December 6, 2019

The audit is in and the outlook is better for Mio Ausable School District.

Posted

MIO— Mio AuSable Schools audit for the 2018-19 fiscal year shows an increase of $165,214 in the general fund balance following a year of careful monitoring.

The district’s fiscal year ended June 30, 2019.

2018-2019 was the first complete fiscal year that Superintendent Paul Ciske was at the helm. The Herald spoke with him about the latest audit.

A year ago, when he had only been leading the district for four months, Ciske was surprised by some accounting errors exposed by the annual audit. After the problems were discovered the district corrected the errors to prevent future surprises. The board has been supportive of the administrative efforts to correct the financial health of the district.

Last year the general fund balance was $107,566, which was only two percent of expenditures. When a school has a fund balance of two percent or lower, they are placed on a watch list as potential for fiscal stress. That means there is no margin for error. For instance, if there is a change in state expenditures or a significant repair needed, the district would needto make up any shortfall.

The district increased the frequency of its budget reports as part of its corrective measures. Monthly reporting to the state is required for schools on the watch list, and in this case the state was easy to work with. The district was allowed to forward reports that they were already doing. The state didn’t require a different format, and the district got positive feedback that they were taking the correct steps. The fund balance has increased and the district knew they were poised to be removed from the watch list. The official notification was received last week. “Getting off the watch list is affirming that we are taking the right steps.” said Ciske.

This year the general fund balance is $272,780 which is five percent of total expenditures. This is better, but the goal is to be higher. Eight to ten percent is considered stable. One of the ways the district increased its revenue was good use of categorical funding. Categorical funding is money set aside for a particular purpose, and cannot be diverted for other uses. Being mindful of what’s available and taking full advantage of it frees general fund money for other uses.

One of these categories, funding for isolated districts, was an item removed from the state budget by Gov. Gretchen Whitmer’s line item vetos. Ciske is hopeful that the money will be restored. It was a small percent of the total budget, but it still would need to be recovered.

During the 2017-2018 school year, replacing a roof and purchasing two buses came from the general budget. The high school is slated for a new roof, but this expenditure won’t need to come out of the general fund. It will be paid from the sinking fund millage passed in a special election this past May. That means money in the general fund will be spent on children.

“The district is heading in the right direction. I’m glad that the audit confirms this,” said Ciske.

The audit was performed by Weinlander Fitzhugh.

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