Monticello Central School District - Fund Balance Management (2020M-2)

Issued Date
April 10, 2020

[read complete report - pdf]

Audit Objective

Determine whether the Board and District officials properly managed the general fund’s fund balance.

Key Findings

  • The Board overestimated appropriations from 2016-17 through 2018-19, helping result in $12.1 million in appropriated fund balance not being used to finance operations.
  • The District’s recalculated surplus fund balance exceeded the statutory limit each of the last three fiscal years by 12.3 to 16.3 percentage points.
  • As of June 30, 2019, the District overfunded one reserve by $820,000.

Key Recommendations

  • Adopt budgets that include reasonable estimates for appropriations and the amount of fund balance that will be used to fund operations.
  • Review debt service and reserve funds and reduce balances to reasonable levels as necessary in accordance with applicable statutes.
  • Reduce surplus fund balance in a manner that benefits District residents.

District officials generally agreed with our recommendations and indicated they planned to initiate corrective action.