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Small Mohave district removed from USFR noncompliance after multi-year fixes
Summary
Auditors told JLAC that Topok Elementary in Mohave County corrected nearly half of longstanding Uniform System of Financial Records deficiencies and, after review of FY2025 audits and a district update, is no longer listed as noncompliant; the State Board will determine how much withheld state aid is returned.
Topok Elementary School District in Mohave County has moved off the state’s Uniform System of Financial Records (USFR) noncompliance list after making substantial corrections, the Arizona Auditor General’s office told the Joint Legislative Audit Committee on June 1. Megan Heager, director of the Auditor General’s Accountability Services Division, said auditors reviewed the district’s FY2025 financial audit reports and its corrective-action update and determined the district had “made significant progress” and was no longer in noncompliance as of May 14, 2026.
The determination follows a history of noncompliance dating to audits and follow-up reports in 2022 and 2023. Heager told the committee the district corrected 12 previously cited deficiencies in areas including open meeting law, property control, procurement, payroll, classroom site fund approvals, student attendance reporting and information technology, while other items—particularly several IT controls—remain in process.
Kaylee Lee, the district’s superintendent, told JLAC the district rebuilt its capital-assets records, completed a physical inventory, strengthened procurement and payroll processes, established oversight and board conflict-of-interest procedures, and engaged an outside consultant, Rebecca Williams, for targeted support. “This is a team effort,” Lee said, thanking staff who helped implement the changes.
Committee members pressed for clarity about the district’s remaining work and the status of a 3% state-aid withholding that took effect after JLAC’s December 2024 referral. Auditor General Lindsey Perry told members the State Board of Education must agendize any decision to release withheld funds and estimated about $93,000 in cash had been withheld; Perry said the State Board and Department of Education would determine how much of that withholding will be returned.
Members and auditors emphasized ongoing oversight: the Auditor General recommended confirming that corrective actions operate consistently over time with a future status review and routine follow-up audits. The committee welcomed the district’s progress but reiterated that sustainable compliance requires continued staffing, training and board engagement. The clerk said staff would follow up with the committee on timing and amounts related to the withheld aid.
JLAC did not take a separate formal action on Topok during the meeting but encouraged continued follow-up and recommended the district maintain the systems it put in place.
