District receives highest and best opinion on audit, but has issues to correct by next year
The Union County School District received a clean audit at its meeting Monday night. Andrew Dobson from McAbee, Schwartz, Halliday, and Company presented the audit report at the meeting. The audit is required to be submitted to the SC Department of Education by December 1 each year, but with the finance director position vacant partway through the year, circumstances led to the report being filed late.
Dobson stated the district received a clean or unmodified opinion, which is the highest and best opinion that can be given. However, there were several issues that he noted as being “material weaknesses”. First the cash accounts were not being reconciled to the dollar each month. New finance director Kelly Richardson came on board as a consultant back in December and helped to get that account reconciled, as the auditor legally cannot do that. There was an issue that debt service revenue was not being reported in the books. Another issue was that some expenditures were listed as special revenue fund expenditures but should have been reported as general fund expenditures, instead. Bond payments and other debt activity had not been reported on the books. Monthly and annual reconciliations had some issues with several receivables from the county, state, and federal levels had not been reconciled.
There were a couple of material noncompliance issues with state law. One dealt with the fact that any public funds held in trust are required to be collateralized. At one point, the district had over half a million dollars in the bank without having collateralized coverage. Another noncompliance issue dealt with the reporting of COVID Relief Fund money and ESSER money. Reports were due by the 5th day after each quarter of what had been spent and claimed by the district, and only one CRF report was made and none of the ESSER reports had been filed. Cindy Langley was brought in by the district to help correct this.
There was one item that was listed as a significant deficiency, meaning that the district’s internal controls had failed on the issue of checking to make sure vendors are neither suspended nor debarred from doing business with districts. He said his office goes behind the district and checks, and none of the vendors they checked had been suspended or debarred, but since the internal check had failed, this was listed as a significant deficiency. This was also a problem noted in last year’s audit.
He said these are all findings that are relatively easy to correct, and new finance director Kelly Richardson comes highly recommended and respected for her ability to oversee finances and to teach those in the finance department how best to do these reporting activities. Dobson noted that these are many of the same findings they have had over the past 2-3 years.
Dobson had this to say:
(audio below story)