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Audit Objective

Determine whether the Board reasonably and transparently financed reserves.

Key Findings

• The Board has not adopted a reserve policy.
• The Board did not include provisions to fund reserves in its annual budgets.
• Seven reserves with balances totaling $9.4 million (72 percent of total reserves) are overfunded by $7.8 million and potentially unnecessary.

Key Recommendations

• The Board should adopt a reserve policy.
• Appropriately budget to fund reserves.
• Determine if the amounts reserved are necessary, reasonable and in compliance with statutory requirements.