Purpose of Audit

The purpose of our audit was to evaluate the District’s financial operations and the use of fund balance for the period July 1, 2011, through June 30, 2013.

Background

The Mount Sinai Union Free School District (District) is located in the Town of Brookhaven in Suffolk County. The District is governed by the Board of Education which comprises seven elected members. The District’s budgeted expenditures for the 2012-13 fiscal year were $54.6 million.

Key Findings

• District officials consistently over-estimated expenditures over the past five years, which resulted in operating surpluses totaling $7.1 million.
• Although the Board appropriated unexpended surplus funds each year (exceeding $14 million over a five-year period) to help finance the ensuing year’s operations, District officials actually used less than $1 million for District operations.
• As a result, the District’s unexpended surplus funds routinely exceeded the amount allowed by statute and District taxpayers paid more than necessary to sustain District operations.

Key Recommendations

• Develop and adopt budgets that include realistic estimates for revenues, expenditures and unexpended surplus funds.
• Discontinue the practice of adopting budgets that result in appropriating unexpended surplus funds that will not be used to sustain District operations.
• Ensure that unexpended surplus fund amounts are within statutory limits.