplies held for consumption. The amount thereof has been presented as an asset for informational purposes and is offset by an equal reserve. The cost of such inventory has been presented as an expenditure at the time the individual inventory items were purchased. PROPRIETARY FUND TYPE The Cafeteria Fund uses the Pennsylvania Department of Education-prescribed "modi fi ed enterprise fund" method of accounting. Under thi s full accrual method of accounting: . Furniture and equipment utilized by the Cafeteria Fund is recorded as fixed assets of that Fund (at cost), and is depreciated therein on a straight-line basis over an estimated useful life of 12 years. The fixed assets, net of accumulated depreciation, are a component of retained earnings. . Donated cOlMlodities received by the Cafeteria Fund are inventoried at estimated cost to purchase comparable products locally or at cost figures provided by the Federal Government if comparable products are not locally available. . Inventories are valued on a first-in, first-out basis; remainder inventories at year-end are a component of retained earnings.. The School District does not attempt to allocate "building-wide costs" to the Cafeteria Fund. Thus, General Fund expenditures which partiallY benefit the Cafeteria Fund (utilities, janitorial services, insurance, etc.) are not proportionately recognized within the Cafeteria Fund; similarly, the Cafeteria Fund does not recognize a cost for the building space it occupies (no rental-of-facllities expense). 13 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED BUDGETS AND BUDGETARY DATA The School District adopts a budget for the General Fund on the cash basis by function and object; expenditures are controlled by line item, Appropriations lapse at the end of each year and must be reappropriated. The Board of Directors of Carlisle Area School District approves budget transfers between departments within the General Fund. The Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund, presents comparisons of the legally-adopted budget with actual data on a GAAP basis. The latter basis differs from the budgetary basis primarily by the inclusion of certain revenue and expenditure accruals, The following presents a reconciliation of the budgetary (cash) basis to the GAAP basis of reporting for the General Fund: Excess of Revenues Over Expenditures (Budgetary Basis) $560,769 Adjustments To adjust revenue and related receivables and deferred revenue To adjust expenditures and related accounts payable and accrued liabilities Total adjustments GAAP Basis - Excess of Revenues and Other Sources over Expenditures and Other Uses (10,705) 351. 757 341.052 12QL.W. INVESTMENTS Investments in short-term certificates of deposit are stated at cost, which approximates market. PRINCIPLES USED IN DETERMINING THE REPORTING ENTITY The Carlisle Area School District is the lowest level of government which has oversight responsibility and control over all activities related to public school education. The District receives funding from local, state and Federal government sources and must comply with the requirements of these funding-source entities. However, the District is not included in any other governmental "reporting entity" as defined by National Council on Government Accounting (NCGA) Statement 3, "Defining the Governmental Reporting Entity", since Board members are elected by the public and have decision-making authority, the power to designate management, the ability to significantly influence operations and primary accountability for fiscal matters. 14 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 1 - SUHHARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED CASH AND CASH EQUIVALENTS For purposes of the statement of cash flows presented for the Proprietary Fund Type, the School District considers time deposits, certificates of deposit and all highly-liquid debt instruments with original maturity of three months or less to be cash equivalents. TOTAL COLUMNS ON COMBINED STATEMENTS Total columns on the combined financial statements are not necessary for a fair presentation of the financial statements in conformity with generally accepted accounting principles. They are presented to facilitate financial analysis. The aggregation of this data is not comparable to a consolidation as interfund eliminations have not been made. NOTE 2 - DEPOSITS AND INVESTMENTS Deposits are held at various financial institutions and are carried at cost. The carrying amount of deposits is displayed on the combined balance sheet as part of cash and investments, they incl ude cash deposits, certificates of deposit and U.S. Treasury Obligations (for which carrying value equals market value). Carrying Bank Financial Amount .. Balance Institution Insured (FDIC) $ 100,000 $ 100,000 CCNB, N.A. Insured (FDIC) 100,000 100,000 Farmers Trust Company Insured (FDIC) 100,000 100,000 Farmers National Bank Insured (FDIC) 100,000 100,000 First Deposit National Credit Card Bank Insured (FDIC) 99,000 99,000 New America Savings Bank, FSB Insured (FDIC) 99,000 99,000 First Security Federal Uninsured, Savings Bank, Inc. Uncollateralized 1,013,634 1,291,345 (A) CCNB, N.A. Uninsured, uncollateralized 2,744,340 2,744,340 (A) Farmers Trust Company Uninsured, uncollateralized 104.870 104.870 Farmers National Bank TOTAL DEPOSITS ~4.460.844 S4.738.555 15 . . tt CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 2 - DEPOSITS AND INVESTMENTS - CONTINUED The carrying amount of cash and investments as presented on the balance sheet includes petty cash of 595. (A) These uninsured and uncollateralized deposits are secured by collateral pools pledged by the issuing financial institution in accordance with Act 72 of 1971. Act 72 is an act standardizing the procedures for pledges of assets to secure deposits of public funds with banking institutions pursuant to other laws; establishing a standard rule for the types, amounts and valuations of assets eligible to be used as collateral for deposits of public funds; permitting assets to be pledged against deposits on a pooled basis; and authorizing the appointment of custodians to act as pledgees of assets. "Uncoll ateralized" incl udes any bank balance that is coll ateralized with securities held by the pledging financial institution, Dr by its trust department or agent, but not in the School District's name. Statutes authorize the School District to invest in the following: . U.S. Treasury Bills. . Short-term obligations of the U.S. Government and Federal agencies. . Insured savings and checking accounts and certificates of deposit in banks, savings and loan associations and credit unions. . General obligation bonds of the Federal Government, the Commonwealth of Pennsylvania or any state agency, or of any Pennsylvania political subdivision. . Shares of investment companies whose investments are restricted to the above categories. NOTE 3 - TAXES RECEIVABLE AND ALLOWANCE FOR UNCOLLECTIBLE TAXES Taxes receivable and allowance for uncollectible taxes consisted of the following at June 30, 1993: Allowance for Gross Uncollectible Net lim Amount Taxes Amount Real Estate 5 798,174 5 5 798,174 Occupational, Resident and Per Capita 1,753,464 169,137 1,584,327 Earned Income 668,318 668,318 Real Estate Transfer 37,073 37,073 Occupational PriVilege 31.927 31. 927 TOTALS 13.288.9rf ~ u.....w..w..i CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 3 - TAXES RECEIVABLE AND ALLOWANCE FOR UNCOLLECTIBLE TAXES - CONTINUED Property taxes are levied on August I. Taxes are collected at a 2% discount if paid before October 1 and at a 10% penalty if paid after the due date of November 30. Taxes are recorded as revenues by the School District when received from the tax collector, and proper accruals are recorded at year end. The allowance for uncollectible taxes is based upon taxes that will not be received within 60 days. NOTE 4 - INTERFUND ACCOUNTS Individual fund receivable and payable balances at June 30, 1993, are as follows: The value of fixed assets was determined by cost plus capital outlay. A sUlllllary of changes in fixed assets for the year ended June 30, 1993, is as follows: Transfers and Additions Disoosals fllM Interfund Receivables Genera 1 Special revenue Capital projects Enterprise Trust and agency Student activity Payro 11 TOTALS $ 61,949 95,733 1157.682 NOTE 5 - FIXED ASSETS General Fund Land and improvements Buildings Construction-in-progress Furniture and equipment Office machines Audio-visual equipment Books July 1, 1992 $ 1,080,852 35,028,732 1,334,597 281,131 1,085,919 561. 404 ~39.372.635 Cafeteria Fund Furniture and equipment $ 526,744 Accumulated depreciation (482.193) ~ Interfund Pavables $ 95,733 17,589 43,646 347 367 1.157 .68~ June 30, 1993 $ $ $ 1,080,852 35,028,732 47,878 1,524,614 281,131 I,OB5,919 561.404 47,878 190,017 ~237.89.i s ~ $ 3,165 (13.852) ~JJO.687) S $ $ 529,909 (496.045) ) 33.86~ CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 6 - DEFERRED REVENUE Deferred revenue consisted of the following at June 30, 1993: Genera 1 IWl EnterDrise Delinquent taxes Federal subsidies $2,280,948 6.883 ~2.287 .83l $ $2,280,948 11.974 18.857 TOTAL ~ ~2.299.805 NOTE 7 - LONG-TERM DEBT CHANGES IN LONG-TERM DEBT The following is a summary of debt transactions of the Carlisle Area School District for the year ended June 30, 1993: Balances Balances July 1, Debt Debt June 30, 1992 Issued Retired 1993 General Obligation Bonds Series of 1988 $ 3,745,000 $ $3,745,000 $ Series of 1992 8,990,000 925,000 8,065,000 Series of 1993 5,385,000 5,385,000 General Obligation Notes Series of 1992 600.000 135.000 465.000 TOTALS J13.335.000 $5.385.000 ,$4.805.000 ~ MATURITIES OF LONG-TERM DEBT The following is a schedule by years and in the aggregate of minimum debt service requirements as of June 30, 1993: Genera 1 Genera 1 Obligation ObliQation Bonds Notes Year Ending Series Series Series June 30 of 1992 of 1993 of 1992 Total 1994 $1,359,260 $ 203,741 $157,883 $ 1,720,884 1995 1,053,842 844,780 162,348 2,060,970 1996 398,441 1,673,317 168,045 2,239,803 1997 458,185 1,776,985 2,235,170 1998 1,983,885 186,338 2,170,223 Later years 4.675.442 1. 439.385 6.114.827 TOTAL MINIMUM PAYMENTS ~9.929.055 ~ ~488.276 ~ Minimum debt service requirements include interest expense of $2,626,877. 18 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 8 - GENERAL OBLIGATION BONDS PAYABLE SERIES OF 19Q1i On April 15, 1988, the School District issued General Obligation Bonds - Series of 1988, in the aggregate principal amount of $9,980,000. The proceeds of the Bonds were used to finance the additions and renovations to the Carlisle High School, the Crestview Elementary School, the Hount Holly Springs Elementary School and the North Dickinson Elementary School. The proceeds were also used to finance other alterations and improvements to all school buildings, including but not limited to asbestos removal. On February 15, 1992, $6,010,000 of the $9,755,000 bonds outstanding were defeased. On April 13, 1993, the remaining outstanding balance of $3,625,000, plus accrued interest of $26,199, were called with proceeds from issuance of the General Obligation Bonds - Series of 1993 (See Note 8). HRIES OF 1992 On February 15, 1992, the School District issued General Obligation Bonds - Series of 1992, in the principal amount of $9,400,000. The proceeds were used to redeem the remaining outstanding balance of the Series of 1985 Bonds as well as $6,010,000 of the Series of 1988 Bonds. Principal installments ranging from $410,000 to $1,895,000 are due through September 1, 2000; interest rates vary from 3.00% to 5.20%. SERIES of 1993 On April 13, 1993, the School District issued General Obligation Bonds - Series of 1993, in the aggregate principal amount of $5,385,000. The proceeds were used to redeem the remaining balance of the Series of 1988 Bonds. The remaining proceeds, net of bond issuance costs, are to be used to finance the 1993 Capital Project Plan. This Plan includes the replacement of a boiler and certain heating and ventilation equipment in the Bel Air Elementary School, replacement of ancillary boiler in Carlisle High School, the acquisition of modular classroom buildings, including related equipment, fixtures and furnishings therefore, and to landscape and otherwise improve related school grounds of the District. Interest, at rates ranging from 2.25% to 4.30% per annum, is payable semi-annually on Harch 1 and September 1. Bonds in various principal amounts mature through September 1, 2001. 19 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 . NOTE 9 - GENERAL OBLIGATION NOTES SERIES OF 1992 On April 10, 1992, the School District issued General Obligation Notes - Series of 1992, in the principal amount of S600,000 for the purpose of refunding the S600,OOO General Obligation Notes - Series of 1990. The issue consists of four notes which mature annually in amounts ranging from S135,OOO to S165,OOO with final maturity on September I, 1995. The notes yield interest from 2.69% to 3.69%. NOTE 10 - ADVANCED REFUNDING OF SCHOOL REVENUE BONDS - SERIES OF 1964 AND GENERAL OBLIGATION BONDS - SERIES OF 1977 On November IS, 19B5, the School District Issued General Obligation Bonds - Series of 1985. The proceeds of the Bonds were used as part of a refinancing plan to refund the Carlisle Area School Districts' General Obligation Bonds - Series of 1977 and to refund the Carlisle Area Joint School Authority School Revenue Bonds - Series of 1964. The net proceeds of the 19B5 issue have been deposited In Irrevocable trusts and invested in U.S. Treasury obligations which, together with interest income earned thereon, will be sufficient to redeem all General Obligation Bonds - Series of 1977, including interest and executory costs. The School Revenue Bonds - Series of 1964 were completely redeemed as of June 30, 1993. At June 30, 1993, the outstanding balances of the General Obligation Bonds - Series of 1977 and School Revenue Bonds - Series of 1964 are S2,230,OOO and S-O-, respectively. NOTE 11 - ADVANCED REFUNDING OF GENERAL OBLIGATION BONDS - SERIES OF 19BB . Februarv 15. 1992 On February IS, 1992, the School District issued S9,400,OOO in General Obligation Bonds (See Note 8). The net proceeds of S6,344,019 (after payment of bond issuance costs and payment to call 1985 Series Bonds) were used to purchase U.S. Government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for debt service payments until the bonds are called on March 1, 1993. As a result, a portion (S6,OI0,OOO) of the 198B Series Bonds are considered defeased and the liability for those bonds has been removed from the General long-Term Debt Account Group. 20 CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 NOTE 11 - ADVANCED REFUNDING OF GENERAL OBLIGATION BONDS - SERIES OF 1988 - CONTINUED February 15. 1992 - Continued The advance refunding reduced the School District's debt service payments over the next 9 years by approximately $401,155 and resulted in an economic gain (difference between the present values of the old and new debt service payments) of $3B3,046. Aorll 13. 1993 On April 13, 1993, the School District issued $5,3B5,OOO in General Obligation Bonds (See Note 8). The net proceeds of 53,651,199 (after payment of bond issuance costs and transfer of monies to fund the 1993 Capital Project Plan) were used to call all remaining General Obligation Bonds - Series of 1988. The redemption of these bonds reduced the School District's debt service payment over the next three years by approximately $207,7B9 and resulted in an economic gain (difference between the present values of the old and new debt service payments) of 5202,541. NOTE 12 - DEFINED-BENEFIT PENSION PLAN The School District participates in the state-wide Publ ic School Employees Retirement System (the System). The School District's payroll for the year ended June 30, 1993, for covered employees was $16,882,436; the District's total payroll was $16,927,631. All full-time District employees are eligible to participate in the System. Employees are entitled to monthly retirement benefits upon reaching (a) age 62; (b) age 60 with 30 or more years of service or (c) 35 or more years of service regardless of age. The Pennsylvania Public School Employee's Retirement Code (lithe Code"), currently permits District employees with at least 30 years of credited service to retire without a reduction in benefits. This provision does not require a minimum age in conjunction with length of service to be eligible for full benefits. Such benefits are generally equal to 2 percent of the employee's final average salary (as defined) multiplied by the number of years of credited service. After completion of 10 years of service, an employee's right to the defined benefits is vested and early retirement benefits may be elected. The System also provides for death benefits and disability retirement benefits. 21 Ie .;JI CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 3D, 1993 NOTE 12 - DEFINED-BENEFIT PENSION PLAN - CONTINUED The contribution policy is set by the Code, and requires contributions by active employees, districts and the Commonwealth, The rate of contribution for most active employees is set by law at 5.25 percent of the employee's compensation. For employees joining the System on or after July 22, 1983, the rate of contribution is 6.25 percent. The contributions required of districts and the Commonwealth are based upon an actuarial valuation computed as a percentage of the total compensation of all active districts during the period for which the amount is determined. The combined amount required from the districts and the Commonwealth was 14.24 percent of covered payroll for all active districts for the year ended June 30, 1993. The districts and the Commonwealth share such cost equally. The contribution requirement for the year ended June 3D, 1993, was $2,135,182, which consisted of $1,194,228 from the District and matched by the Commonwealth and $940,954 from the employees. These contributions represented 7.07 percent and 5.57 percent of covered payroll, respectively. The pension benefit obligation is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and any step-rate benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among PERS and districts. The system-wide pension benefit ob1 igation at June 30, 1992, the date of the latest actuarial valuation, was $22.9 billion. The System's net assets available for benefits on that date (valued at cost) were $19.6 billion, leaving an unfunded pension 'benefit obligation of $3.3 billion. The System held no securities of the District or other related parties during the year or as of the close of the fiscal year. The District's contribution represented less than 1 percent of total contributions required of all participating entities. Ten-year historical trend information showing the System's progress in accumulating sufficient assets to pay benefits when due is presented in the System's June 3D, 1992, comprehensive annual financial report. 22 . CARLISLE AREA SCHOOL DISTRICT NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1993 . . NOTE 13 - COHHITMENT - 1993 CAPITAL PROJECT PLAN The School District Is currently Involved In the Capital Project Plan of 1993 (See Note 8 - Series of 1993). The total estimated cost to complete the Plan is approximately $1,500,000. As of June 30, 1993, the School District was committed to approximately $1,123,974 of the total estimated amount. NOTE 14 - UNCERTAINTY . The School District has been operating since July 1, 1992, without a contract with the teachers. Negotiations between the Carlisle Area School District Board of Directors (CASD) and the Carlisle Area Education Association (CAEA) have not been completed. The current CASD proposal offers no retro-active payment of salary or salary based benefits which creates no additional liability for the 92-93 fiscal year. The best offer proposal by the CAEA does contain a retro- active payment of salary and salary based benefits thereby creating a potential liability of $1,120,286 for the 92-93 fiscal year. Group Insurance benefits have been expended and are reflected in this statement as part of the status-quo work provision between the CASD and CAEA. . . . . . . ,. 23 ..,.."'*1;:...,-.... SUPPLEMENTAL INFORMATION ,.-,'.-,.,.,,- -j~-, ,,,~,".- BOYER & RITTER C :EHTIFIED Pl 'BLI<: ;\C:C:Ol ';\:T..\;\lTS Reoort of Indeoendent Certified Public Accountants on Suoolemental Information Board of Directors Carlisle Area School District Carlisle, Pennsylvania Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole of Carlisle Area School District for the year ended June 30, 1993, which are presented in the preceding section of this report. The supplemental information presented hereinafter is presented for purposes of additional analysts and is not a required part of the general purpose financial statements. Such information has been subjected to the audit procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole. Our report on the basic financial statements refers to contract negotiations described in Note 14 to the financial statements, the outcome of which cannot presently be determined. Accordingly, no provision for any liability that may result has been made in the financial statements. 8r/~ September 1, 1993 Camp Hill, Pennsylvania 24 CARLISLE AREA SCHOOL DISTRICT AGENCY FUNDS COMBINING BALANCE SHEET JUNE 30, 1993 ASSETS PAYROLL STUDENT TOTAL l4ITHHOLDINGS ACTIVITY Cash 545.709 $1.580 544.129 TOTAL ASSETS j45.709 1L.W ~ LIA8ILITIES Accounts ~ayable 5 3,397 $ - $ 3,397 Due to ot er funds 714 367 347 Payroll taxes and withholdings 1,213 1,213 Due to student groups 40.385 40.385 TOTAL LIABILITIES 1.45.709 1L.W ~ . 25 . CARLISLE AREA SCHOOL OISTRICT GENERAL FUND SCHEDULE OF REVENUES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIAHCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE\ REVENUES Taxes Real estate $10,3B5,400 $10,244,421 $(140,979) Per capita 86,000 89,477 3,477 Resident 87,000 90,331 3,331 Earned income 1,895,000 1,903,389 8,389 Real estate transfers 245,000 237,110 (7,890) Occupation 2,551,500 2,541,942 (9,558) Payments in lieu of taxes 9,000 9,726 726 Delinquent 285,000 449,066 164,066 Occupational privilege 105,000 106,988 1,988 Public utility tax 180.000 210.908 30.908 Total taxes 15,828,900 15,883,358 54,458 State appropriations Basic instructional subsidy 7,809,865 8,068,838 258,973 Homebound instruction 750 1,213 463 Special education 1,374,860 1,375,871 1,011 Transportation 531,850 571 ,952 40,102 Vocational education 64,709 62,891 (1,818) Rentals and Sinking Fund payments 662,379 804,771 142,392 Driver education 9,000 8,750 (250) Medical and dental services 34,218 35,910 1,692 Nurses services 36,000 128,314 92,314 Social security 622,180 647,335 25,155 Tuition - Section 1305 and 1306 15.000 14.224 (776) Total state appropriations 11,160,811 11,720,069 559,258 Federal appropriations Federally-affected areas 295,000 262,017 (32,983) Federal programs 671.199 649.312 (21.887) Total Federal appropriations 966,199 911,329 (54,870) Interest 275,000 170,785 (104,215) 26 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF REVENUES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES - CONTINUED Other Tuition 35,000 45,246 10,246 Rent of school facilities 30,000 28,140 (1,860) Gifts, bequests and endowment earnings 28,000 22,693 (5,307) Miscellaneous 800 7,352 6,552 Sale of fixed assets 1,200 1,200 Athletics 25,000 38,254 13,254 Refunds of prior year's expenses 53.206 53.206 Total other 118.800 196.091 77.291 TOTAL REVENUES ~28.349. 7\,2 ~ 1..llLm 27 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLEl EXPENDITURES INSTRUCTIONAL Regular programs Salaries $ 9,884,815 $ 9,721,141 $ 163,674 Employee benefits 2,800,000 2,749,533 50,467 Purchased services Professional and technical 16,200 19,364 (3,164) Property 41 ,030 46,756 (5,726) Other 33,616 49,827 (16,211) Supplies 367,726 322,982 44,744 Property 111. 976 110.711 1. 265 Total regular programs 13,255,363 13,020,314 235,049 Spechl programs Salaries 1,865,503 1,477,646 387,857 Employee benefits 75,000 413,490 (338,490) Purchased services Professional and technical 50,000 616,693 (.566,693 ) Property 8,500 3,546 4,954 Other 616,100 74,275 541,825 Supplies 46,300 44,780 1,520 Property 9.450 7.987 1.463 Total special programs 2,670,853 2,638,417 32,436 Vocational education programs Salaries 1,000,795 991,101 9,694 Employee benefits 255,600 271 ,941 (16,341) Purchased services Property 9,000 8,152 848 Other 150 9,774 (9,624) Supplies 102,952 93,721 9,231 Property 75.220 45.990 29.230 Total vocational education programs 1 ,443,717 1,420,679 23,038 28 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) INSTRUCTIONAL - CONTINUED Other instructional programs Salaries 364,560 374,217 (9,657) Employee benefits 72,916 105,779 (32,B63) Purchased services Professional and technical 4,250 1,730 2,520 Other 480 134 346 SU~Plles 32,514 13,880 18,634 Ot er objects 30.603 30.603 Total other instructional programs 505,323 495,740 9,583 Adult education programs Salaries 31,245 30,892 353 Em~lOyee benefits 5,744 4,587 1,157 Ot er purchased services 782 508 274 Supplies 2.188 2.619 (431 ) Total adult education programs 39,959 38,606 1,353 Community college education programs 373.100 373.020 80 TOTAL INSTRUCTIONAL 18,288,315 17,986,776 301,539 SUPPORT SERVICES Pupil personnel Sal arles 828,243 781,914 46,329 Employee benefits 175,635 217,037 (41,402) Purchased services Professional and technical 24,348 17,960 6,388 Suppli es 8,552 4,058 4,494 Property 750 750 Other objects 7.364 7.252 112 Total pupil personnel 1,044,892 1,028,971 15,921 29 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLEl SUPPORT SERVICES - CONTINUED Instructional staff Salaries 530,054 4BB,347 41,707 Employee benefits 95,702 134,340 (38,638) Purchased services Professional and technical 8,701 11,429 (2,728) Property 3,000 1,733 1,267 Other 33,9BO 27,313 6,667 Supplies 80,290 76,873 3,417 Property 32,664 36,181 (3,517) Other objects 1.200 3.051 C1.851) Total instructional staff 785,591 779,267 6,324 Administration Salaries 1,066,249 1,039,689 26,560 Employee benefits 298,285 297,263 1,022 Purchased services Professional and technical 191,700 238,579 (46,879) Property 42,287 44,321 (2,034) Other 56,419 48,449 7,970 Supplies 37,816 32,648 5,168 Property 38,954 22,892 16,062 Other objects 15.494 15.472 22 Total administration 1,747,204 1,739,313 7,891 Pupil heal th Salaries 207,151 197,889 9,262 Employee benefits 43,321 57,311 (13,990) Purchased services Professional and technical 11,100 4,481 6,619 Other 550 261 289 Supplies 5,500 3,372 2,128 Property 500 292 20B Total pupil health 268,122 263,606 4,516 30 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE\ SUPPORT SERVICES - CONTINUED Business Salaries 170,624 165,5B6 5,038 Employee benefits 50,000 47,253 2,747 Purchased services Professional and technical 53,310 53,022 288 Property 1,500 250 1,250 Other 750 750 Supplies 4,700 10,325 (5,625) Property 1.877 ll.877) Total business 280,884 278,313 2,571 Operation and maintenance of plant services Salaries 775,348 788,188 (12,840) Employee benefits 19,107 234,615 (215,50B) Purchased services Property 473,659 296,006 177,653 Other 108,160 105,291 2,869 Supplies B59,655 826,492 33,163 Property 12.500 12.643 ll43) Total operation and maintenance of plant services 2,248,429 2,263,235 (14,806) Transportation services Other purchased services 1,239,767 1,238,794 973 Centra 1 Sa lari es 28,134 28,316 (182) Employee benefits 9,612 9,386 226 Purchased services Property 1,000 1,000 Other 600 158 442 Supplies 2,500 2,086 414 Property 5.476 (5.476) Total central 41,846 45,422 (3,576) 31 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) SUPPORT SERVICES - CONTINUED Other support services 42,148 39,612 2,536 Employee benefits Supplies 450 260 190 Total other support services 42.598 39.872 2.726 TOTAL SUPPORT SERVICES 7,699,333 7,676,793 22,540 OPERATION OF NON INSTRUCTIONAL SERVICES Food services Sal aries 22,555 21,624 931 Property 20.000 16.944 3.056 Total food services 42,555 38,568 3,987 Student activities Sal aries 235,078 234,882 196 Employee benefits 60,000 66,921 (6,921) Purchased services Professional and technical 45,820 50,900 (5,080) Property 4,180 3,204 976 Other 54,498 45,937 8,561 Supplies 5,950 5,788 162 Property 21,775 23,851 (2,076) Other objects 25.083 14.756 10.327 Total student activities 452,384 446,239 6,145 Community services Purchased services Professional and technical 400 300 100 Other 2,600 1,280 1,320 Supplies 100 363 (263) Other 80 75 5 Total community services 3.180 2.018 1.162 TOTAL OPERATION OF NONINSTRUCTIONAL SERVICES 498.119 486.825 11. 294 . TOTAL EXPENDITURES ~26.485.767 ~26.150.394 ~ 335.373 32 OTHER FINANCING USES Operating transfers out TOTAL OTHER FINANCING USES BUDGET $11.837.133) ACTUAL $11.829.417) VARIANCE FAVORABLE lUNFAVORABLE\ $7.716 CARLISLE AREA SCHOOL DISTRICT GENERAL FUND SCHEDULE OF OTHER FINANCING USES BUDGET AND ACTUAL YEAR ENDED JUNE 30, 1993 1ll.Jllalll) 1LLm&Z) 1Ll.1i 33 BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS Reoort of Indeoendent Certified Public Accountants on Internal Control Structure-Related Matters Noted in a Financial Statement Audit Conducted in Accordance With Government Auditina Standards Board of Directors Carlisle Area School District Carlisle, Pennsylvania . . We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September 1, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. We conducted our audit in accordance with generally accepted auditing standards; Government Auditina Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget Circular A-128, "Audits of State and local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. In planning and performing our audit of the general purpose financial statements of Carlisle Area School District for the year ended June 30, 1993, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of Carlisle Area School District is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose fi nancia1 statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk .that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. . . . . i i. , ; . 34 Accounttna Controls For the purpose of this report, we have classified the significant internal control structure policies and procedures in the following categories: . Receivables . Cash receipts . Accounts payable . Cash disbursements . Payroll . General ledger Controls Used in Administerlno Como1iance With Laws and Reaulatlons . General controls . Specific controls For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risk. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one Dr more of the specific internal control structure elements does not reduce to a relatively low level, the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. However, we noted certain matters involving the internal control structure and its operation that we have reported to the management of Carlisle Area School District in the attached "Convnents and Suggestions" on page 37. This report is intended for the i nformat i on of the Board of Di rectors, management of Carlisle Area School District, and the Convnonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of public record and its distribution is not limited. ~f~ September I. 1993 Camp Hill, Pennsylvania 35 BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS Reoort of Indeoendent Certified Public Accountants on Comoliance With laws and Reaulations Based on an Audit of the General Puroose Financial Statements Performed in Accordance With Government Auditina Standards Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September I, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. We conducted our audit in accordance with generally accepted auditing standards, Government Auditina Standards, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. Compliance with laws, regulations, contracts, and grants applicable to Carlisle Area School District, is the responsibility of the School District's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material mi sstatement, we performed tests of the School District's compl iance with certain provisions of laws, regulations, contracts, and grants. However, our objective was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests indicate that, with respect to the items tested, Carlisle Area School District complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that Carlisle Area School District had not complied, in all material respects, with those provis ions. This report is intended for the information of the Board of Directors, management of Carlisle Area School District, and the Commonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of public record and its distribution is not limited. September I, 1993 Camp Hill, Pennsylvania ;Jr/~ 36 CARLISLE AREA SCHOOL DISTRICT COMMENTS AND SUGGESTIONS YEAR ENDED JUNE 30, 1993 CONSIDER STAFF INCREASES FOR BUSINESS OFFICE We feel that staff requirements of the business office should be evaluated in light of the day-to-day demands of an entity whose financial dealings, regulatory constraints, and personnel requirements have grown dramatically in recent years. Currently, the Director of Finance is directly involved with routine accounting matters which are more appropriately assigned to individuals who exclusively function in that capacity. We believe the Board of Directors should evaluate the personnel requirements of the business office in order to operate the department more efficiently and effectively. This recommendation is based upon our experience with the volume of transactions being processed by the business office, the size of the Distl'ict's budget, the comparable size of other district business offices and the additional accounting and financial reporting requirements that have been placed on the District in recent years. IMPROVE FILING SYSTEM FOR AUTHORIZATIONS OF VOLUNTARY PAYROLL WITHHOLDINGS During our audit, we noted that employee authorizations for voluntary withholdings are filed in the bl-weekly payroll records. The employer is required to keep on file current written authorizations for all employee deductions to support their wlthholdings. However, the current filing system makes it cumbersome and time-consuming to locate these authorizations. For efficiency, we recommend that written authorizations for all employee deductions be maintained In Individual personnel files. CONSIDER COMPUTERIZING OTHER FUNDS Currently, the School District maintains the General Fund and the Capital Projects Fund on the computer system. However, the remaining funds of the School District are being maintained manually. If the School District were able to automate some Dr all of these other funds, reliable relevant information would be available on a more timely basis. We suggest the District review each of the funds not currently on the District's computer system, and consider automating the accounting records. This should result in more timely financial information compiled in a more efficient manner. 37 BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS ReDort of IndeDendent Certified Public Accountants on Schedule of Federal Financial Assistance Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September I, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. These general purpose financial statements are the responsibility of the management of Carlisle Area School District. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards, Government Auditina Standards, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A-12B, . "Audits of State and Local Governments". Those standards and OMB Circular A-I28 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant .. estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We bel ieve that our audit provides a reasonable basis for our opinion. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of Carlisle Area School District taken as a whole. .. The accompanying Schedule of Federal Financial Assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. tit . ~lfiYIa September I, 1993 Camp Hill, Pennsylvania . 38 ~..-..... "-' ~".. O. CARLISLE AREA SCHOOL DISTRICT SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30, 1993 C PASS PROGRAM FEDERAL THROUGH OR FEDERAL GRANTOR/PASS THROUGH/ SOURCE GRANT CFDA GRANTOR'S AWARD GRANTOR PROGRAM TITLE CODE PER 100 NUMBER NUMBER AMOUNT C' U.S. DeDartment of Education Impact Aid 0 92/93 B4.041 N/A N/A 0 B4.041 N/A N/A 0 Passed through Pennsylvania Department of Education: Chapter 1 Basic * I 92/93 84.010 13-3063 $468,833 Chapter 1 Basic * I 91/92 84.010 13-2063 $420,014 Chapter 1 I 91/92 84.218 104-2063 $ 1,250 0 Chapter 2 I 92/93 84.151 11-3063 $ 30,492 Chapter 2 I 91/92 84. 151 11-2063 $ 30,571 Adult Education Adult Basic Education I 92/93 84.002 36-3056 $ 12,7BO 0 Adult Basic Education I 91/92 84.002 36-2079 $ 11,126 GED I 92/93 84.002 37-3042 $ 16,619 GED I 91/92 B4.002 37-2056 $ 14,536 Vocational Education Consumer and Homemaking I 92/93 84.049 383-3021 $ 38,067 0 Consumer and Homemaking I 91/92 84.049 383-2001 $ 15,540 Consumer and Homemaking I 91/92 84.049 383-2049 $ 10,000 Secondary allocations I 92/93 84.048 380-3006 $ 53,265 Secondary allocations I 91/92 84.048 380-2006 $ 45,996 0 Eisenhower Mathematics and Science Education I 92/93 84. 164 20-3063 $ 15,721 Eisenhower Mathematics and Science Education I 91/92 84.164 20-2063 $ 13,152 Drug-Free Schools I 92/93 84.186 100-3063 $ 35,422 CD Drug-Free Schools I 91/92 84.186 100-2063 $ 35,342 English Literacy Program I 6/93- 12/93 84.223 66-3006 $ 6,656 TOTAL U.S. DEPARTMENT OF EDUCATION <<l 39 o . $256,972 5,045 $ $256,972 5,045 $256,972 5,045 $ TOTAL RECEIVED (REFUNDED) IN FISCAL YEAR ACCRUED (DEFERRED) REVENUE AT REVENUE ~ULY 1. 1992 RECOGNIZED ACCRUED (DEFERRED) REVENUE AT ~XPENDITURES ~UNE 30. 1993 351,625 394,232 394,232 42,607 105,003 32,836 72,167 72,167 1,250 1,250 1,250 27,443 30,492 30,492 3,049 3,048 3,057 (9) (9) 9,372 11,488 11,488 2,116 1,103 1,103 12,187 12,916 12,916 729 2,907 (2,907) (2,907) . 25,378 32,579 32,579 7,201 1,659 1,659 742 (1,066) 1,808 1,808 42,612 51,397 51,397 8,785 . 7,557 7,557 14,149 15,278 15,278 1,129 1,315 1,315 .. 8,879 5,255 3,624 3,624 31,880 24,997 24,997 (6,883) .. 907,219 54,623 911,329 911,329 58,733 . 40 CARLISLE AREA SCHOOL DISTRICT SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE YEAR ENDED JUNE 30, 1993 FEDERAL GRANTOR/PASS THROUGH/ GRANTOR PROGRAM TITLE U.S. Deoartment of Aoriculture Passed through Pennsylvania Department of Education: School Breakfast Program National School Lunch Program National School Lunch Program Special Milk Program National School Lunch Program National School Lunch Program School Breakfast Program Special Milk Program National School Lunch Program National School Lunch Program Passed through Pennsylvania Department of Agriculture Food Distribution (a) TOTAL U.S. DEPARTMENT OF AGRICULTURE TOTAL FEDERAL FINANCIAL ASSISTANCE PASS FEDERAL THROUGH SOURCE GRANT CFDA GRANTOR'S CODE PERIOD NUMBER NUMBER PROGRAM OR AWARD AMOUNT I (F) 92/93 10.553 N/A N/A I (F) 92/93 10.555 N/A N/A I (S) 92/93 N/A N/A N/A I (F) 92/93 10.556 N/A N/A I (S) 92/93 N/A N/A N/A I (F) 91/92 10.555 N/A N/A I (F) 91/92 10.553 N/A N/A I (F) 91/92 10.556 N/A N/A I (S) 91/92 N/A N/A N/A I (S) 91/92 N/A N/A N/A I Source Codes: 0 - Direct Funding I - Indirect Funding (F) - Federal Share (S) - State Share 92/93 10.550 N/A N/A Legends: (a) Donated commodities valued at local market values. (b) Total amount of commodities received from Department of Agriculture. (c) Beginning inventories at July 1, 1992. (d) Total amount of commodities used. (e) Ending inventories at June 30, 1993. * Major program. 41 TOTAL RECEIVEO (REFUNOED) IN FISCAL VEAR ACCRUED (DEFERRED) REVENUE AT REVENUE JUL V I. 1992 RECOGNIZED ACCRUED (DEFERRED) REVENUE AT JUNE 30. 1993 EXPENDITURES 22,377 27,106 27,106 4,729 167,862 198,180 198,180 30,318 22,764 26,638 26,638 3,874 4,736 5,647 5,647 911 2,384 2,894 2,894 510 28,110 28,110 4,336 4,336 897 897 2,691 2,691 498 498 (b) 47.630 304.285 ~ (c) (14.945) 50.601 (d) 50.601 (e) (11.974) 31 I. 066 28.368 1}.222.395 ULJJll $1,222,395 (29.532) 1}.192.863 21.587 311.066 ~ 76.2tQ 11.222.395 Test of 50% Rule: Total Expenditures Less State Expenditures Total Federal Expenditures Programs Selected for Testing Chapter 1 Basic Impact Aid $ 466,399 262.017 ~ 728.4l2/$1,192,863. ~% 42 . . . BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS ~eoort ~f I:ldeoe:~e~lt ce;tified Public Accountants on the In er;d Co r St ucture Used in Administerina eral Financial Assistance Proarams Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September I, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. We have also audited Carlisle Area School District's compliance with requirements applicable to major federal financial assistance programs and have issued our report thereon dated September I, 1993. We conducted our audit in accordance with generally accepted auditing standards, Government Auditina Standards, issued by the Comptroller General of the United States, and Office of Management and Budget (OMB) Circular A-128, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the School District complied with laws and regulations, noncompliance with which would be material to a major Federal financial assistance program. In planning and performing our audit for the year ended June 30, 1993, we considered the School District's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the School District's general purpose financial statements and on the compliance of the agency, with requirements applicable to major programs and to report on the internal control structure in accordance with OMB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to federal financial assistance programs. We have addressed policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated September I, 1993. 43 . . Selection of attendance areas . Annual-needs assessment . Selection of participants . Maintenance of effort . Comparabil i ty . Nonsupplanting . Participation of private schools . Consultation with parents . School-wide projects . Evaluation . Program improvements . Availability and carry-over of funds . Record retention . Other grant requirements and cost principles The management of Carlisle Area School District is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that Federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering Federal financial assistance programs in the following categories: Controls Used in Administerina Federal Proarams General Reouirements . Political activity . Davis-Bacon Act . Civil rights . Cash management . Relocation assistance and real property acquisition . Federal financial reports . Allowable costs/cost principles . Drug-Free Workplace Act . Administrative requirements Soecific Reauirements Chapter 1 . 44 ',. . Impact Aid . Types of services allowed or unallowed . Eligibil ity . Hatching, level of effort, and/or earmarking requirements . Special reporting requirements . Special tests and provisions ~laims for Advances and Reimbursements Amounts Claimed or Used for Hatchina For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1993, Carl isle Area School District expended 61.06% of its total Federal financial assistance under a major Federal financial assistance prograll) and the following nonmajor Federal financial assistance program: Impact Aid We performed tests of controls, as required by OHB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we have considered relevant to preventing or detect ing materi al noncompl i ance wi th speci fic requi rements, general requi rements and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to the School District's major Federal financial assistance program, which is identified in the accompanying Schedule of Federal Financial Assistance, and the aforementioned nonmajor program. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the School District's ability to administer Federal financial assistance programs in accordance with applicable laws and regulations. Our audit procedures revealed inadequate controls and failure to adhere to established control policies and procedures relating to the accounting records and Federal program reports (See Schedule of Findings and Questioned Costs on page 52). 45 . . . A material weakness Is a reportable condition In which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a Federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe the reportable condition described above is not a material weakness. This report is intended for the information of the Board of Directors, management of Carlisle Area School District, and the Commonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of public record and its distribution is not limited. iJrnr I ~ September 1, 1993 Camp Hill, Pennsylvania 46 ': - . .. . . BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS Reo~rt of \rdeoe;;eni ce;tified Public Accountants on Como ianc~ "it~ -F,e ene al Reauirements Aoolicable ta eder 1 inancial Assistance Proarams Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September I, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. We have applied procedures to test Carlisle Area School District's compliance with the following requirements applicable to its Federal financial assistance programs, which are identified in the schedule of Federal financial assistance, for the year ended June 30, 1993: . Political activity . Davis-Bacon Act . Civil rights . Cash management . Relocation assistance and real property acquisition . Federal financial reports . Allowable costs/cost principles . Drug-free Workplace Act . Administrative requirements Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits of State and Local Governments". Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the School District's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that Carlisle Area School District had not complied, In all material respects, with those requirements. However, the results of our procedures disclosed Immaterial Instances of noncompliance with those requirements, which Is discussed In the accompanying Schedule of Findings and Questioned Costs. 47 This report is intended for the information of the Board of Directors, management of Carlisle Area School District, and the Commonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of publ ic record and its distribution is not limited. Ifr I' tfJjIa September I, 1993 Camp Hill, Pennsylvania 4B "'.,.... ..-"...... ..,.....;--. . BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS . Reoort of Indeoendent Certified Public Accountants on Comoliance With Soecific Reauirements Aoolicable to Maior Federal Financial Assistance Proarams . Board of Directors Carlisle Area School District Carlisle, Pennsylvania . . We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September I, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. We have also audited Carlisle Area School District's compl1ance with the requirements governing types of services allowed or unallowed: eligibility: matching, level of effort, or earmarking; reporting: special provisions: claims for advances and reimbursements: and amounts claimed or used for matching that are applicable to each of its major Federal financial assistance programs, which are identified in the accompanying schedule of Federal financial assistance for the year ended June 3D, 1993. The management of Carlisle Area School District is responsible for the School District's compl1ance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. We conducted our audit in accordance with generally accepted auditing standards: Government Auditina Standards, issued by the Comptroller General of the United States: and Office of Management and Budget Circular A-128, "Audits of State and Local Governments". Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompl1ance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the School District's compl1ance with those requirements. We believe that our audit prOVides a reasonable basis for our opinion. The results of our audit procedures disclosed immaterial instances of noncompliance with the requirements referred to above, which are described in the accompanying Schedule of Findings and Questioned Costs. We considered these instances of noncompl1ance in forming our opinion on compl1ance, which is expressed in the following paragraph. In our opinion, Carlisle Area School District complied, in all material respects, with the requirements governing types of services allowed Dr unallowed: eligibility: matching, level of effort, or earmarking; reporting: special provisions: claims for advances and reimbursements: and amounts claimed or used for matching that are applicable to each of its major Federal financial assistance programs for the year ended June 30, 1993. . . . . . . 49 ~/~ This report is intended for the information of the Board of Directors, management of Carlisle Area School District, and the Commonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of public record and its distribution is not limited. September I, 1993 Camp Hill, Pennsylvania 50 BOYER & RITTER CERTIFIED PUBLIC ACCOUNTANTS ReDort of Indeoendent Certified Public Accountants on ComD1iance With Soecific Reauirements ADD1icab1e to Nonmaior Federal Financial Assistance Proaram Transactions Board of Directors Carlisle Area School District Carlisle, Pennsylvania We have audited the general purpose financial statements of Carlisle Area School District as of and for the year ended June 30, 1993, and have issued our report thereon dated September 1, 1993. In our report, explanatory language was added due to the uncertainty regarding the negotiations of the teachers' employment contract. In connection with our audit of the 1993 general purpose financial statements of Carlisle Area School District and with our consideration of the School District's internal control structure used to administer Federal financial assistance programs, as required by Office of Management and Budget Circular A-128, "Audits of State and Local Governments", we selected certain transactions applicable to certain nonmajor Federal financial assistance programs for the year ended June 30, 1993. As required by OMB Circular A-128, we have performed auditing procedures to test compliance with the requirements governing types of services allowed Dr unallowed, eligibility, and any special provisions that are applicable to those transactions. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the School District's compliance with these requirements. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements 1 isted in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that Carlisle Area School District had not complied, in all material respects, with those requirements. Also, the results of our procedures did not disclose any immaterial instances of noncompliance with those requirements. This report is intended for the information of the Board of Directors, management of Carlisle Area School District, and the Commonwealth of Pennsylvania, Office of the Budget. However, this report is a matter of public record and its distribution is not limited. September 1, 1993 Camp Hill, Pennsylvania &ol!(!dla 51 -- CARLISLE AREA SCHOOL DISTRICT SCHEOULE OF FINDINGS AND QUESTIONED COSTS FOR FEDERAL PROGRAMS YEAR ENDED JUNE 30, 1993 PROGRAM Chapter 1 FINDINGS/NONCOMPLIANCE Criteria: Students receiving (1) a grade below 45 percent on the SAT In second through fifth grade or below 50 percent In sixth through eighth grade, (2) a grade lower than normal on the IRI test; or (3) based on teacher recommendation, are eligible for program participation. Condition: In our testing of the student selection records Involving 16 students, we found two (2), or 13% of those tested did not have any valid reason for exclusion from the program. Effect: The two students not selected for the program may have been in need of remedial attention In reading; however, the students did not receive any such attention as they were not evaluated for placement In same. There are no questioned costs. Cause: Inability of designated staff to operate effective internal control procedures. Recommendations: Management should establish and implement effective Internal control procedures to help assure that all students el igible for Chapter 1- who are not placed In the program have a documented reason for nonpartlcipation, available for examination upon request. 52 CARLISLE AREA SCHOOL DISTRICT STATUS OF PRIOR YEAR'S SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR FEDERAL PROGRAMS YEAR ENDED JUNE 30, 1993 FINDING 1: Condition The Reconciliation of Cash on Hand Quarterly Report (PDE-2030) for the quarter ended June 30, 1992, filed for ESEA Chapter 1 was understated by 5520.40. DisDosition During the fiscal year ended June 30, 1993, the School District implemented new procedures for controlling the reconciliation of the PDE-2030 reports with the general ledger. The School District has one person specifically designated as the Administrator of Federal Programs. This person is responsible for all filings of Federal Reports and any reconciliations of the reports with the general ledger. As of June 30, 1993, the PDE-2030 reports were reconciled with the June 30 general ledger, and all differences were due the accruals, which are not reported on the PDE-2030 since these reports are on cash basis reporting. FINDING 2: Condition The Reconciliation of Cash on Hand Quarterly Report (PDE-2030) for the quarter ended June 30, 1992, filed for EESA Title II Basic was overstated by 54,216.58. DisDosition As explained in FINDING 1, the School District has implemented procedures that provide for proper reporting and reconciliations for all Federal Programs. As of June 30, 1993, the EESA Title II Basic was properly reconciled to the general ledger. FINDING 3: The Reconciliation of Cash on Hand Quarterly Report (PDE-2030) for the quarter ended June 30, 1992, filed for Drug-Free Schools was understated by 5514.05. DisDosition As explain in FINDING 1, the School District has implemented procedures that provide for proper reporting and reconciliations for all Federal Programs. As of June 30, 1993, the Drug-Free Schools Program was properly reconciled to the general ledger. 53 CARLISLE AREA SCHOOL DISTRICT STATUS OF PRIOR YEAR'S SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR FEDERAL PROGRAMS YEAR ENDED JUNE 30, 1993 FINDING 4: The general ledger was understated by $5,844.41 in the ESEA Chapter 1 accounts. DiSDos1t1on During the fiscal year ended June 30, 1993, the benefits charged to any Federal program was done monthly. Therefore, as of June 30, 1993, the Chapter 1 program did accurately reflect the total expenditures incurred to date. FINDING 5: The School District failed to adhere to reporting requirements evidenced by submitting reports on an untimely basis. The Final Expenditure Record and Report (PDE-2011/2012) for Adult Basic Education and GED was not filed as of September 4, 1992. Disoosition The School District has assigned one individual the responsibility of ensuring all Federal program reports are filed on a timely basis. During the fiscal year ended June 3D, 1993, all reports appeared to be filed timely and accurately. 54