2018-19 Audit

Garfield Re-2 accepts 2018-19 audit
This is the image for the news article titled Garfield Re-2 accepts 2018-19 auditRIFLE - At the February 11, 2020, School Board meeting the Garfield Re-2 Board of Directors accepted the 2018-19 audit as presented by Paul Backes from the accounting firm McMahan and Associates. The audit shows the finances of the District in excellent shape with a $53.2 million general fund and a $14.9 million fund balance.

Mr. Backes explained in the accompanying management letter that there were no disagreements with management however, there were “several difficulties in receiving timely and accurate data” to complete the audit.

• Reconciliation of District Cash and Investment Accounts - The District’s reconciliations were not prepared timely nor accurately. . .The District will need to implement a process to ensure that future cash and investments accounts are timely and properly prepared;
• Completeness and Accuracy of Accounting Records - Many of the District account balances required extensive reconciliation to finalize financial information that was reliable. This caused significant delays and additional effort in producing audited financial statements.

“Our fundamental responsibility is to be accountable to our community,” explained School Board President Anne Guettler. “We want to ensure compliance with local, state and federal regulations. We understand the gravity of being transparent for all of our stakeholders, and these material weaknesses have come as a significant shock to the board.”

This is the first time in many years that the Garfield Re-2 School District has had a significant material weakness identified as part of the financial audit. Garfield Re-2 has been a repeated recipient of the Meritorious Budget Award (MBA) from the Association of School Business Officials International (ASBO). Backes indicated at the January 27, 2020 school board workshop to review the draft audit that when material weaknesses such as those experienced for the 2018-19 audit do emerge, many times the organization has experienced turnover in the Finance Department, much as Garfield Re-2 has experienced over the last 18-months.

Furthermore, the material weaknesses indicated in the audit were related to a lack of practices and procedures to ensure that the District follows Governmental Accounting Standards Board (GASB) accounting standards.

The Garfield Re-2 School Board has already moved forward with steps to correct the identified weaknesses.

• First, the board has entered into an agreement with Christine Stouder, CPA to provide regular account reconciliation through the end of the 2019-20 school year. Ms. Stouder supported the Garfield Re-2 finance team through the audit process, and has made extensive progress on ensuring complete and timely reconciliation of the District’s accounts;
• Second, at the February 11, 2020 school board meeting, the Board of Directors hired an accountant to transition from the Payroll Specialist roll to Accountant and work directly with Ms. Stouder over the next four months;
• Third, at the February 11, 2020 school board meeting, the Board of Directors agreed to work with Hazzard, Young, Attean & Associates to find a temporary Chief Financial Officer (CFO) to assist with budgeting for the 2020-21 school year.
• The Board approved the opening of the CFO position internally and using the traditional job notification channels to advertise.
• Once an interim CFO is identified, he/she will begin work with the District on the 2020-21 budget as well as initiating processes to ensure the GASB financial reporting standards are followed.

“Financially, the Garfield Re-2 School District is in very good shape,” explained Guettler. “We do have a sense of urgency around filling the positions in our Finance Department. The identification of the deficiencies in our 2018-19 audit, although distressing, shows that the process works. We know where we need to improve and will continue the work of addressing these deficiencies and processes moving forward.”

All budgets, audits, accounts payable info, and other financial information can be found on the Garfield Re-2 Financial Transparency page here.
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