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Independent audit finds no reportable findings but flags district fund deficit and borough reconciliation issues
Summary
Independent auditors issued an unmodified (clean) opinion on the Ketchikan Gateway Borough School District's FY2023–24 financial statements but highlighted a near‑term governmental funds deficit and a growing self‑insurance liability tied to the borough central treasury. Auditors and district staff said delays reconciling borough balances delayed
An independent audit of the Ketchikan Gateway Borough School District's fiscal year 2023–24 financial statements returned an unmodified opinion — the auditor's clean report — and found no reportable federal or state compliance findings. Grant Todd, partner at Altman Rogers & Company, told the board the audit found no internal-control exceptions in the sampled transactions and no federal or state program compliance findings.
Despite the clean opinion, the audit outlined material fiscal challenges. On a governmental-funds basis (the near‑term view of resources), the district reported an aggregate fund-balance deficit of roughly $4.9 million for FY2023–24. Auditors explained differences between government-wide (accrual) and fund (modified-accrual) statements and pointed to several large, non-cash and reconciliation items that changed reported figures: a $1.8 million write-off by the borough of a portion of a self‑insurance/health‑insurance payable; a decline in the district's PERS/TERS reported liability; and capital accounting differences that move expenditures on to the balance sheet for accrual reporting.
Auditor Grant Todd said the timing and reconciliation of borough central‑treasury balances were the principal reason the financial statements were issued later than usual: the bureau needed to provide final balances used in the district's statements. The business manager confirmed the borough and district had negotiated a one‑time write-off of roughly $1.7 million to reduce the district's liability in FY2023–24, but the fund statements still show a near‑term deficit.
Superintendent Robbins used the audit presentation to reemphasize the district's immediate budgeting context: unless the state increases the Base Student Allocation (BSA) or the borough alters its local contribution, the district will have to enact wide cuts. Robbins encouraged constituents to contact Representative Jeremy Bynum and Senator Stedman to advocate for legislation such as HB 69, which the superintendent described as a package that would increase the BSA and index it to inflation.
Board action: the board voted to approve the annual audit prepared by Altman Rogers & Company; the clerk recorded the roll call.
Provenance: Audit material and presentation begin at 01:03:29 and continue through the financial discussion and votes (topicintro: 01:03:29; topfinish: 02:08:10).
