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Auditors give Calvert County Public Schools a clean FY2025 opinion; OPEB net liability explained
Summary
External auditors told the Calvert County Board of Education they issued an unmodified opinion on the district's FY2025 financial statements, found no material weaknesses, noted a 19% increase in accounts receivable and explained a $56 million net OPEB liability; board members asked detailed accounting and funding questions.
The Calvert County Board of Education heard from the district's external auditors that they issued a clean, unmodified opinion on the fiscal year that ended June 30, 2025, and identified no material weaknesses in internal controls.
Chris Lehman, the engagement partner who led the audit, told the board the firm audited the district's financial statements and is completing a separate federal single audit required because the district receives more than $750,000 in federal funds. "We've issued a clean or unmodified opinion on the financial statements," Lehman said, noting the firm's risk-based approach and work testing design and operating effectiveness of internal controls.
Board members pressed auditors and staff for details on specific balances. Lehman confirmed the unrestricted fund activity shown in the statements and walked directors through the method used to reconcile budgetary information to GAAP-based financial statements. The presentation included year-end totals showing roughly $255,000,000 in revenue and about $261,000,000 in expenditures against a final budget of approximately $271,000,000.
On accounts receivable, a board member noted that AR rose about 19% year over year; Lehman said the increase appears driven by volume rather than collection delays and that auditors perform confirmations and subsequent receipt testing to verify collectibility. "I would say it's overall volume. I'm not aware of any delay in collections," Lehman said.
The audit team also explained pension and other postemployment benefit (OPEB) reporting. Lehman said actuarial assumptions drive the large estimates in the notes; the actuary calculates projected benefit promises and discounts them to present value. He described a $200 million total actuarial OPEB liability partially offset by approximately $144 million in plan assets held jointly with the county, producing a roughly $56 million net OPEB liability on the district's statements. Lehman emphasized that the net OPEB number is an actuarial construct and not an immediate cash obligation.
Scott Johnson, the district chief financial officer, and auditors addressed board questions about depreciation (recorded on entity-wide statements but not in the general fund on a modified-accrual basis), the treatment of county-funded capital projects, bank reconciliations, and an isolated duplicate encumbrance that inflated fixed charges in the first-quarter financial report (staff said the error has been corrected and will be reflected in the next report).
Lehman said the single-audit compliance testing remained in process but within the required timeline and invited any further questions after the meeting. The board voted subsequently on routine business and then continued its agenda.
