[read complete report - pdf]

Audit Objective

Determine whether reserve funds and the debt service fund balance were reasonable.

Key Findings

• The Board did not adopt a written reserve fund policy.
• Three reserve funds totaling $1.3 million as of June 30, 2018, were overfunded.
• The approximately $1 million balance in the debt service fund was not used towards the $2.8 million in debt payments made by the District during the three-year audit period.

Key Recommendations

• Adopt a comprehensive written reserve fund policy.
• Review all reserves and determine if the amounts are necessary, reasonable and in compliance with statutes. To the extent they are not, transfers should be made to unrestricted fund balance as allowed by law, or to other reserves per statutes.
• Use money in the debt service fund to pay related debt service expenditures.

District officials agreed with our findings and indicated they plan to initiate corrective action.