School District One gets good financial report

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During their audit presentation Tuesday, the Anderson School District One Board were told by auditor Larry Finney that the District “is in good financial condition.”

According to Finney, District One received an “unqualified opinion” which is “the best the District can receive.” “You have been through some tough years and have done very well with that,” he said. According to Finney, the General Fund Balance increased by $100,000 to $10.5 million.

Since the District had budgeted to spend $700,000 to $800,000 of the fund balance to cover expenses this year, Finney said they had done very well to actually have an increase.

The District has about $9.5 million, or 17.6 percent unassigned, which is just over the 17 percent recommended by the GFOA. The amount represents about two months of operations.

Finney said the fund balance is important because it covers five to six months of expenses during the period when there is no tax revenue coming in. It also results in a lower interst rate when bonds are issued by the District.

Finney reported that the District’s general fund revenue, at $49.8 million, was $3.2 million higher than last year. There was an increase in State revenue of approximately $2.9 million, primarily due to an increase in the base student cost, according to Finney.

Lower property tax collections were offset by higher State revenue and resulted in the general fund being $200,000 under budget.

General Fund expenditures were $4 million higher than last year at $50.8 million, primarily due to an increase in higher instruction and support costs, which Finney said were related to salaries and no furloughs. Even with the higher expenses, expenditures were still $1.5 million lower than budgeted, primarily due to lower expenditures for instruction and support services related to salaries and employee benefits.

The District has a $2.2 million fund balance for debt service and a capital project fund balance of $2.3 million to cover construction projects being finished this year.

Food service also had a “good healthy fund balance “ with $1.6 million in net assets.

According to the report, District One has assets of $151.8 million and liabilities of $101.4 million.

Finney said that a new government accounting requirement is coming and will require state pension liabilities to show on the District’s financials. The liabilites are for retirement and healthcare costs. “It will show as a liability in 2015,” he said.

Finney said that the new requirement is the result of employers being required to show funding and that the State will begin to “increase rates for employers and employees.”

The audit did find a capital asset that needed to be restated and a problem with food vending machines at one school being used during lunch periods in violation of USDA guidelines.

Dr. Fowler said that the vending machines were supposed to be turned off.

The audit report also recommended that some pupil activity accounts be managed better.

Overall the District is in good financial condition and has shown good management of finances, Finney said.