Auditor delivers clean opinion; management letter repeats three prior recommendations

A district audit manager told the Galesburg CUSD 205 Board of Education that the independent audit for fiscal year 2024 resulted in a clean opinion with no modifications.

The clean opinion came from Allison Kamen, the audit manager in charge of the district and the Galesburg Area Vocational Center audit, who said, “The opinion in itself was a clean opinion. No modifications of any kind.” The auditors highlighted a healthy fund balance in the district’s general fund: $42,500,000, which the audit notes said represents 74% of the district’s total fund balance ($57,600,000). The general fund reported a net operating increase of $6,400,000, the auditors said, and attributed the gain to grants, property tax revenue and interest income.

The auditors also reviewed the vocational center and reported a clean opinion there; that general fund had a fund balance of $81,000 and a net change in fund balance of $5,000 for the year.

Why it matters: A clean opinion indicates the auditors found the district’s financial statements materially correct under applicable accounting standards. The audit also identifies operational items the district should address to strengthen internal controls and reporting.

Key recommendations and management letter items: The management letter repeated three prior-year recommendations: (1) address funds over budget, (2) record cash currently being held but not recorded, and (3) adopt a formal capital asset policy. The auditors also noted upcoming Governmental Accounting Standards Board (GASB) standards (GASBs 100–103) that the district will need to implement in coming years.

The audit presentation also described a transfer that occurred this fiscal year: the district closed an internal service fund (historically referred to in local discussion as the “medical trust”) into the education fund after determining claims were fully paid and a separate internal service fund was no longer necessary. District staff told the board the underlying activity continues to be tracked via revenue and expense accounts within Fund 10.

Budget tracking and “Q accounts”: The auditors pointed trustees to the budget-to-actual schedules in the annual financial report. District staff explained that so-called Q accounts (local internal reserve trackers used historically to hold year-end balances for carryforward) will be pared down and tracked differently going forward. Per the presentation, the plan is to list those balances as expenditures in FY26 and then have those balances transferred at fiscal year end into beginning balances or budgets for the next year, rather than maintain a separate set of Q accounts as done previously.

Board action: The board approved the annual financial report for the district and for the Galesburg Area Vocational Center during the meeting (see “Votes at a glance”).

Ending: District staff and auditors said they will work together to implement the noted GASB standards and to address the carryover recommendations; the auditors offered to assist with implementation in upcoming years.