District auditor gives unmodified opinion, flags cafeteria shortfall and urges stronger controls
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Summary
External auditor presented an unmodified opinion on the district’s financial statements, highlighted processing delays and bank‑reconciliation lapses, flagged a roughly $32,000 cafeteria shortfall, recounted two caught check‑fraud attempts, and recommended internal audits; the auditor estimated internal audits cost about $20,000.
The district’s external auditor, introduced during the workshop as Sue Peters, reported an unmodified opinion on the financial statements and reviewed a set of recommended improvements to internal controls.
Peters told the board auditors found no condition that would change the overall opinion but did identify process issues: delayed bank reconciliations during a period of staffing turnover and two payments lacking supporting invoices in activity funds. She described two instances of check fraud involving altered or re‑used checks; bank contact and internal review led to funds being recovered. “We were able to catch both instances where they've had them. We got the money back,” Peters said.
Peters highlighted a cafeteria fund shortfall — the district spent more on food than reimbursements and currently has an approximately $32,000 gap that the administration proposes to cover with a $230,000 transfer over time to restore the cafeteria balance and repay the general fund. The auditor recommended keeping timely bank reconciliations, maintaining segmented duties on approvals, and continuing the checks‑and‑balances protocol for large wire transfers.
On internal audits, the auditor estimated the cost of a quarterly internal‑audit program at roughly $20,000 annually (four reports), with scope adjustable by the board. Board members asked her to provide a scope and to prioritize areas (e.g., fuel bids, cash‑handling, wire transfers) for the internal audits.
Next steps: the auditor will provide the board the full audit findings and recommended improvements in the April packet; staff will prepare proposals for an internal audit scope and cost alternatives.
