Auditor gives schools ‘clean report’
An independent audit of Clark County Public Schools for the fiscal year that ended June 30 found no evidence of fraud or misappropriation of funds in examining the school district’s finances.
“We issued an unmodified opinion, which is a clean report,” Thomas Sparks of the accounting firm Summers, McCrary & Sparks PSC told school board members in presenting the audit during a virtual meeting Monday night.
Sparks commended the schools’ financial director, Aleisha Ellis, Superintendent Paul Christy and their staff for “a great job” of pulling together and presenting the information for the audit.
There were a couple of minor issues board members questioned at the end of the presentation, including some missing dates on some forms for activity funds and a note the auditors had inadvertently left out of the report about the effects of the coronavirus pandemic on school finances, and which Sparks said he would email to Ellis right away.
The audit has to be submitted to the Kentucky Department of Education by Jan. 15 by the auditor, and the school district must submit a data collection report to the federal government.
Sparks said the missing information was simply a “blanket” note that basically says “we don’t know what impact” the pandemic will have on school districts.
Clark County schools have been operating mostly through online distance learning since March, and that has affected finances, from lower federal reimbursement of school lunches to grants.
Sparks went over several highlights from the report relating to the district’s budget, pensions and bonding for construction projects.
He noted that total assets for the year decreased by about $4.7 million.
“This was primarily cash used for the construction fund on the two major projects you had going on this year, which is the athletics complex and the fieldhouse,” Sparks said.
The auditor said total liabilities decreased by $4.2 million from the prior year.
“This is primarily a reduction in your long term bonds … which is good news,” he said.
Sparks said expenditures this year compared to last year went up about $2 million, primarily in the areas of student services and plant operation. Before transfers,the general fund had a deficit of $2.3 million compared to $942,000 for the prior year.
The district had outstanding bonds of $83 million as of June 30, and this year, the audit shows, it needs to budget $3.9 million for bond payments and $152,000 for its KISTA (Kentucky Interlocal Schools Transportation Authority) agreement.
The district’s proportionate share of the net pension liability for the County Employee Retirement System is $18.6 million for the year compared to $15.7 million for the prior year.
The state’s proportionate share of the Kentucky Teachers Retirement System liability directly associated with the district is $99.3 million. The district did not report a liability for the district’s proportionate share of KTRS because the state provides the pension support directly to KTRS on behalf of the district in a special funding situation.
In terms of compliance with government auditing standards, Sparks said: “I’m happy to say we had no findings. We had a couple last year. Those have been corrected. Everything the district was supposed to do on the compliance side was corrected, and there were no findings.”
After the presentation of the report, Board Member Scott Hisle expressed his appreciation to the auditor and the district’s financial director.
“I commend Mrs. Ellis and her staff for the fine work that they have done,” he said.
“I agree,” Sparks said.