Oceanside UFSD accepts external audit and corrective-action plans; district says fund balance purposely exceeds 4% to offset tax revenue loss

The Oceanside Union Free School District Board of Education on Oct. 15 accepted the district's annual external audit for the fiscal year ending June 30, 2025, and approved corrective-action plans responding to the audit firm's management letter and the district's internal risk assessments.

The audit presentation, delivered by Christopher Schneider, partner at RS Abrams, reported an "unmodified opinion," the auditing firm's strongest level of assurance, and noted a series of recommended improvements that the district has addressed with a corrective-action plan that the board voted to accept.

Schneider told the board, "what we call an unmodified opinion, that is the best opinion you can get." He summarized the deliverables the firm provides each year: the district financial statements, the extraclassroom activity fund statements, a management letter and a governance letter. He said corrected misstatements identified during the audit were ultimately corrected and that the financial statements were "appropriately stated, fairly stated."

In discussion before the vote, district officials explained why the district's unassigned fund balance exceeds a commonly referenced 4% guideline. Doctor Joel Coakley and Doctor Harrington said the district is intentionally holding additional reserves to offset known future tax-revenue declines tied to a multi-year glide path related to parcels at the E.F. Barrett plant. "If the district and the board did not take this action, ultimately, this tax burden would be felt by the Oceanside taxpayer," Coakley said.

Board members voted to accept the external audit prepared by RS Abrams, to accept the results of the annual risk assessment prepared by the internal auditors, and to approve related corrective-action plans (CAPs) responding to the external auditors' management letter, the internal risk assessment, and the capital projects audit. The motions were approved by voice vote and recorded as passed.

The auditors' summary slides shown to the board highlighted the district's reserve structure and noted that the district used $11,300,000 of its capital reserve during the year and replenished some reserves. Schneider and district staff said those actions are voter-authorized and part of normal capital planning.

The board was told that materials presented at the meeting and the district's corrective-action plan will be posted to the district website. "The presentation once accepted by the board, tonight as well as the district's response, which is called the corrective action plan. Both will be posted to the district website for public, accessibility first thing in the morning," Doctor Harrington said.

What happened: the board accepted the external financial audit with an unmodified opinion and approved CAPs responding to audit findings. Why it matters: acceptance of an unmodified audit and the approved CAPs confirm the district's financial statements for FY2025 are fairly stated and set a public action plan to address recommended improvements. The board also affirmed its fiscal strategy to use reserves to blunt expected tax-revenue losses rather than immediately shifting costs to taxpayers.

The district and the auditing firms provided additional documentation to the board and said the full reports and the district's corrective-action plan will be available on the district website.