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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Bolivar-Richburg Central School District – Internal Controls Over Selected Financial Operations (2013M-92)


Released: July 26, 2013 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to evaluate the District’s financial condition and determine if District officials established effective internal controls over selected financial activities for the period July 1, 2011, to December 31, 2012.

Background

The Bolivar-Richburg Central School District (District) is located in the Towns of Alma, Bolivar, Clarksville, Cuba, Friendship, Genesee and Wirt, in Allegany County. The District is governed by the Board of Education (Board) which comprises seven elected members. The District’s budgeted general fund expenditures for the 2012-13 fiscal year are approximately $17 million.

Key Findings

  • From fiscal years 2007-08 through 2011-12, District officials have consistently over-estimated expenditures by a total of $7.1 million and increased the tax levy by 23 percent. These budgeting practices generated approximately $2.1 million in operating surpluses, which caused the unexpended surplus fund balance to exceed statutory limitations for the past five years. For example, at June 30, 2012, the unexpended surplus fund balance exceeded statutory limits by approximately $350,000.
  • We question the District’s need to maintain over $5.8 million in reserves. In addition, extra classroom activity moneys were not maintained in accordance with District policy and Regulations.
  • Extra classroom activity moneys were not maintained in accordance with District policy and Regulations. We found significant weaknesses, including failure to appoint a faculty auditor, as required, and an unauthorized individual making adjustments and entries to student ledgers.

Key Recommendations

  • Develop realistic expenditure and fund balance estimates for the annual budget.
  • Review reserves and determine if the amounts reserved are necessary, reasonable and in compliance with statutory requirements. Develop a plan for the use of the excess unexpended surplus fund balance and the excess amounts in reserve funds in a manner that benefits District taxpayers.
  • Ensure that activity funds are maintained in accordance with District policy and the Regulations. Appoint a faculty auditor to oversee the management of activity fund moneys in accordance with requirements in the Regulations.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236