Results of the Fiscal Year 2017 Financial Statement Audit and Federal Single Audit

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1 Results of the Fiscal Year 2017 Financial Statement Audit and Federal Single Audit

2 Audit Team Engagement Partner Lupe Garcia, CPA Concurring Partner Tom Pedersen, CPA Senior Manager Dan Hernandez, CPA Senior Eddie Juarez, CPA and Nathan Johnson Staff Raul Balbuena and Jordan Henneman 2

3 The Audit Process Risk Assessment Substantive Analytics Auditor s Opinion Test of Controls Verification, Confirmation, and Corroboration 3

4 Types of Auditor Opinions Unmodified (BEST) Clean Opinion Highest Level of Assurance Modified Qualified - Scope Limitation or departure from GAAP Adverse Opinion - Scope Limitation or departure that is very material and could mislead users Disclaimer (Worst) Cannot express an opinion No assurance 4

5 Auditor s Report on the Financial Statements Unmodified or clean opinion Highest level of assurance that can be given on a set of financial statements Audit conducted in accordance with Government Auditing Standards 5

6 Auditor s Report on Internal Control and Compliance Internal control over financial reporting No material weakness identified No significant deficiencies reported No instances of noncompliance material to the financial statements were noted. 6

7 Auditor s Report on Compliance for Each Major Program Major programs: Special Education Cluster Carl Perkins Internal controls over major programs No material weakness identified No significant deficiencies reported Unmodified opinion on compliance for major programs No instances of noncompliance or questioned costs were noted. 7

8 Required Communications Auditors Responsibility Under Generally Accepted Auditing Standards The financial statements are the responsibility of management. Our audit provides reasonable, rather than absolute, assurance that the financial statements are free of material misstatements. As a part of our audit, we obtained an understanding of internal control sufficient to plan our audits and to determine the nature and extent of testing performed. Significant Accounting Policies The District s accounting policies and methods are appropriate and in accordance with industry standards. The following GASB Statements were implemented in FY 2017: No. 82, Pension Issues, an Amendment of GASB Statements No. 67, No. 68 and No. 73 8

9 Required Communications Accounting Estimates The preparation of the financial statements requires that certain estimates and judgments be made by management. These judgments and estimates include: Allowances for uncollectable taxes receivable Useful lives of capital assets State aid Net pension liability, deferred inflows and outflows of resources, and pension expense We concluded that management has a reasonable basis for significant judgments and estimates that impact the financial statements. 9

10 Required Communications Difficulties Encountered in Performing the Audit We encountered no difficulties in dealing with management in performing and completing our audit. Corrected or Uncorrected Misstatements There were no material misstatements that were identified by us that required management s correction. Disagreements with Management We had no disagreements with management over the application of accounting principles or management s judgments about accounting estimates. 10

11 Required Communications Management Representations We will request certain representations from management. Consultation with Other Accountants We are not aware of any situations in which management consulted with other accountants on accounting or financial reporting matters. Major Issues Discussed with Management Prior to Retention We discussed the application of accounting principles and auditing standards, however, our responses were not a condition to our retention. 11

12 Statement of Net Position 8/31/2017 8/31/2016 % Change Current and other assets $208,627,535 $260,971,202-20% Capital assets 820,632, ,339,432 3% Total Assets 1,029,259,549 1,055,310,634-2% Total Deferred Outflows of Resources 67,936,665 63,510,318 7% Current and other liabilities 52,349,166 52,734,612-1% Net pension liability 78,672,174 75,575,737 4% Other noncurrent liabilities 893,045, ,152,920-5% Total Liabilities 1,024,067,022 1,065,463,269-4% Total Deferred Inflows of Resources 13,034,195 5,608, % Total Net Position $60,094,997 $47,749,551 26% 12

13 General Fund Total revenues of $328.0 million increased by $7.4 million or 2.3% from FY 2016 Local revenues of $210.4 million increased by $17.2 million or 8.9% from FY 2016 State program revenues of $112.9 million decreased by $10.9 million or 8.8% from FY 2016 Federal program revenues of $4.7 million increased by $1.0 million or 28.8% from FY 2016 Total expenditures of $317.4 million were under budget by $5.0 million Fund balance increased by $3.2 million Fund balance of $62.2 million as of August 31,

14 General Fund Unassigned Fund Balance ($M) $60.00 $58.00 $58.30 $56.00 $54.94 $54.00 $53.56 $52.00 $50.00 $49.82 $50.58 $48.00 $46.00 $44.00 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Total General Fund Unassigned Fund Balance 14

15 Unassigned Fund Balance in Days Minimum CCISD Maximum Minimum CCISD Maximum 15

16 Questions 16