Somerset schools end FY22 with high fiscal marks, $1.247M surplus

Posted 1/9/23

WESTOVER — The annual audit for Somerset County Public Schools shows it ended fiscal year 2022 with an unassigned fund balance of nearly $1.247 million, which will be applied to the FY24 …

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Somerset schools end FY22 with high fiscal marks, $1.247M surplus

Posted

WESTOVER — The annual audit for Somerset County Public Schools shows it ended fiscal year 2022 with an unassigned fund balance of nearly $1.247 million, which will be applied to the FY24 budget.

That surplus was $187,400 more than the prior year and the result after some $63.9 million ran through all accounts managed by the finance office, said Ron Hickman, a partner with UHY LLP who oversaw the audit for the year ending June 30, 2022.

Mr. Hickman said savings were in several expense categories with fixed charges the largest, however, he said that while the excess is “a large amount of money…it represents about eight days of expenses.”

The annual audit of financial statements earned a “clean audit opinion, the highest level of opinion you can get.” Mr. Hickman also told the school board last month that the reports “fairly present the Board of Education’s financial position.”

Likewise a federal audit showed no compliance issues, he said.

Testing was performed to check on internal controls, “and that too was a clean report,” Mr. Hickman said, with no material weaknesses uncovered with checks and balances.

He said the central office with its staff dedicated to financial matters has more checks and balances than the schools, so school-based transactions are sampled for oversight.

“We recommend that we continue to monitor those because they don’t have the resources for checks and balances,” Mr. Hickman said, “but the dollars at the schools are much smaller so we focus on the board.”

Food service operations, which had been a money-loser several years ago, was in the black by nearly $467,000 excluding depreciation. The reimbursement rate since the start of the pandemic helped with this, and CFO Linda Johnson said earnings continued through November.

Food service is the SCPSs’ only proprietary account and it funds upgrades for cafeterias and kitchens.

Some other points from the audit include the fact that 68.5% of school funds are from state and county appropriations, with the state share in FY22 less by $394,000 due to decreased enrollment.

Other revenue includes funding through grants for specific programs. In the fall of 2021 an auction of surplus and old equipment raised nearly $76,000 with most of that reserved for use by Somerset County Technical High School.

Both Mr. Hickman and Superintendent of Schools Dr. John Gaddis credited Ms. Johnson and her staff “who are very thorough,” with Dr. Gaddis adding that a good audit helps the county maintain its high bond rating.

“We all know the one thing that gets a board of education, a superintendent and the CFO in trouble is money,” Dr. Gaddis said, so it’s always important to identify “who has access to what.”

One continuing area of concern is cash collected at the schools for activities such as sporting events. Dr. Gaddis suggested there may come a time when technology will be used, for example, so tickets are pre-sold and cell phones display a receipt for entry.

In early 2021 an incident was uncovered (not by the audit) where cash collected from staff on jury duty was discovered missing, and the finance office employee was fired and charged with theft. At court he was ordered to repay more than $550 as part of his probation before judgment.

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