Los Gatos Union Elementary board accepts 2024'25 financial audit; auditors cite GASB 101 restatement and two technical findings

The Los Gatos Union Elementary School District board voted to accept the district's independent financial audit for the 2024'25 fiscal year after a presentation from CWDL, the district's outside auditing firm.

John of CWDL presented the audit and said the firm rendered "what we would refer to as our unmodified opinion," covering the full 97-page report. He told the board the opinion reflects the auditors' review of financial data, disclosures and implementation of a recently adopted accounting standard.

CWDL reported a $5,600,000 restatement tied to implementation of GASB Statement No. 101 (compensated absences). "This was strictly an implementation of a required standard," the auditor said, explaining the change came from a new requirement to consider multiple sources of leave, not only vacation, when measuring the liability.

The auditors also identified two instances of noncompliance the firm is required to report. The first finding related to attendance-record controls and weekly rosters; the auditor noted the district is exploring electronic approval processes the California Department of Education allows. The second finding concerned the timeline for comprehensive school safety plans, which include a specific approval date (March 1) under the applicable rules. The auditor emphasized these were technical findings in the context of an otherwise clean audit: "We did not identify any material weaknesses or significant deficiencies over financial reporting," he said.

District staff and trustees discussed implications of GASB 101. A district staff member explained that including sick leave in the liability measurement is a change from prior practice: "I find it interesting that GASB decided to make that a part of the financial statements," the staff member said, noting that in California many sick-leave balances move with employees and are not typically paid out.

A board member moved to accept the independent auditors' report; the motion was seconded and the board voted to accept the audit.

In the same agenda segment CWDL presented the Measure CC (general obligation bond) financial and performance audit for the bond's initial issuance. The auditor reported roughly $483,000 of interest attributable to Measure CC for the tested period and $867,000 in expenditures sampled at over 84 percent coverage. He concluded the Measure CC work "met the intent of the voters" under Proposition 39 and characterized the Measure CC audit as a clean kickoff for the bond program.

Next steps noted in the presentation: staff and auditors intend to track corrective actions on the two technical findings and report back in follow-up work next year. The board moved on to other agenda items after accepting both the district audit and the Measure CC audit.