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NYS Comptroller


Audits of Local Governments and School Districts

McGraw Central School District – Fund Balances (2017M-248)

Released: February 23, 2018 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to determine whether the Board and District officials ensured that the general fund balance and reserve fund levels were reasonable for the period July 1, 2015 through June 30, 2017.


The McGraw Central School District is located in the Village of McGraw in Cortland County. The District, which is governed by a seven-member Board of Education, has approximately 575 students. Budgeted appropriations for the 2017-18 fiscal year total approximately $12.1 million.

Key Findings

  • District officials appropriated, on average, $638,300 of unrestricted fund balance as a financing source each year for the 2014-15 through 2016-17 budgets, but the amounts appropriated were not needed to finance operations.
  • Recalculated unrestricted fund balance exceeded the 4 percent statutory limit for 2014-15 through 2016-17, ranging from 5 to 10 percentage points.
  • Reserves were not used as intended and could be overfunded by $1.8 million as of June 30, 2017.

Key Recommendations

  • Adopt budgets with realistic estimates and discontinue the practice of appropriating fund balance that will not be used.
  • Develop a plan for the use of excess unrestricted fund balance in a manner that benefits District residents.
  • Review all reserves to determine whether balances are necessary and reasonable, and use excess amounts in accordance with applicable statutes in a manner that benefits District residents.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email:
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236