New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of the Dryden Central School District, New Rochelle City School District, Port Jefferson Union Free School District and the Portville Central School District.
“In an era of limited resources and increased accountability, it’s critical that schools make every dollar count,” DiNapoli said. “By auditing school district and charter school finances and operations, my office continues to provide taxpayers the assurance that their money is being spent appropriately and effectively.”
From 2008-09 through 2012-13, the district budgeted to use an average of $495,000 of unexpended surplus funds to fund the ensuing year’s expenditures. The district did not use these funds as intended, however, because revenues exceeded expenditures by an average of more than $1 million in each of these years. As a result, the district’s unexpended surplus funds, totaling $2.7 million as of June 30, 2013, were 7.5 percent of the 2013-14 budgeted appropriations, which exceeded the statutory limit of 4 percent.
District officials adopted budgets with realistic revenue and expenditure estimates. However, the district’s total unrestricted unappropriated fund balance has declined from $7.2 million in fiscal year 2010-11 to $5.4 million in fiscal year 2012-13. The district is considered to be susceptible to fiscal stress due to three years of operating deficits and low unassigned fund balance.
District officials need to improve controls over the information technology (IT) assets. The board has not established a computer use policy for employees to define appropriate user behavior or procedures to ensure the security of the District’s IT system. For example, the treasurer has administrative rights to the district’s financial software that allow her to control and use all aspects of the financial software application, which creates the opportunity for the manipulation and concealment of transactions.
Although district officials appropriated on average $630,000 of fund balance in each of the last five fiscal years to reduce the tax levy, the district had operating surpluses in four of the five years reviewed. District officials then used excess fund balance to fund five reserves that, as of June 30, 2013, totaled more than $2 million. However, the district has not demonstrated a valid need for nearly 60 percent of the amounts set aside in these reserve funds.
For access to state and local government spending and nearly 50,000 state contracts, visit http://www.openbooknewyork.com/. The easy-to-use website was created by Comptroller DiNapoli to promote openness in government and provide taxpayers with better access to the financial workings of government.