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Mahtomedi auditors issue clean opinion but note segregation-of-duties finding, two timeliness compliance issues
Summary
External auditor Jim Eichton presented an unmodified (clean) opinion on the districts financial statements for year ended June 30, 2024, but cited a reportable item for lack of segregation of duties and two Minnesota legal-compliance findings for untimely withholding affidavits and unclaimed property reporting.
The Mahtomedi Public School District board accepted the independent auditors report for the fiscal year ended June 30, 2024, after Jim Eichton of MMKR/LB Carlson CPAs presented the results and findings.
Eichton told the board auditors issued an unmodified opinion on the districts comprehensive annual financial report and a clean opinion on the Schedule of Expenditures of Federal Awards. "It is a clean opinion, really the opinion you were looking for," he said.
Nut graf: While the financial statements received a clean audit opinion, the auditor reported a reportable item (significant deficiency) for lack of segregation of duties within the business office and two legal-compliance findings related to timeliness: withholding affidavits received after final vendor payments and a delayed unclaimed property report to the state.
Eichton said the district operates with a limited business-office staff that makes full segregation impractical; auditors tested compensating controls and reported the deficiency as a significant deficiency rather than a material weakness. "You could hire more people," he said when asked how the finding could be eliminated, "but the costs outweigh the benefits." He emphasized the finding is common for districts the size of Mahtomedi and must nevertheless be reported to the board.
On compliance, Eichton said the withholding-affidavit requirement calls for vendor affidavits verifying tax withholdings before final payments; in these instances the affidavit arrived after payment. He also said an unclaimed-property filing required in November was submitted a few months late. Both were described as timeliness issues rather than nonreceipt.
Eichton highlighted fiscal metrics for the year: the districts MDE-calculated fund balance percentage was 22.3 percent; the district reported roughly $19,115 in revenue per student and $18,901 in expenditures per student; and the districts general fund unassigned balance ended the year at about 12.2 percent, above the boards 8 percent policy minimum.
Board members thanked the auditor and district staff; the board then voted to approve the independent auditors report, moved by Director Doman and seconded by Director Whitson. The chair called the ayes and declared the motion carried.
Ending: The audit materials and management letter will be used in ongoing budget discussions; the board and administration agreed to continue monitoring internal control compensating measures and to track timeliness improvements on the two legal-compliance items.
