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Audit gives Cape Girardeau School District clean bill of health, financially speaking
The Cape Girardeau School District's total assets grew by more than $26.3 million in its 2010 fiscal year, thanks in large part to taxpayer support of April's $40 million bond issue.
On Monday, the Cape Girardeau School Board approved the latest audit, which essentially gives the district's books a financially clean bill of health through the last fiscal year, which ended June 30. The annual report, however, did note the district was not in compliance with two state transportation requirements.
The audit, conducted by Cape Girardeau-based certified public accountants Stanley, Dirnberger, Hopper and Associates, shows the district recorded $95.4 million in assets, up from $69.08 million at the end of the 2009 fiscal year. Total net assets, including restricted and unrestricted money, topped $36.3 million, an increase of about $1.68 million. Total liabilities climbed to $58.46 million, up nearly $24 million from the previous year.
"That's almost entirely driven from the bond money," Patrick Kintner of the CPA firm said of the increases in assets and liabilities.
The $40 million from bond proceeds will pay for the replacement of an elementary school, build an event complex and address deferred maintenance throughout the district, among other projects. The issue garnered 61.26 percent of the vote in April.
Total debt was more than $57.66 million, much of that tied to the facilities bonds, the last of which won't reach maturity until 2030, Kintner said.
Revenue and expenses also were up in the 2010 fiscal year. The district's total revenue topped $47.34 million, up about $3.27 million from the previous year. Much of the increase was driven by an uptick in property tax valuation, which boosted property tax revenue. Federal stimulus funding also helped drive the rise in revenue, offsetting about $1 million in lost state aid. In the revenue pie, property taxes still made up the biggest piece, about 58 percent, followed by federal grants, at about 18 percent, and state aid right around 11 percent.
The district reported $45.65 million in expenses in fiscal year 2010, up nearly $1.3 million from the previous year. Salaries and benefits fueled the vast majority of the increase. Salaries and benefits represent about 71 percent of total expenses. The breakdown of expenses includes:
* $25.57 million for instructional services
* $3.86 million to pupil and instructional staff
* $1.79 million for board and executive services
* $1.79 million for food service.
Between revenue and expenditures, the district reported a change in net assets of $1.68 million.
Board member Don Call said the audit shows a "good segregation of duties" in the district's manifold finances, something not found in a lot of districts around the state. Without that separation, Call said, the door is opened to "money being stolen."
"Having an audit that is this clean, the community should be proud," board member Tony Smee said during a work session before Monday's school board meeting.
The audit did report two findings of non-compliance. According to the audit, the district failed to report transportation ridership counts for February, per state requirements. First Student Inc., the district's bus provider, had to "re-create the counts using the October cycle ridership lists," the audit stated. Still, the district is ultimately responsible for making sure its service providers are in compliance.
In addition, required transportation mileage readings were based on predetermined bus routes, not actual odometer readings as policy stipulates, the audit found. Again, the contractor failed to provide accurate records, the audit states, but the finding falls on the school district.
The audit recommends the district ensure that the service provider follow through in delivering accurate and timely information.
"The contract says we can terminate the contract" if First Student doesn't meet the standards, "but what do we do then?" said Neil Glass, the district's director of administrative services. "We've got to have buses."
Glass plans to conduct a feasibility study on the cost of the district operating its own transportation service. First Student is in the last year of its contract with the district.
301 N. Clark Ave
Cape Girardeau, MO