Audit
ANNUAL FINANCIAL REPORT NEWTON INDEPENDENT SCHOOL DISTRICT Newton, Texas For the Year Ended August 31, 2012
AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
INTRODUCTORY SECTION
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TABLE OF CONTENTS PAGE Introductory Section: Certificate of Board ................................................................................................4
EXHIBIT
Financial Section: Independent Auditors’ Report on Financial Statements .......................................... 6 Management's Discussion and Analysis ................................................................. 8 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Assets ............................................................................ 14 Statement of Activities .............................................................................. 15 Fund Financial Statements: Balance Sheet - Governmental Funds ....................................................... 16 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets ......................................... 17 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds ................................................ 18 Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities .................................................................. 19 Statement of Fiduciary Assets and Liabilities - Agency Funds ................... 20 Notes to the Financial Statements ............................................................ 21 Required Supplementary Information: Budgetary Comparison Schedules: General Fund ........................................................................................... 33 Combining Statements as Supplementary Information: Combining Balance Sheet - Nonmajor Governmental Funds ........................... 35 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds ..................................... 36 Special Revenue Funds: Combining Balance Sheet - Nonmajor Special Revenue Funds .................. 37 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue Funds ............................ 42 Other Supplementary Information Section: Schedule of Delinquent Taxes Receivable ............................................................. 48 Schedule of Expenditures for Computation of Indirect Cost for 2012 - 2013 ............................................................................. 50 Fund Balance and Cash Flow Calculation Worksheet (Unaudited) General Fund..................................................................................................... 51 Budgetary Comparison Schedules Required by the Texas Education Agency: National School Breakfast and Lunch Program .............................................. 52 Debt Service Fund .......................................................................................... 53 Independent Auditors' Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards .......................... 54 Independent Auditors' Report on Compliance with Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance with OMB Circular A-133 ............................................................ 55 Schedule of Findings and Questioned Costs ......................................................... 57 Summary Schedule of Prior Audit Findings .......................................................... 58 Corrective Action Plan .......................................................................................... 59 Schedule of Expenditures of Federal Awards ........................................................ 60 Notes to the Schedule of Expenditures of Federal Awards .................................... 61 Schedule of Required Responses to Selected School First Indicators .................... 62 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
A-1 B-1 C-1 C-1R C-2 C-3 E-1
G-1 H-1 H-2 H-3 H-4 J-1 J-2 J-3 J-4 J-5
K-1 L-1
FINANCIAL SECTION
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CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees: We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Newton Independent School District as of and for the year ended August 31, 2012, which collectively comprise the District's basic financial statements as listed in the table of contents. These financial statements are the responsibility of Newton Independent School District's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free 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 opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of Newton Independent School District as of August 31, 2012 and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America In accordance with Government Auditing Standards, we have also issued our report dated January 22, 2013, on our consideration of Newton Independent School District's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and the budgetary information on pages 8 through 12 and page 33 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquires of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. 6 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Newton Independent School District’s financial statements as a whole. The combining and individual major fund financial statements and required TEA schedules are presented for purposes of additional analysis and are not a required part of the financial statements. The accompanying schedule of expenditures of federal awards required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, and is also not a required part of the financial statements. The combining and individual nonmajor fund financial statements, required TEA schedules, and the schedule of expenditures of financial awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information, except for that portion marked “unaudited” on which we express no opinion, is fairly stated in all material respects in relation to the financial statements as a whole.
____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013
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NEWTON INDEPENDENT SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS This section of Newton Independent School District's annual financial report presents our discussion and analysis of the District's financial performance during the fiscal year ended August 31, 2012. Please read it in conjunction with the District's financial statements, which follow this section. FINANCIAL HIGHLIGHTS
The District's total combined net assets were $6,971,468 at August 31, 2012.
During the year, the District's expenses were $667,430 less than the $12,995,543 generated in taxes and other revenues for governmental activities.
The general fund reported a fund balance this year of $1,951,024.
OVERVIEW OF THE FINANCIAL STATEMENTS This annual report consists of three parts - management's discussion and analysis (this section), the basic financial statements, and required supplementary information. The basic financial statements include two kinds of statements that present different views of the District:
The first two statements are government-wide financial statements that provide both long-term and short-term information about the District's overall financial status.
The remaining statements are fund financial statements that focus on individual parts of the government, reporting the District's operations in more detail than the governmentwide statements.
The governmental funds statements tell how general government services were financed in the short term as well as what remains for future spending.
Fiduciary fund statements provide information about the financial relationships in which the District acts solely as a trustee or agent for the benefit of others, to whom the resources in question belong.
The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the information in the financial statements. Figure A-1 shows how the required parts of this annual report are arranged and related to one another.
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Figure A-1, Required Components of the District's Annual Financial Report
Figure A-2 Summarizes the major features of the District's financial statements, including the portion of the District government they cover and the types of information they contain. The remainder of this overview section of management's discussion and analysis explains the structure and contents of each of the statements. Government-wide Statements The government-wide statements report information about the District as a whole using accounting methods similar to those used by private-sector companies. The statement of net assets includes all of the government's assets and liabilities. All of the current year's revenues and expenses are accounted for in the statement of activities regardless of when cash is received or paid.
Type of Statements Scope
Required financial statements
Accounting basis and measurement focus
Type of asset/liability information
Type of inflow/outflow information
Government-wide Entire Agency's government (except fiduciary funds) and the Agency's component units Statement of net assets Statement of activities
Accrual accounting and economic resources focus All assets and liabilities, both financial and capital, short-term and longterm
All revenues and expenses during year, regardless of when cash is received or paid
Governmental Funds The activities of the district that are not proprietary or fiduciary Balance sheet Statement of revenues, expenditures & changes in fund balances Modified accrual accounting and current financial resources focus Only assets expected to be used up and liabilities that come due during the year or soon thereafter; no capital assets included Revenues for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and payment is due during the year or soon thereafter
Fiduciary Funds Instances in which the district is the trustee or agent for someone else's resources Statement of fiduciary net assets Statement of changes in fiduciary net assets Accrual accounting and economic resources focus All assets and liabilities, both shortterm and long-term; the Agency's funds do not currently contain capital assets, although they can All revenues and expenses during year, regardless of when cash is received or paid
The two government-wide statements report the District's net assets and how they have changed. Net assets the difference between the District's assets and liabilities - is one way to measure the District's financial health or position.
Over time, increases or decreases in the District's net assets are an indicator of whether its financial health is improving or deteriorating, respectively.
To assess the overall health of the District, one needs to consider additional nonfinancial factors such as changes in the District's tax base.
The government-wide financial statements of the District include the Governmental activities. Most of the District's basic services are included here, such as instruction, extracurricular activities, curriculum and staff development, health services and general administration. Property taxes and grants finance most of these activities. Fund Financial Statements The fund financial statements provide more detailed information about the District's most significant funds - not the District as a whole. Funds are accounting devices that the District uses to keep track of specific sources of funding and spending for particular purposes.
Some funds are required by State law and by bond covenants.
The Board of Trustees establishes other funds to control and manage money for particular purposes or to show that it is properly using certain taxes and grants.
9
The District has the following kinds of funds:
Governmental funds - Most of the District's basic services are included in governmental funds, which focus on (1) how cash and other financial assets that can readily be converted to cash flow in and out and (2) the balances left at year-end that are available for spending. Consequently, the governmental fund statements provide a detailed short-term view that helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the District's programs. Because this information does not encompass the additional long-term focus of the government-wide statements, we provide additional information at the bottom of the governmental funds statement, or on the subsequent page, that explain the relationship (or differences) between them.
Fiduciary funds - The District is the trustee, or fiduciary, for certain funds. It is also responsible for other assets that - because of a trust arrangement - can be used only for the trust beneficiaries. The District is responsible for ensuring that the assets reported in these funds are used for their intended purposes. All of the District's fiduciary activities are reported in a separate statement of fiduciary net assets and a statement of changes in fiduciary net assets. We exclude these activities from the District's government-wide financial statements because the District cannot use these assets to finance its operations.
FINANCIAL ANALYSIS OF THE DISTRICT AS A WHOLE Net assets. The District's combined net assets were $6,971,468 at August 31, 2012. Table A-1 Newton School District's Net Assets GOVERNMENTAL ACTIVITIES 2012 Current Assets: Cash and cash equivalents Property taxes receivable (net) Due from other government Due to other funds Other assets TOTAL CURRENT ASSETS Noncurrent Assets: Capital assets Less accumulated depreciation TOTAL NONCURRENT ASSETS TOTAL ASSETS
$
2 548 300 1 557 315 157 352 5 500 164 387 4 432 854 25 (13 11 15
255 974 280 713
2011 $
933 967) 966 820
2 462 380 1 518 426 307 473 94 031 4 382 310 25 (13 11 16
215 334 880 263
514 663) 851 161
Current Liabilities: Accounts payable and accrued liabilities Deferred revenue TOTAL CURRENT LIABILITIES Non-Current Liabilities: Debt TOTAL LIABILITIES
754 438 754 438
1 049 944 315 223 1 365 167
7 987 914 8 742 352
8 593 956 9 959 123
Net Assets: Invested in capital assets Restricted Unrestricted TOTAL NET ASSETS
2 901 600 3 469 6 971
2 955 441 2 906 6 304
$
036 982 450 468
$
863 228 947 038
Changes in net assets. The District's total revenues were $12,995,543. A significant portion (24 percent) of the District's revenues come from taxes, (See Figure A-3) 50 percent comes from state aid and formula grants. The total cost of all programs and services was $12,328,113: 48 percent of these costs are for instructional and student services.
10
Table A-2 Change in District's Net Assets GOVERNMENTAL ACTIVITIES 2012 2011 Program Revenues: Charges for services Operating grants and contributions General Revenues: Property taxes State aid - Formula Investment earnings Other TOTAL REVENUES
$
265 958 2 467 919
$
3 114 575 6 500 949 14 866 631 276 12 995 543
Instruction Instructional resources and media services Curriculum dev. and instructional staff dev. Instructional leadership School leadership Guidance, counseling and evaluation services Social work services Health services Student (pupil) transportation Food services Curricular/extracurricular activities General administration Plant maintenance and operation Security and monitoring services Data processing services Community services Debt service Payments to member districts - SSA/other government TOTAL EXPENSES
5 917 153 214 219 597 510 8 145 840 654 552 540 1 131 23 153 104 300 261 12 328
CHANGE IN NET ASSETS
251 993 2 426 216 3 132 147 6 839 595 12 838 472 661 13 135 450
184 299 584 574 349 043 194 518 822 215 647 307 051 203 827 044 517 735 113
6 523 201 220 268 644 540
257 666 244 761 812 761 905 139 220 820 254 686 634 549 309 575 533 1 202 986 35 437 192 510 158 635 722 530 285 329 13 768 783
667 430
Net assets - Beginning NET ASSETS - ENDING
$
6 304 038 6 971 468
(633 333)
$
6 937 371 6 304 038
Table A-3 presents the cost of each of the District's largest functions as well as each function's net cost (total cost less fees generated by the activities and intergovernmental aid). The net cost reflects what was funded by state revenues as well as local tax dollars.
However, the amount that our taxpayers paid for these activities through property taxes was only $3,114,575.
The cost of all governmental activities this year was $12,328,113.
Some of the costs were paid by grants and contributions - $8,968,868. Table A-3 Net Cost of Selected District Functions TOTAL COST OF
NET COST OF
SERVICES 2012 Instruction Plant maintenance and operations
$
5 917 184
SERVICES 2011
$
6 523 257
2012 $
4 682 178
2011 $
5 290 320
1 131 051
1 202 986
1 128 551
1 200 736
Student transportation
840 822
820 254
840 822
754 320
General administration
540 307
575 533
540 307
575 533
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CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets At the end of 2012, the District had invested $11,280,966 in a broad range of capital assets, including land, equipment, buildings, and vehicles. (See Table A-4.) This amount represents a net decrease (including additions, deductions and adjustments) of $599,885 over last year. Table A-4 District's Capital Assets
Land Buildings and improvements Equipment and furniture TOTALS AT HISTORICAL COST Total accumulated depreciation NET CAPITAL ASSETS
$
21 3 25 13 $ 11
GOVERNMENTAL ACTIVITIES 2012 2011 244 067 $ 244 067 104 520 21 104 520 907 346 3 866 927 255 933 25 215 514 974 967 13 334 663 280 966 $ 11 880 851
The District's fiscal year 2012 capital asset spending of $146,217 was for equipment and building improvements. (More information about the District's capital assets is presented in the notes to the financial statements.) Long Term Debt At year-end the District had $7,987,914 in bonds, notes and leases outstanding as shown in Table A-5. More detailed information about the District's debt is presented in the notes to the financial statements. Table A-5 District's Long Term Debt
Leases payable Notes payable Bonds payable TOTAL BONDS AND LEASES PAYABLE
$ $
GOVERNMENTAL ACTIVITIES 2012 2011 100 881 $ 115 517 582 032 698 436 7 305 001 7 780 000 7 987 914 $ 8 593 953
CONTACTING THE DISTRICT'S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the District's finances and to demonstrate the District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the District's Business Services Department.
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BASIC FINANCIAL STATEMENTS
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NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF NET ASSETS August 31, 2012 EXHIBIT A-1 DATA CONTROL CODES 1110 1225 1240 1260 1290 1410 1510 1520 1530 1000 2110 2160 2210 2140 2516 2501 2502 2000 3200 3820 3850 3900 3000
GOVERNMENTAL ACTIVITIES ASSETS Cash and cash equivalents Property taxes receivable (net allowance) Due from other governments Due from other funds Other receivable Prepaid expense Capital Assets: Land Buildings and improvements, net Furniture and equipment, net TOTAL ASSETS
$
244 10 300 736 15 713
LIABILITIES Accounts payable Accrued wages payable Other accrued expense Accrued interest Bond premium Due in one year Noncurrent Liabilities: Due in more than one year TOTAL LIABILITIES NET ASSETS Invested in capital assets, net of related debt Restricted For: State and federal programs Debt service Unrestricted TOTAL NET ASSETS
The accompanying notes are an integral part of this statement. 14 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
2 548 300 1 557 315 157 352 5 500 149 844 14 543 067 655 244 820
109 869 213 229 435 69 495 361 410 626 188 7 361 726 8 742 352 2 901 036
$
531 69 3 469 6 971
391 591 450 468
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF ACTIVITIES For the Year Ended August 31, 2012 EXHIBIT B-1 1 DATA CONTROL CODES 11 12 13 21 23 31 32 33 34 35 36 41 51 52 53 61 71 93 99 TG TP
MT DT IE GC MI TR CN NB NE
FUNCTIONS/PROGRAMS Government Activities: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling, and evaluation services Social work services Health services Student transportation Food service Cocurricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Interest on long-term debt Payments related to shared service arrangements Payments to other governments TOTAL GOVERNMENTAL ACTIVITIES TOTAL PRIMARY GOVERNMENT
3
PROGRAM REVENUES CHARGES OPERATING FOR GRANTS AND SERVICES CONTRIBUTIONS
EXPENSES $
5 917 184
$
-
$
1 235 006
GOVERNMENTAL ACTIVITIES $
(4 682 178)
153 299
-
15 617
(137 682)
214 584 219 574 597 349
-
72 022 150 454 46 713
(142 562) (69 120) (550 636) (233 (8 (107 (840 (5
510 8 145 840 654
043 194 518 822 215
166 465
276 821 37 878 481 820
552 647 540 307
96 993 -
7 892 -
1 131 051
2 500
23 153 104 300
-
31 131 -
95 873
-
112 565
165 862
-
12 328 113
$
265 958
AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
(23 (153 (72 (300
$
203) 827) 913) 517)
16 692 (165 862)
2 467 919
(9 594 236)
2 467 919
(9 594 236)
General Revenues: Property taxes, levied for general purposes Property taxes, levied for debt service Investment earnings Grants and contributions not restricted to specific programs Miscellaneous TOTAL GENERAL REVENUES CHANGE IN NET ASSETS Net assets - Beginning NET ASSETS - ENDING
The accompanying notes are an integral part of this statement. 15
(1 128 551)
-
265 958
222) 194) 640) 822) 930)
(447 762) (540 307)
-
203 827 044 517
12 328 113 $
NET (EXPENSE) REVENUE AND CHANGES IN NET ASSETS
4
2 914 386 200 189 14 866
$
6 500 631 10 261 667 6 304 6 971
949 276 666 430 038 468
NEWTON INDEPENDENT SCHOOL DISTRICT BALANCE SHEET - GOVERNMENTAL FUNDS August 31, 2012 EXHIBIT C-1 10 DATA CONTROL CODES
ASSETS Cash and cash equivalents Taxes receivable, net Due from other governments Due from other funds Other receivables Prepaid expenses TOTAL ASSETS
2110 2160 2170 2210 2300 2000
LIABILITIES Current Liabilities: Accounts payable Accrued wages payable Due to other funds Other accrued expense Deferred revenue TOTAL LIABILITIES
3430 3450 3480 3600 3000 4000
OTHER GOVERNMENTAL FUNDS
GENERAL FUND
1110 1225 1240 1260 1290 1410 1000
FUND BALANCES Non-spendable Fund Balance: Prepaid Expenses Restricted Fund Balances: Restricted for grants Restricted for debt service Unassigned TOTAL FUND BALANCE TOTAL LIABILITIES AND FUND BALANCES
$ 2 224 403 1 360 911 139 765 5 500 46 241 14 543 $ 3 791 363
$
$
$
2 390 180 704 295 899 435 1 360 911 1 840 339
$
14 543
The accompanying notes are an integral part of this statement. 16 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
323 196 17 295 103
897 404 587 899 603 937 390
$
107 479 32 525 196 404 336 408
$
$
-
1 936 481 1 951 024 $ 3 791 363
98 TOTAL GOVERNMENTAL FUNDS
937 390
109 869 213 229 295 899 435 1 557 315 2 176 747
14 543
531 391 69 591 600 982 $
2 548 300 1 557 315 157 352 301 399 149 844 14 543 4 728 753
531 69 1 936 2 552 $
391 591 481 006
4 728 753
NEWTON INDEPENDENT SCHOOL DISTRICT RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS August 31, 2012 EXHIBIT C-1R TOTAL FUND BALANCES - GOVERNMENTAL FUNDS BALANCE SHEET
$
2 552 006
Amounts Reported For Governmental Activities in the Statement of Net Assets are Different Because: Capital assets net of depreciation used in governmental activities are not reported in the funds.
11 265 184
The value of capital assets received included in gains on retirement of capital assets is not reported in the funds.
15 782
Property taxes receivable unavailable to pay for current period expenditures are deferred in the funds.
1 557 315
Payables for debt which are not due in the current period are not reported in the funds.
(7 987 914)
Payables for interest which are not due in the current period are not reported in the funds.
(69 495)
Bond issue are amortized in governmental activity and expensed in the funds. NET ASSETS OF GOVERNMENTAL ACTIVITIES STATEMENT OF NET ASSETS
The accompanying notes are an integral part of this statement. 17 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
(361 410) $
6 971 468
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS For the Year Ended August 31, 2012 EXHIBIT C-2 10 DATA CONTROL CODES
5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0032 0033 0034 0035 0036 0041 0051 0052 0053 0061 0071 0093 0099 6030
GENERAL FUND
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
$
Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Social work services Health services Student transportation Food services Co-curricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Debt service Payments to shared service arrangements Payments to other governments TOTAL EXPENDITURES
1200 0100 3000
Other Financing Sources (Uses): Transfer in Transfers out TOTAL OTHER FINANCING SOURCES (USES) NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
4 451 856
EXCESS REVENUE OVER (UNDER) EXPENDITURES 7915 8925 7080
3 536 763 6 151 000 128 589 9 816 352
$
98 TOTAL GOVERNMENTAL FUNDS
OTHER GOVERNMENTAL FUNDS
435 870 1 818 3 124
241 728 551 520
$
1 078 884
3 7 1 12
972 021 947 940
004 728 140 872
5 530 740
138 127 111 508
233 314 531 536
17 73 108 49
116 191 043 558
155 200 219 558
349 505 574 094
271 8 96 883 25
984 194 044 675 171
204 539 39 940 586 064
476 8 135 883 611
523 194 984 675 235
469 504 1 056 23 165 70 162
017 850 785 203 068 917 604
47 354 33 127 778 261
516 504 1 056 23 165 104 940
371 850 785 203 068 044 865
165 862 9 240 844
95 873 3 111 950
95 873 165 862 12 352 794
575 508
12 570
588 078
(147 184)
317 376 (170 192)
317 376 (317 376)
(147 184)
147 184
428 324 1 522 700 1 951 024
The accompanying notes are an integral part of this statement. 18 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
159 754 441 228 600 982
-
$
588 078 1 963 928 2 552 006
NEWTON INDEPENDENT SCHOOL DISTRICT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For the Year Ended August 31, 2012 NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS
EXHIBIT C-3 $
588 078
Amounts Report For Government Activities in the Statement of Activities ("SOA") are Different Because: Capital outlays are not reported as expenses in the SOA.
129 217
The depreciation of capital assets used in governmental activities is not reported in the funds.
(744 884)
Gains and losses on retirement of property and equipment are not reported in the funds.
15 782
Certain property tax revenues are deferred in the funds. This is the change in these amounts this year.
38 889
Expenses in the SOA not providing current financial resources are not reported as expenses in the funds.
30 117
Repayment of debt is an expenditure in the funds but is not an expense in the SOA.
606 042
Decrease in accrued interest from beginning of period to end of period. CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES STATEMENT OF ACTIVITIES
The accompanying notes are an integral part of this statement. 19 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
4 189 $
667 430
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES AGENCY FUNDS August 31, 2012 EXHIBIT E-1 863 PAYROLL CLEARING FUND
DATA CONTROL CODES 1110 1290 1000
ASSETS Cash and cash equivalents Other receivables TOTAL ASSETS
2160 2170 2190 2000
LIABILITIES Accrued expense Due to other funds Due to student groups TOTAL LIABILITIES
3000
NET ASSETS TOTAL NET ASSETS
$
3 847 1 653 5 500
865 STUDENT CLUB FUND $
5 500 5 500 $
The accompanying notes are an integral part of this statement. 20 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
20 667 20 667
TOTAL AGENCY FUNDS $
109 20 558 20 667 $
-
24 514 1 653 26 167 109 5 500 20 558 26 167
$
-
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The basic financial statements of Newton Independent School District ("the District") have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") applicable to governmental units in conjunction with the Texas Education Agency's Financial Accountability System Resource Guide ("Resource Guide"). The Governmental Accounting Standards Board ("GASB") is the accepted standard setting body for establishing governmental accounting and financial reporting principles. 1.
Reporting Entity The Board of School Trustees ("Board"), a seven-member group, has governance responsibilities over all activities related to pubic elementary and secondary education within the jurisdiction of the District. The Board is elected by the public and has the exclusive power and duty to govern and oversee the management of the public schools of the District. All powers and duties not specifically delegated by statute to the Texas Education Agency ("TEA") or to the State Board of Education are reserved for the Board, and the TEA may not substitute its judgment for the lawful exercise of those powers and duties by the Board. The District receives funding from local, state and federal government sources and must comply with the requirements of those funding entities. However, the District is not included in any other governmental "reporting entity" as defined by the GASB in its Statement No. 14, "The Financial Reporting Entity" and there are no component units included within the reporting entity.
2.
Basis of Presentation, Basis of Accounting a.
Basis of Presentation Government-wide Statements: The statement of net assets and the statement of activities include the financial activities of the overall government. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. The statement of activities presents a comparison between direct expenses and program revenues for each function of the District's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. The District does not allocate indirect expenses in the statement of activities. Program revenues include (a) fees, fines, and charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the District's funds, with separate statements presented for each fund category. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.
The District reports the following major governmental funds: General Fund. This is the District's primary operating fund. It accounts for all financial resources of the District except those required to be accounted for in another fund. 21 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED In addition, the District reports the following fund types: Agency Funds: These funds are used to report student activity funds and other resources held in a purely custodial capacity (assets equal liabilities). Agency funds typically involve only the receipt, temporary investment, and remittance of fiduciary resources to individuals, private organizations, or other governments. Fiduciary funds are reported in the fiduciary fund financial statements. However, because their assets are held in a trustee or agent capacity and are therefore not available to support District programs, these funds are not included in the government-wide statements. b.
Measurement Focus, Basis of Accounting Government-wide Financial Statements: These financial statements are reported using the economic resources measurement focus. They are reported using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Non-exchange transactions, in which the District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, grants, entitlements, and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year in which all eligibility requirements have been satisfied. Governmental Fund Financial Statements: Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The District considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end. Revenues from local sources consist primarily of property taxes. Property tax revenues and revenues received from the State are recognized under the susceptible-to-accrual concept. Miscellaneous revenues are recorded as revenue when received in cash because they are generally not measurable and available. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources. When the District incurs an expenditure or expense for which both restricted, committed or assigned and unrestricted resources may be used, it is the District's policy to use restricted, committed or assigned resources first, then unrestricted resources. In the fund financial statements, governmental funds report restricted fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Committed fund balance represents amount established by formal action of the School Board, and may be changed with formal action. Assigned fund balance represents amounts established by the Districts management by authority of the School Board, and may be changed by management. 22 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED 3.
Fund Balance Year ending August 31, 2011, the District implemented GASB Statement No. 54, "Fund Balance Reporting and Governmental Fund Type Definitions." This Statement provides more clearly defined fund balance categories to make the nature and extent of the constraints placed on a government's fund balances more transparent. The following classifications describe the relative strength of the spending constraints:
Nonspendable Fund Balance - Amounts that are not in nonspendable form (such as inventory) or are required to be maintained intact.
Restricted Fund Balance - Amounts constrained to specific purposes by their providers (such as grantors, bondholders, and higher levels of government), through constitutional provisions, or by enabling legislation.
Committed Fund Balance - Amounts constrained to specific purposes by the District itself, using its highest level of decision-making authority (i.e., School Board). To be reported as committed, amounts cannot be used for any other purpose unless the District takes the same highest level action to remove or change the constraint.
Assigned Fund Balance - Amounts the District intends to use for a specific purpose. Intent can be expressed by the School Board or by an official or body to which the School Board delegates the authority.
Unassigned Fund Balance - Amounts that are available for any purpose. Positive amounts are reported only in the general fund.
The School Board establishes (and modifies or rescinds) fund balance commitments by passage of an ordinance or resolution. This is typically done through adoption and amendment of the budget. A fund balance commitment is further indicated in the budget document as a designation or commitment of the fund (such as for special incentives). Assigned fund balance is established by School Board through adoption or amendment of the budget as intended for specific purpose (such as the purchase of fixed assets, construction, debt service, or for other purposes). 4.
Financial Statement Amounts a.
Property Taxes Property taxes are levied by October 1 on the assessed value listed as of the prior January 1 for all real and business personal property in conformity with Subtitle E, Texas Property Tax Code. Taxes are due on receipt of the tax bill and are delinquent if not paid before February 1 of the year following the year in which imposed. On January 1 of each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed. Property tax revenues are considered available (1) when they become due or past due and receivable within the current period and (2) when they are expected to be collected during a 60-day period after the close if the fiscal year.
23 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Allowances for uncollectibles tax receivables within the General and Debt Service Funds are based upon historical experience in collecting property taxes. Uncollectible personal property taxes are periodically reviewed and written off, but the District is prohibited from writing off real property taxes without specific statutory authority from the Texas Legislature. b.
Inventories and Prepaid Items The District records purchases of supplies as expenditures, utilizing the purchase method of accounting for inventory in accordance with the Resource Guide.
c.
Capital Assets Purchased or constructed capital assets are reported at cost or estimated historical cost. Donated fixed assets are recorded at their estimated fair value at the date of the donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized. A capitalization threshold of $5,000 is used. Capital assets are being depreciated using the straight-line method over the following estimated useful lives: ASSET CLASS Buildings Furniture and equipment
d.
ESTIMATED USEFUL LIVES 30 3-10
Receivable and Payable Balances The District believes that sufficient detail of receivable and payable balances is provided in the financial statements to avoid the obscuring of significant components by aggregation. Therefore, no disclosure is provided which disaggregates those balances. There are no significant receivables which are not scheduled for collection within one year of year-end.
e.
Compensated Absences It is the District's policy not to allow carryover of vacation not taken at August 31, 2012, so there is no liability for unpaid vacation at August 31, 2012. Full time employees of the District in positions listed in the Texas Public Education Compensation Plan accrue five days of state leave per year. There is no limit on accumulation and restrictions transfers among districts. The District also provides two days per year of local personal days, none of which is cumulative. Unused leave is not paid upon termination or retirement. Consequently, leave pay is recorded as an expenditure when taken. Due to the fact that amounts required to be paid in any fiscal year are raised in that year's budget and the District has no obligation for the accumulated leave until it is actually taken, no accrual for leave has been made.
24 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED f.
Interfund Activity Interfund activity results from loans, services provided, reimbursements or transfers between funds. Loans are reported as interfund receivables and payables as appropriate and are subject to elimination upon consolidation. Services provided, deemed to be at market or near market rates, are treated as revenues and expenditures or expenses. Reimbursements occur when a fund incurs a cost, charges the appropriate benefiting fund and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers In and Transfers Out are netted and presented as a single "Transfers" line on the government-wide statement of activities. Similarly, interfund receivables and payables are netted and presented as a single "Internal Balances" line of the government-wide statement of net assets.
g.
Use of Estimates The preparation of financial statements in conformity with Generally Accepted Accounting Principles "GAAP" requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates.
h.
Data Control Codes Data Control Codes appear in the rows and above the columns of certain financial statements. The TEA requires the display of these codes in the financial statements filed with TEA in order to insure accuracy in building a statewide database for policy development and funding plans.
5.
Subsequent Events Management has evaluated subsequent events through January 22, 2013, the date the financial statements were available to be issued.
B.
DEPOSITS AND INVESTMENTS The District's funds are required to be deposited and invested under the terms of a depository contract. The depository bank deposits for safekeeping and trust with the District's agent bank approved pledged securities in an amount sufficient to protect District funds on a dayto-day basis during the period of the contract. The pledge of approved securities is waived only to the extent of the depository bank's dollar amount of Federal Deposit Insurance Corporation ("FDIC") insurance. Cash Deposits - At August 31, 2012, the carrying amount of the District's deposits (cash, certificates of deposit, and interest-bearing savings accounts included in temporary investments) was $2,572,814 and the bank balance was $2,770,836. The District's cash deposits at August 31, 2012 and during the period ended August 31, 2012, were entirely covered by FDIC insurance or by pledged collateral held by the District's agent bank in the District's name. Investments - The Public Funds Investment Act ("Act") requires an annual audit of investment practices. Audit procedures in this area conducted as a part of the audit of the general purpose financial statements disclosed that in the areas of investment practices, management reports and establishment of appropriate policies, the District adhered to the requirements of the Act. Additionally, investment practices of the District were in accordance with local policies. 25 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 B.
DEPOSITS AND INVESTMENTS - CONTINUED The Act determined the types of investments which are allowable for the District. These include, with certain restrictions, (1) obligations of the U.S. Treasury, certain U.S. agencies, and the State of Texas, (2) certificates of deposit, (3) certain municipal securities, (4) money market savings accounts, (5) repurchase agreements, (6) bankers acceptances, (7) mutual funds, (8) investment pools, (9) guaranteed investment contracts, and (10) common trust funds. The District currently has investments in the Lone Star Investment Pool of $1,118,686. Public Funds Investment Pools - Public funds investment pools in Texas ("Pools") are established under the authority of the Internal Cooperation Act, Chapter 79 of the Texas Government Code, and subject to the provisions of the Public Funds Investment Act (the "Act"), Chapter 2256 of the Texas Government Code. In addition to other provisions of the Act designed to promote liquidity and safety of principal, the Act requires Pools to: 1) have an advisory board composed of participants in the pool and other persons who do not have a business relationship with the pool and are qualified to advise the pool; 2) maintain a continuous rating of no lower than AAA or AAA-m or an equivalent rating by at least one nationally recognized rating service; and 3) maintain the market value of its underlying investment portfolio within one half of one percent of the value of its shares. The District's investments in Pools are reported at an amount determined by the fair value per share of the pool's underlying portfolio, unless the pool is 2a7-like, in which case they are reported at share value. A 2a7-like pool is one which is not registered with the Securities and Exchange Commission ("SEC") as an investment company, but nevertheless has a policy that it will, and does, operate in a manner consistent with the SEC's Rule 2a7 of the Investment Company Act of 1940. The investments in the Pools are based on contractual agreements and not the individual security itself; therefore, the District's investment in the Pool is not categorized as to level of risk. The market value of the Pool is based on quoted market values of underlying investments of the Pools. Authorized investments include obligations of States, agencies and other local governments having an investment rating of not less than A or its equivalent; certificates of deposit that are guaranteed by the Federal Deposit Insurance Cooperation and other investments authorized by statutes governing public funds investment pools. The pools use amortized cost rather than market value to report net assets to comparable share prices. Accordingly, the fair value of the position in the Pool is the same as the value of the shares in the Pool. The purpose of the Pools is to allow for the pooling of public funds to provide a higher yield on the pooled investments than would be possible with the investment of the individual public entity's funds. The investment in the Pool and any accrued interest may be redeemed at the District's discretion. Additional contractual provisions governing deposits and investments for the District are as follows: a.
Custodial Credit Risk - Deposits: In the case of deposits, this is the risk that in the event of a bank failure, the government's deposits may not be returned to it. To insure against this risk of loss, the District's contract with its depository bank specifies that the depository bank agrees to cover by corporate surety bond or pledge of approved securities an amount that is equal to funds anticipated to be on deposit from day to day that exceeds the value of FDIC insurance coverage. During the year ended at August 31, 2012, the District had FDIC insurance and pledge securities that were adequate at all times to insure the District's deposits.
26 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 B.
DEPOSITS AND INVESTMENTS - CONTINUED b.
C.
Custodial Credit Risk - Investments: For an investment, this is the risk that, in the event of the failure of the counterparty, the government will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. All of the District's investments are held in external investment pools which are not subject to custodial credit risk.
CAPITAL ASSETS Capital asset activity for the period ended August 31, 2012, was as follows: BEGINNING BALANCES
Governmental Activities: Capital Assets Not Being Depreciated: Land TOTAL CAPITAL ASSETS NOT BEING DEPRECIATED
$
$
-
244 067
Capital Assets Being Depreciated: Buildings and improvements Furniture and equipment TOTAL CAPITAL ASSETS BEING DEPRECIATED Less Accumulated Depreciation For: Buildings and improvement Furniture and equipment TOTAL ACCUMULATED DEPRECIATION TOTAL CAPITAL ASSETS BEING DEPRECIATED, NET GOVERNMENTAL ACTIVITIES CAPITAL ASSETS, NET
244 067
INCREASES
$
ENDING BALANCES
DECREASES
$
-
-
-
$
244 067 244 067
21 104 520 3 866 927
146 217
105 798
21 104 520 3 907 346
24 971 447
146 217
105 798
25 011 866
10 199 587 3 135 076
604 278 140 606
104 580
10 803 865 3 171 102
13 334 663
744 884
104 580
13 974 967
11 636 784
(598 667)
1 218
11 036 899
1 218
$ 11 280 966
11 880 851
$
(598 667)
$
Cost of leased equipment at August 31, 2012 was $323,534 with accumulated depreciation of $241,777. The net value of leased assets at year end was $81,757. Depreciation was charged to functions as follows: Instruction Instructional resources and media services Curriculum and staff development School leadership Guidance, counseling, and evaluation services Health services Student transportation Food services Extracurricular activities General administration Plant maintenance and operations TOTAL
27 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
$
386 10 14 39 33 9 62 42 36 35 74 744
444 950 079 255 520 534 123 980 276 457 266 884
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 D.
INTERFUND BALANCES AND ACTIVITIES 1.
Due To and From Other Funds Balances due to and due from other funds at August 31, 2012, consisted of the following: DUE TO FUND General Fund Special Revenue Fund
DUE FROM FUND Agency Fund General Fund TOTAL
AMOUNT 5 500 295 899 $ 301 399 $
PURPOSE Payroll expenses Payroll expenses
All amounts due are scheduled to be repaid within one year. 2.
Transfers To and From Other Funds Transfers to and from other funds at August 31, 2012, consisted of the following: TRANSFERS FROM General Fund General Fund Special Revenue Fund
E.
TRANSFERS TO Special Revenue Fund Debt Service Fund Debt Service Fund TOTAL
AMOUNT $ 121 818 25 366 170 192 $ 317 376
REASON Repayment Repayment Repayment
LONG-TERM OBLIGATIONS 1.
Long-Term Obligation Activity Long-term obligations include debt and other long-term liabilities. Changes in longterm obligations for the period ended August 31, 2012, are as follows: AMOUNT BEGINNING BALANCE
Governmental Activities: Bonds Notes payable Capital leases TOTAL GOVERNMENTAL ACTIVITIES
INCREASES
DECREASES
ENDING
DUE WITHIN
BALANCE
ONE YEAR
$ 7 780 001 698 438 115 517
$
-
$
475 000 116 406 14 636
$ 7 305 001 582 032 100 881
$
495 000 116 406 14 782
$ 8 593 956
$
-
$
606 042
$ 7 987 914
$
626 188
A summary of general obligation bonds for the year ended August 31, 2012, is as follows:
DESCRIPTION Tax Refunding Bonds
INTEREST
AMOUNTS
AMOUNTS
AMOUNTS
RATE
ORIGINAL
OUTSTANDING
OUTSTANDING
PAYABLE
ISSUE
09/01/2011
3.25% to 4.10%
$
8 484 996
$
7 780 001
28 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
ISSUED $
-
RETIRED $
475 000
08/31/2012 $
7 305 001
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 E.
LONG-TERM OBLIGATIONS - CONTINUED 2.
Debt Service Requirements Debt service requirements on bonds payable at August 31, 2012, are as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 2018-2022 2023-2027 TOTALS
3.
GOVERNMENTAL ACTIVITIES INTEREST TOTAL PRINCIPAL $ 495 000 $ 283 460 $ 778 460 520 000 263 160 783 160 545 000 241 860 786 860 570 000 219 560 789 560 595 000 196 260 791 260 3 420 000 4 011 400 7 431 400 1 160 001 1 199 155 2 359 156 $ 7 305 001 $ 6 414 855 $ 13 719 856
Notes Payable Debt service requirements on notes payable at August 31, 2012, are as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 TOTALS
$
$
GOVERNMENTAL ACTIVITIES PRINCIPAL INTEREST TOTAL 116 406 $ 20 954 $ 137 360 116 406 16 297 132 703 128 046 116 406 11 640 116 406 6 984 123 390 116 408 2 328 118 736 582 032 $ 58 203 $ 640 235
The effective interest rate on the note payable is 4.0%, with deposits as security. 4.
Capital Leases Commitments under capitalized lease agreements for facilities and equipment provide for minimum future lease payments as of August 31, 2012 as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 2018-2022 TOTAL MINIMUM RENTALS Less amount representing interest CAPITAL LEASE PAYABLE
$
$
Rental Expenditures in 2012
$
20 20 20 20 20 20 120 19 100
123 123 123 123 123 123 738 857 881
14 636
The effective interest rate on capital lease is 5.3%. Notes payable are collateralized by the future receivables of the District, and capital leases are collateralized by the assets being leased.
29 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 F.
RISK MANAGEMENT The District is exposed to various risks of loss related to torts, theft, damage or destruction of assets, errors and omissions, injuries to employees, and natural disasters. During fiscal year 2012, the District purchased commercial insurance to cover general liabilities. There were no significant reductions in coverage in the past fiscal year and there were no settlements exceeding insurance coverage for each of the past three fiscal years.
G.
PENSION PLAN Plan Description - The Newton Independent School District contributes to the Teacher Retirement System of Texas (TRS), a cost-sharing multiple employer defined benefit pension plan. TRS administers retirement and disability annuities, and death and survivor benefits to employees and beneficiaries of employees of the public school systems of Texas. It operates primarily under the provisions of the Texas Constitution, Article XVI, Sec. 67, and Texas Government Code, Title 8, Subtitle C. TRS also administers proportional retirement benefits and service credit transfer under Texas Government Code, Title 8, Chapters 803 and 805, respectively. The Texas state legislature has the authority to establish and amend benefit provisions of the pension plan and may, under certain circumstances, grant special authority to the TRS Board of Trustees. TRS issues a publicly available financial report that includes financial statements and required supplementary information for the defined benefit pension plan. That report may be obtained by writing to the TRS Communications Department, 1000 Red River Street, Austin, Texas 78701, by calling the TRS Communications Department at 1.800.223.8778, or by downloading the report for the TRS Internet website, www.trs.state.tx.us, under the TRS Publications heading. Funding Policy - Contribution requirements are not actuarially determined, but are established and amended by the Texas state legislature. The state funding policy is as follows: (1) The state constitution requires the legislature to establish a member contribution rate of not less than 6.0% of the members' annual compensation and a state contribution rate of not less than 6.0% and more than 10% of the aggregate annual compensation of all members of the system; (2) A state statute prohibits benefit improvements or contribution reductions if, as a result of the particular action, the time required to amortize TRS' unfunded actuarial liabilities would be increased to a period that exceeds 31 years, or, if the amortization period already exceeds 31 years, the period would be increased by such action. State law provides for a member contribution rate of 6.4% for fiscal year 2012, 2011 and 2010 and a state contribution rate of 6.58% for fiscal years 2012, 2011 and 2010. State contributions to TRS made on behalf of the Newton Independent School District's employees for the years ended August 31, 2012, 2011 and 2010 were $361,743, $396,249 and $380,289, respectively. The Newton Independent School District paid additional state contributions for the years ended August 31, 2012, 2011 and 2010 in the amount of $32,297, $33,688 and $28,303, respectively, on the portion of the employees' salaries that exceeded the statutory minimum.
30 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 H.
HEALTH CARE COVERAGE Plan Description - The Newton School District contributes to the Texas Public School Retired Employees Group Insurance Program (TRS-Care), a cost-sharing multiple-employer defined benefit postemployment health care plan administered by the Teacher Retirement System of Texas. TRS-Care Retired Plan provides health care coverage for certain persons (and their dependents) who retired under the Teacher Retirement System of Texas. The statutory authority for the program is Texas Insurance Code, Chapter 1575. Section 1575.052 grants the TRS Board of Trustees the authority to establish and amend basic and optional group insurance coverage for participants. The TRS issues a publicly available financial report that includes financial statements and required supplementary information for TRS-Care. That report may be obtained by visiting the TRS Website at www.trs.state.tx.us, by writing to the Communications Department of the Teacher Retirement System of Texas at 1000 Red River Street, Austin, Texas 78701, or by calling 1.800.223.8778. Funding Policy - Contribution requirements are not actuarially determined, but are legally established each biennium by the Texas Legislature. Texas Insurance Code, Sections 1575.202, 203 and 204 establish state, active employee, and public school employee contributions, respectively, the State of Texas and active public school employee contribution rates were 1.0% and 0.65% of public school payroll, respectively, with school districts contributing a percentage of payroll set at 0.55% for fiscal years 2012, 2011 and 2010. Per Texas Insurance Code, Chapter 1575, the public school contribution may not be less than 0.25% or greater than 0.75% of the salary of each active employee of the public school. For the years ended August 31, 2012, 2011 and 2010, the State's contributions to TRS-Care were $62,399, $66,745 and $66,994, respectively, the active member contributions were $40,557, $43,884 and $43,546, respectively, and the school district's contributions were $34,319, $36,710 and $36,847, respectively, which equaled the required contributions each year. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which was effective January 1, 2006 established prescription drug coverage for Medicare beneficiaries known as Medicare Part D. One of the provisions of Medicare Part D allows for the Texas Public School Retired Employee Group Insurance Program (TRS-Care) to receive retiree drug subsidy payments from the federal government to offset certain prescription drug expenditures for eligible TRS-Care participants. For the fiscal years ended August 31, 2012, 2011 and 2010, the subsidy payments received by TRS-Care on behalf of the District were $15,469, $15,460 and $16,784, respectively.
I.
COMMITMENTS AND CONTINGENCIES 1.
Contingencies The District participates in grant programs which are governed by various rules and regulations of the grantor agencies. Costs charges to the respective grant programs are subject to audit and adjustment by the grantor agencies; therefore, to the extent that the District has not complied with the rules and regulations governing the grants, refunds of any money received may be required and the collectibility of any related receivable may be impaired. In the opinion of the District, there are no significant contingent liabilities relating to compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying basic financial statements for such contingencies.
2.
Litigation No reportable litigation was pending against the District at August 31, 2012. 31 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
REQUIRED SUPPLEMENTARY INFORMATION Required supplementary information includes financial information and disclosures required by the Governmental Accounting Standards Board, but no considered a part of the basic financial statements.
32 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT GENERAL FUND BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT G-1 DATA CONTROL CODES 5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0032 0033 0034 0035 0036 0041 0051 0052 0053 0061 0071 0099 6030
ORIGINAL BUDGET Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
$
Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Social work Health services Student transportation Food service Cocurricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Debt service Payments to other governments TOTAL EXPENDITURES
1200 0100 3000
$
$
3 536 763 6 151 000 128 589 9 816 352
$
17 (229 126 (85
954 924) 589 381)
4 451 856
154 661
143 829
145 145
138 233
6 912
117 073 126 866 563 626
132 905 124 976 534 144
127 314 111 531 508 536
5 591 13 445 25 608
264 482 253 105 583 827 785 39 939
288 7 103 870 25
271 8 96 883 25
16 733 (288) 7 634 (13 078) 145
470 554 525 857
475 254 527 041
469 017 504 850
6 237 22 191
1 115 223
1 119 564
1 056 785
62 779
495 644 630 124
28 210 78 169
717 906 678 597 316
506 278 291 124
23 165 70 162
984 194 044 675 171
203 068 917 604
5 45 7 6
303 210 374 520
180 000 9 535 104
180 000 9 627 959
165 862 9 240 844
14 138 387 115
295 269
273 774
575 508
301 734
-
-
(147 184)
(147 184)
-
-
(147 184)
(147 184)
428 324
154 550
295 269
Fund balances - Beginning FUND BALANCES - ENDING
3 518 809 6 380 924 2 000 9 901 733
4 606 517
Other Financing Sources: Transfers out TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES
$
ACTUAL
4 597 141
47 180 59 169
EXCESS REVENUE OVER (UNDER) EXPENDITURES 8925
2 857 414 6 906 959 66 000 9 830 373
FINAL BUDGET
VARIANCE WITH FINAL BUDGET POSITIVE (NEGATIVE)
1 522 700 1 817 969
273 774 $
See independent auditors' report. 33 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
1 522 700 1 796 474
$
1 663 342 2 091 666
$
140 642 295 192
COMBINING STATEMENTS AS SUPPLEMENTARY INFORMATION This supplementary information includes financial statements and schedules not required by the Governmental Accounting Standards Board, nor a part of the basic financial statements, but are presented for purposes of additional analysis.
34 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS August 31, 2012 EXHIBIT H-1
DATA CONTROL CODES
SPECIAL REVENUE FUNDS
1110 1225 1240 1260 1290 1000
ASSETS Cash and cash equivalents Taxes receivable, net Due from other governments Due from other funds Other receivables TOTAL ASSETS
2110 2160 2300 2000
LIABILITIES Current Liabilities: Accounts payable Accrued wages payable Deferred revenue TOTAL LIABILITIES
3450 3420 3000
FUND BALANCES Reserved Fund Balances: Reserved for grants Reserved for debt service TOTAL FUND BALANCE
4000
$
$
$
TOTAL LIABILITIES AND FUND BALANCES
$
TOTAL NONMAJOR GOVERNMENTAL FUNDS (SEE EXHIBIT C-1)
DEBT SERVICE FUND
259 022 12 871 295 899 103 603 671 395
$
64 875 196 404 4 716 $ 265 995
$
107 479 32 525 140 004
$
$
196 404 196 404
531 391 531 391
69 591 69 591
671 395
$ 265 995
See independent auditors' report. 35 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
323 196 17 295 103 937
897 404 587 899 603 390
107 32 196 336
479 525 404 408
531 391 69 591 600 982 $
937 390
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS For the Year Ended August 31, 2012
DATA CONTROL CODES
5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0033 0035 0036 0061 0071 0093 6030 1100
7915 8915 7080 1200 0100 3000
SPECIAL REVENUE FUNDS
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Health services Food services Co-curricular/ extracurricular activities Community services Debt service Payments to shared service arrangements TOTAL EXPENDITURES EXCESS REVENUE OVER (UNDER) EXPENDITURES Other Financing Sources (Uses): Transfers in Transfer out TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
234 649 1 818 2 702
815 368 551 734
EXHIBIT H-2 TOTAL NONMAJOR GOVERNMENTAL FUNDS (SEE EXHIBIT C-2)
DEBT SERVICE FUND
$
200 426 221 360 421 786
$
435 870 1 818 3 124
241 728 551 520
1 078 884
-
1 078 884
17 116
-
17 116
73 191 108 043 49 558
-
73 191 108 043 49 558
204 539 39 940 586 064
-
204 539 39 940 586 064
47 354 33 127 -
778 261
47 354 33 127 778 261
95 873 2 333 689
778 261
95 873 3 111 950
$
See independent auditors' report. 36 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
369 045
(356 475)
12 570
121 818 (170 192)
195 558 -
317 376 (170 192)
(48 374) 320 671 210 720 531 391
195 558 (160 917) 230 508 69 591
147 159 441 600
$
$
184 754 228 982
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS August 31, 2012
211
224
225
240
DATA CONTROL
ESEA
IDEA-B
IDEA-B
FOOD
CODES
TITLE I
FORMULA
PRESCHOOL
SERVICE
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
1260
Due from other funds
1290
Other receivables
1000
$
-
$
-
$
-
46 457
-
$
-
36 349
-
TOTAL ASSETS
-
10 918
4 502
-
115 524 -
-
231
$
46 457
$
36 349
$
4 502
$
$
25 385
$
32 514
$
4 502
$
126 673
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
21 072
3 835
2000
TOTAL LIABILITIES
46 457
36 349
-
-
4 502
-
FUND BALANCES Reserved Fund Balances: 3450
Reserve for grants
3000
TOTAL FUND BALANCES
4000
TOTAL LIABILITIES AND FUND BALANCES
$
-
-
-
126 673
-
-
-
126 673
46 457
37 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
36 349
$
4 502
$
126 673
EXHIBIT H-3 PAGE 1 OF 3 242
244
255
266
VOCATIONAL
$
$
$
272
287
EDUCATION
TITLE
RURAL
SUMMER
EDUCATION
TITLE II
XIV
AND LOW
MEDICAID
FEEDING
BASIC
PART A
ARRA
INCOME
ADMINISTRATIVE
JOBS
PROGRAM
GRANT
TRAINING
SFSF
SCHOOLS
CLAIMING
GRANT
6 184
$
-
-
-
-
722
$
270
6 184
-
$
-
$
11 347
-
-
-
$
-
$
27 777
-
-
-
-
64
-
-
-
$
17 030
3 069
$
722
$
11 347
$
-
$
64
$
$
-
$
6 207
$
-
$
64
$
30 846
-
-
-
5 140
-
-
-
-
-
11 347
-
64
-
-
$
17 030
$
17 030 17 030
6 184
722
-
-
-
30 846
-
6 184
722
-
-
-
30 846
-
6 184
$
722
$
11 347
$
-
$
38 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
64
$
30 846
$
17 030
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED August 31, 2012
364
365
401
404
ARRA
ARRA
OPTIONAL
DATA
IDEA
IDEA
EXTENDED
STUDENT
CONTROL
PART B
PART B
YEAR
SUCCESS
CODES
FORMULA
PRESCHOOL
PROGRAM
INITIATIVE
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
-
-
-
1260
Due from other funds
-
-
31
1290
Other receivables
1000
TOTAL ASSETS
$
-
$
-
-
$
-
-
$
7 905
-
-
$
-
$
-
$
31
$
$
-
$
-
$
-
$
7 905
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
-
-
-
2 478
-
2000
TOTAL LIABILITIES
-
-
-
2 478
-
-
31
5 427
-
-
31
5 427
FUND BALANCES Reserved Fund Balances: 3450 3000
Reserve for grants TOTAL FUND BALANCES TOTAL LIABILITIES
4000
AND FUND BALANCES
$
-
$
39 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
$
31
$
7 905
EXHIBIT H-3 PAGE 2 OF 3 410
411
437
461
MATERIALS
TECHNOLOGY
SPECIAL
ALLOTMENT
ALLOTMENT
EDUCATION
ACTIVITY
INSTRUCTIONAL
$
$
$
$
3 826
$
-
$
-
$
472
473
HIGH
MIDDLE
ELEMENTARY
SCHOOL
SCHOOL
SCHOOL
ACTIVITY
ACTIVITY
2 949
-
-
162 612
6 008
2 872
-
-
59 062
53
290
-
-
$
221 674
$
9 010
$
$
-
$
19 263
$
467
$
-
-
-
3 826 3 826
$
5 116
-
22 607 30 334
$
52 941
$
2 047
-
-
19 263
467
-
-
202 411
8 543
5 116
50 894
-
202 411
8 543
5 116
50 894
-
-
$
1 953
$
-
3 826
-
1
-
3 826
-
$
-
$
221 674
$
9 010
40 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
5 116
2 047
$
52 941
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED August 31, 2012 EXHIBIT H-3 PAGE 3 OF 3
DATA
816
TOTAL
AUSSIE
NONMAJOR
WALDO
SPECIAL
SCHOLAR-
REVENUE
CONTROL
SHIP
FUNDS (SEE
CODES
FUND
EXHIBIT H-1)
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
-
12 871
1260
Due from other funds
-
295 899
1290
Other receivables
1000
$
80 154
$
10 564
TOTAL ASSETS
$
90 718
259 022
103 603 $
671 395
$
107 479
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
2000
$
TOTAL LIABILITIES
-
32 525
-
140 004
FUND BALANCES Reserved Fund Balances: 3450 3000
Reserve for grants TOTAL FUND BALANCES
90 718
531 391
90 718
531 391
TOTAL LIABILITIES AND 4000
FUND BALANCES
$
See independent auditors' report. 41 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
90 718
$
671 395
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS For the Year Ended August 31, 2012
211
224
225
240
DATA CONTROL
ESEA
IDEA-B
IDEA-B
FOOD
CODES
TITLE I
FORMULA
PRESCHOOL
SERVICE
5700
Revenues: Local and intermediate sources
$
-
$
-
-
$
-
-
$
-
163 860
5800
State program revenues
5900
Federal program revenues
526 206
363 617
5 821
475 630
6 190
5020
TOTAL REVENUES
526 206
363 617
5 821
645 680
399 147
213 823
10 020
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media
0013
Curriculum and staff development
0021
Instructional leadership
0023
School leadership
0031
Guidance, counseling, and
0033
Health services
-
0035
Food services
0036
Cocurricular/extracurricular
0061
Community services
0093
Payments to shared service
6030
TOTAL EXPENDITURES
1100
EXCESS REVENUE OVER
services
-
-
-
-
-
-
-
-
-
-
11 612
-
-
-
21 072
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
71 136 -
evaluation services
activities
31 627
arrangements
-
95 873
534 594
(UNDER) EXPENDITURES
-
-
309 696
(8 388)
580 384
-
10 020
53 921
580 384
(4 199)
65 296
Other Financing Sources (Uses): 7900
Transfers in
8900
Transfers (out)
1200 0100 3000
8 388
-
-
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
4 199
(53 921)
-
-
-
-
-
-
65 296
-
-
-
61 377
-
42 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
-
$
-
$
126 673
EXHIBIT H-4 PAGE 1 OF 3 242
244
255
266
270
VOCATIONAL
$
287
EDUCATION
RURAL
SUMMER
EDUCATION
TITLE II
TITLE XIV
AND LOW
MEDICAID
FEEDING
BASIC
PART A
ARRA
INCOME
ADMINISTRATIVE
JOBS
PROGRAM
GRANT
TRAINING
SFSF
SCHOOLS
CLAIMING
GRANT
2 747
$
-
-
$
-
2 747
-
-
$
-
-
$
-
-
$
-
-
41 132
16 117
222 863
16 637
114 697
34 027
41 132
16 117
222 863
15 837
113 118
25 933
3 011
146 823
-
-
800
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
800
-
-
-
4 036
-
-
-
2 878
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2 055 2 584
16 637
(2 933)
117 757
14 399
4 697
-
3 060
-
-
-
(2 933)
-
-
-
-
9 117
722
-
-
-
722
$
-
-
-
(34 027)
$
-
43 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
37 062 8 649 244 254
(21 391)
26 149
(14 399)
$
34 562
11 420
-
$
34 027
42
-
26 733
(3 060)
17 116
1 495
-
-
-
6 184
-
34 027
-
-
-
114 697
-
5 680
$
16 637
-
5 680
$
272
21 391
-
-
30 846
-
$
30 846
$
-
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED For the Year Ended August 31, 2012
364
365
401
404
ARRA
ARRA
OPTIONAL
DATA
IDEA
IDEA
EXTENDED
STUDENT
CONTROL
PART B
PART B
YEAR
SUCCESS
CODES
FORMULA
PRESCHOOL
PROGRAM
INITIATIVE
5700
Revenues: Local and intermediate sources
$
-
$
-
$
-
-
$
-
-
5800
State program revenues
-
5900
Federal program revenues
-
1 804
-
73 946
5020
TOTAL REVENUES
-
1 804
-
73 946
2 478
-
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media
95
-
-
0013
Curriculum and staff development
-
-
-
-
-
-
-
0021
-
Instructional leadership
-
-
-
-
0023
School leadership
-
-
-
-
0031
Guidance, counseling, and -
-
-
-
0033
Health services
-
-
-
-
0035
Food services
-
-
-
-
0036
Cocurricular/extracurricular -
-
-
-
0061
Community services
-
-
-
-
0093
Payments to shared service -
-
-
6030
TOTAL EXPENDITURES
95
-
-
2 478
1100
EXCESS REVENUE OVER -
71 468
services
evaluation services
activities
arrangements
(UNDER) EXPENDITURES
(95)
1 804
-
Other Financing Sources (Uses): 7900
Transfers in
95
8900
Transfers (out)
-
1200 0100 3000
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
-
-
(1 804)
(66 041) 5 427
-
-
-
-
-
31
-
44 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
-
$
-
-
31
$
5 427
EXHIBIT H-4 PAGE 2 OF 3 410
411
437
461
MATERIALS
TECHNOLOGY
SPECIAL
ALLOTMENT
ALLOTMENT
EDUCATION
ACTIVITY
INSTRUCTIONAL
$
-
$
61 517
$
-
-
$
HIGH
MIDDLE
ELEMENTARY
SCHOOL
SCHOOL
SCHOOL
ACTIVITY
ACTIVITY
9 087
-
-
57 691
-
473
507 715
-
61 517
507 715
12 205
$
-
-
-
-
9 087
78 703
7 823
$
42 858 -
7 823
42 858
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3 826
179 431
363 840
(12 205)
143 875
-
-
-
3 826 $
-
-
$
202 411
22 444
1 099
20 414
-
-
-
-
-
8 993 $
-
6 724
-
(450)
-
-
-
(450)
202 411
22 444
-
9 537
-
12 205
6 724
-
58 536
(12 205)
-
9 537
-
12 205
-
3 826
105 706
-
57 691
$
-
472
8 543
45 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
1 099
20 414
4 017
30 480
5 116
$
50 894
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED For the Year Ended August 31, 2012
DATA
EXHIBIT H-4 PAGE 3 OF 3
816
TOTAL
AUSSIE
NONMAJOR
WALDO
SPECIAL
SCHOLAR-
REVENUE
CONTROL
SHIP
FUNDS (SEE
CODES
FUND
EXHIBIT H-2)
5700
Revenues: Local and intermediate sources
$
8 440
$
234 815
5800
State program revenues
-
649 368
5900
Federal program revenues
-
1 818 551
5020
TOTAL REVENUES
8 440
2 702 734
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media services
0013
Curriculum and staff development
-
73 191
0021
Instructional leadership
-
108 043
0023
School leadership
-
49 558
0031
Guidance, counseling, and -
204 539
0033
Health services
-
39 940
0035
Food services
-
586 064
0036
Cocurricular/extracurricular -
47 354
0061
Community services
0093
Payments to shared service
6030
TOTAL EXPENDITURES
1100
EXCESS REVENUE OVER
services
evaluation services
activities
-
1 078 884
-
17 116
1 500
arrangements
33 127
-
(UNDER) EXPENDITURES
95 873
1 500
2 333 689
6 940
369 045
Other Financing Sources (Uses): 7900
Transfers in
-
121 818
8900
Transfers (out)
-
(170 192)
1200 0100 3000
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
See independent auditors' report. 46 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
6 940
320 671
83 778
210 720
90 718
$
531 391
OTHER SUPPLEMENTARY INFORMATION This section includes financial information and disclosures not required by the Governmental Accounting Standards Board and not considered a part of the basic financial statements. It may, however, include information, which is required by other entities.
47 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF DELINQUENT TAXES RECEIVABLE For the Year Ended August 31, 2012 1
2
3
TAX RATES YEAR ENDED AUGUST 31,
MAINTENANCE
2003 and Prior Years
ASSESSED/APPRAISED DEBT SERVICE
VALUE FOR SCHOOL TAX PURPOSES
N/A
N/A
2004
1.4082
0.2218
2005
1.4265
0.2035
156 177 239
2006
1.3050
0.1925
150 694 324
2007
0.9912
0.1810
198 527 726
2008
0.9912
0.1810
231 889 268
2009
1.010
0.1635
269 129 320
2010
1.040
0.2000
259 851 366
2011
1.040
0.2000
245 668 850
2012 (School Year Under Audit)
1.170
0.0700
244 182 097
1000 TOTALS
See independent auditors' report. 48 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
N/A $
150 483 313
EXHIBIT J-1
$
10
20
BEGINNING
CURRENT
31
32
40
50
DEBT
ENTIRE
ENDING
BALANCE
YEAR'S
MAINTENANCE
SERVICE
YEAR'S
BALANCE
09/01/2011
TOTAL LEVY
COLLECTIONS
COLLECTIONS
ADJUSTMENTS
08/31/2012
689 440
$
-
$
17 670
$
2 865
$
(12 676)
$
656 229
67 665
-
1 892
278
(1 780)
63 715
76 398
-
4 276
662
(1 848)
69 612
79 536
-
4 632
651
(1 876)
72 377
86 530
-
6 810
1 005
(1 466)
77 249
77 563
-
7 387
1 349
(454)
68 373
117 043
-
18 140
2 937
(1 214)
94 752
174 005
-
35 213
5 702
318 960
-
67 214
12 926
2 588 143
154 847
$ 1 687 140
3 027 858 $
3 027 858
$
2 751 377
$
183 222
49 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
330
$
133 420
(18 489)
220 331
36 588
321 456
(2 885)
$ 1 777 514
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF EXPENDITURES FOR COMPUTATION OF INDIRECT COST FOR 2012-2013 GENERAL, SPECIAL REVENUE, AND GOVERNMENTAL EXPENDABLE TRUST FUNDS For the Year Ended August 31, 2012 EXHIBIT J-2 FUNCTION 41 AND RELATED FUNCTION 99 - GENERAL ADMINISTRATION A
B
C
D
E
F
(702)
(703)
(701)
(750)
(720)
(Other)
Direct
Account
School
Tax
Supt's
Indirect
Number
Board
Collection
Office
Cost
611X-6146
$
6211
1 619
-
52 095
6212
-
6213
-
621X
3 278
6230
500
6240
-
6260
3 948
6290
10 657
6320
15 071
6490
94 474
-
-
-
Cost
167 484
-
-
-
26 858
-
144
-
9 488
-
2 885
7 908
52 095
-
-
18 200
-
-
7 908
-
-
11 486
-
27 358
-
4 297
-
10 745 13 796
-
-
144
12 955
-
-
25 716
3 104
-
-
5 989
-
-
15 071
7 744 $
342 619
-
-
13 657 188 665
$
-
-
3 139
Total
15 706
-
4 297
2 116
$
$
-
-
4 681
-
-
18 200 8 208
-
Misc.
$
-
-
$
$
-
-
4 033 $
-
-
-
6420
157 810
-
3 273
6410
$
7 908
-
63XX
Total
$
G
249 808
$
4 297
Total expenditures/expenses for General and Special Revenue Funds (Exhibit C-2)
$
15 706 (9)
25 434 $
560 858
$
11 574 533
Less: Deductions of Unallowable Costs FISCAL YEAR Total Capital Outlay (6600) incl. only 100-199/200-494/810-879
(10)
176 307
Total Debt and Lease (6500) incl. only funds 100-199/200-494/810-879
(11)
162 604
Plant Maintenance (Function 51, 6100-6400)
(12)
1 050 125
Food (Function 35, 6341 and 6499)
(13)
293 180
Stipends (6413)
(14)
-
Column D (above) - Total Indirect Cost
249 808 Subtotal
1 932 024
Net Allowed Direct Cost
$
9 642 509
CUMULATIVE Total Cost of Buildings before depreciation
(15)
$
21 104 520
Historical Cost of Buildings over 50 years old
(16)
$
501 625
Amount of Federal Money in Building Cost (Net of #16)
(17)
$
Total Cost of Furniture and Equipment before Depreciation
(18)
$
3 907 346 492 506
Historical Cost of Furniture and Equipment over 16 years old
(19)
$
Amount of Federal Money in Furniture and Equipment (Net of #19)
(20)
$
Note A - $56,008 in function 53 expenditures are included in this report on administrative costs.
See independent auditors' report. 50 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
-
NEWTON INDEPENDENT SCHOOL DISTRICT FUND BALANCE AND CASH FLOW CALCULATION WORKSHEET (UNAUDITED) GENERAL FUND As of August 31, 2012 DATA CONTROL CODES 1 2 3 4 5 6
7 8 9
EXHIBIT J-3
EXPLANATION Total General Fund Balance as of August 31, 2012 (Exhibit C-1 object 3000 for the General Fund only).
AMOUNT $
Total General Fund Nonspendable Fund Balance (from Exhibit C-1 total of object 3410-344X for the General Fund only).
1 951 024 14 543
Total General Fund Designated Fund Balance (from Exhibit C-1 total object 3450-349X for the General Fund only).
-
Total Committed Fund Balance (from Exhibit C-1 total of object 3510-354X for the General Fund only).
-
Total Assigned Fund Balance (from Exhibit C-1 total of object 3550-359X for the General Fund only).
-
Estimated amount needed to cover fall cash flow deficits in the General Fund (net of borrowed funds and funds representing deferred revenues).
-
Estimate of two months' average cash disbursements during the regular school session (09/01/2012 - 05/31/2012).
2 053 521
Estimate of delayed payments from state sources (58XX) including August payment delays.
139 765
Estimate of underpayment from state sources equal to variance between Legislative Payment Estimate (LPE) and District Planning Estimate (DPE) or District's calculated earned state aid amount.
-
10
Estimate of delayed payments from federal sources (59XX).
-
11
Estimate of expenditures to be reimbursed to General Fund from Capital Projects Fund (uses of General Fund cash after bond referendum and prior to issuance of bonds).
-
12 13
General Fund Optimum Fund Balance and Cash Flow (lines 2+3+4+5+6+7+8+9). EXCESS (DEFICIT) UNDESIGNATED UNRESERVED GENERAL FUND BALANCE (LINE 1 MINUS LINE 10).
2 207 829 $
(256 805)
If item 11 is a positive number explanation of need and/or projected use of net positive Undesignated Unreserved General Fund Balance: See independent auditors' report. 51 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NATIONAL SCHOOL BREAKFAST AND LUNCH PROGRAM BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT J-4 DATA CONTROL CODES
ORIGINAL BUDGET
5700 5800 5900 5020
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
0035 6030
Expenditures: Current: Support Services - Student: Food services TOTAL EXPENDITURES
1200
0100 3000
$
NET CHANGE IN FUND BALANCES
199 6 433 639
673 775 436 884
FINAL BUDGET $
$
163 6 475 645
860 190 630 680
$
(35 813) (585) 35 654 (744)
624 010 624 010
580 384 580 384
43 626 43 626
15 874
22 414
65 296
42 882
61 377
61 377
$
673 775 976 424
ACTUAL
624 010 624 010
Fund balance - Beginning FUND BALANCE - ENDING
199 6 439 646
VARIANCE POSITIVE (NEGATIVE)
15 874
See independent auditors' report. 52 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
83 791
$
126 673
$
42 882
NEWTON INDEPENDENT SCHOOL DISTRICT DEBT SERVICE FUND BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT J-5 DATA CONTROL CODES
ORIGINAL BUDGET
5700 5800 5020
Revenues: Local and intermediate sources State program revenues TOTAL REVENUES
0071 6030
Expenditures: Current: Debt service TOTAL EXPENDITURES
$
1200
0100 3000
$
778 860 778 860
EXCESS REVENUE OVER (UNDER) EXPENDITURES
7915
509 260 217 235 726 495
FINAL BUDGET
(52 365)
Other Financing Sources: Transfers in TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCE
$
$
200 426 221 360 421 786
$
(27 776) 4 125 (23 651)
779 360 779 360
778 261 778 261
1 099 1 099
(333 923)
(356 475)
(22 552)
-
195 558
195 558
-
-
195 558
195 558
(333 923)
(160 917)
173 006
230 508
230 508
210 720
FUND BALANCE - ENDING
ACTUAL
-
(52 365)
Fund balance - Beginning
228 202 217 235 445 437
VARIANCE POSITIVE (NEGATIVE
158 355
See independent auditors' report. 53 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
(103 415)
$
69 591
$
173 006
CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees: We have audited the financial statements of Newton Independent School District as of and for the year ended August 31, 2012, and have issued our report thereon dated January 22, 2013. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller of the United States. COMPLIANCE As part of obtaining reasonable assurance about whether Newton Independent School District's basic 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 provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. INTERNAL CONTROL OVER FINANCIAL REPORTING In planning and performing our audit, we considered the District'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 an opinion on the effectiveness of internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the District's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of management, others within the organization, the Board of Trustees, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. ____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013 54 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133
Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees COMPLIANCE We have audited the compliance of Newton Independent School District with the types of compliance requirements described in the U. S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to its major federal program for the year ended August 31, 2012. Newton Independent School District's major federal program is identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major federal program is the responsibility of Newton Independent School District's management. Our responsibility is to express an opinion on Newton Independent School District's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Newton Independent School District'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 Newton Independent School District's compliance with those requirements. In our opinion, the District complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended August 31, 2012. INTERNAL CONTROL OVER COMPLIANCE The administration of the District 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 the District'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, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the District's internal control over compliance. 55 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of management, others within the organization, the Board of Trustees, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013
56 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended August 31, 2012 A. Summary of the Auditor's Results 1. Financial Statements Type of auditor's report issued:
Unqualified
Internal control over financial reporting: Material weakness(es) identified?
Yes
X No
Significant deficiency(s) identified that are not considered to be material weaknesses?
Yes
X None reported
Yes
X No
Noncompliance material to financial statements noted? 2. Federal Awards 3. Type of auditor's report issued:
Unqualified
Internal control over major programs: Material control over major programs: Material weakness(es) identified?
Yes
X No
Significant deficiency(s) identified that are not considered to be material weaknesses?
Yes
X None reported
Type of auditor's report issued on compliance for major programs:
Unqualified
Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133?
Yes
X No
Identification of major programs: CFDA Number(s) 84.367 84.410 10.553/10.555 84.394
Name of Federal Program or Cluster Title II, Part A Education Jobs Fund Child Nutrition Cluster State Fiscal Stabilization Fund Cluster
Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee?
$300,000 Yes
B. Financial Statement Findings NONE C. Federal Award Findings and Questioned Costs NONE
57 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
X No
NEWTON INDEPENDENT SCHOOL DISTRICT SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS For the Year Ended August 31, 2012
Current Status
Finding/Recommendation Use of Title XIV to purchase gift cards to be used for teacher supplies
Resolved
58 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
Management's Explanation If Not Implemented
NEWTON INDEPENDENT SCHOOL DISTRICT CORRECTIVE ACTION PLAN For the Year Ended August 31, 2012 NONE
59 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended August 31, 2012 Exhibit K-1 (1)
(2)
FEDERAL GRANTOR/
FEDERAL
(2A)
(3)
PASS-THROUGH GRANTOR/
CFDA
PROJECT
FEDERAL
PROGRAM TITLE
NUMBER
NUMBER
EXPENDITURES
U.S. Department of Education: Passed Through Texas Education Agency: ESEA Title I Part A - Improving Basic Programs
84.010A
12610101176902
IDEA - B Formula
84.027
12660001176902
$
526 206
Vocational Education - Basic Grant
84.048
1242006176902
IDEA - B Preschool
84.173
12661001176902
5 821
84.358B
12696001176902
41 132
363 617 16 637
ESEA, Title VI, Part B - Rural and Low Income School ESEA Title II Part A - Teacher and Principal Training and Recruiting
84.367A
12694501176902
114 697
ARRA, IDEA - B Formula
84.391A
10554001176902
1 766
ARRA, IDEA - B Preschool
84.392A
10555001176902
38
ARRA, Title XIV, SFSF
84.394A
12557001176902
34 027
Education Jobs Fund
84.410
11550101176902
222 863
TOTAL U.S. DEPARTMENT OF EDUCATION
1 326 804
U. S. Department of Agriculture: Passed Through Texas Department of Agriculture: Food Distribution*
10.550
176-902
School Breakfast Program*
10.553
71401201
132 133
31 176
National School Lunch Program*
10.555
71301201
312 321
TOTAL PASSED THROUGH TEXAS DEPARTMENT OF AGRICULTURE
475 630
Passed Through Texas Department of Health and Human Services: Medicaid Reimbursement Program
93.778
176-902
16 117
School Health and Related Programs
93.990
176-902
128 589
TOTAL PASSED THROUGH TEXAS DEPARTMENT OF HEALTH AND HUMAN SERVICES
144 706
TOTAL EXPENDITURES OF FEDERAL AWARDS
$
* Indicates clustered program under OMB Circular A-133 Compliance Supplement.
The accompanying notes are an integral part of this schedule. 60 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
1 947 140
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended August 31, 2012 Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of Newton Independent School District and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the general purpose financial statements.
61 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF REQUIRED RESPONSES TO SELECTED SCHOOL FIRST INDICATORS As of August 31, 2012 EXHIBIT L-1 DATA CONTROL CODES SF2
SF4 SF5 SF9
RESPONSES Were there any disclosures in the Annual Financial Report and/ or other sources of information concerning default on bonded indebtedness obligations?
NO
Did the district receive a clean audit? - Was there an unqualified opinion on the Annual Financial Report?
YES
Did the Annual Financial Report disclose any instances of material weaknesses in internal controls?
NO
Was there any disclosure in the Annual Financial Report of material noncompliance?
NO
62 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
INTRODUCTORY SECTION
AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
TABLE OF CONTENTS PAGE Introductory Section: Certificate of Board ................................................................................................4
EXHIBIT
Financial Section: Independent Auditors’ Report on Financial Statements .......................................... 6 Management's Discussion and Analysis ................................................................. 8 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Assets ............................................................................ 14 Statement of Activities .............................................................................. 15 Fund Financial Statements: Balance Sheet - Governmental Funds ....................................................... 16 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets ......................................... 17 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds ................................................ 18 Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities .................................................................. 19 Statement of Fiduciary Assets and Liabilities - Agency Funds ................... 20 Notes to the Financial Statements ............................................................ 21 Required Supplementary Information: Budgetary Comparison Schedules: General Fund ........................................................................................... 33 Combining Statements as Supplementary Information: Combining Balance Sheet - Nonmajor Governmental Funds ........................... 35 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds ..................................... 36 Special Revenue Funds: Combining Balance Sheet - Nonmajor Special Revenue Funds .................. 37 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue Funds ............................ 42 Other Supplementary Information Section: Schedule of Delinquent Taxes Receivable ............................................................. 48 Schedule of Expenditures for Computation of Indirect Cost for 2012 - 2013 ............................................................................. 50 Fund Balance and Cash Flow Calculation Worksheet (Unaudited) General Fund..................................................................................................... 51 Budgetary Comparison Schedules Required by the Texas Education Agency: National School Breakfast and Lunch Program .............................................. 52 Debt Service Fund .......................................................................................... 53 Independent Auditors' Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards .......................... 54 Independent Auditors' Report on Compliance with Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance with OMB Circular A-133 ............................................................ 55 Schedule of Findings and Questioned Costs ......................................................... 57 Summary Schedule of Prior Audit Findings .......................................................... 58 Corrective Action Plan .......................................................................................... 59 Schedule of Expenditures of Federal Awards ........................................................ 60 Notes to the Schedule of Expenditures of Federal Awards .................................... 61 Schedule of Required Responses to Selected School First Indicators .................... 62 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
A-1 B-1 C-1 C-1R C-2 C-3 E-1
G-1 H-1 H-2 H-3 H-4 J-1 J-2 J-3 J-4 J-5
K-1 L-1
FINANCIAL SECTION
5 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees: We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Newton Independent School District as of and for the year ended August 31, 2012, which collectively comprise the District's basic financial statements as listed in the table of contents. These financial statements are the responsibility of Newton Independent School District's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free 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 opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of Newton Independent School District as of August 31, 2012 and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America In accordance with Government Auditing Standards, we have also issued our report dated January 22, 2013, on our consideration of Newton Independent School District's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and the budgetary information on pages 8 through 12 and page 33 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquires of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. 6 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Newton Independent School District’s financial statements as a whole. The combining and individual major fund financial statements and required TEA schedules are presented for purposes of additional analysis and are not a required part of the financial statements. The accompanying schedule of expenditures of federal awards required by U. S. Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, and is also not a required part of the financial statements. The combining and individual nonmajor fund financial statements, required TEA schedules, and the schedule of expenditures of financial awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information, except for that portion marked “unaudited” on which we express no opinion, is fairly stated in all material respects in relation to the financial statements as a whole.
____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013
7 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS This section of Newton Independent School District's annual financial report presents our discussion and analysis of the District's financial performance during the fiscal year ended August 31, 2012. Please read it in conjunction with the District's financial statements, which follow this section. FINANCIAL HIGHLIGHTS
The District's total combined net assets were $6,971,468 at August 31, 2012.
During the year, the District's expenses were $667,430 less than the $12,995,543 generated in taxes and other revenues for governmental activities.
The general fund reported a fund balance this year of $1,951,024.
OVERVIEW OF THE FINANCIAL STATEMENTS This annual report consists of three parts - management's discussion and analysis (this section), the basic financial statements, and required supplementary information. The basic financial statements include two kinds of statements that present different views of the District:
The first two statements are government-wide financial statements that provide both long-term and short-term information about the District's overall financial status.
The remaining statements are fund financial statements that focus on individual parts of the government, reporting the District's operations in more detail than the governmentwide statements.
The governmental funds statements tell how general government services were financed in the short term as well as what remains for future spending.
Fiduciary fund statements provide information about the financial relationships in which the District acts solely as a trustee or agent for the benefit of others, to whom the resources in question belong.
The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the information in the financial statements. Figure A-1 shows how the required parts of this annual report are arranged and related to one another.
8
Figure A-1, Required Components of the District's Annual Financial Report
Figure A-2 Summarizes the major features of the District's financial statements, including the portion of the District government they cover and the types of information they contain. The remainder of this overview section of management's discussion and analysis explains the structure and contents of each of the statements. Government-wide Statements The government-wide statements report information about the District as a whole using accounting methods similar to those used by private-sector companies. The statement of net assets includes all of the government's assets and liabilities. All of the current year's revenues and expenses are accounted for in the statement of activities regardless of when cash is received or paid.
Type of Statements Scope
Required financial statements
Accounting basis and measurement focus
Type of asset/liability information
Type of inflow/outflow information
Government-wide Entire Agency's government (except fiduciary funds) and the Agency's component units Statement of net assets Statement of activities
Accrual accounting and economic resources focus All assets and liabilities, both financial and capital, short-term and longterm
All revenues and expenses during year, regardless of when cash is received or paid
Governmental Funds The activities of the district that are not proprietary or fiduciary Balance sheet Statement of revenues, expenditures & changes in fund balances Modified accrual accounting and current financial resources focus Only assets expected to be used up and liabilities that come due during the year or soon thereafter; no capital assets included Revenues for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and payment is due during the year or soon thereafter
Fiduciary Funds Instances in which the district is the trustee or agent for someone else's resources Statement of fiduciary net assets Statement of changes in fiduciary net assets Accrual accounting and economic resources focus All assets and liabilities, both shortterm and long-term; the Agency's funds do not currently contain capital assets, although they can All revenues and expenses during year, regardless of when cash is received or paid
The two government-wide statements report the District's net assets and how they have changed. Net assets the difference between the District's assets and liabilities - is one way to measure the District's financial health or position.
Over time, increases or decreases in the District's net assets are an indicator of whether its financial health is improving or deteriorating, respectively.
To assess the overall health of the District, one needs to consider additional nonfinancial factors such as changes in the District's tax base.
The government-wide financial statements of the District include the Governmental activities. Most of the District's basic services are included here, such as instruction, extracurricular activities, curriculum and staff development, health services and general administration. Property taxes and grants finance most of these activities. Fund Financial Statements The fund financial statements provide more detailed information about the District's most significant funds - not the District as a whole. Funds are accounting devices that the District uses to keep track of specific sources of funding and spending for particular purposes.
Some funds are required by State law and by bond covenants.
The Board of Trustees establishes other funds to control and manage money for particular purposes or to show that it is properly using certain taxes and grants.
9
The District has the following kinds of funds:
Governmental funds - Most of the District's basic services are included in governmental funds, which focus on (1) how cash and other financial assets that can readily be converted to cash flow in and out and (2) the balances left at year-end that are available for spending. Consequently, the governmental fund statements provide a detailed short-term view that helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the District's programs. Because this information does not encompass the additional long-term focus of the government-wide statements, we provide additional information at the bottom of the governmental funds statement, or on the subsequent page, that explain the relationship (or differences) between them.
Fiduciary funds - The District is the trustee, or fiduciary, for certain funds. It is also responsible for other assets that - because of a trust arrangement - can be used only for the trust beneficiaries. The District is responsible for ensuring that the assets reported in these funds are used for their intended purposes. All of the District's fiduciary activities are reported in a separate statement of fiduciary net assets and a statement of changes in fiduciary net assets. We exclude these activities from the District's government-wide financial statements because the District cannot use these assets to finance its operations.
FINANCIAL ANALYSIS OF THE DISTRICT AS A WHOLE Net assets. The District's combined net assets were $6,971,468 at August 31, 2012. Table A-1 Newton School District's Net Assets GOVERNMENTAL ACTIVITIES 2012 Current Assets: Cash and cash equivalents Property taxes receivable (net) Due from other government Due to other funds Other assets TOTAL CURRENT ASSETS Noncurrent Assets: Capital assets Less accumulated depreciation TOTAL NONCURRENT ASSETS TOTAL ASSETS
$
2 548 300 1 557 315 157 352 5 500 164 387 4 432 854 25 (13 11 15
255 974 280 713
2011 $
933 967) 966 820
2 462 380 1 518 426 307 473 94 031 4 382 310 25 (13 11 16
215 334 880 263
514 663) 851 161
Current Liabilities: Accounts payable and accrued liabilities Deferred revenue TOTAL CURRENT LIABILITIES Non-Current Liabilities: Debt TOTAL LIABILITIES
754 438 754 438
1 049 944 315 223 1 365 167
7 987 914 8 742 352
8 593 956 9 959 123
Net Assets: Invested in capital assets Restricted Unrestricted TOTAL NET ASSETS
2 901 600 3 469 6 971
2 955 441 2 906 6 304
$
036 982 450 468
$
863 228 947 038
Changes in net assets. The District's total revenues were $12,995,543. A significant portion (24 percent) of the District's revenues come from taxes, (See Figure A-3) 50 percent comes from state aid and formula grants. The total cost of all programs and services was $12,328,113: 48 percent of these costs are for instructional and student services.
10
Table A-2 Change in District's Net Assets GOVERNMENTAL ACTIVITIES 2012 2011 Program Revenues: Charges for services Operating grants and contributions General Revenues: Property taxes State aid - Formula Investment earnings Other TOTAL REVENUES
$
265 958 2 467 919
$
3 114 575 6 500 949 14 866 631 276 12 995 543
Instruction Instructional resources and media services Curriculum dev. and instructional staff dev. Instructional leadership School leadership Guidance, counseling and evaluation services Social work services Health services Student (pupil) transportation Food services Curricular/extracurricular activities General administration Plant maintenance and operation Security and monitoring services Data processing services Community services Debt service Payments to member districts - SSA/other government TOTAL EXPENSES
5 917 153 214 219 597 510 8 145 840 654 552 540 1 131 23 153 104 300 261 12 328
CHANGE IN NET ASSETS
251 993 2 426 216 3 132 147 6 839 595 12 838 472 661 13 135 450
184 299 584 574 349 043 194 518 822 215 647 307 051 203 827 044 517 735 113
6 523 201 220 268 644 540
257 666 244 761 812 761 905 139 220 820 254 686 634 549 309 575 533 1 202 986 35 437 192 510 158 635 722 530 285 329 13 768 783
667 430
Net assets - Beginning NET ASSETS - ENDING
$
6 304 038 6 971 468
(633 333)
$
6 937 371 6 304 038
Table A-3 presents the cost of each of the District's largest functions as well as each function's net cost (total cost less fees generated by the activities and intergovernmental aid). The net cost reflects what was funded by state revenues as well as local tax dollars.
However, the amount that our taxpayers paid for these activities through property taxes was only $3,114,575.
The cost of all governmental activities this year was $12,328,113.
Some of the costs were paid by grants and contributions - $8,968,868. Table A-3 Net Cost of Selected District Functions TOTAL COST OF
NET COST OF
SERVICES 2012 Instruction Plant maintenance and operations
$
5 917 184
SERVICES 2011
$
6 523 257
2012 $
4 682 178
2011 $
5 290 320
1 131 051
1 202 986
1 128 551
1 200 736
Student transportation
840 822
820 254
840 822
754 320
General administration
540 307
575 533
540 307
575 533
11
CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets At the end of 2012, the District had invested $11,280,966 in a broad range of capital assets, including land, equipment, buildings, and vehicles. (See Table A-4.) This amount represents a net decrease (including additions, deductions and adjustments) of $599,885 over last year. Table A-4 District's Capital Assets
Land Buildings and improvements Equipment and furniture TOTALS AT HISTORICAL COST Total accumulated depreciation NET CAPITAL ASSETS
$
21 3 25 13 $ 11
GOVERNMENTAL ACTIVITIES 2012 2011 244 067 $ 244 067 104 520 21 104 520 907 346 3 866 927 255 933 25 215 514 974 967 13 334 663 280 966 $ 11 880 851
The District's fiscal year 2012 capital asset spending of $146,217 was for equipment and building improvements. (More information about the District's capital assets is presented in the notes to the financial statements.) Long Term Debt At year-end the District had $7,987,914 in bonds, notes and leases outstanding as shown in Table A-5. More detailed information about the District's debt is presented in the notes to the financial statements. Table A-5 District's Long Term Debt
Leases payable Notes payable Bonds payable TOTAL BONDS AND LEASES PAYABLE
$ $
GOVERNMENTAL ACTIVITIES 2012 2011 100 881 $ 115 517 582 032 698 436 7 305 001 7 780 000 7 987 914 $ 8 593 953
CONTACTING THE DISTRICT'S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the District's finances and to demonstrate the District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the District's Business Services Department.
12
BASIC FINANCIAL STATEMENTS
13 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF NET ASSETS August 31, 2012 EXHIBIT A-1 DATA CONTROL CODES 1110 1225 1240 1260 1290 1410 1510 1520 1530 1000 2110 2160 2210 2140 2516 2501 2502 2000 3200 3820 3850 3900 3000
GOVERNMENTAL ACTIVITIES ASSETS Cash and cash equivalents Property taxes receivable (net allowance) Due from other governments Due from other funds Other receivable Prepaid expense Capital Assets: Land Buildings and improvements, net Furniture and equipment, net TOTAL ASSETS
$
244 10 300 736 15 713
LIABILITIES Accounts payable Accrued wages payable Other accrued expense Accrued interest Bond premium Due in one year Noncurrent Liabilities: Due in more than one year TOTAL LIABILITIES NET ASSETS Invested in capital assets, net of related debt Restricted For: State and federal programs Debt service Unrestricted TOTAL NET ASSETS
The accompanying notes are an integral part of this statement. 14 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
2 548 300 1 557 315 157 352 5 500 149 844 14 543 067 655 244 820
109 869 213 229 435 69 495 361 410 626 188 7 361 726 8 742 352 2 901 036
$
531 69 3 469 6 971
391 591 450 468
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF ACTIVITIES For the Year Ended August 31, 2012 EXHIBIT B-1 1 DATA CONTROL CODES 11 12 13 21 23 31 32 33 34 35 36 41 51 52 53 61 71 93 99 TG TP
MT DT IE GC MI TR CN NB NE
FUNCTIONS/PROGRAMS Government Activities: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling, and evaluation services Social work services Health services Student transportation Food service Cocurricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Interest on long-term debt Payments related to shared service arrangements Payments to other governments TOTAL GOVERNMENTAL ACTIVITIES TOTAL PRIMARY GOVERNMENT
3
PROGRAM REVENUES CHARGES OPERATING FOR GRANTS AND SERVICES CONTRIBUTIONS
EXPENSES $
5 917 184
$
-
$
1 235 006
GOVERNMENTAL ACTIVITIES $
(4 682 178)
153 299
-
15 617
(137 682)
214 584 219 574 597 349
-
72 022 150 454 46 713
(142 562) (69 120) (550 636) (233 (8 (107 (840 (5
510 8 145 840 654
043 194 518 822 215
166 465
276 821 37 878 481 820
552 647 540 307
96 993 -
7 892 -
1 131 051
2 500
23 153 104 300
-
31 131 -
95 873
-
112 565
165 862
-
12 328 113
$
265 958
AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
(23 (153 (72 (300
$
203) 827) 913) 517)
16 692 (165 862)
2 467 919
(9 594 236)
2 467 919
(9 594 236)
General Revenues: Property taxes, levied for general purposes Property taxes, levied for debt service Investment earnings Grants and contributions not restricted to specific programs Miscellaneous TOTAL GENERAL REVENUES CHANGE IN NET ASSETS Net assets - Beginning NET ASSETS - ENDING
The accompanying notes are an integral part of this statement. 15
(1 128 551)
-
265 958
222) 194) 640) 822) 930)
(447 762) (540 307)
-
203 827 044 517
12 328 113 $
NET (EXPENSE) REVENUE AND CHANGES IN NET ASSETS
4
2 914 386 200 189 14 866
$
6 500 631 10 261 667 6 304 6 971
949 276 666 430 038 468
NEWTON INDEPENDENT SCHOOL DISTRICT BALANCE SHEET - GOVERNMENTAL FUNDS August 31, 2012 EXHIBIT C-1 10 DATA CONTROL CODES
ASSETS Cash and cash equivalents Taxes receivable, net Due from other governments Due from other funds Other receivables Prepaid expenses TOTAL ASSETS
2110 2160 2170 2210 2300 2000
LIABILITIES Current Liabilities: Accounts payable Accrued wages payable Due to other funds Other accrued expense Deferred revenue TOTAL LIABILITIES
3430 3450 3480 3600 3000 4000
OTHER GOVERNMENTAL FUNDS
GENERAL FUND
1110 1225 1240 1260 1290 1410 1000
FUND BALANCES Non-spendable Fund Balance: Prepaid Expenses Restricted Fund Balances: Restricted for grants Restricted for debt service Unassigned TOTAL FUND BALANCE TOTAL LIABILITIES AND FUND BALANCES
$ 2 224 403 1 360 911 139 765 5 500 46 241 14 543 $ 3 791 363
$
$
$
2 390 180 704 295 899 435 1 360 911 1 840 339
$
14 543
The accompanying notes are an integral part of this statement. 16 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
323 196 17 295 103
897 404 587 899 603 937 390
$
107 479 32 525 196 404 336 408
$
$
-
1 936 481 1 951 024 $ 3 791 363
98 TOTAL GOVERNMENTAL FUNDS
937 390
109 869 213 229 295 899 435 1 557 315 2 176 747
14 543
531 391 69 591 600 982 $
2 548 300 1 557 315 157 352 301 399 149 844 14 543 4 728 753
531 69 1 936 2 552 $
391 591 481 006
4 728 753
NEWTON INDEPENDENT SCHOOL DISTRICT RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS August 31, 2012 EXHIBIT C-1R TOTAL FUND BALANCES - GOVERNMENTAL FUNDS BALANCE SHEET
$
2 552 006
Amounts Reported For Governmental Activities in the Statement of Net Assets are Different Because: Capital assets net of depreciation used in governmental activities are not reported in the funds.
11 265 184
The value of capital assets received included in gains on retirement of capital assets is not reported in the funds.
15 782
Property taxes receivable unavailable to pay for current period expenditures are deferred in the funds.
1 557 315
Payables for debt which are not due in the current period are not reported in the funds.
(7 987 914)
Payables for interest which are not due in the current period are not reported in the funds.
(69 495)
Bond issue are amortized in governmental activity and expensed in the funds. NET ASSETS OF GOVERNMENTAL ACTIVITIES STATEMENT OF NET ASSETS
The accompanying notes are an integral part of this statement. 17 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
(361 410) $
6 971 468
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS For the Year Ended August 31, 2012 EXHIBIT C-2 10 DATA CONTROL CODES
5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0032 0033 0034 0035 0036 0041 0051 0052 0053 0061 0071 0093 0099 6030
GENERAL FUND
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
$
Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Social work services Health services Student transportation Food services Co-curricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Debt service Payments to shared service arrangements Payments to other governments TOTAL EXPENDITURES
1200 0100 3000
Other Financing Sources (Uses): Transfer in Transfers out TOTAL OTHER FINANCING SOURCES (USES) NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
4 451 856
EXCESS REVENUE OVER (UNDER) EXPENDITURES 7915 8925 7080
3 536 763 6 151 000 128 589 9 816 352
$
98 TOTAL GOVERNMENTAL FUNDS
OTHER GOVERNMENTAL FUNDS
435 870 1 818 3 124
241 728 551 520
$
1 078 884
3 7 1 12
972 021 947 940
004 728 140 872
5 530 740
138 127 111 508
233 314 531 536
17 73 108 49
116 191 043 558
155 200 219 558
349 505 574 094
271 8 96 883 25
984 194 044 675 171
204 539 39 940 586 064
476 8 135 883 611
523 194 984 675 235
469 504 1 056 23 165 70 162
017 850 785 203 068 917 604
47 354 33 127 778 261
516 504 1 056 23 165 104 940
371 850 785 203 068 044 865
165 862 9 240 844
95 873 3 111 950
95 873 165 862 12 352 794
575 508
12 570
588 078
(147 184)
317 376 (170 192)
317 376 (317 376)
(147 184)
147 184
428 324 1 522 700 1 951 024
The accompanying notes are an integral part of this statement. 18 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
159 754 441 228 600 982
-
$
588 078 1 963 928 2 552 006
NEWTON INDEPENDENT SCHOOL DISTRICT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For the Year Ended August 31, 2012 NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS
EXHIBIT C-3 $
588 078
Amounts Report For Government Activities in the Statement of Activities ("SOA") are Different Because: Capital outlays are not reported as expenses in the SOA.
129 217
The depreciation of capital assets used in governmental activities is not reported in the funds.
(744 884)
Gains and losses on retirement of property and equipment are not reported in the funds.
15 782
Certain property tax revenues are deferred in the funds. This is the change in these amounts this year.
38 889
Expenses in the SOA not providing current financial resources are not reported as expenses in the funds.
30 117
Repayment of debt is an expenditure in the funds but is not an expense in the SOA.
606 042
Decrease in accrued interest from beginning of period to end of period. CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES STATEMENT OF ACTIVITIES
The accompanying notes are an integral part of this statement. 19 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
4 189 $
667 430
NEWTON INDEPENDENT SCHOOL DISTRICT STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES AGENCY FUNDS August 31, 2012 EXHIBIT E-1 863 PAYROLL CLEARING FUND
DATA CONTROL CODES 1110 1290 1000
ASSETS Cash and cash equivalents Other receivables TOTAL ASSETS
2160 2170 2190 2000
LIABILITIES Accrued expense Due to other funds Due to student groups TOTAL LIABILITIES
3000
NET ASSETS TOTAL NET ASSETS
$
3 847 1 653 5 500
865 STUDENT CLUB FUND $
5 500 5 500 $
The accompanying notes are an integral part of this statement. 20 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
20 667 20 667
TOTAL AGENCY FUNDS $
109 20 558 20 667 $
-
24 514 1 653 26 167 109 5 500 20 558 26 167
$
-
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The basic financial statements of Newton Independent School District ("the District") have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") applicable to governmental units in conjunction with the Texas Education Agency's Financial Accountability System Resource Guide ("Resource Guide"). The Governmental Accounting Standards Board ("GASB") is the accepted standard setting body for establishing governmental accounting and financial reporting principles. 1.
Reporting Entity The Board of School Trustees ("Board"), a seven-member group, has governance responsibilities over all activities related to pubic elementary and secondary education within the jurisdiction of the District. The Board is elected by the public and has the exclusive power and duty to govern and oversee the management of the public schools of the District. All powers and duties not specifically delegated by statute to the Texas Education Agency ("TEA") or to the State Board of Education are reserved for the Board, and the TEA may not substitute its judgment for the lawful exercise of those powers and duties by the Board. The District receives funding from local, state and federal government sources and must comply with the requirements of those funding entities. However, the District is not included in any other governmental "reporting entity" as defined by the GASB in its Statement No. 14, "The Financial Reporting Entity" and there are no component units included within the reporting entity.
2.
Basis of Presentation, Basis of Accounting a.
Basis of Presentation Government-wide Statements: The statement of net assets and the statement of activities include the financial activities of the overall government. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. The statement of activities presents a comparison between direct expenses and program revenues for each function of the District's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. The District does not allocate indirect expenses in the statement of activities. Program revenues include (a) fees, fines, and charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the District's funds, with separate statements presented for each fund category. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.
The District reports the following major governmental funds: General Fund. This is the District's primary operating fund. It accounts for all financial resources of the District except those required to be accounted for in another fund. 21 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED In addition, the District reports the following fund types: Agency Funds: These funds are used to report student activity funds and other resources held in a purely custodial capacity (assets equal liabilities). Agency funds typically involve only the receipt, temporary investment, and remittance of fiduciary resources to individuals, private organizations, or other governments. Fiduciary funds are reported in the fiduciary fund financial statements. However, because their assets are held in a trustee or agent capacity and are therefore not available to support District programs, these funds are not included in the government-wide statements. b.
Measurement Focus, Basis of Accounting Government-wide Financial Statements: These financial statements are reported using the economic resources measurement focus. They are reported using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Non-exchange transactions, in which the District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, grants, entitlements, and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year in which all eligibility requirements have been satisfied. Governmental Fund Financial Statements: Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The District considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end. Revenues from local sources consist primarily of property taxes. Property tax revenues and revenues received from the State are recognized under the susceptible-to-accrual concept. Miscellaneous revenues are recorded as revenue when received in cash because they are generally not measurable and available. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources. When the District incurs an expenditure or expense for which both restricted, committed or assigned and unrestricted resources may be used, it is the District's policy to use restricted, committed or assigned resources first, then unrestricted resources. In the fund financial statements, governmental funds report restricted fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Committed fund balance represents amount established by formal action of the School Board, and may be changed with formal action. Assigned fund balance represents amounts established by the Districts management by authority of the School Board, and may be changed by management. 22 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED 3.
Fund Balance Year ending August 31, 2011, the District implemented GASB Statement No. 54, "Fund Balance Reporting and Governmental Fund Type Definitions." This Statement provides more clearly defined fund balance categories to make the nature and extent of the constraints placed on a government's fund balances more transparent. The following classifications describe the relative strength of the spending constraints:
Nonspendable Fund Balance - Amounts that are not in nonspendable form (such as inventory) or are required to be maintained intact.
Restricted Fund Balance - Amounts constrained to specific purposes by their providers (such as grantors, bondholders, and higher levels of government), through constitutional provisions, or by enabling legislation.
Committed Fund Balance - Amounts constrained to specific purposes by the District itself, using its highest level of decision-making authority (i.e., School Board). To be reported as committed, amounts cannot be used for any other purpose unless the District takes the same highest level action to remove or change the constraint.
Assigned Fund Balance - Amounts the District intends to use for a specific purpose. Intent can be expressed by the School Board or by an official or body to which the School Board delegates the authority.
Unassigned Fund Balance - Amounts that are available for any purpose. Positive amounts are reported only in the general fund.
The School Board establishes (and modifies or rescinds) fund balance commitments by passage of an ordinance or resolution. This is typically done through adoption and amendment of the budget. A fund balance commitment is further indicated in the budget document as a designation or commitment of the fund (such as for special incentives). Assigned fund balance is established by School Board through adoption or amendment of the budget as intended for specific purpose (such as the purchase of fixed assets, construction, debt service, or for other purposes). 4.
Financial Statement Amounts a.
Property Taxes Property taxes are levied by October 1 on the assessed value listed as of the prior January 1 for all real and business personal property in conformity with Subtitle E, Texas Property Tax Code. Taxes are due on receipt of the tax bill and are delinquent if not paid before February 1 of the year following the year in which imposed. On January 1 of each year, a tax lien attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed. Property tax revenues are considered available (1) when they become due or past due and receivable within the current period and (2) when they are expected to be collected during a 60-day period after the close if the fiscal year.
23 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Allowances for uncollectibles tax receivables within the General and Debt Service Funds are based upon historical experience in collecting property taxes. Uncollectible personal property taxes are periodically reviewed and written off, but the District is prohibited from writing off real property taxes without specific statutory authority from the Texas Legislature. b.
Inventories and Prepaid Items The District records purchases of supplies as expenditures, utilizing the purchase method of accounting for inventory in accordance with the Resource Guide.
c.
Capital Assets Purchased or constructed capital assets are reported at cost or estimated historical cost. Donated fixed assets are recorded at their estimated fair value at the date of the donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized. A capitalization threshold of $5,000 is used. Capital assets are being depreciated using the straight-line method over the following estimated useful lives: ASSET CLASS Buildings Furniture and equipment
d.
ESTIMATED USEFUL LIVES 30 3-10
Receivable and Payable Balances The District believes that sufficient detail of receivable and payable balances is provided in the financial statements to avoid the obscuring of significant components by aggregation. Therefore, no disclosure is provided which disaggregates those balances. There are no significant receivables which are not scheduled for collection within one year of year-end.
e.
Compensated Absences It is the District's policy not to allow carryover of vacation not taken at August 31, 2012, so there is no liability for unpaid vacation at August 31, 2012. Full time employees of the District in positions listed in the Texas Public Education Compensation Plan accrue five days of state leave per year. There is no limit on accumulation and restrictions transfers among districts. The District also provides two days per year of local personal days, none of which is cumulative. Unused leave is not paid upon termination or retirement. Consequently, leave pay is recorded as an expenditure when taken. Due to the fact that amounts required to be paid in any fiscal year are raised in that year's budget and the District has no obligation for the accumulated leave until it is actually taken, no accrual for leave has been made.
24 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 A.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED f.
Interfund Activity Interfund activity results from loans, services provided, reimbursements or transfers between funds. Loans are reported as interfund receivables and payables as appropriate and are subject to elimination upon consolidation. Services provided, deemed to be at market or near market rates, are treated as revenues and expenditures or expenses. Reimbursements occur when a fund incurs a cost, charges the appropriate benefiting fund and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers In and Transfers Out are netted and presented as a single "Transfers" line on the government-wide statement of activities. Similarly, interfund receivables and payables are netted and presented as a single "Internal Balances" line of the government-wide statement of net assets.
g.
Use of Estimates The preparation of financial statements in conformity with Generally Accepted Accounting Principles "GAAP" requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates.
h.
Data Control Codes Data Control Codes appear in the rows and above the columns of certain financial statements. The TEA requires the display of these codes in the financial statements filed with TEA in order to insure accuracy in building a statewide database for policy development and funding plans.
5.
Subsequent Events Management has evaluated subsequent events through January 22, 2013, the date the financial statements were available to be issued.
B.
DEPOSITS AND INVESTMENTS The District's funds are required to be deposited and invested under the terms of a depository contract. The depository bank deposits for safekeeping and trust with the District's agent bank approved pledged securities in an amount sufficient to protect District funds on a dayto-day basis during the period of the contract. The pledge of approved securities is waived only to the extent of the depository bank's dollar amount of Federal Deposit Insurance Corporation ("FDIC") insurance. Cash Deposits - At August 31, 2012, the carrying amount of the District's deposits (cash, certificates of deposit, and interest-bearing savings accounts included in temporary investments) was $2,572,814 and the bank balance was $2,770,836. The District's cash deposits at August 31, 2012 and during the period ended August 31, 2012, were entirely covered by FDIC insurance or by pledged collateral held by the District's agent bank in the District's name. Investments - The Public Funds Investment Act ("Act") requires an annual audit of investment practices. Audit procedures in this area conducted as a part of the audit of the general purpose financial statements disclosed that in the areas of investment practices, management reports and establishment of appropriate policies, the District adhered to the requirements of the Act. Additionally, investment practices of the District were in accordance with local policies. 25 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 B.
DEPOSITS AND INVESTMENTS - CONTINUED The Act determined the types of investments which are allowable for the District. These include, with certain restrictions, (1) obligations of the U.S. Treasury, certain U.S. agencies, and the State of Texas, (2) certificates of deposit, (3) certain municipal securities, (4) money market savings accounts, (5) repurchase agreements, (6) bankers acceptances, (7) mutual funds, (8) investment pools, (9) guaranteed investment contracts, and (10) common trust funds. The District currently has investments in the Lone Star Investment Pool of $1,118,686. Public Funds Investment Pools - Public funds investment pools in Texas ("Pools") are established under the authority of the Internal Cooperation Act, Chapter 79 of the Texas Government Code, and subject to the provisions of the Public Funds Investment Act (the "Act"), Chapter 2256 of the Texas Government Code. In addition to other provisions of the Act designed to promote liquidity and safety of principal, the Act requires Pools to: 1) have an advisory board composed of participants in the pool and other persons who do not have a business relationship with the pool and are qualified to advise the pool; 2) maintain a continuous rating of no lower than AAA or AAA-m or an equivalent rating by at least one nationally recognized rating service; and 3) maintain the market value of its underlying investment portfolio within one half of one percent of the value of its shares. The District's investments in Pools are reported at an amount determined by the fair value per share of the pool's underlying portfolio, unless the pool is 2a7-like, in which case they are reported at share value. A 2a7-like pool is one which is not registered with the Securities and Exchange Commission ("SEC") as an investment company, but nevertheless has a policy that it will, and does, operate in a manner consistent with the SEC's Rule 2a7 of the Investment Company Act of 1940. The investments in the Pools are based on contractual agreements and not the individual security itself; therefore, the District's investment in the Pool is not categorized as to level of risk. The market value of the Pool is based on quoted market values of underlying investments of the Pools. Authorized investments include obligations of States, agencies and other local governments having an investment rating of not less than A or its equivalent; certificates of deposit that are guaranteed by the Federal Deposit Insurance Cooperation and other investments authorized by statutes governing public funds investment pools. The pools use amortized cost rather than market value to report net assets to comparable share prices. Accordingly, the fair value of the position in the Pool is the same as the value of the shares in the Pool. The purpose of the Pools is to allow for the pooling of public funds to provide a higher yield on the pooled investments than would be possible with the investment of the individual public entity's funds. The investment in the Pool and any accrued interest may be redeemed at the District's discretion. Additional contractual provisions governing deposits and investments for the District are as follows: a.
Custodial Credit Risk - Deposits: In the case of deposits, this is the risk that in the event of a bank failure, the government's deposits may not be returned to it. To insure against this risk of loss, the District's contract with its depository bank specifies that the depository bank agrees to cover by corporate surety bond or pledge of approved securities an amount that is equal to funds anticipated to be on deposit from day to day that exceeds the value of FDIC insurance coverage. During the year ended at August 31, 2012, the District had FDIC insurance and pledge securities that were adequate at all times to insure the District's deposits.
26 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 B.
DEPOSITS AND INVESTMENTS - CONTINUED b.
C.
Custodial Credit Risk - Investments: For an investment, this is the risk that, in the event of the failure of the counterparty, the government will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. All of the District's investments are held in external investment pools which are not subject to custodial credit risk.
CAPITAL ASSETS Capital asset activity for the period ended August 31, 2012, was as follows: BEGINNING BALANCES
Governmental Activities: Capital Assets Not Being Depreciated: Land TOTAL CAPITAL ASSETS NOT BEING DEPRECIATED
$
$
-
244 067
Capital Assets Being Depreciated: Buildings and improvements Furniture and equipment TOTAL CAPITAL ASSETS BEING DEPRECIATED Less Accumulated Depreciation For: Buildings and improvement Furniture and equipment TOTAL ACCUMULATED DEPRECIATION TOTAL CAPITAL ASSETS BEING DEPRECIATED, NET GOVERNMENTAL ACTIVITIES CAPITAL ASSETS, NET
244 067
INCREASES
$
ENDING BALANCES
DECREASES
$
-
-
-
$
244 067 244 067
21 104 520 3 866 927
146 217
105 798
21 104 520 3 907 346
24 971 447
146 217
105 798
25 011 866
10 199 587 3 135 076
604 278 140 606
104 580
10 803 865 3 171 102
13 334 663
744 884
104 580
13 974 967
11 636 784
(598 667)
1 218
11 036 899
1 218
$ 11 280 966
11 880 851
$
(598 667)
$
Cost of leased equipment at August 31, 2012 was $323,534 with accumulated depreciation of $241,777. The net value of leased assets at year end was $81,757. Depreciation was charged to functions as follows: Instruction Instructional resources and media services Curriculum and staff development School leadership Guidance, counseling, and evaluation services Health services Student transportation Food services Extracurricular activities General administration Plant maintenance and operations TOTAL
27 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
$
386 10 14 39 33 9 62 42 36 35 74 744
444 950 079 255 520 534 123 980 276 457 266 884
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 D.
INTERFUND BALANCES AND ACTIVITIES 1.
Due To and From Other Funds Balances due to and due from other funds at August 31, 2012, consisted of the following: DUE TO FUND General Fund Special Revenue Fund
DUE FROM FUND Agency Fund General Fund TOTAL
AMOUNT 5 500 295 899 $ 301 399 $
PURPOSE Payroll expenses Payroll expenses
All amounts due are scheduled to be repaid within one year. 2.
Transfers To and From Other Funds Transfers to and from other funds at August 31, 2012, consisted of the following: TRANSFERS FROM General Fund General Fund Special Revenue Fund
E.
TRANSFERS TO Special Revenue Fund Debt Service Fund Debt Service Fund TOTAL
AMOUNT $ 121 818 25 366 170 192 $ 317 376
REASON Repayment Repayment Repayment
LONG-TERM OBLIGATIONS 1.
Long-Term Obligation Activity Long-term obligations include debt and other long-term liabilities. Changes in longterm obligations for the period ended August 31, 2012, are as follows: AMOUNT BEGINNING BALANCE
Governmental Activities: Bonds Notes payable Capital leases TOTAL GOVERNMENTAL ACTIVITIES
INCREASES
DECREASES
ENDING
DUE WITHIN
BALANCE
ONE YEAR
$ 7 780 001 698 438 115 517
$
-
$
475 000 116 406 14 636
$ 7 305 001 582 032 100 881
$
495 000 116 406 14 782
$ 8 593 956
$
-
$
606 042
$ 7 987 914
$
626 188
A summary of general obligation bonds for the year ended August 31, 2012, is as follows:
DESCRIPTION Tax Refunding Bonds
INTEREST
AMOUNTS
AMOUNTS
AMOUNTS
RATE
ORIGINAL
OUTSTANDING
OUTSTANDING
PAYABLE
ISSUE
09/01/2011
3.25% to 4.10%
$
8 484 996
$
7 780 001
28 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
ISSUED $
-
RETIRED $
475 000
08/31/2012 $
7 305 001
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 E.
LONG-TERM OBLIGATIONS - CONTINUED 2.
Debt Service Requirements Debt service requirements on bonds payable at August 31, 2012, are as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 2018-2022 2023-2027 TOTALS
3.
GOVERNMENTAL ACTIVITIES INTEREST TOTAL PRINCIPAL $ 495 000 $ 283 460 $ 778 460 520 000 263 160 783 160 545 000 241 860 786 860 570 000 219 560 789 560 595 000 196 260 791 260 3 420 000 4 011 400 7 431 400 1 160 001 1 199 155 2 359 156 $ 7 305 001 $ 6 414 855 $ 13 719 856
Notes Payable Debt service requirements on notes payable at August 31, 2012, are as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 TOTALS
$
$
GOVERNMENTAL ACTIVITIES PRINCIPAL INTEREST TOTAL 116 406 $ 20 954 $ 137 360 116 406 16 297 132 703 128 046 116 406 11 640 116 406 6 984 123 390 116 408 2 328 118 736 582 032 $ 58 203 $ 640 235
The effective interest rate on the note payable is 4.0%, with deposits as security. 4.
Capital Leases Commitments under capitalized lease agreements for facilities and equipment provide for minimum future lease payments as of August 31, 2012 as follows: YEAR ENDING AUGUST 31, 2013 2014 2015 2016 2017 2018-2022 TOTAL MINIMUM RENTALS Less amount representing interest CAPITAL LEASE PAYABLE
$
$
Rental Expenditures in 2012
$
20 20 20 20 20 20 120 19 100
123 123 123 123 123 123 738 857 881
14 636
The effective interest rate on capital lease is 5.3%. Notes payable are collateralized by the future receivables of the District, and capital leases are collateralized by the assets being leased.
29 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 F.
RISK MANAGEMENT The District is exposed to various risks of loss related to torts, theft, damage or destruction of assets, errors and omissions, injuries to employees, and natural disasters. During fiscal year 2012, the District purchased commercial insurance to cover general liabilities. There were no significant reductions in coverage in the past fiscal year and there were no settlements exceeding insurance coverage for each of the past three fiscal years.
G.
PENSION PLAN Plan Description - The Newton Independent School District contributes to the Teacher Retirement System of Texas (TRS), a cost-sharing multiple employer defined benefit pension plan. TRS administers retirement and disability annuities, and death and survivor benefits to employees and beneficiaries of employees of the public school systems of Texas. It operates primarily under the provisions of the Texas Constitution, Article XVI, Sec. 67, and Texas Government Code, Title 8, Subtitle C. TRS also administers proportional retirement benefits and service credit transfer under Texas Government Code, Title 8, Chapters 803 and 805, respectively. The Texas state legislature has the authority to establish and amend benefit provisions of the pension plan and may, under certain circumstances, grant special authority to the TRS Board of Trustees. TRS issues a publicly available financial report that includes financial statements and required supplementary information for the defined benefit pension plan. That report may be obtained by writing to the TRS Communications Department, 1000 Red River Street, Austin, Texas 78701, by calling the TRS Communications Department at 1.800.223.8778, or by downloading the report for the TRS Internet website, www.trs.state.tx.us, under the TRS Publications heading. Funding Policy - Contribution requirements are not actuarially determined, but are established and amended by the Texas state legislature. The state funding policy is as follows: (1) The state constitution requires the legislature to establish a member contribution rate of not less than 6.0% of the members' annual compensation and a state contribution rate of not less than 6.0% and more than 10% of the aggregate annual compensation of all members of the system; (2) A state statute prohibits benefit improvements or contribution reductions if, as a result of the particular action, the time required to amortize TRS' unfunded actuarial liabilities would be increased to a period that exceeds 31 years, or, if the amortization period already exceeds 31 years, the period would be increased by such action. State law provides for a member contribution rate of 6.4% for fiscal year 2012, 2011 and 2010 and a state contribution rate of 6.58% for fiscal years 2012, 2011 and 2010. State contributions to TRS made on behalf of the Newton Independent School District's employees for the years ended August 31, 2012, 2011 and 2010 were $361,743, $396,249 and $380,289, respectively. The Newton Independent School District paid additional state contributions for the years ended August 31, 2012, 2011 and 2010 in the amount of $32,297, $33,688 and $28,303, respectively, on the portion of the employees' salaries that exceeded the statutory minimum.
30 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE FINANCIAL STATEMENTS - CONTINUED For the Year Ended August 31, 2012 H.
HEALTH CARE COVERAGE Plan Description - The Newton School District contributes to the Texas Public School Retired Employees Group Insurance Program (TRS-Care), a cost-sharing multiple-employer defined benefit postemployment health care plan administered by the Teacher Retirement System of Texas. TRS-Care Retired Plan provides health care coverage for certain persons (and their dependents) who retired under the Teacher Retirement System of Texas. The statutory authority for the program is Texas Insurance Code, Chapter 1575. Section 1575.052 grants the TRS Board of Trustees the authority to establish and amend basic and optional group insurance coverage for participants. The TRS issues a publicly available financial report that includes financial statements and required supplementary information for TRS-Care. That report may be obtained by visiting the TRS Website at www.trs.state.tx.us, by writing to the Communications Department of the Teacher Retirement System of Texas at 1000 Red River Street, Austin, Texas 78701, or by calling 1.800.223.8778. Funding Policy - Contribution requirements are not actuarially determined, but are legally established each biennium by the Texas Legislature. Texas Insurance Code, Sections 1575.202, 203 and 204 establish state, active employee, and public school employee contributions, respectively, the State of Texas and active public school employee contribution rates were 1.0% and 0.65% of public school payroll, respectively, with school districts contributing a percentage of payroll set at 0.55% for fiscal years 2012, 2011 and 2010. Per Texas Insurance Code, Chapter 1575, the public school contribution may not be less than 0.25% or greater than 0.75% of the salary of each active employee of the public school. For the years ended August 31, 2012, 2011 and 2010, the State's contributions to TRS-Care were $62,399, $66,745 and $66,994, respectively, the active member contributions were $40,557, $43,884 and $43,546, respectively, and the school district's contributions were $34,319, $36,710 and $36,847, respectively, which equaled the required contributions each year. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which was effective January 1, 2006 established prescription drug coverage for Medicare beneficiaries known as Medicare Part D. One of the provisions of Medicare Part D allows for the Texas Public School Retired Employee Group Insurance Program (TRS-Care) to receive retiree drug subsidy payments from the federal government to offset certain prescription drug expenditures for eligible TRS-Care participants. For the fiscal years ended August 31, 2012, 2011 and 2010, the subsidy payments received by TRS-Care on behalf of the District were $15,469, $15,460 and $16,784, respectively.
I.
COMMITMENTS AND CONTINGENCIES 1.
Contingencies The District participates in grant programs which are governed by various rules and regulations of the grantor agencies. Costs charges to the respective grant programs are subject to audit and adjustment by the grantor agencies; therefore, to the extent that the District has not complied with the rules and regulations governing the grants, refunds of any money received may be required and the collectibility of any related receivable may be impaired. In the opinion of the District, there are no significant contingent liabilities relating to compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying basic financial statements for such contingencies.
2.
Litigation No reportable litigation was pending against the District at August 31, 2012. 31 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
REQUIRED SUPPLEMENTARY INFORMATION Required supplementary information includes financial information and disclosures required by the Governmental Accounting Standards Board, but no considered a part of the basic financial statements.
32 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT GENERAL FUND BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT G-1 DATA CONTROL CODES 5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0032 0033 0034 0035 0036 0041 0051 0052 0053 0061 0071 0099 6030
ORIGINAL BUDGET Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
$
Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Social work Health services Student transportation Food service Cocurricular/extracurricular activities General administration Plant maintenance and operations Security and monitoring services Data processing services Community services Debt service Payments to other governments TOTAL EXPENDITURES
1200 0100 3000
$
$
3 536 763 6 151 000 128 589 9 816 352
$
17 (229 126 (85
954 924) 589 381)
4 451 856
154 661
143 829
145 145
138 233
6 912
117 073 126 866 563 626
132 905 124 976 534 144
127 314 111 531 508 536
5 591 13 445 25 608
264 482 253 105 583 827 785 39 939
288 7 103 870 25
271 8 96 883 25
16 733 (288) 7 634 (13 078) 145
470 554 525 857
475 254 527 041
469 017 504 850
6 237 22 191
1 115 223
1 119 564
1 056 785
62 779
495 644 630 124
28 210 78 169
717 906 678 597 316
506 278 291 124
23 165 70 162
984 194 044 675 171
203 068 917 604
5 45 7 6
303 210 374 520
180 000 9 535 104
180 000 9 627 959
165 862 9 240 844
14 138 387 115
295 269
273 774
575 508
301 734
-
-
(147 184)
(147 184)
-
-
(147 184)
(147 184)
428 324
154 550
295 269
Fund balances - Beginning FUND BALANCES - ENDING
3 518 809 6 380 924 2 000 9 901 733
4 606 517
Other Financing Sources: Transfers out TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES
$
ACTUAL
4 597 141
47 180 59 169
EXCESS REVENUE OVER (UNDER) EXPENDITURES 8925
2 857 414 6 906 959 66 000 9 830 373
FINAL BUDGET
VARIANCE WITH FINAL BUDGET POSITIVE (NEGATIVE)
1 522 700 1 817 969
273 774 $
See independent auditors' report. 33 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
1 522 700 1 796 474
$
1 663 342 2 091 666
$
140 642 295 192
COMBINING STATEMENTS AS SUPPLEMENTARY INFORMATION This supplementary information includes financial statements and schedules not required by the Governmental Accounting Standards Board, nor a part of the basic financial statements, but are presented for purposes of additional analysis.
34 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS August 31, 2012 EXHIBIT H-1
DATA CONTROL CODES
SPECIAL REVENUE FUNDS
1110 1225 1240 1260 1290 1000
ASSETS Cash and cash equivalents Taxes receivable, net Due from other governments Due from other funds Other receivables TOTAL ASSETS
2110 2160 2300 2000
LIABILITIES Current Liabilities: Accounts payable Accrued wages payable Deferred revenue TOTAL LIABILITIES
3450 3420 3000
FUND BALANCES Reserved Fund Balances: Reserved for grants Reserved for debt service TOTAL FUND BALANCE
4000
$
$
$
TOTAL LIABILITIES AND FUND BALANCES
$
TOTAL NONMAJOR GOVERNMENTAL FUNDS (SEE EXHIBIT C-1)
DEBT SERVICE FUND
259 022 12 871 295 899 103 603 671 395
$
64 875 196 404 4 716 $ 265 995
$
107 479 32 525 140 004
$
$
196 404 196 404
531 391 531 391
69 591 69 591
671 395
$ 265 995
See independent auditors' report. 35 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
323 196 17 295 103 937
897 404 587 899 603 390
107 32 196 336
479 525 404 408
531 391 69 591 600 982 $
937 390
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS For the Year Ended August 31, 2012
DATA CONTROL CODES
5700 5800 5900 5020
0011 0012 0013 0021 0023 0031 0033 0035 0036 0061 0071 0093 6030 1100
7915 8915 7080 1200 0100 3000
SPECIAL REVENUE FUNDS
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES Expenditures: Current: Instruction Instructional resources and media services Curriculum and staff development Instructional leadership School leadership Guidance, counseling and evaluation services Health services Food services Co-curricular/ extracurricular activities Community services Debt service Payments to shared service arrangements TOTAL EXPENDITURES EXCESS REVENUE OVER (UNDER) EXPENDITURES Other Financing Sources (Uses): Transfers in Transfer out TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
234 649 1 818 2 702
815 368 551 734
EXHIBIT H-2 TOTAL NONMAJOR GOVERNMENTAL FUNDS (SEE EXHIBIT C-2)
DEBT SERVICE FUND
$
200 426 221 360 421 786
$
435 870 1 818 3 124
241 728 551 520
1 078 884
-
1 078 884
17 116
-
17 116
73 191 108 043 49 558
-
73 191 108 043 49 558
204 539 39 940 586 064
-
204 539 39 940 586 064
47 354 33 127 -
778 261
47 354 33 127 778 261
95 873 2 333 689
778 261
95 873 3 111 950
$
See independent auditors' report. 36 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
369 045
(356 475)
12 570
121 818 (170 192)
195 558 -
317 376 (170 192)
(48 374) 320 671 210 720 531 391
195 558 (160 917) 230 508 69 591
147 159 441 600
$
$
184 754 228 982
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS August 31, 2012
211
224
225
240
DATA CONTROL
ESEA
IDEA-B
IDEA-B
FOOD
CODES
TITLE I
FORMULA
PRESCHOOL
SERVICE
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
1260
Due from other funds
1290
Other receivables
1000
$
-
$
-
$
-
46 457
-
$
-
36 349
-
TOTAL ASSETS
-
10 918
4 502
-
115 524 -
-
231
$
46 457
$
36 349
$
4 502
$
$
25 385
$
32 514
$
4 502
$
126 673
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
21 072
3 835
2000
TOTAL LIABILITIES
46 457
36 349
-
-
4 502
-
FUND BALANCES Reserved Fund Balances: 3450
Reserve for grants
3000
TOTAL FUND BALANCES
4000
TOTAL LIABILITIES AND FUND BALANCES
$
-
-
-
126 673
-
-
-
126 673
46 457
37 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
36 349
$
4 502
$
126 673
EXHIBIT H-3 PAGE 1 OF 3 242
244
255
266
VOCATIONAL
$
$
$
272
287
EDUCATION
TITLE
RURAL
SUMMER
EDUCATION
TITLE II
XIV
AND LOW
MEDICAID
FEEDING
BASIC
PART A
ARRA
INCOME
ADMINISTRATIVE
JOBS
PROGRAM
GRANT
TRAINING
SFSF
SCHOOLS
CLAIMING
GRANT
6 184
$
-
-
-
-
722
$
270
6 184
-
$
-
$
11 347
-
-
-
$
-
$
27 777
-
-
-
-
64
-
-
-
$
17 030
3 069
$
722
$
11 347
$
-
$
64
$
$
-
$
6 207
$
-
$
64
$
30 846
-
-
-
5 140
-
-
-
-
-
11 347
-
64
-
-
$
17 030
$
17 030 17 030
6 184
722
-
-
-
30 846
-
6 184
722
-
-
-
30 846
-
6 184
$
722
$
11 347
$
-
$
38 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
64
$
30 846
$
17 030
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED August 31, 2012
364
365
401
404
ARRA
ARRA
OPTIONAL
DATA
IDEA
IDEA
EXTENDED
STUDENT
CONTROL
PART B
PART B
YEAR
SUCCESS
CODES
FORMULA
PRESCHOOL
PROGRAM
INITIATIVE
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
-
-
-
1260
Due from other funds
-
-
31
1290
Other receivables
1000
TOTAL ASSETS
$
-
$
-
-
$
-
-
$
7 905
-
-
$
-
$
-
$
31
$
$
-
$
-
$
-
$
7 905
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
-
-
-
2 478
-
2000
TOTAL LIABILITIES
-
-
-
2 478
-
-
31
5 427
-
-
31
5 427
FUND BALANCES Reserved Fund Balances: 3450 3000
Reserve for grants TOTAL FUND BALANCES TOTAL LIABILITIES
4000
AND FUND BALANCES
$
-
$
39 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
$
31
$
7 905
EXHIBIT H-3 PAGE 2 OF 3 410
411
437
461
MATERIALS
TECHNOLOGY
SPECIAL
ALLOTMENT
ALLOTMENT
EDUCATION
ACTIVITY
INSTRUCTIONAL
$
$
$
$
3 826
$
-
$
-
$
472
473
HIGH
MIDDLE
ELEMENTARY
SCHOOL
SCHOOL
SCHOOL
ACTIVITY
ACTIVITY
2 949
-
-
162 612
6 008
2 872
-
-
59 062
53
290
-
-
$
221 674
$
9 010
$
$
-
$
19 263
$
467
$
-
-
-
3 826 3 826
$
5 116
-
22 607 30 334
$
52 941
$
2 047
-
-
19 263
467
-
-
202 411
8 543
5 116
50 894
-
202 411
8 543
5 116
50 894
-
-
$
1 953
$
-
3 826
-
1
-
3 826
-
$
-
$
221 674
$
9 010
40 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
5 116
2 047
$
52 941
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED August 31, 2012 EXHIBIT H-3 PAGE 3 OF 3
DATA
816
TOTAL
AUSSIE
NONMAJOR
WALDO
SPECIAL
SCHOLAR-
REVENUE
CONTROL
SHIP
FUNDS (SEE
CODES
FUND
EXHIBIT H-1)
1110
ASSETS Cash and cash equivalents
1240
Due from other governments
-
12 871
1260
Due from other funds
-
295 899
1290
Other receivables
1000
$
80 154
$
10 564
TOTAL ASSETS
$
90 718
259 022
103 603 $
671 395
$
107 479
LIABILITIES Current Liabilities: 2110
Accounts payable
2160
Accrued wages payable
2000
$
TOTAL LIABILITIES
-
32 525
-
140 004
FUND BALANCES Reserved Fund Balances: 3450 3000
Reserve for grants TOTAL FUND BALANCES
90 718
531 391
90 718
531 391
TOTAL LIABILITIES AND 4000
FUND BALANCES
$
See independent auditors' report. 41 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
90 718
$
671 395
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS For the Year Ended August 31, 2012
211
224
225
240
DATA CONTROL
ESEA
IDEA-B
IDEA-B
FOOD
CODES
TITLE I
FORMULA
PRESCHOOL
SERVICE
5700
Revenues: Local and intermediate sources
$
-
$
-
-
$
-
-
$
-
163 860
5800
State program revenues
5900
Federal program revenues
526 206
363 617
5 821
475 630
6 190
5020
TOTAL REVENUES
526 206
363 617
5 821
645 680
399 147
213 823
10 020
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media
0013
Curriculum and staff development
0021
Instructional leadership
0023
School leadership
0031
Guidance, counseling, and
0033
Health services
-
0035
Food services
0036
Cocurricular/extracurricular
0061
Community services
0093
Payments to shared service
6030
TOTAL EXPENDITURES
1100
EXCESS REVENUE OVER
services
-
-
-
-
-
-
-
-
-
-
11 612
-
-
-
21 072
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
71 136 -
evaluation services
activities
31 627
arrangements
-
95 873
534 594
(UNDER) EXPENDITURES
-
-
309 696
(8 388)
580 384
-
10 020
53 921
580 384
(4 199)
65 296
Other Financing Sources (Uses): 7900
Transfers in
8900
Transfers (out)
1200 0100 3000
8 388
-
-
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
4 199
(53 921)
-
-
-
-
-
-
65 296
-
-
-
61 377
-
42 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
-
$
-
$
126 673
EXHIBIT H-4 PAGE 1 OF 3 242
244
255
266
270
VOCATIONAL
$
287
EDUCATION
RURAL
SUMMER
EDUCATION
TITLE II
TITLE XIV
AND LOW
MEDICAID
FEEDING
BASIC
PART A
ARRA
INCOME
ADMINISTRATIVE
JOBS
PROGRAM
GRANT
TRAINING
SFSF
SCHOOLS
CLAIMING
GRANT
2 747
$
-
-
$
-
2 747
-
-
$
-
-
$
-
-
$
-
-
41 132
16 117
222 863
16 637
114 697
34 027
41 132
16 117
222 863
15 837
113 118
25 933
3 011
146 823
-
-
800
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
800
-
-
-
4 036
-
-
-
2 878
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2 055 2 584
16 637
(2 933)
117 757
14 399
4 697
-
3 060
-
-
-
(2 933)
-
-
-
-
9 117
722
-
-
-
722
$
-
-
-
(34 027)
$
-
43 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
37 062 8 649 244 254
(21 391)
26 149
(14 399)
$
34 562
11 420
-
$
34 027
42
-
26 733
(3 060)
17 116
1 495
-
-
-
6 184
-
34 027
-
-
-
114 697
-
5 680
$
16 637
-
5 680
$
272
21 391
-
-
30 846
-
$
30 846
$
-
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED For the Year Ended August 31, 2012
364
365
401
404
ARRA
ARRA
OPTIONAL
DATA
IDEA
IDEA
EXTENDED
STUDENT
CONTROL
PART B
PART B
YEAR
SUCCESS
CODES
FORMULA
PRESCHOOL
PROGRAM
INITIATIVE
5700
Revenues: Local and intermediate sources
$
-
$
-
$
-
-
$
-
-
5800
State program revenues
-
5900
Federal program revenues
-
1 804
-
73 946
5020
TOTAL REVENUES
-
1 804
-
73 946
2 478
-
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media
95
-
-
0013
Curriculum and staff development
-
-
-
-
-
-
-
0021
-
Instructional leadership
-
-
-
-
0023
School leadership
-
-
-
-
0031
Guidance, counseling, and -
-
-
-
0033
Health services
-
-
-
-
0035
Food services
-
-
-
-
0036
Cocurricular/extracurricular -
-
-
-
0061
Community services
-
-
-
-
0093
Payments to shared service -
-
-
6030
TOTAL EXPENDITURES
95
-
-
2 478
1100
EXCESS REVENUE OVER -
71 468
services
evaluation services
activities
arrangements
(UNDER) EXPENDITURES
(95)
1 804
-
Other Financing Sources (Uses): 7900
Transfers in
95
8900
Transfers (out)
-
1200 0100 3000
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
-
-
(1 804)
(66 041) 5 427
-
-
-
-
-
31
-
44 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
-
$
-
-
31
$
5 427
EXHIBIT H-4 PAGE 2 OF 3 410
411
437
461
MATERIALS
TECHNOLOGY
SPECIAL
ALLOTMENT
ALLOTMENT
EDUCATION
ACTIVITY
INSTRUCTIONAL
$
-
$
61 517
$
-
-
$
HIGH
MIDDLE
ELEMENTARY
SCHOOL
SCHOOL
SCHOOL
ACTIVITY
ACTIVITY
9 087
-
-
57 691
-
473
507 715
-
61 517
507 715
12 205
$
-
-
-
-
9 087
78 703
7 823
$
42 858 -
7 823
42 858
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3 826
179 431
363 840
(12 205)
143 875
-
-
-
3 826 $
-
-
$
202 411
22 444
1 099
20 414
-
-
-
-
-
8 993 $
-
6 724
-
(450)
-
-
-
(450)
202 411
22 444
-
9 537
-
12 205
6 724
-
58 536
(12 205)
-
9 537
-
12 205
-
3 826
105 706
-
57 691
$
-
472
8 543
45 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
1 099
20 414
4 017
30 480
5 116
$
50 894
NEWTON INDEPENDENT SCHOOL DISTRICT COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS - CONTINUED For the Year Ended August 31, 2012
DATA
EXHIBIT H-4 PAGE 3 OF 3
816
TOTAL
AUSSIE
NONMAJOR
WALDO
SPECIAL
SCHOLAR-
REVENUE
CONTROL
SHIP
FUNDS (SEE
CODES
FUND
EXHIBIT H-2)
5700
Revenues: Local and intermediate sources
$
8 440
$
234 815
5800
State program revenues
-
649 368
5900
Federal program revenues
-
1 818 551
5020
TOTAL REVENUES
8 440
2 702 734
Expenditures: Current: 0011
Instruction
0012
Instructional resources and media services
0013
Curriculum and staff development
-
73 191
0021
Instructional leadership
-
108 043
0023
School leadership
-
49 558
0031
Guidance, counseling, and -
204 539
0033
Health services
-
39 940
0035
Food services
-
586 064
0036
Cocurricular/extracurricular -
47 354
0061
Community services
0093
Payments to shared service
6030
TOTAL EXPENDITURES
1100
EXCESS REVENUE OVER
services
evaluation services
activities
-
1 078 884
-
17 116
1 500
arrangements
33 127
-
(UNDER) EXPENDITURES
95 873
1 500
2 333 689
6 940
369 045
Other Financing Sources (Uses): 7900
Transfers in
-
121 818
8900
Transfers (out)
-
(170 192)
1200 0100 3000
NET CHANGE IN FUND BALANCES Fund balances - Beginning FUND BALANCES - ENDING
$
See independent auditors' report. 46 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
6 940
320 671
83 778
210 720
90 718
$
531 391
OTHER SUPPLEMENTARY INFORMATION This section includes financial information and disclosures not required by the Governmental Accounting Standards Board and not considered a part of the basic financial statements. It may, however, include information, which is required by other entities.
47 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF DELINQUENT TAXES RECEIVABLE For the Year Ended August 31, 2012 1
2
3
TAX RATES YEAR ENDED AUGUST 31,
MAINTENANCE
2003 and Prior Years
ASSESSED/APPRAISED DEBT SERVICE
VALUE FOR SCHOOL TAX PURPOSES
N/A
N/A
2004
1.4082
0.2218
2005
1.4265
0.2035
156 177 239
2006
1.3050
0.1925
150 694 324
2007
0.9912
0.1810
198 527 726
2008
0.9912
0.1810
231 889 268
2009
1.010
0.1635
269 129 320
2010
1.040
0.2000
259 851 366
2011
1.040
0.2000
245 668 850
2012 (School Year Under Audit)
1.170
0.0700
244 182 097
1000 TOTALS
See independent auditors' report. 48 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
N/A $
150 483 313
EXHIBIT J-1
$
10
20
BEGINNING
CURRENT
31
32
40
50
DEBT
ENTIRE
ENDING
BALANCE
YEAR'S
MAINTENANCE
SERVICE
YEAR'S
BALANCE
09/01/2011
TOTAL LEVY
COLLECTIONS
COLLECTIONS
ADJUSTMENTS
08/31/2012
689 440
$
-
$
17 670
$
2 865
$
(12 676)
$
656 229
67 665
-
1 892
278
(1 780)
63 715
76 398
-
4 276
662
(1 848)
69 612
79 536
-
4 632
651
(1 876)
72 377
86 530
-
6 810
1 005
(1 466)
77 249
77 563
-
7 387
1 349
(454)
68 373
117 043
-
18 140
2 937
(1 214)
94 752
174 005
-
35 213
5 702
318 960
-
67 214
12 926
2 588 143
154 847
$ 1 687 140
3 027 858 $
3 027 858
$
2 751 377
$
183 222
49 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
330
$
133 420
(18 489)
220 331
36 588
321 456
(2 885)
$ 1 777 514
NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF EXPENDITURES FOR COMPUTATION OF INDIRECT COST FOR 2012-2013 GENERAL, SPECIAL REVENUE, AND GOVERNMENTAL EXPENDABLE TRUST FUNDS For the Year Ended August 31, 2012 EXHIBIT J-2 FUNCTION 41 AND RELATED FUNCTION 99 - GENERAL ADMINISTRATION A
B
C
D
E
F
(702)
(703)
(701)
(750)
(720)
(Other)
Direct
Account
School
Tax
Supt's
Indirect
Number
Board
Collection
Office
Cost
611X-6146
$
6211
1 619
-
52 095
6212
-
6213
-
621X
3 278
6230
500
6240
-
6260
3 948
6290
10 657
6320
15 071
6490
94 474
-
-
-
Cost
167 484
-
-
-
26 858
-
144
-
9 488
-
2 885
7 908
52 095
-
-
18 200
-
-
7 908
-
-
11 486
-
27 358
-
4 297
-
10 745 13 796
-
-
144
12 955
-
-
25 716
3 104
-
-
5 989
-
-
15 071
7 744 $
342 619
-
-
13 657 188 665
$
-
-
3 139
Total
15 706
-
4 297
2 116
$
$
-
-
4 681
-
-
18 200 8 208
-
Misc.
$
-
-
$
$
-
-
4 033 $
-
-
-
6420
157 810
-
3 273
6410
$
7 908
-
63XX
Total
$
G
249 808
$
4 297
Total expenditures/expenses for General and Special Revenue Funds (Exhibit C-2)
$
15 706 (9)
25 434 $
560 858
$
11 574 533
Less: Deductions of Unallowable Costs FISCAL YEAR Total Capital Outlay (6600) incl. only 100-199/200-494/810-879
(10)
176 307
Total Debt and Lease (6500) incl. only funds 100-199/200-494/810-879
(11)
162 604
Plant Maintenance (Function 51, 6100-6400)
(12)
1 050 125
Food (Function 35, 6341 and 6499)
(13)
293 180
Stipends (6413)
(14)
-
Column D (above) - Total Indirect Cost
249 808 Subtotal
1 932 024
Net Allowed Direct Cost
$
9 642 509
CUMULATIVE Total Cost of Buildings before depreciation
(15)
$
21 104 520
Historical Cost of Buildings over 50 years old
(16)
$
501 625
Amount of Federal Money in Building Cost (Net of #16)
(17)
$
Total Cost of Furniture and Equipment before Depreciation
(18)
$
3 907 346 492 506
Historical Cost of Furniture and Equipment over 16 years old
(19)
$
Amount of Federal Money in Furniture and Equipment (Net of #19)
(20)
$
Note A - $56,008 in function 53 expenditures are included in this report on administrative costs.
See independent auditors' report. 50 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
-
-
NEWTON INDEPENDENT SCHOOL DISTRICT FUND BALANCE AND CASH FLOW CALCULATION WORKSHEET (UNAUDITED) GENERAL FUND As of August 31, 2012 DATA CONTROL CODES 1 2 3 4 5 6
7 8 9
EXHIBIT J-3
EXPLANATION Total General Fund Balance as of August 31, 2012 (Exhibit C-1 object 3000 for the General Fund only).
AMOUNT $
Total General Fund Nonspendable Fund Balance (from Exhibit C-1 total of object 3410-344X for the General Fund only).
1 951 024 14 543
Total General Fund Designated Fund Balance (from Exhibit C-1 total object 3450-349X for the General Fund only).
-
Total Committed Fund Balance (from Exhibit C-1 total of object 3510-354X for the General Fund only).
-
Total Assigned Fund Balance (from Exhibit C-1 total of object 3550-359X for the General Fund only).
-
Estimated amount needed to cover fall cash flow deficits in the General Fund (net of borrowed funds and funds representing deferred revenues).
-
Estimate of two months' average cash disbursements during the regular school session (09/01/2012 - 05/31/2012).
2 053 521
Estimate of delayed payments from state sources (58XX) including August payment delays.
139 765
Estimate of underpayment from state sources equal to variance between Legislative Payment Estimate (LPE) and District Planning Estimate (DPE) or District's calculated earned state aid amount.
-
10
Estimate of delayed payments from federal sources (59XX).
-
11
Estimate of expenditures to be reimbursed to General Fund from Capital Projects Fund (uses of General Fund cash after bond referendum and prior to issuance of bonds).
-
12 13
General Fund Optimum Fund Balance and Cash Flow (lines 2+3+4+5+6+7+8+9). EXCESS (DEFICIT) UNDESIGNATED UNRESERVED GENERAL FUND BALANCE (LINE 1 MINUS LINE 10).
2 207 829 $
(256 805)
If item 11 is a positive number explanation of need and/or projected use of net positive Undesignated Unreserved General Fund Balance: See independent auditors' report. 51 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
NEWTON INDEPENDENT SCHOOL DISTRICT NATIONAL SCHOOL BREAKFAST AND LUNCH PROGRAM BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT J-4 DATA CONTROL CODES
ORIGINAL BUDGET
5700 5800 5900 5020
Revenues: Local and intermediate sources State program revenues Federal program revenues TOTAL REVENUES
0035 6030
Expenditures: Current: Support Services - Student: Food services TOTAL EXPENDITURES
1200
0100 3000
$
NET CHANGE IN FUND BALANCES
199 6 433 639
673 775 436 884
FINAL BUDGET $
$
163 6 475 645
860 190 630 680
$
(35 813) (585) 35 654 (744)
624 010 624 010
580 384 580 384
43 626 43 626
15 874
22 414
65 296
42 882
61 377
61 377
$
673 775 976 424
ACTUAL
624 010 624 010
Fund balance - Beginning FUND BALANCE - ENDING
199 6 439 646
VARIANCE POSITIVE (NEGATIVE)
15 874
See independent auditors' report. 52 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
83 791
$
126 673
$
42 882
NEWTON INDEPENDENT SCHOOL DISTRICT DEBT SERVICE FUND BUDGETARY COMPARISON SCHEDULE For the Year Ended August 31, 2012 EXHIBIT J-5 DATA CONTROL CODES
ORIGINAL BUDGET
5700 5800 5020
Revenues: Local and intermediate sources State program revenues TOTAL REVENUES
0071 6030
Expenditures: Current: Debt service TOTAL EXPENDITURES
$
1200
0100 3000
$
778 860 778 860
EXCESS REVENUE OVER (UNDER) EXPENDITURES
7915
509 260 217 235 726 495
FINAL BUDGET
(52 365)
Other Financing Sources: Transfers in TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCE
$
$
200 426 221 360 421 786
$
(27 776) 4 125 (23 651)
779 360 779 360
778 261 778 261
1 099 1 099
(333 923)
(356 475)
(22 552)
-
195 558
195 558
-
-
195 558
195 558
(333 923)
(160 917)
173 006
230 508
230 508
210 720
FUND BALANCE - ENDING
ACTUAL
-
(52 365)
Fund balance - Beginning
228 202 217 235 445 437
VARIANCE POSITIVE (NEGATIVE
158 355
See independent auditors' report. 53 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
$
(103 415)
$
69 591
$
173 006
CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees: We have audited the financial statements of Newton Independent School District as of and for the year ended August 31, 2012, and have issued our report thereon dated January 22, 2013. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller of the United States. COMPLIANCE As part of obtaining reasonable assurance about whether Newton Independent School District's basic 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 provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. INTERNAL CONTROL OVER FINANCIAL REPORTING In planning and performing our audit, we considered the District'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 an opinion on the effectiveness of internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the District's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of management, others within the organization, the Board of Trustees, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. ____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013 54 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
CROCKETT - JASPER - LIVINGSTON - LUFKIN - NACOGDOCHES
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133
Board of Trustees Newton Independent School District Newton, Texas Members of the Board of Trustees COMPLIANCE We have audited the compliance of Newton Independent School District with the types of compliance requirements described in the U. S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to its major federal program for the year ended August 31, 2012. Newton Independent School District's major federal program is identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major federal program is the responsibility of Newton Independent School District's management. Our responsibility is to express an opinion on Newton Independent School District's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Newton Independent School District'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 Newton Independent School District's compliance with those requirements. In our opinion, the District complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended August 31, 2012. INTERNAL CONTROL OVER COMPLIANCE The administration of the District 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 the District'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, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the District's internal control over compliance. 55 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of management, others within the organization, the Board of Trustees, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties.
____________________________________ CERTIFIED PUBLIC ACCOUNTANTS Lufkin, Texas January 22, 2013
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NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended August 31, 2012 A. Summary of the Auditor's Results 1. Financial Statements Type of auditor's report issued:
Unqualified
Internal control over financial reporting: Material weakness(es) identified?
Yes
X No
Significant deficiency(s) identified that are not considered to be material weaknesses?
Yes
X None reported
Yes
X No
Noncompliance material to financial statements noted? 2. Federal Awards 3. Type of auditor's report issued:
Unqualified
Internal control over major programs: Material control over major programs: Material weakness(es) identified?
Yes
X No
Significant deficiency(s) identified that are not considered to be material weaknesses?
Yes
X None reported
Type of auditor's report issued on compliance for major programs:
Unqualified
Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133?
Yes
X No
Identification of major programs: CFDA Number(s) 84.367 84.410 10.553/10.555 84.394
Name of Federal Program or Cluster Title II, Part A Education Jobs Fund Child Nutrition Cluster State Fiscal Stabilization Fund Cluster
Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee?
$300,000 Yes
B. Financial Statement Findings NONE C. Federal Award Findings and Questioned Costs NONE
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X No
NEWTON INDEPENDENT SCHOOL DISTRICT SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS For the Year Ended August 31, 2012
Current Status
Finding/Recommendation Use of Title XIV to purchase gift cards to be used for teacher supplies
Resolved
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Management's Explanation If Not Implemented
NEWTON INDEPENDENT SCHOOL DISTRICT CORRECTIVE ACTION PLAN For the Year Ended August 31, 2012 NONE
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NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended August 31, 2012 Exhibit K-1 (1)
(2)
FEDERAL GRANTOR/
FEDERAL
(2A)
(3)
PASS-THROUGH GRANTOR/
CFDA
PROJECT
FEDERAL
PROGRAM TITLE
NUMBER
NUMBER
EXPENDITURES
U.S. Department of Education: Passed Through Texas Education Agency: ESEA Title I Part A - Improving Basic Programs
84.010A
12610101176902
IDEA - B Formula
84.027
12660001176902
$
526 206
Vocational Education - Basic Grant
84.048
1242006176902
IDEA - B Preschool
84.173
12661001176902
5 821
84.358B
12696001176902
41 132
363 617 16 637
ESEA, Title VI, Part B - Rural and Low Income School ESEA Title II Part A - Teacher and Principal Training and Recruiting
84.367A
12694501176902
114 697
ARRA, IDEA - B Formula
84.391A
10554001176902
1 766
ARRA, IDEA - B Preschool
84.392A
10555001176902
38
ARRA, Title XIV, SFSF
84.394A
12557001176902
34 027
Education Jobs Fund
84.410
11550101176902
222 863
TOTAL U.S. DEPARTMENT OF EDUCATION
1 326 804
U. S. Department of Agriculture: Passed Through Texas Department of Agriculture: Food Distribution*
10.550
176-902
School Breakfast Program*
10.553
71401201
132 133
31 176
National School Lunch Program*
10.555
71301201
312 321
TOTAL PASSED THROUGH TEXAS DEPARTMENT OF AGRICULTURE
475 630
Passed Through Texas Department of Health and Human Services: Medicaid Reimbursement Program
93.778
176-902
16 117
School Health and Related Programs
93.990
176-902
128 589
TOTAL PASSED THROUGH TEXAS DEPARTMENT OF HEALTH AND HUMAN SERVICES
144 706
TOTAL EXPENDITURES OF FEDERAL AWARDS
$
* Indicates clustered program under OMB Circular A-133 Compliance Supplement.
The accompanying notes are an integral part of this schedule. 60 AXLEY & RODE, LLP CERTIFIED PUBLIC ACCOUNTANTS
1 947 140
NEWTON INDEPENDENT SCHOOL DISTRICT NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended August 31, 2012 Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of Newton Independent School District and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the general purpose financial statements.
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NEWTON INDEPENDENT SCHOOL DISTRICT SCHEDULE OF REQUIRED RESPONSES TO SELECTED SCHOOL FIRST INDICATORS As of August 31, 2012 EXHIBIT L-1 DATA CONTROL CODES SF2
SF4 SF5 SF9
RESPONSES Were there any disclosures in the Annual Financial Report and/ or other sources of information concerning default on bonded indebtedness obligations?
NO
Did the district receive a clean audit? - Was there an unqualified opinion on the Annual Financial Report?
YES
Did the Annual Financial Report disclose any instances of material weaknesses in internal controls?
NO
Was there any disclosure in the Annual Financial Report of material noncompliance?
NO
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