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Draft audit flags activity‑fund controls and payroll liabilities, board asks for follow-up
Summary
The district’s audit manager presented a near‑final draft that found improvements but listed recurring weaknesses in activity‑fund reporting, outstanding checks and payroll liability reconciliations. The board asked administration to return with status updates after the federal compliance supplement is issued.
John Regier, the district’s audit manager, told the Haysville USD board that auditors have prepared a working draft of the district’s 2024–25 audit but cannot issue a final report until the federal Office of Management and Budget releases a compliance supplement. "It's 99.9 percent completed," Regier said, calling the draft a near‑final product.
Regier detailed several recurring issues and what auditors recommend the district fix. He said activity funds at some campuses previously showed negative month‑end balances, in violation of KSA 10‑113, and cited outstanding checks and missing activity‑fund reporting for outside accounts such as "Stomping Grounds" and "Colt Branded." He told the board that district‑level journal entries need better review because those postings can create fraud risk if not independently checked.
The draft also called out payroll liability reconciling problems that have contributed to mismatches between reconciled bank balances and the district cash summary. Regier said the district has already taken steps and received training that produced measurable improvements but that several items still require additional work to meet auditing standards.
Board members pressed for a clear follow‑up plan. Administration agreed to compile a report addressing the three outstanding areas highlighted by auditors — activity‑fund reporting, payroll liabilities, and the Stomping Grounds reconciliation — and present progress to the board once the federal compliance supplement is available and the auditors can finalize the report.
Regier emphasized that, despite those issues, the auditors gave the district an unmodified opinion on the regulatory basis of accounting and described the financial statements as a "clean bill of health" under that basis of accounting. He also noted the district's federal single‑audit work found no reportable noncompliance for tested federal programs, including the food service program.
