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Florence One audit returns unmodified opinion; district posts modest fund balance growth
Summary
External auditors presented a clean (unmodified) opinion on Florence One’s 2025 financial statements, reported no material weaknesses, and highlighted a $2.3 million increase in general fund balance and a $4.8 million government‑wide GASB restatement for compensated absences.
Brian Nicholson, the lead audit director on the engagement, told the Florence One Board of Trustees that the district’s 2025 financial statements received an unmodified (clean) opinion and that auditors identified no material weaknesses, significant deficiencies or reportable noncompliance.
The audit presentation, introduced by Superintendent Dr. Ali and delivered by Mr. Nicholson, covered federal award testing (a single audit with about 26% of expenditures tested), the district’s general fund performance and several accounting standard updates. "We issued a clean or an unmodified opinion over the financial statements," Nicholson said. He added that the district qualified as a low‑risk auditee for single‑audit testing purposes.
Why it matters: auditors reported total general fund revenues of approximately $192 million and total expenditures near $193 million, producing an increase in fund balance of roughly $2–2.3 million for the year. Nicholson noted the district’s fund balance of about $47.5 million exceeds the state minimum and the board’s policy benchmarks — levels tied to the district’s bond rating and borrowing costs.
The presentation also highlighted a government‑wide accounting adjustment required by recent GASB guidance: implementation of the GASB statement affecting compensated absences generated a $4.8 million increase in accrued leave at the government‑wide level, a restatement that does not affect fund‑level balances. "That had no fund‑level effect; it's a government‑wide reporting change," Nicholson said.
Board members and the chair praised the district’s finance staff and the auditors. Mr. Stewart thanked the finance team and specifically recognized staff effort in producing the district’s comprehensive financial report. Board members noted the positive implications of maintaining fund balance for capital planning and bond rates.
The audit also flagged an operational deficit in the food service fund of $1.5 million, which auditors said was driven largely by $2.5 million of capital investments in kitchens and cafeterias and by timing of purchases relative to fiscal year close. Auditors explained USDA rules limit the food service fund to roughly three months of reserve and that the district had been in a planned spend‑down to complete capital work.
Next steps and context: the board accepted the report and thanked district staff; the auditors offered to provide quarterly continuing professional education to district leadership. No formal policy changes were proposed during the meeting based on the audit presentation.
