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New auditors give Springfield Township SD a clean opinion; single-audit compliance report delayed
Summary
Barba King Thornton reported an unmodified opinion for the 2024-25 fiscal year with no significant deficiencies; auditors flagged a delay in the OMB compliance supplement that prevents issuance of the final single-audit compliance report, and the finance committee will recommend approving the audit in draft form at the Dec. 2 board meeting.
Alex Frank, audit manager at Barba King Thornton, told the Springfield Township School District finance committee on Nov. 19 that the firm’s first-year audit will carry an unmodified (clean) opinion for fiscal 2024–25 and that no significant deficiencies or material weaknesses in internal controls were identified. "As of now, I don't see it changing in any way, but have an unmodified or clean audit opinion on all reports in the audit," Frank said.
Frank reviewed key fiscal-year numbers: the general fund decreased by about $650,000 from the prior year, capital projects rose about $1.1 million largely because of new bond proceeds, and revenues exceeded budget by roughly $860,000. He also described accounting impacts that do not represent immediate cash outflows, including an approximately $82 million pension liability and a roughly $3.7 million OPEB liability that are required to be reported under accounting standards. "These are liabilities required to be presented, but in reality, the district may never have to pay them back," Frank said.
Frank cautioned that the district’s federal single-audit compliance report remains incomplete because the U.S. Office of Management and Budget has not yet finalized the annual compliance supplement auditors use to test federal awards. "Without a finalized compliance supplement, we can't issue a final audit report on the compliance," he said, adding that the firm is holding the financial-statement report at "about a 99% final report" until the supplement is released. Frank noted the district could ask the firm to break out and complete the compliance work early, but that would add cost and increase risk.
Miss Green, who led the finance committee meeting, told members the committee will recommend approval of the 2024–25 audit in draft form at the board's Dec. 2 regular meeting, with a clear caveat: if there are any significant or material changes after the OMB supplement or subsequent procedures, she will pull the action item. "What we would like to do ... is to approve the 24-25 audit in its draft form as we've done in the past at that meeting under the recommendation of the finance committee," she said.
The report flagged a restatement of opening accumulated depreciation after auditors found certain assets were over-depreciated; the restatement added about $4 million to opening depreciation. Frank said capital assets net of depreciation were roughly $106 million, with about $10 million in current-year additions and about $5 million in depreciation expense. Net reportable bonds payable were about $114 million, an increase of roughly $4 million from the prior year due to new bond issuance.
The finance committee thanked the audit team and administration for a smooth transition to a new auditor and for the audit process. Frank said the numbers presented should remain materially consistent in the final report once the compliance supplement is issued and any minor wording tweaks are made.
The next formal step is the Dec. 2 board meeting, where the finance committee's recommendation to approve the audit in draft form will be placed on the agenda; Miss Green said she will remove the item if any material changes arise after additional compliance work.
