Wednesday, February 21, 2018

Sabine ISD gets clean audit

By Meredith Shamburger
Nov. 14, 2017 at 12:24 a.m.

LIBERTY CITY — Sabine ISD was one of only five school districts throughout the state to receive an F, or substandard, financial accountability rating this year.

It isn't expecting the same rating next year, based on audit information presented to the board Monday, but officials said even that one failed rating would have a financial impact on the district.

"It increases the amount of audit that has to be done, which costs us more money," school board President Tony Raymond said. "It's just a great big pain in the butt."

Sabine ISD trustees and officials discussed the "F" rating and results of the most recently completed audit at their Monday meeting, talking about the financial ramifications of Trustee Rusty Taylor's decision last year not to return a required audit form and how district staff fared on annual financial and procedural evaluations of their work.

Auditor Karen Jacks presented results of the 2016-17 annual audit, noting that the district has received an unmodified, or clean, opinion this year.

"All of the reports this year are clean and without finding, and we are pleased to bring that information to you," she said.

The district's "F" rating was based on its 2015-16 annual audit and a series of indicators and questions. The 2015-16 audit received a "modified" opinion when Taylor, who was not at Monday's meeting, refused to fill out a required form because Jacks did not participate in a fraud audit that was taking place at the time. Districts are required to have an unmodified opinion, and receive an automatic failure when they don't, even if every other category is highly rated.

The required form is sent to all board members and asks questions such as whether they have knowledge of fraud or if they know of any compliance issues.

"Our auditors had to issue a modified opinion because of what's called a scope limitation," said Director of Business Operations Kevin Yandell. "Since they didn't get his letter back, they weren't able to know what he may have wanted to tell them. And since they didn't, they had to issue a scope limitation. This year, as you'll hear in a few minutes from Ms. Jacks when she gets here ... we will not have this problem next year."

Aside from the modified opinion, officials noted the district scored a perfect 100 in other categories on this year's financial rating.

"We did everything that we needed to from a district administration and district staff point of view and all that we could do to get the Superior/A rating, but it was taken out of our hands by one board member," Yandell said.

Yandell said there would be definite financial ramifications from the modified opinion because it can be seen as an indication that the district's reporting or financial controls need some sort of correction.

"The modified opinion from last year, that causes us to be deemed a higher-risk entity, as far as dealing with federal grants is concerned," Yandell said. "It caused our audit expense to go up, I believe, $1,200.

It also will mean that from now on, every time we do anything with the federal government, even if it's through the Texas Education Agency, that fine-tooth comb will be pulled out and we'll be looked at more thoroughly than we were in the past."

District officials were eager Monday to assure taxpayers that the "F" financial rating was not a reflection of the district's finances or staff.

"Every year since the beginning of time, we have either had a perfect score or near-perfect score on every other FIRST rating since it started," Raymond said. "This is the first time that we didn't have a perfect or near-perfect score. Even though we did have a perfect score."



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