USD 368 board approves annual district audit; auditors reported clean findings

Paola USD 368 accepted and approved its annual district audit after staff presented a summary of highlights, including revenue and expenditure changes, restricted funds and the status of the health insurance reserve.

Staff said the audit covers the fiscal year and that field work is performed in July with final reports usually returned in September. The presenter described the audit as a “clean audit” with no material noncompliance or internal control deficiencies reported. Staff noted the audit’s role as a compliance and transparency tool and explained the decision to present the audit in October even though the filing deadline is Dec. 31.

Key items discussed included a year‑over‑year increase in general fund and local option budget (LOB) revenues tied to state aid and enrollment, a large decrease in federal COVID relief funds because those funds were fully expended, and changes in special education and cooperative fund flows. Staff also reviewed the district’s health insurance reserve history, noting a cumulative increase over recent years but emphasizing the fund must be monitored because high‑claim years can quickly change the balance.

The presenter pointed out that the district had paid off its bonds during the fiscal year (noted in the audit as of June 30), and described the audit’s footnote disclosures for items such as accrued sick‑leave liabilities, deposits and investments, and activity funds. Staff said many federally funded programs, including the cooperative special‑education hosting arrangement, trigger single‑audit requirements; the audit found no compliance issues in those areas.

A board member moved to approve the annual USD 368 district audit; the board seconded the motion and approved it by voice vote.