Board approves Sheridan County School District #3 audit; auditor reports clean opinion and recommends stronger internal controls

The Sheridan County School District #3 Board of Trustees voted to accept the district's most recent financial audit after an auditor presented a clean opinion on the district's financial statements.

Auditor James (identified in the meeting as the presenting auditor) told the board the audit found no instances of noncompliance with contracts, grant agreements, ADM requirements, school lunch rules, state statutes or federal tax requirements. He said the audit team issued a clean opinion on the district's financial statements and that the district's books and records were "in tremendous shape."

James said the district's total cash reserves as of June 30 were $3,668,000, an increase of $192,000 from the previous year. He reported the general fund cash balance ended the year at $996,000 and said the general fund remains under the 30 percent threshold used as a guide for reserve levels. For the fiscal year presented, total governmental fund revenues were $3,666,000; the auditor reported $2,000,941 of that amount came from state and federal sources and tax revenues from the county totaled $663,000. General fund expenses were reported at $3,000,514, leaving an excess of revenues over expenses of $152,000 in the general fund.

The auditor outlined several additional details the board requested: the district transferred $420,000 out of operating funds during the year, the bulk to the depreciation reserve (including a $325,000 portion), and the depreciation reserve balance was reported at $1,514,000. The special revenue (grant) fund showed roughly $832,000 in revenue and $833,000 in expenses. The school lunch fund showed roughly $40,000 in food sales and operating expenses of about $143,000; after a $110,000 transfer from the general fund the lunch fund was effectively near breakeven, the auditor said.

Although the audit reported no compliance findings, James said segregation of duties is an acknowledged risk for very small districts because one person often performs multiple accounting functions. He recommended compensating controls rather than adding staff, for example: superintendent approval of journal entries and a second administrative review or approval of bank reconciliations. He also noted credit-card oversight is an area the Wyoming Department of Audit has focused on statewide; the district currently has about 10 credit cards, the auditor said, and the district had appropriate invoices and no audit findings in that area.

Board members thanked district business staff Greg and Brenda for preparing records and for making the audit efficient. After the presentation a motion to accept the audit was moved and seconded; the board voted to approve the audit report.

The board did not record a roll-call tally in the minutes excerpt provided; the motion passed by voice vote.