Interim CFO reports reconciliations under way; board tables budget cuts and moves audit language to a later meeting

Interim chief financial officer Kim Michael Lee told the Iowa City Community School District board on March 10 that staff have made progress reconciling bank statements for fiscal years 2023 and 2024 and that the district is preparing for audit work on FY24 and FY25.

“We've completed the bank statements for 2023 and 2024,” Kim Michael Lee said by phone, adding that the general fund had been reconciled through September 2024 and that remaining funds would be reconciled after completing the general‑fund work. She told directors auditors were on site performing field work and that some liabilities previously recorded in incorrect accounts had been corrected, though she did not provide on‑the‑spot dollar totals for those corrections and said she would provide additional detail by email.

When asked whether a forensic audit was required, Michael Lee said she would not recommend a forensic audit at this time while the external auditors complete their procedures and she continues her review; she added that she holds forensic certification and is evaluating items with that lens. The interim CFO said she would alert the board if her assessment changes.

Separately, district staff reported an internal finding that October property‑tax receipts had not been split correctly among SAVE, PPEL and debt service, and those funds were spent on projects rather than restricted capital accounts. The board was told this may leave SAVE and debt‑service balances with limited resources to meet bond obligations due June 1; administrators said they are identifying corrective actions and a borrowing strategy to ensure obligations are met.

On the evening’s action items, the board approved updates to the 600‑series policies (which include the RAM model updates) and then voted to table the recommended budget reductions until a later meeting; the board also tabled new audit‑resolution language until the next meeting. Directors said they plan an exempt session March 24 to discuss administrator contracts and to continue work on the budget and borrowing plan.

Next steps: Michael Lee will continue reconciliations, provide requested written deficiency/corrective action documentation, and meet with auditors; administration will present capital‑account corrective plans and borrowing options at upcoming meetings.