An external auditor presented Hoke County Schools’ 2024–25 annual audit on Jan. 13, issuing a clean, unmodified opinion while identifying several control and compliance findings the district must address.

The auditor (Speaker 9) told the board that the general fund balance as of June 30, 2025, was $948,000.46 — a year‑over‑year decrease of $226,003.18. Combined with the "other special revenue fund," the district reported a roughly $1.4 million decrease in fund balance. "We would actually recommend that you try to get the fund balance back up to around $1,500,000.0 if you could," Speaker 9 said, noting that $1.5 million would provide about two to two‑and‑a‑half months of operating cash.

The audit’s compliance and internal control findings included:

• Reconciliations not completed timely: auditors noted general ledger accounts were not reconciled promptly, requiring audit adjustments; delayed reconciliations risk decisions being made on inaccurate data.

• Purchase‑order and pre‑audit failures: instances were identified where purchase orders were completed after goods or services were received, contrary to the School Budget and Fiscal Control Act.

• Budget violations: the audit documented approximately $286,000 in expenditures in the general fund that the board had not previously authorized.

• Position allotment overspends: the district overspent months allotted by DPI for several categories (school health personnel overspent by 5.96 months, family support nurses by 4 months) and recorded salary exceptions totaling $47,004.13 for the fiscal year.

The auditor also reported that the school nutrition program recorded a loss of $764,006.89 for the year — an increase from the prior year’s $247,000 loss — driven largely by a $197,000 revenue decline and a $337,000 increase in salaries/benefits and capital outlay. Nonetheless, Speaker 9 said child nutrition still maintained a healthy cash reserve of around $4.5 million.

District staff responded that a retired experienced finance officer consultant and new staff (Miss Richardson) are assisting to address these controls and to improve monthly reconciliations. The auditor recommended strengthening monthly reconciliation procedures, ensuring purchase orders are completed before purchasing, and closely monitoring position allotments to avoid leaving months on the table or recording overspends.

What’s next: The board was advised to factor these findings into budget planning for 2026–27 and to take corrective steps to rebuild fund balance and correct internal controls.