Purpose of Audit

The purpose of our audit was to evaluate the District’s financial condition for the period July 1, 2011, to May 23, 2013.

Background

The Roxbury Central School District is located in the Towns of Roxbury, Middletown and Gilboa in Delaware and Schoharie Counties. The District is governed by the Board of Education which comprises five elected members. The District’s budgeted expenditures for the 2013-14 fiscal year are approximately $10 million.

Key Findings

• The Board and District officials believed they were effectively managing the District’s fund balance. However, the adopted budgets continually included overestimated expenditures. Although the actual results of the District’s operations were reasonably close to the budgeted estimates each year, the cumulative effect of these variances generated over $2.4 million in operating surpluses for the fiscal years ending in 2008 to 2012.
• To reduce the year-end fund balances to under the 4 percent limit, District officials had to transfer moneys to the District’s reserves, which now total $4 million. Some of these reserve balances are questionable as to the amounts required for their stated purposes.

Key Recommendations

• Develop expenditure estimates that are realistic and based upon all information available at the time the budget is developed.
• Review all reserve balances and determine if the amounts reserved are necessary and reasonable, and create a written reserve fund plan. To the extent that they are not necessary and reasonable, make transfers to unrestricted fund balance, where allowed by law, or other reserves established and maintained in compliance with statutory directives.