Determine whether the Indian River Central School District (District) Board of Education (Board) and District officials adequately managed the District’s financial condition.
The Board and District officials did not adequately manage the District’s financial condition and the current findings and recommendations are similar to our November 2016 Financial Condition audit report. While the Board and officials made some progress in implementing the prior audit recommendations, they must continue to improve their management of financial condition, otherwise more taxes will be levied than are needed to fund operations. From 2017-18 through 2020-21, the Board:
- Underestimated general fund revenues by $68.8 million.
- Overestimated appropriations by $29.5 million.
- Purported the District would incur operating deficits totaling $75.5 million but had operating surpluses totaling $13.9 million (after transfers), which led to operational shifts totaling $89.4 million.
Additionally, the District’s reported surplus fund balance as of June 30, 2021 was 10 percent, exceeding the statutory limit of 4 percent. When unused appropriated fund balance is added back, the recalculated surplus fund balance totals $27.8 million which exceeds the statutory limit by $24 million.
- Develop and adopt reasonable and realistic budgets and reduce surplus fund balance to comply with the statutory limit.
District officials disagreed with many of our findings but indicated they would take corrective action.