New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of Allegany-Limestone Central School District, Cassadaga Valley Central School District, Elba Central School District, Hampton Bays Union Free School District and the Laurens 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."
The board's budgeting practices included annually appropriating fund balance that was not used to finance operations. As of June 30, 2017, unrestricted fund balance totaled more than $2.2 million and was 10 percent of the 2017-18 budgeted appropriations, exceeding the statutory limit by approximately $1.3 million. In addition, the district's reserve funds are generally not being used and the retirement, repair and unemployment reserves are overfunded.
District officials did not properly manage fund balance and need to improve their budgeting practices. Although the board's fund balance policy requires the district to maintain unrestricted fund balance within the statutory limit, the board allowed it to exceed the statutory limit for the past three years. As of June 30, 2017, unrestricted fund balance totaled nearly $1.8 million and was 9 percent of 2017-18 budgeted appropriations, exceeding the statutory limit by more than $950,000.
The board adopted budgets with overestimated appropriations averaging $950,000. As a result, it did not use appropriated fund balance and, instead, increased taxes despite having sufficient fund balance and reserves to fund ongoing operations. Auditors recalculated unrestricted fund balance with the amounts of unused appropriated fund balance and the totals exceed the statutory limit by as much as 10 percentage points. The board also overfunded three reserves which totaled more than $2 million.
While all of the purchases reviewed by auditors appeared to be for appropriate purposes, claims were not adequately audited and approved. In addition, allowing the purchase of goods through Amazon has a high level of risk because of the ease with which employees can make purchases without pre-approvals.
Auditors commended district officials for identifying opportunities to increase revenues and decrease expenditures for cafeteria operations while simultaneously increasing participation and sales. The audit also revealed, however, the district has accumulated excessive balances in several reserve funds.
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