Audit finds repeated accounting deficiencies; board seeks outside help during Skyward transition

County auditors reported multiple repeated accounting findings dating back to 2020 and recommended targeted outside help and staff training to correct them.

Auditors told the Lake County Schools board that prior years’ findings included unreconciled cash in the trustee check‑clearing account, instances where purchase orders were not issued correctly, and invoices paid without adequate proof that goods or services were received. A separate finding said the district did not close and make its accounting records available for audit within two months after the fiscal year close—a requirement auditors said is set by state law; the district missed the August 31 deadline this year and closed records in September.

The auditors said some improvements were visible in 2024 but that similar reconciliation and documentation issues have recurred. They urged the district to prioritize cash reconciliation and year‑end accruals to avoid material audit adjustments, which auditors characterize as a material weakness rather than a lesser significant deficiency.

Board members and staff discussed that the district converted to Skyward accounting software earlier this year, and that learning the new system while simultaneously closing prior accounting gaps complicates reconciliations. Auditors and staff agreed that software familiarity alone will not solve problems rooted in internal controls and processes.

To address the backlog, the board heard that a firm based in Dyersburg had agreed verbally to help reconcile prior years and document corrective procedures so the district can sustain month‑to‑month reconciliation going forward. The district also plans targeted staff training, including sending two people to CCFO (County Certified Financial Officer) training and rolling out accounting 101 sessions with the trustee.

Speakers urged a two‑track approach: bring in external expertise to clean up historical balances and train existing staff so monthly reconciliations and purchase‑order controls become routine. Auditors stressed that if historic discrepancies can be reduced to an immaterial, documented residual, auditors can provide an audit adjustment and the district can move forward, provided evidence shows reconciliations are occurring on an ongoing basis.

Board members asked staff to prioritize the most serious findings, confirm the scope and Skyward experience of the outside firm before contracting them, and ensure documentation of all corrective work so the same findings do not recur.

Ending

District leaders said they will finalize engagement documents with the outside firm, continue CCFO and accounting training for staff, and report back to the board on reconciliation progress and any remaining material adjustments.