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State audit results released, district implements recommendations

April 9, 2019

After a thorough review, the Office of the State Comptroller issued an audit report on the South Glens Falls Central School District that found no instances of the misuse of tax dollars, but did include recommendations to help the district improve existing practices in regards to unrestricted fund balance.

The audit, which took place from fall 2017-January 2018, included an in-depth review of the district’s financial practices in accordance with a New York state law that requires all school districts to undergo a periodic comptroller audit. The district received initial feedback at that time, but the report was officially released to the public on Friday, April 5, 2019.

South Glens Falls Central School District officials have already implemented the state’s recommendations into their accounting practices.

“Our business office and the board of education are always looking for ways to improve practices and tighten controls,” said Business Manager Audrey Varney. “It is always our goal to comply with best practices, as recommended by the state, to manage money and ensure long-term fiscal health in our school district.”

As a result of the audit findings, the district has implemented the following procedures:

  • Discontinuation of the long-term accounting practices of accruing, encumbering or prepaying health insurance, utilities and WSWHE BOCES lease purchases for the 2017-18 school year and subsequent years. This ensures that the district properly accounts for encumbrances, accrued liabilities, accounts payable and prepaid expenditures at the end of each fiscal year. It also corrects the district’s accounting records and makes sure that the district’s unrestricted fund balance is accurately reported.

 

  • Although the district had previously developed a “Comprehensive, Multi-Year Financial Plan,” the state recommended that the board of education formally review and adopt the plan annually. This plan is a framework for future budgets that guides the district’s management of its financial condition. The district also purchased software to improve long-term fiscal planning.

 

  • Adoption of a formal, written “Reserve Fund Plan and Policy” in May 2018 that explains how the reserves will be funded, the optimal funding levels for each reserve and the condition under which reserves will be used to finance related costs. Prior to the end of each school year, the district and board of education will review the current year reserve balances, anticipated use for the current year and recommendations for increasing or reallocating balances for the next fiscal year.

 

  • Establishment of a voter-approved Capital Reserve Fund that can include up to $10 million dollars. Unemployment reserve funds, other reserves and fund balance were reallocated in the amount of $2.1 million to the Capital Fund Reserve in May 2018 by the board of education as part of the annual reserve and fund balance review. This new reserve fund allows the district to ensure it has money available for one-time capital needs such as urgent or emergency repair of facilities or equipment. This fund ensures the district has the resources it needs in the case of an emergency. Money from this fund can also be used for ongoing capital improvements with voter approval.

These improvements to existing practices will help ensure that the community’s investment in the South Glens Falls Central School District continues to be safely and efficiently managed.

View a link to the state’s audit report.

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