HCISD readies TEA financial audit and single audit; internal audits find no material issues
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Summary
District finance staff reviewed TEA audit deadlines, the single audit for federal programs, internal control reviews and audit tests (inventory, bid testing, PEIMS, intent coding). Internal audits reported no findings; construction encumbrances under TRE funds were summarized.
During the Finance and Planning Committee meeting, HCISD business officials reviewed the district’s financial‑audit timeline, internal‑control work and recent internal audits conducted with external auditors.
Presenting, Ida (district finance) said Texas Education Agency requires districts with June 30 fiscal year ends to submit annual audited financials to TEA’s Financial Compliance Division by Nov. 27. External auditors also perform a single audit when federal awards exceed $750,000; district staff reported HCISD had approximately $32,000,000 in federal awards this year, triggering single‑audit testing of major programs.
Ida described preparation steps: finalizing bank reconciliations and payroll journals, reviewing purchasing and bid files, updating accounting procedure manuals and addressing prior‑year audit recommendations. The auditors’ scope commonly includes an IT controls review (user lists, firewalls, cybersecurity training certificates), single‑audit tests on major federal programs, and testing tied to the district’s self‑funded health insurance claims.
Internal auditor Neli Ledesma summarized tests she led with external auditors over the summer. Those tests included end‑of‑year inventory observations for child nutrition, commodity and central receiving warehouses, bid testing of vendors with transactions over $50,000, PEIMS student classification and eligibility testing (special populations), intent coding for payroll and non‑payroll program intent, and review of the self‑funded insurance claims process. Ledesma said the audits produced no findings; auditors noted only minor immaterial variances, including one payroll coding correction.
The committee also received a construction‑funds snapshot from district staff: under TRE funds (Fund 199 and 175), encumbrances totaled $8,800,000 with $6,200,000 paid through Sept. 30, leaving a remaining balance of $2,500,000 as of the end of September. Staff said they are on schedule with the audit calendar and will present audit reports to the board once the external audit is complete.
Committee members asked whether auditors would comment on recent changes to fund balance; staff said auditors have been reviewing larger transactions in greater detail but that monitoring and expense controls suggested positive results. The district’s internal audit office operates an anonymous hotline for staff and public reporting; callers are routed to the internal auditor and the superintendent’s office as part of existing oversight channels.
No formal committee votes occurred. Staff said they will return audit reports and recommended responses to any findings to the board once the external audit is finalized.
