External auditors give AUHSD a clean opinion; district projects out‑year budget gaps amid enrollment decline
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Summary
External auditors delivered an unmodified (clean) opinion on the district’s 2024–25 financial statements and bond spending; district staff certified a positive first‑interim but projections show declining enrollment and possible multi‑year deficits unless one‑time state funds arrive.
External auditors told the Anaheim Union High School District board on Thursday that their review of the district’s 2024–25 financial statements, federal awards and state compliance produced unmodified — or "clean" — opinions.
The audit partner reported no reportable deficiencies for the financial statements and said compliance testing for federal programs (including ESSER and Title I) and state programs produced unmodified opinions. On bond audits, the auditor said testing covered about $677,000 of $684,279 (roughly 99%) for Measure H and a sample of about $36.7 million (approximately 91% coverage) of $40.2 million for Measure K; testing found bond proceeds were used consistent with voter approvals.
The board also received the first interim budget report for the fiscal period ending Oct. 31, 2025, which staff certified as "positive." Chief Financial Officer Dr. Nancy Nian outlined assumptions used for projections, including a 92% ADA assumption for P1 projections, a 2.3% current‑year COLA and a 3.02% out‑year assumption (subject to change). Dr. Nian said district enrollment has declined from about 33,000 in 2010 to roughly 25,186 students in 2025 and that the district projects multi‑year shortfalls: a possible deficit spend of about $34.9 million in 2026–27, increasing to $55.2 million and $71.4 million in later out years absent one‑time state funds or other offsets.
Trustees probed technical distinctions between enrollment and funding ADA (the district is funded on a three‑year average that can produce differences between headcount and funded ADA). Staff said some one‑time state funds could mitigate the projected deficits depending on timing and distribution and committed to updating the board after the governor’s January budget package and the May revision.
Action: The board approved adjustments and the first‑interim report by roll call vote (unanimous). Staff said they will present updated projections to the board after the governor’s January proposal and before the next interim report.
