Auditor: Englewood districtfinancial records rebuilt after cyberattack, audit expected in spring

The districthas largely reconstructed its financial records after a cyberattack that erased or scrambled accounting data, an outside auditor told the Board of Education on Tuesday.

Andrew Parente, introduced at the meeting as representing the independent audit firm Lurch, Vinceni Vinceni & Higgins, said vendors and district contractorsSystems 3000, the Concilio Group and the MacLane Grouphave reentered receipts, disbursements, purchase orders and payrolls for the affected period. "They had to rebuild all of your databases, on the financial side, payroll, personnel," Parente said. "A 100% of your receipts, a 100% of your disbursements, all had to be reentered into your system."

Parente said the rebuild covered multiple funds the district manages: general, special revenue, debt service and food-service enterprise funds. He said the outside teams have completed much of the data entry and are now in a month-by-month reconciliation phase comparing the rebuilt board secretary information to treasurerreports and bank reconciliations.

"The group is pretty much through December," Parente said. "I think it's anticipated that they will be able to get us through 06/30/2024 by March." Parente said his audit firm intends to start the formal financial audit after the rebuild is complete; if the March timeline holds he expected the audit fieldwork would take four to six weeks.

Board members pressed Parente on the months when little or no financial detail was available. Parente said the reconstruction relied on canceled checks, purchase orders and other supporting documents to reassign transactions to appropriate accounts. "They had to base it upon canceled checks, based upon purchase orders, determine what account, what fund these things all had to be charged to," he said.

Finance committee members and others sought assurance that the rebuilt records will reconcile to treasurer reports and cash balances. Parente said reconciliation of cash is a major component of the audit: "Getting it reconciled with that treasurer's report would be a home run," he said.

The board was told some compliance audits have already been completed and that the independent audit team will return to finish financial testing once the rebuild is complete. Administrative staff said they will forward documents and follow up with board members who asked for line-item and staffing-cost detail.

Ending

District staff and the external teams described the work as "monumental" and said progress is visible, but final audit conclusions will depend on the reconciliations scheduled for March. Parente cautioned the board that the process is complex but said the district is nearing a point where auditors can render formal financial reports.