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CFO briefs Sumter trustees on fund balance versus cash flow; audit results highlighted

3720473 · May 20, 2025
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Summary

CFO Shatika Spearman walked the board through fund-balance classifications, differences from cash flow, and key audit highlights, including an unmodified opinion and FY24 ending general fund balance.

Shatika Spearman, Sumter School District chief financial officer, presented an educational briefing on the district’s general fund balance and how it differs from cash flow during the May 19 board meeting.

“Cash flow represents the ability of an organization to pay the obligations on time, while fund balance is a sign of overall financial stability and health,” Spearman told trustees, and she explained the accounting difference between the balance sheet and an income (revenue/expenditure) statement.

Spearman walked the board through the five fund-balance classifications used in governmental accounting—nonspendable, restricted, committed, assigned and unassigned—and explained that for FY25 the district will display three categories (committed, assigned and unassigned) in the general fund. She emphasized that an amount in fund balance is not the same as cash on hand.

Spearman also reviewed material items in the district’s audited financial statements for FY24 and highlighted key auditor findings: an unmodified (clean) opinion, no internal-control weaknesses reported for federal programs, and an FY24 ending general fund balance of approximately $61.19 million. She noted that South Carolina school districts are required by law to maintain a minimum general reserve of at least one month; the district’s unassigned fund balance equated to about 4.8 months, well above the statutory minimum.

Spearman described cash-management practices such as daily cash monitoring, use of the Local Government Investment Pool (LGIP) for short-term investments, and the importance of managing inflows from property taxes that occur at variable times during the year. Trustees asked where to find fund-balance classifications in the financial statements (Spearman directed them to note 16 on page 67) and inquired about legacy expenditures noted in the reports (for example, former St. John’s site costs reflected in the FY24 statements), which Spearman said related to historical maintenance obligations that had been resolved.

The briefing produced no board vote; several trustees thanked Spearman for clarifying the difference between cash flow and fund balance and for reviewing the audited financial statements.