Bath Central School District – Reserves (2016M-401)

Issued Date
January 27, 2017

Purpose of Audit

The purpose of our audit was to evaluate the District’s reservation of fund balance for the period July 1, 2012 through September 30, 2016.


The Bath Central School District is located in the Towns of Avoca, Bath, Cameron, Thurston, Urbana and Wheeler in Steuben County. The District, which operates three schools with approximately 1,500 students, is governed by a seven-member Board of Education. Budgeted appropriations for the 2016-17 fiscal year total approximately $35.9 million.

Key Findings

  • The Board did not adopt a written reserve fund policy.
  • District officials could not provide evidence that approximately $3.3 million was required to be restricted in the debt reserve.
  • The District inaccurately reported one reserve totaling $330,000 and overfunded two reserves totaling approximately $297,000.

Key Recommendations

  • Develop a written policy that indicates the amount of funds to be reserved, how each reserve will be funded and when the balances will be used to finance related costs.
  • Return money improperly maintained in the debt reserve to the general fund as unrestricted fund balance.
  • Review all reserves at least annually to determine if the amounts reserved and the cash restricted for reserves is properly accounted for, necessary and reasonably funded.