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Audit draft finds improvements but flags activity‑fund controls at Haysville USD 261
Summary
Auditor John Regier presented a nearly complete draft audit to the Haysville USD 261 board, citing better reconciliations but lingering issues in activity-fund reporting, journal-entry review and inactive funds; the final report is delayed pending a federal compliance supplement.
John Regier, audit manager, told the Haysville USD 261 Board of Education that auditors had prepared a working draft of the district’s financial audit but could not issue a final report because the federal Office of Management and Budget had not yet published a required compliance supplement. “It’s 99.9% completed,” Regier said, but the missing federal guidance prevents final issuance.
Regier walked trustees through findings and progress from the 2024–25 review. He said bank reconciliations and other controls have improved at several schools, and the audit produced an unmodified opinion on the district’s regulatory basis of accounting. The auditors also performed a single-audit review because the district spent about $5,100,000 in federal awards during the year; testing of the food-service program found no compliance exceptions.
Remaining concerns centered on activity funds and internal controls. Regier cited cash-basis violations under the state statute (KSA 10‑113)—specifically, activity funds with negative month‑end balances earlier in the year—outstanding checks at several buildings, and a need for more consistent journal‑entry review at the district level. He identified isolated problems at a district concession operation referred to in the audit as Stomping Grounds, which required additional documentation to reconcile beginning balances, receipts and expenditures.
Board members asked administration to return with a short report documenting how the district will address the three outstanding areas the auditors emphasized: activity‑fund reporting work at Stomping Grounds, district-level journal-entry reviews, and elementary petty-cash conversion to activity funds. Superintendent Craig said staff will consult with the auditors to ensure proposed policy changes comply with law and will present an update at a future meeting.
Regier noted the draft included a disclosure about a bond election and proceeds that were received after year-end, and he reiterated that the audit would be finalized once the federal compliance supplement is available. The board did not take formal action on the audit tonight; trustees instructed administration to track the recommendations and report back.
