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East Meadow Board Hears External Audit: Overspending Offset by Revenue; Unassigned Fund Balance at 3.3%
Summary
The board heard an external audit that found an unqualified opinion for all funds except extra classroom activity accounts, reported a roughly $1.47 million overspend in FY24–25 offset by $6 million in additional revenue, and left the district's unassigned fund balance at about 3.3% ($8.95 million).
The East Meadow Union Free School District Board of Education on Monday received its external auditor’s report for the 2024–25 school year, which concluded the district’s general-purpose financial statements were fairly presented "in accordance with generally accepted accounting principles," with one qualification for extra classroom activity funds.
Jill Sanders of audit firm Cullinan Danowski told trustees the firm rendered an "unqualified" opinion on all funds except the extra classroom activity accounts, a common qualification because auditors are not present when some student club cash receipts are collected. She said the district overspent budget appropriations by about $1,470,000 — roughly 0.5% of the district’s large budget — with the instructional and transportation areas among those that drove the overexpenditure.
"The spending side of the budget was overspent by about $1,470,000 in round numbers," Sanders said. "It's about a half a percent of your total budget." She attributed part of the pressure to the drop-off in pandemic-era federal funding, noting the district saw a decrease of roughly $4.5 million in CARES-Act-related support between FY24 and FY25.
Board and administration heard that revenue performance largely offset the overspending. Sanders reported the district exceeded revenue expectations by about $6,000,000, from increased state aid and favorable interest income. That combination led to an increase in the district’s unassigned fund balance to 3.3% of next year’s budget — below the 4% guideline cited under state real property tax law.
"When we look back at '24, the unassigned fund balance was somewhere in the neighborhood of a little bit over 2%," Sanders said. "...your unassigned fund balance was 3.3%." She gave trustees the dollar equivalents: about $8,949,000 in unassigned fund balance at year-end, compared with about $5,088,000 the previous year.
Sanders walked the board through other audit materials — an accompanying management letter, communication of adjustments and best-practice recommendations — and encouraged trustees to review the district’s mitigation plan in the financial statements (she referenced pages 70–72) as the administration builds next year’s budget.
Trustees asked whether reserve accounts were used to cover the overspending; Sanders said they were not and reminded the board that dipping into reserve requires board approval. Board members also asked about comparisons with a neighboring district that recently ran a larger overspend and closed in deficit; Sanders said the neighboring district’s overspending was substantially larger (about 5% in her estimate) and that district closed the year with a deficit, which differs from East Meadow’s position.
Sanders summarized the district’s extra-classroom-activity accounts on a cash basis: the auditor audited approximately $495,000 in bank-account balances for clubs and activities after reporting about $383,000 in opening funds, roughly $810,000 collected, and almost $700,000 spent during the year.
Next steps: the administration and board will use the audit and the recommended mitigation plan as they develop the FY26 budget. Sanders offered to respond to follow-up questions through the superintendent or business office.
The auditor concluded the presentation by thanking district staff for cooperation during the audit and said the firm will remain available for questions as the board considers the budget process.
