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Katy ISD audit yields clean opinion; district reports $412.9M net position
Summary
External auditors gave Katy ISD an unmodified (clean) opinion on the FY2025 financial statements and found no material weaknesses or federal findings. Auditors reported total assets of $4.2 billion, net position of $412.9 million, and noted pension and OPEB liability figures disclosed in the ACFR.
An external audit presented Monday to the Katy ISD Board of Trustees found the district’s FY2025 financial statements materially correct and free of material weaknesses.
Whitley Penn audit partner Lupe Garcia told trustees the firm issued an unmodified opinion for the annual financial statements and reported no material noncompliance or internal control findings. The federal single audit of major programs also produced no reportable findings for the four major programs tested.
Key numbers highlighted by Garcia included total assets and deferred outflows of about $4.2 billion, cash and investments near $1.1 billion and net capital assets about $2.8 billion. The district’s liabilities and deferred inflows totaled roughly $3.8 billion, including long‑term bonds payable of about $2.8 billion. Katy ISD’s net position was $412.9 million at Aug. 31, 2025.
Garcia discussed pension and retiree‑health liabilities the district must report as its proportional share of statewide Teacher Retirement System amounts: a pension liability of about $336.6 million (pension funding about 77.51 percent) and an OPEB liability of about $216.2 million (reflecting a pay‑as‑you‑go structure that can show high ratios).
The district’s general fund revenues were driven by state funding (about 52 percent) and property taxes (about 38 percent); instruction and instruction‑related services comprised about 68 percent of general fund expenditures. The audit partner also noted the district’s ACFR preparation and the staff work that supports producing the report in‑house.
Trustees asked about third‑party recognitions; staff said the district has received GFOA and ASBO awards for the comprehensive financial report for decades. Garcia estimated his firm spent approximately 600 audit hours on the engagement, with significant additional staff time required on the district side.
The board will be asked next week to accept the audit and authorize required filings with state and federal clearinghouses.
