Audit finds district's financial reports in order

October 27, 2017

Independent financial auditors have given the Stillwater Area Public School District an “unmodified” opinion on its annual audit; the highest rating possible.

The 2016-2017 Comprehensive Annual Financial Report, upon which the annual audit is based, showed no deficiencies in the district’s internal controls and no instances of noncompliance of government auditing standards.

“We’re pleased to report this year we have issued what is known as an unmodified opinion, meaning that the financial statements are fairly presented and in accordance with generally accepted accounting principles - so exactly what you are looking for,” said Aaron Nielsen, a partner with the auditing firm Malloy, Montague, Karnowski, Radosevich & Co. (MMKR). Nielsen recognized district staff for sound processes, procedures and good record keeping, supported by a system of internal controls to ensure the protection of the district’s assets.   

School districts, charter schools, and educational cooperatives are required to have an annual independent financial audit.  The audit and the financial statements included in the audit must be based on Generally Accepted Government Auditing Standards, the federal Single Audit Act, and the Minnesota Legal Compliance Guide issued by the Office of the State Auditor.  Minnesota Statutes, section 123B.77, requires reporting entities to submit audited financial data to the commissioner of the Minnesota Department of Education and to the Office of the State Auditor.

Financial statements within the audit report show that the district ended fiscal year 2017 positively. Total unassigned fund balance reflected less than a one percent variance between what was budgeted and what was actual.

The district closed the books with an unassigned fund balance totaling 7.8 percent, which is in line with the school board’s policy to maintain at least a five percent unassigned fund balance. The fund balance, or “rainy day fund,” equals less than seven weeks of operations for the district assuming level spending throughout the year. The board intentionally used some of the fund balance to lower class sizes during the 2016-2017 school year.

The audit report, which compares Stillwater Area Public Schools to other districts, also showed that the District’s expenditures per Average Daily Membership have generally been below both the metro area and statewide averages in recent years.

The complete financial report is available at stillwaterschools.org/audit.