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Independent auditors give Merton Community School District a clean opinion, cite three internal-control issues
Summary
Riley, Penner & Benton issued an unmodified (clean) audit opinion for Merton Community School District’s 2024–25 financial statements but reported three internal-control findings (financial‑statement preparation, segregation of duties, audit-adjusting entries). The district’s general fund balance remains strong at roughly $4 million.
Riley, Penner & Benton told the Merton board on Jan. 26 that the district’s 2024–25 financial statements received an unmodified (clean) opinion, while the auditors also identified three internal‑control matters for management attention.
“Katie Riley said the audit resulted in an unmodified opinion,” the auditor told the board, describing that outcome as the highest opinion level the firm issues. The audit summary showed a general‑fund balance of about $4,000,000 and a capital‑projects fund balance of roughly $1,900,000.
Auditor highlights included a general‑fund decrease of about $197,000 offset by a capital‑projects increase of about $465,000; total fund balance increased overall for the fiscal year. The firm also listed liabilities including a promissory note (about $182,000) and the district’s share of the Wisconsin Retirement System pension liability (about $467,000). Audit staff explained that the recent GASB change to compensated‑absence reporting increased the district’s reported liabilities by about $156,000.
On internal controls, the auditors reported three findings: (1) financial‑statement preparation (the district relies on the auditors to prepare financial statements and footnotes); (2) segregation of duties (the district’s small staff makes perfect segregation difficult); and (3) audit‑adjusting journal entries (a few entries were required and discussed with business office staff). The auditors emphasized none of the findings were “alarming” and that there were no findings related to internal control over major state awards.
Board members asked questions about how the district compares to peers and whether segregation‑of‑duties concerns are common in smaller districts; the auditor said those issues are common and often reflect cost‑benefit decisions. The board and administration said they would continue to work with auditors and the business office to address the items and reduce future adjusting entries.
The audit will be filed with the Wisconsin Department of Public Instruction in the district’s required reporting.
