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Audit shows clean opinion; board hears budget effects of $9 million capital reserve move
Summary
Independent auditors issued an unmodified opinion on Elizabethtown Area School District's fiscal year ending June 30, 2024, while district leaders told the board a $9 million transfer to capital reserve altered reported year‑end fund balances and spending comparisons.
An independent audit of the Elizabethtown Area School District for the year ended June 30, 2024, produced an unmodified (clean) opinion, auditor Jacqueline Davidson told the board at the Feb. 11 workshop.
The audit included a single significant deficiency related to documentation and year‑end accruals, Davidson said. District staff have corrected the matters noted and filed a corrective action plan in the audit report.
Why it matters: a clean opinion shows the auditors found the district's financial statements fairly presented under government accounting standards. However, administrators warned that a one‑time accounting treatment — moving district cash into a capital reserve to pay for construction — changed how revenue and expenditures appear in the year‑end statements and could affect comparisons to the budget.
Davidson of audit firm Boyer & Ritter summarized the 95‑page financial statements and explained statements include capital assets, long‑term debt and net pension liabilities. She said the district met single‑audit reporting rules because it spent more than the federal threshold on grant programs and that auditors issued no compliance findings on federal programs.
Business office staff member Tom Strickler and district leaders reviewed how a board‑authorized move of up to $9 million from the general fund into capital reserve affected the reported results for 2023‑24. Strickler said the district shifted about $5.5 million in that fiscal year as a percentage of construction progress, leaving about $3.5 million to transfer in 2024‑25.
Strickler told the board that without accounting for the capital reserve movement, the general fund expenditures would look close to budget (about $79,000 unfavorable on an approximately $79 million budget). With the capital reserve transfers included, he said the district’s total reported expenditures for the year are larger — reflecting the $5.5 million that moved out of general fund cash to capital reserve — and noted this reduced the general fund cash available for operating expenses even though the money remains in district control for capital work.
The auditors also identified two operational items the district corrected: (1) a missing annual food‑service inventory document, which was produced after the auditors requested it; and (2) a retained‑contractor payable (retainage) at year end that had not been recorded in the district accounting system and required an adjusting entry. Davidson said both items had no effect on cash or the district’s bottom line and were addressed during the audit process.
Board members asked for clarifying detail and the administrators said they would provide any follow‑up questions to Strickler for written responses.
Closing note: the audit package returned a clean opinion on the financial statements, the single‑audit program review for federal funds had no compliance issues, and the district has a corrective action plan and management letter with targeted operational suggestions.
