The recent audit is on the school’s website, but I thought I post just a few comments from the report. I feel that the District has so many outstanding employees that we should say thanks when we see and deal with them.
1. The District’s budget continues to remain fairly constant. Any increases in revenue are used to offset the additional cost of salary and benefits for staff. The District’s continues to maintain a healthy fund balance in the General Fund. The District budgets sufficient contingencies to cover any unanticipated operational needs. For the year ended June 30, 2012, the District’s total net assets decreased by $2,092,395 to $12,788,209. This decrease is primarily due to the addition of the new Middle School bond long term debt obligation.
2. Financial Analysis of the District as a Whole. The District’s total net capital assets were $12,788,209 as of June 30, 2012. The District’s governmental activities net assets decreased by $2,092,395 from 2011 to 2012. This is primarily due to the addition of the new Middle School 20-year bond obligation and decreased grant expenditures and revenues. The business-type net assets showed an increase of $24,918 from 2011 to 2012. This was primarily due to reduced expenditures because of the receipt of more commodity food supplies, and increased reimbursements from the Colorado Department of Education due to large at-risk numbers.
3. We did not identify any deficiencies in internal control over compliance that we consider to be significant deficiencies, as defined above.
4. In our opinion, the District complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2012.
5. The District received a BEST Grant through the Colorado Department of Education for facility improvements that will commence during the fiscal year 2013 school year. The State is funding this program through Certificate of Participation issuances. The State will coordinate the payment to the contractors with no funding flowing through the District other than for reimbursable costs that the District incurred. The District will not receive clear title to the improvements until the State has repaid the certificates. At that point, the District will record a capital asset and related accumulated depreciation for the cost of the BEST improvements, along with offsetting grant revenue. The BEST grant is for $15,885,491 and the District’s match is $2,373,694. The District funded its match through the Series 2011 bond issuance described in Note 6. The District’s bonds proceeds were placed in escrow with the State of Colorado and will be used proportionately with the State’s COP proceeds to fund the project.
6. Without commercial expansion, mineral development or a change in how the state manages school facilities District 22 may never be able to keep pace. The district has used the services of Strategic Resources West, Inc. to help in planning to address these challenges.
7. The two year forecast for K12 education funding in Colorado is bleak. There are concerns with the conversation of new legislation changing the state k12 education funding formula. Over 80 percent of the revenue for Ellicott School District is from State or Federal Aid. If the new adjustment in the state funding formula would have a negative impact on school districts that depend heavily on state aid this would hinder our ability to provide the quality of education they need and deserve. Ellicott is one of the few rural districts in the state that has increased in enrollment. Enrollment seems to be leveling off, but some growth over the next couple of years is possible. El Paso County does rely on the military. If El Paso County experiences a sequester in Federal Programs, this will have a negative impact on the Ellicott School District. The district has increased the ending fund balance by over $500,000 over the last two years. The board goal is to maintain an ending fund balance of about three million. The audit is showing about a 3.2 ending fund balance. With the additional fund balance, salaries and some programs might be added back to address student needs. Technology has been put on hold in the district for over five years. Upgrade in technology is essential. Even in light of the economic woes, the district leadership continues to anticipate the future with enthusiasm. We must continue to move forward toward improved student learning achievement. The Ellicott School District has very limited resources so the district will be conservative in their spending.
8. The accounting policies of El Paso County School District # 22 (the District) conform to generally accepted accounting principles as applicable to governmental units.
9. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above.
10. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
11. In our opinion, the District complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2012.
12. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above.
Here is the link to the report: http://www.ellicottschools.org/DocumentCenter/View/2700
Integrity in Leadership