Independent auditors issue clean opinion for Londonderry; auditors and staff report modest revenue surplus and noted long‑term retirement accounting impacts

Matthew Murray, the lead auditor from Vachon Couquet & Company, told the School Board on Jan. 28 that the Londonderry School District received an unmodified opinion on its audited financial statements for the year ended June 30, 2024, and an unmodified opinion on its federal program compliance testing.

Murray said the auditor's report found no material misstatements and no material audit adjustments were required. The audit firm performed a federal single audit because district federal expenditures exceeded the federal single‑audit threshold; Murray reported no findings for major federal programs and said the district's internal controls tested for grants and compliance were adequate.

Key financial points presented by auditors and district staff - Unmodified (clean) audit opinion for fiscal year ended 06/30/2024; no material audit adjustments or uncorrected misstatements reported. - Revenue/expenditure variances: The district reported about $296,000 in excess revenue on an approximately $86.4 million budget and total expenditures and other financing uses that were about $923,000 less than budgeted — favorable variances Murray described as within a healthy range for a district the size of Londonderry. - Fund balance and retention: The district reported an increase in budgetary general‑fund balance, and the board voted to retain $1,775,000 of fund balance (the district may retain up to 5% as determined by DRA). Murray said roughly $455,000 of that amount was used to offset the FY25 tax rate. - Net position and GASB pension/OPEB effects: Murray explained that government‑wide, full‑accrual statements report long‑term items (for example, pension and OPEB liabilities). He said the district reported a deficit net position attributable largely to GASB Statements No. 68 (pension) and 75 (OPEB) pension/OPEB accounting. He described the accounting change as a reporting requirement that increases unfunded liability presentation in the financial statements; the district’s full audit report provides the detailed actuarial measures. - Grants and federal compliance: The district expended approximately $2.5 million in federal awards in the fiscal year; the auditors conducted a compliance audit of major programs and reported an unmodified opinion and no questioned costs. - Management letter items: Auditors noted a common observation involving student activity funds (some deposits were not made in a timely manner; one span cited was 12–14 days). The auditors said the business office has already addressed the item through communication and increased periodic spot checks.

District budget update (second quarter highlights presented later in the meeting) Business‑office presenters reported midyear financials showing the district was trending under budget in several major categories, but they also cautioned that the winter months and known liabilities could change projections. Notable items included: - A conservative projected increase to the general‑fund balance for fiscal year 2025 in the range of roughly $900,000 to $1,000,000 (early estimate); $145,000 of year‑end fund balance already budgeted for capital reserve financing if voters approve warrant articles. - Significant savings attributed to staff turnover and retirements: full‑time salaries were running about $2.0 million under budget year‑to‑date, and benefits projected lower by about $1.0 million. However, those figures could be affected by retirements that had not yet been finalized. - Overruns and contingencies: the district reported an approximate $800,000 overrun attributable to unbudgeted out‑of‑district special‑education placements and related contracted services; contracted nursing and certain software transitions were also noted as drivers of over‑budget expenditures in some lines. - Dining services: the food service fund began the year with a fund balance near $655,000, spent about $250,000 on new elementary tables, and was projecting a year‑end loss in the neighborhood of $220,000 — within the fund's allowable retained limits.

Audit and business‑office praise: Murray and board members commended the district finance team for organization and responsiveness. Murray singled out the business office's grant documentation and segregation of duties — including dual payroll processing weeks — as strong controls that eased the audit process.

What's next: The auditor said the complete financial statements and the audit communication letter are posted on the district website and invited board members to direct specific follow‑up questions to the firm's lead auditor or the business office.

Speakers (as identified in the transcript): Matthew Murray (lead auditor, Vachon Couquet & Company), Cheryl Rich (finance director referenced), Jeanette Evans (federal funds bookkeeper referenced), Amity (business administrator/finance presentation).