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Audit Objective

Determine if officials effectively managed the District’s general fund balance.

Key Findings

• The District’s unrestricted fund balance at the end of 2016-17 was approximately $2.5 million or 11.7 percent of the ensuing year’s budgeted appropriations, exceeding the statutory limit by 7.7 percentage points.
• The District’s budgets included appropriated fund balance that was not used to fund operations.
• The budgets overestimated appropriations by more than $7 million or 10.1 percent from 2013-14 through 2016-17.

Key Recommendations

• Ensure that the District’s fund balance is in compliance with statutory limits and use surplus funds as a financing source to fund one-time expenditures and needed reserves or reduce District property taxes.
• Discontinue the practice of appropriating fund balance that is not needed or used to fund District operations.
• Adopt realistic annual budgets based on historical trends or other known trends and appropriate realistic amounts of fund balance to fund operations.

District officials generally agreed with our recommendations and have initiated, or indicated they planned to initiate corrective action