10/25/15 ABSS gets clean audit, but adds nothing to savings

ABSS gets clean audit, but adds nothing to savings
By Isaac Groves, The Times-News 10/25/15  
Reprinted with permission.      

   The annual audit of the school system’s finances reported good financial management, but school board members still have concerns about drawing money from the district’s shrinking fund balance.

   “I’m glad we had the funds,” said Patsy Simpson, member of the Alamance-Burlington Board of Education, “but we have to stop the bleeding because we’re down to $2 million in the fund balance.”

   Adjustments at the end of the previous budget year drew close to $1.9 million from reserves of unspent funds called the fund balance. The district has been tapping into savings since the Great Recession, and its auditors have been warning about going much lower as the economy recovers.

   Michael Wike, the auditor from Anderson, Smith & Wike, did not say much about that in his presentation at the board’s October work session, but board members seem to have taken previous warnings to heart.

   Overall, Wike was very positive about how the Alamance-Burlington School System had handled its money in fiscal 2014-15. He also gave ABSS staff credit for good compliance with state and federal requirements for bookkeeping and observing spending rules, and for being forthcoming with information during the audit.

   “If I’m calling someone and I ask for information, and to me it’s something they should be able to just pull out of their drawer and hand to me, but it takes two or three days to get it to me, it makes me sort of wonder, ‘What’s going on here?’” Wike said. “But we get that information (from ABSS) timely, we were granted full access, everyone is very cooperative, and we are very grateful for that cooperation.”

   The district seemed to have addressed several technical issues in last year’s audit, Wike said, like a classroom teacher’s salary paid from funds reserved for the exceptional children’s program, and a payment made for computers the district had not yet received. There were no similar technical violations in 2014-15, he said.

   Financial highlights in the auditor’s report included an increase of 60 students and the end of a large source of federal funds. The district went through millions in American Recovery and Reinvestment Act funding over the past five years, and district management and the board have successfully adjusted budgets to account for its absence as they spent down those funds, according to the audit report.

   The district’s revenues increased by $9.2 million from 2013-14 to 2014-15, while expenses increased $1.9 million.

   The state contributed 68 percent of the district’s revenues, while Alamance County provided 19 percent, and the federal government contributed 8 percent.

   The biggest expense, not surprisingly, was teaching — or “instructional services” — which amounted to 83 percent of ABSS spending. Fourteen percent was spent on support services.