001call the special meeting of the Udica City School District Board of Education to order. Can we all please stand for the pledge of allegiance? I pledge allegiance to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible, with liberty and justice for all. >> Can the clerk call the role, please? >> Mr. Jason Cooper >> here, >> Mr. Donald here, >> Mr. Joseph Jr. >> here, >> Mrs. Tamil N. >> Mr. Braden Mayor >> here, >> Mrs. Danielle Padulla >> here, and Mr. James Paul >> here. >> We do have a quorum. Okay. Up first would be the presentation um of the district's external audit. Who will be doing that for us? >> Hi everyone. >> Hello. >> I'm uh Jacob Skelevel with Bonado
002Group. We're the external auditors for the district. Um we did meet with the audit committee last week to re to review the results of the audit and the drafts that are in place. Um I can run through briefly uh what was discussed in the summary of that in that meeting. So starting with the scope of the audit um a few different deliverables that um we have drafts of. One is the audit of the financial statements um including our yellowbook report. We do have a separate audit of the ECA activities as well as the federal single audit for the district. So starting with that overall audit of the district's financial statements and our auditor's report, uh we anticipate issuing a an unmodified opinion on the statements. Um a clean opinion that's the highest level of assurance
003that we can provide. Um, so that's what you're hoping to see in the audit each year. We do remind you the financial statements belong to the district and management. Our responsibility as auditors is to give that opinion on the statements. Um, a couple required communications as part of the audit. First related to the financial statements. Um, nothing that we found in the audit that was unusual or lacked guidance. Um we do point out that uh the the statements do contain estimates um largest being related to uh pension um liabilities, retirey health care um things of that nature. On the audit side, um the only audit adjustments that we proposed during the course of our work related to the cash balances um specifically related to certificates of deposit and uh treasury investments just to bring those
004up to fair market value at year end. Um so those were recorded by the district and are included in the financial statements. We did not have any uh further uh misstatements not uh noted in the audit that were not adjusted by management. We didn't have any issues working with management to complete the audit. Um we do call out the the timeline of the audit. The biggest one being uh the reason for uh the timeline and planning ahead for a special meeting. Uh the thing outside of any of our control is New York State and the pension reports they provide that are needed to be included in the financial statements. Um this year those weren't available until September 8th. Um so that's the point where we can do the work to complete the district's financial statements.
005As far as other items, the most significant um other thing we are waiting on for the audit was uh capital asset information um which was received on September 9th. A couple brief highlights um of the financial statements. First on the statement of net position, that's the first statement you'll see if you go through the financial statement packet. In that statement, uh the district at year end has a deficit of 195 million. We like to point this out because uh that shouldn't cause concern. Um this is present in really all district um financial statements across the state. And what really drives that deficit is the recording of the liability for retiree healthcare and the future actuarial valuation of those liabilities. Um, so at year end those were 428 million. >> Could you kind of explain that
006in layman's terms? >> Yep. So, uh, I do like to compare to the pension. Um, that's very similar of actuaries are doing these estimates of how much future costs will come out for the next forever run out of the district's current employees. Um, and you'll see those those valuations change by tens of millions of dollars each year because it's so susceptible to small changes in market performance and things like that. Um, the one difference from the pension is uh the state pension system has investments and assets. Um, so those at time are not a significant net liability to the district. Whereas uh the retiree healthcare there's not a mechanism to fund that in advance and keep investments for that. Um so that's why every district has this and shows that big liability on the balance
007sheet each year. >> Okay. Thank you. Um as far as the fund financial statements which uh are more relevant to the ongoing monitoring of governance and the district um the general fund of the district uh increased about 9 million for the year end um and fund balance was at about 121 million. That includes uh all of the district's reserves and restricted fund balance which were at about $106 million at year end. The district's unassigned fund balance this year did meet the state requirement of being at 4% of the district's budget. Um so the district was in compliance for that. >> Excellent. So, as far as uh operations for the year and how we got to that $9 million increase, we do point out that actually was a more significant favorable variance to what was expected
008as the district anticipated uh using about $13 million of fund balance for the year. So, that was appropriated fund balance for the 2425 year. So, it would have been expected if all the budget numbers were matched exactly to have a $13 million decrease. Um, but the final variances ended up being a $9 million increase to that fund balance for the year end. >> Okay. So, that's it for the financial statements. Um as far as our other reports we'll point out first is our report on internal controls over financial reporting um the scope of the audit is not to express an opinion on those financial controls but we do gain an understanding of them in performing our audit and identify anything that raises to the level of a material weakness or significant deficiency in those controls.
009Um that being said, we did not have any such findings to report for this year. We did issue a separate management letter of opportunities for improvement um in in internal controls um which just contained one uh continued item for uh capital asset reconciliation to uh uh Bosey's reports on the single audit side. So that's the audit of the federal funds. Uh similarly we give a report on compliance as well as internal controls over compliance with those federal awards. Um this year our uh programs tested were the education stabilization fund. Um so that's the ARP esser monies um and the special education cluster um which is the 611619 grants you might know them by. Um in our report uh we have no uh findings over compliance or on controls over compliance. We do point out uh
010the single audit reports um we are on hold to issue in final form uh just as we await the federal government to issue its final compliance supplement. However, we were able to perform all the work um based on the draft uh provided by the federal government. So just administrative on our end that we have to wait until that final um version is issued before we can um issue those in final form. However, that doesn't impact uh the district's financial statements or ECA statements. So those will be able to be issued and uh uploaded to NISAD um to meet the 10:15 deadline. And on that topic of ECA, um, we just point out that those do have a separate financial statement on the cash basis that we do an audit of. And then same as the
011district's financial statements, um, we do have an unmodified or a clean opinion on those financial statements. Um, so again, that's what you're looking to see each year. Any questions on any of those reports or financial information? So, was this a market improvement over the prior years? >> Yep. I I would say uh while we can't quantify uh everything along the way, our timeline as a whole was was improved um from prior years. >> Okay. Um does anyone else have any questions? >> No, I don't have a question. I just have a statement. I just want to just give credence to the team. They worked very tirelessly and feverishly to ensure that the district would be in a sound financial position. We a lot of meetings, a lot of energy went into this and that's the
012side that the public doesn't see. Often working around mail hours, often working after hours to make sure that they're supporting the work of the district. This is another um aspect of our wins as we have been continuing to build momentum. This builds on our Forbes list rating, only school district in New York State to have that distinction as being the best employer in the Forbes. And now you're also seeing the operational side get another big win. So I just want to tip my hat to you all publicly because I understand the work that goes into that. And I'd like to clap for my administrators if we could. [Applause] Does anyone else have any questions about it? >> Do we require a corrective action plan of any sort? >> Um, not for the financial statements to
013be issued. Uh, I believe New York State will ask for a corrective action plan related to uh management letter comments for the NISAD upload. >> Okay. Is there anything of significance in the management letter? >> No. Again, the the one on the financial statement side was a carryover from the prior year. Um, so I think that's still in progress and corrective action would be similar to the prior year. Um, and then on the ECA side was minor documentation um items that is very common. >> Good. Okay. Anyone else? >> All right. Thank you. Thank you. >> Thanks. Have a good evening everyone. >> Good week. >> Okay. Up next is the uh superintendence report. So, does anyone need any pages pulled or are we good with it as it is? >> Yeah, I would honestly
014first make a motion to go into executive session, discuss personnel, legal opinions, those two items. Okay, I need a need a second. >> Second. >> All in favor? I >> opposed. Motion carries. We're going to executive session. Uh do you want to just stay in the room or you want to go in the other room?