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Audit Objective

Determine whether the Board and District officials monitored the District’s financial condition.

Key Findings

• Conservative budgeting resulted in operating surpluses, negating the use of appropriated fund balance. In the last three completed fiscal years, the District generated $2.3 million in unplanned operating surpluses instead of $1.4 million in planned deficits.
• Certain reserve balances were excessive or not needed. Of $3.7 million in seven reserves, three reserves totaling $636,665 may be unnecessary because related expenses were paid from operating funds.
• District officials did not develop comprehensive written multiyear financial or capital plans.

Key Recommendations

• Discontinue the practice of appropriating fund balance that is not needed or used to fund operations.
• Review reserve balances and develop a plan to reduce balances to reasonable levels in accordance with applicable statutes.
• Develop multiyear financial and capital plans that set long-term objectives and goals.

District officials disagreed with some of our recommendations, but indicated they would take corrective action as stated in their response letter.