MADISON COUNTY TENNESSEE

ANNUAL FINANCIAL REPORT MADISON COUNTY, TENNESSEE

FOR THE YEAR ENDED JUNE 30, 2019

DIVISION OF LOCAL GOVERNMENT AUDIT

ANNUAL FINANCIAL REPORT MADISON COUNTY, TENNESSEE FOR THE YEAR ENDED JUNE 30, 2019

COMPTROLLER OF THE TREASURY JUSTIN P. WILSON

DIVISION OF LOCAL GOVERNMENT AUDIT JAMES R. ARNETTE Director

LEE ANN WEST, CPA, CGFM Audit Manager

JUSTIN NEAL, CPA, CGFM LAUREN LEWIS, CPA MEGAN FOSTER MADISON LASTER

ELISHA CROWELL, CISA, CFE State Auditors

This financial report is available at ptroller.

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MADISON COUNTY, TENNESSEE TABLE OF CONTENTS

Summary of Audit Findings

INTRODUCTORY SECTION

Madison County Officials

FINANCIAL SECTION

Independent Auditor's Report Management's Discussion and Analysis BASIC FINANCIAL STATEMENTS:

Government-wide Financial Statements: Statement of Net Position Statement of Activities

Fund Financial Statements: Governmental Funds: Balance Sheet Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position Statement of Revenues, Expenditures, and Changes in Fund Balances Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statements of Revenues, Expenditures, and Changes in Fund Balances ? Actual (Budgetary Basis) and Budget: General Fund Highway/Public Works Fund Proprietary Fund: Statement of Net Position Statement of Revenues, Expenses, and Changes in Net Position Statement of Cash Flows Fiduciary Funds: Statement of Fiduciary Assets and Liabilities

Index and Notes to the Financial Statements REQUIRED SUPPLEMENTARY INFORMATION:

Schedule of Changes in Net Pension Liability (Asset) and Related Ratios Based on Participation in the Public Employee Pension Plan of TCRS ? Primary Government

Schedule of Contributions Based on Participation in the Public Employee Pension Plan of TCRS ? Primary Government

Exhibit

A B

Page(s)

6

7

8-9

10

11-13 14-20

21

22-23 24-25

C-1

26-28

C-2

29

C-3

30-33

C-4

34

C-5

35-38

C-6

39

D-1

40

D-2

41

D-3

42

E

43

44-111

112

F-1

113

F-2

114

3

Schedule of Contributions Based on Participation in the Teacher Retirement Plan of TCRS ? Discretely Presented Madison County School Department

Schedule of Contributions Based on Participation in the Teacher Legacy Pension Plan of TCRS ? Discretely Presented Madison County School Department

Schedule of Proportionate Share of the Net Pension Asset in the Teacher Retirement Plan of TCRS ? Discretely Presented Madison County School Department

Schedule of Proportionate Share of the Net Pension Asset in the Teacher Legacy Pension Plan of TCRS ? Discretely Presented Madison County School Department

Schedule of Changes in Total OPEB Liability and Related Ratios - Self-Insurance Plan - Primary Government

Schedule of Changes in Total OPEB Liability and Related Ratios - Local Education Plan - Discretely Presented Madison County School Department

Notes to the Required Supplementary Information COMBINING AND INDIVIDUAL FUND FINANCIAL

STATEMENTS AND SCHEDULES: Nonmajor Governmental Funds: Combining Balance Sheet Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Schedules of Revenues, Expenditures, and Changes in Fund Balances ? Actual (Budgetary Basis) and Budget: Juvenile Services Fund Solid Waste/Sanitation Fund Local Purpose Tax Fund Special Purpose Fund Drug Control Fund Other Special Revenue Fund Community Development/Industrial Park Fund Major Governmental Funds: Schedule of Revenues, Expenditures, and Changes in Fund Balance ? Actual (Budgetary Basis) and Budget: General Debt Service Fund General Capital Projects Fund Fiduciary Funds: Combining Statement of Fiduciary Assets and Liabilities Combining Statement of Changes in Assets and Liabilities ? All Agency Funds Component Unit: Discretely Presented Madison County School Department: Statement of Activities Balance Sheet ? Governmental Funds Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position

Exhibit Page(s)

F-3

115

F-4

116

F-5

117

F-6

118

F-7

119

F-8

120

121

122

123-124

G-1

125-128

G-2

129-132

G-3

133

G-4

134

G-5

135

G-6

136

G-7

137

G-8

138

G-9

139

140

H-1

141

H-2

142-143

144

I-1

145

I-2

146-147

148

J-1

149

J-2

150-151

J-3

152

4

Statement of Revenues, Expenditures, and Changes in Fund Balances ? Governmental Funds

Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities

Combining Balance Sheet - Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures, and Changes in

Fund Balances - Nonmajor Governmental Funds Schedules of Revenues, Expenditures, and Changes in Fund

Balances ? Actual (Budgetary Basis) and Budget: General Purpose School Fund School Federal Projects Fund Central Cafeteria Fund Education Capital Projects Fund

Fiduciary Fund: Statement of Fiduciary Net Position Statement of Changes in Fiduciary Net Position

Miscellaneous Schedules: Schedule of Changes in Long-term Notes and Bonds Schedule of Long-term Debt Requirements by Year Schedule of Transfers - Primary Government and Discretely Presented Madison County School Department Schedule of Salaries and Official Bonds of Principal Officials ? Primary Government and Discretely Presented Madison County School Department Schedule of Detailed Revenues ? All Governmental Fund Types Schedule of Detailed Revenues ? All Governmental Fund Types ? Discretely Presented Madison County School Department Schedule of Detailed Expenditures ? All Governmental Fund Types Schedule of Detailed Expenditures ? All Governmental Fund Types ? Discretely Presented Madison County School Department Schedule of Detailed Receipts, Disbursements, and Changes in Cash Balances ? City Agency Funds

SINGLE AUDIT SECTION

Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards

Auditor's Report on Compliance for Each Major Program; Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance

Schedule of Expenditures of Federal Awards and State Grants Summary Schedule of Prior-year Findings Schedule of Findings and Questioned Costs Management's Corrective Action Plan

Exhibit Page(s)

J-4

153-154

J-5

155

J-6

156

J-7

157

J-8 J-9 J-10 J-11

J-12 J-13

K-1 K-2

K-3

158-159 160-161

162 163

164 165 166 167 168

169

K-4

170

K-5

171-191

K-6

192-195

K-7

196-227

K-8

228-241

K-9

242

243

244-245

246-248 249-251

252 253-256 257-259

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Summary of Audit Findings

Annual Financial Report Madison County, Tennessee For the Year Ended June 30, 2019

Scope We have audited the basic financial statements of Madison County as of and for the year ended June 30, 2019.

Results Our report on Madison County's financial statements is unmodified. Our audit resulted in three findings and recommendations, which we have reviewed with Madison County management. Detailed findings, recommendations, and management's responses are included in the Single Audit section of this report.

Findings The following are summaries of the audit findings: OFFICE OF FINANCE DIRECTOR The office had deficiencies related to time and attendance records. An investigation of the Jackson-Madison County Regional Health Department

disclosed deficiencies related to inventory.

OFFICE OF SHERIFF Time sheets did not always accurately reflect time worked.

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INTRODUCTORY SECTION

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Madison County Officials June 30, 2019

Officials

Jimmy Harris, County Mayor Bart Walls, Highway Engineer Dr. Eric Jones, Director of Schools John Newman, Trustee Frances Hunley, Assessor of Property Fred Birmingham, County Clerk Kathy Blount, Circuit and General Sessions Courts Clerk Bart Swift, Juvenile Court Clerk Pam Carter, Clerk and Master Anjanette Byers, Register of Deeds John Mehr, Sheriff Mike Nichols, Finance Director

Board of County Commissioners

Gary Deaton, Chairman Carl Alexander Jimmy Arnold Brett Beckham Katie Brantley Claudell Brown, Jr. Scott Brown Cyndi Bryant Jay Bush Jason Compton Aaron Ellison Tommy Gobbell Joey Hale

Arthur Johnson, Jr. Barbara Johnson William Martin Luther Mercer Adrian Montague James Pearson Harold Petty Billy Spain Terry Spearman Doug Stephenson Mike Taylor Jeff Wall

Board of Education

Financial Management Committee

Kevin Alexander, Chairman Wayne Arnold Doris Black Jim Campbell Janice Hampton James Johnson A. J. Massey Morris Merriweather Shannon Stewart

Arthur Johnson, Jr., Chairman Jimmy Harris, County Mayor Bart Walls, Highway Engineer Dr. Eric Jones, Director of Schools Gary Deaton Luther Mercer Billy Spain

(Continued)

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