Auditors issue unmodified opinion for West Allis-West Milwaukee; material20weakness noted on statement preparation

The West Allis-West Milwaukee School District received an unmodified audit opinion for the fiscal year ended June 30, 2025, the district27s auditor told trustees at a workshop meeting.

"We were able to issue what's called an unmodified opinion on the financial statements," Michelle Walters, senior manager at Baker Tilly, said, meaning the statements were free of material misstatements and accounting principles were applied consistently.

Walters also highlighted an "emphasis of matter" tied to a new accounting standard on compensated absences, which affects disclosures but not district operations. The audit did not identify significant deficiencies in internal controls, the auditor said; however, Baker Tilly reported a material weakness because the audit firm prepares the district27s financial statements, an arrangement the auditor described as common for school districts.

On results, Walters said the district budgeted to use about $121,000 of general-fund balance but instead added roughly $745,000 by year-end, bringing total general-fund balance to about $40.8 million. She broke the balance into roughly $1.5 million nonspendable (prepaids), about $117,000 restricted (grant carryovers), about $4.7 million committed (compensation model redevelopment), and approximately $34.4 million unassigned. Under the district27s policy the target is 20% of general-fund expenditures; the FY2025 level equated to about 34%.

Walters said auditors reviewed federal and state awards separately this year because of timing of the compliance supplement. The audit covered three federal programs (Medicaid, child nutrition and IDEA) and two state programs (general aids and state special education); auditors found no compliance findings.

The report also summarized the district's capital activity and long-term obligations: capital-projects revenue tied to the referendum was large for the year, with unspent bond proceeds reported at about $69.6 million, and general-obligation bonds outstanding around $72.5 million. Pension and postemployment liabilities were presented as actuarial estimates, with the Wisconsin Retirement System net pension liability at roughly $4.4 million and OPEB health liabilities shown near $27 million (plus about $2.5 million for life insurance), Walters said.

Board members pressed staff on the OPEB figures. "With the change in structure that we have for our OPEB long term, will we expect to see this decrease each year because we've moved from the undefined benefit to a defined benefit?" asked a trustee. District and audit staff said actuarial trends already show substantial reductions from earlier years and that the shift to a defined-benefit structure should reduce liabilities over time, though they could not give a precise timetable for when those savings will be realized.

Walters recommended that the district continue reconciling Skyward budget records to the board27s approved budgets; staff said they have implemented processes to better connect original and final adopted budget figures for fiscal 2026.

The board thanked auditors and finance staff for their work; no board action was recorded on the audit at the meeting.