Purpose of Audit

The purpose of our audit was to examine the District’s financial management for the period July 1, 2011 through June 30, 2013.

Background

The Floral Park-Bellerose Union Free School District is located in the Village of Floral Park in Nassau County. The District is governed by the Board of Education which comprises five elected members. The District’s general fund expenditures for fiscal year 2012-13 were approximately $24.9 million.

Key Finding

• Over the past five years, District officials have consistently overestimated expenditures totaling $12.5 million. Although the Board appropriated unexpended surplus funds each year (approximately $10.3 million over a five-year period) to help finance the ensuing year’s operations, District officials actually used $2.5 million (24 percent) of unexpended surplus funds for District operations. The consistent overestimation of expenditures resulted in the District not using fund balance that was appropriated. This allowed District officials to make it appear that they were in compliance with the 4 percent statutory limit, when in fact, they were not.

Key Recommendations

• Develop and adopt budgets that include realistic estimates for expenditures and unexpended surplus funds. Discontinue the practice of adopting budgets that result in appropriating unexpended surplus fund balance that will not be used to sustain District operations.
• Review the District’s fund balance and develop a plan to reduce the balance to an appropriate level.