East Islip Union Free School District - Financial Condition Management (2020M-24)

Issued Date
May 01, 2020

[read complete report - pdf]

Audit Objective

Determine whether the Board and District officials provided adequate oversight and management of the District’s budget and financial condition.

Key Findings

  • The District’s general fund balance increased by $12.9 million (141 percent) from 2015-16 through 2018-19, due to appropriations being overestimated by an average of $5.1 million (4.7 percent) per year.
  • Over the last four completed fiscal years, the District reported unassigned fund balance equal to 4 percent of the ensuing year’s appropriations. However, when unused appropriated fund balance is added back, unassigned fund balance exceeds the statutory limit by up to 4.2 percentage points.

Key Recommendations

  • Review the District’s financial plan to maintain an unassigned fund balance at a level that complies with the statutory limit.
  • Develop and adopt budgets with realistic estimates for revenues, expenditures and unassigned fund balance based on historical data and known trends.
  • Discontinue the practice of appropriating fund balance that is not needed or used to fund operations.

District officials disagreed with some of our findings but indicated they will take corrective action. Appendix B contains our comment on an issue raised in the District response.