State board adopts tougher audit rule, pledges triage for districts missing financial audits
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Summary
The Mississippi State Board of Education adopted a new administrative rule (Adm. Code 7.24) to strengthen consequences and triage for districts that miss required financial audits, while staff acknowledged capacity limits and a statewide shortage of audit firms.
The Mississippi State Board of Education on March 19 adopted a change to Mississippi Administrative Code 7.24 aimed at enforcing timelier financial audits and providing a structured process to triage districts with outstanding audits.
Dr. Paula Vandivert, who introduced the item, told the board staff opened a public-comment period that ran Jan. 16'Feb. 18 and concluded staff "felt like there were no revisions needed to the policy as proposed by the state board" because the rule's placement of "may" and "shall" language gives MDE discretion to weigh each district's circumstances when recommending actions to the Commission on School Accreditation.
Board discussion focused on the practical barriers districts face in meeting audit deadlines. Multiple board members and staff described a statewide shortage of CPA firms willing or able to perform school audits, especially for smaller or rural districts, and noted that audit firms have prioritized current-year work. One board member said many districts end up paying more or searching out-of-state firms to catch up.
MDE staff said the number of districts missing FY2023 audits narrowed from roughly 19 to 13 since the policy conversation began in November, and that outstanding audits overall fell from about 47 to 32 as districts responded to new deadlines and outreach. Staff emphasized the agency lacks capacity to pursue accreditation downgrades for dozens of districts at once and will prioritize the most egregious noncompliance (for example, repeated missing audits, disclaimers of opinion, or negative fund balances beyond thresholds set in the policy).
The board emphasized support actions to help districts comply: a proposed "toolkit" and targeted training for school business managers, cross-agency coordination with the state auditor's office, and outreach to vendors of common financial platforms to help standardize reporting. Miss Wiggins said the Office of School Financial Services already provides annual certification training and is exploring expansion of mentorship programs modeled after other states.
The rule passed on a voice vote with one member recorded as abstaining; MDE staff said the policy allows for hearings and due process before any accreditation action. The board directed staff to continue prioritizing districts for corrective action and to report progress at future meetings.
