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Auditor reports unmodified opinion on Coventry’s 2023 financial statements, flags municipal deficit provision
Summary
CLA auditor told the Coventry School Committee the 2023 audit received an unmodified ("clean") opinion but noted a violation of Rhode Island Law 45-12-22.1 on municipal deficits and highlighted pension and OPEB liabilities.
Steven Gross of CLA presented the fiscal year 2023 audit to the Coventry School Committee and answered members' questions about findings, deficits and next steps.
Gross told the committee CLA issued an unmodified opinion on the basic financial statements for the town and school — commonly described as a "clean" opinion. He also summarized a compliance finding: the Coventry schools were noted in relation to Rhode Island Law section 45-12-22.1 concerning municipal deficits. "...you're in violation with, Rhode Island Law section 45-12-22.1 relating to municipal deficits," Gross said.
Gross reviewed key financial highlights from the audited statements. He said revenues came in about $837,000 higher than budgeted for the school department, while expenditures exceeded budget by about $1.2 million, producing a budgetary deficit versus plan. He also noted a $285,000 deficit in transfers to other funds, which often reflects negative fund balances in special revenue grants and other internal funds.
The auditor summarized long-term liabilities: a single-employer pension plan identified as the CT ASRP fund has roughly a $17 million liability at about 48.54% funding; the state's teacher retirement plan showed a Coventry share of about $54 million; a teacher survivor-benefit fund appeared as a net pension asset of about $12.3 million; and the combined town/school OPEB liability was about $15.9 million. Gross emphasized actuarial valuations mean those amounts can fluctuate.
Gross also reported there was a delay in audit issuance caused by staffing turnover at both the town and school; CLA issued a management advisory letter with recommendations for internal control improvements. The committee chair and superintendent noted the school administration can respond to recommendations and that some items may already have been addressed since the 2023 reporting year.
Committee members asked how deficiencies are categorized; Gross described material weaknesses, significant deficiencies and management advisory findings and said most of Coventry's recommendations were included in the management advisory letter. The committee received the presentation and thanked Gross for attending; no vote on the audit itself was recorded at the meeting.
