Auditors tell Novi schools’ board financial statements ‘present fairly’; district posts $28.6M improvement in net position

Yeo & Yeo, the independent auditors, reported to the Joint Finance & Capital Projects Committee that the Novi Community School District’s financial statements for the year ended June 30, 2025, “present fairly, in all material respects, the respective financial position” of the district’s governmental activities and major funds. The audit report noted the district adopted GASB Statement No. 101 during the year and recorded a prior-period adjustment to correct beginning capital asset balances.

Management’s discussion and analysis showed the district’s net position improved to $6.04 million at June 30, 2025, from a restated beginning balance that reflected accounting changes. The statement of activities reported total governmental revenues of $139.34 million and total expenses of $110.69 million, leaving a reported increase in net position of $28.65 million for the year. District financial staff highlighted that much of the change reflected actuarial and deferral adjustments for pensions and other post-employment benefits rather than cash operating surpluses.

The auditors’ report and the district’s financial statements documented key balances: total assets and deferred outflows of $422.46 million, total liabilities and deferred inflows of $416.41 million, and capital assets net of depreciation of roughly $288.49 million. The notes disclosed the district’s long-term obligations, including $178.71 million in general obligation bonds outstanding and a construction-in-progress balance supporting ongoing bond projects. Yeo & Yeo also issued a companion bond-compliance testing letter for the 2024 School Building and Site Bonds, Series III, reporting that annual compliance tests were performed and that the related capital projects were not yet substantially complete.

The committee packet included detailed schedules and reconciliations explaining differences between fund-based reporting and government-wide statements, showing how capital outlays, debt activity, and actuarial pension/OPEB adjustments translate into the government-wide change in net position. District officials and the auditors said the reports will be forwarded to the Board of Education for final acknowledgment and any formal acceptance required at a future meeting.