School Finance Week 4-Part 5 Financial Audits

In speaking with Superintendent Dr. Dan Powell CISD’s process for conducting the Annual External Financial Audit mirrors the steps shared in the lecture notes for this week shared by Dr. Lu Stephens.  CISD utilizes the TASBO model format for selection of the external auditor, which includes placing a RFQ for firms to submit their proposal of interest.  The district reviews and verifies the firms’ references and narrows the choices to 2 or 3 firms.  The district then conducts interviews of these firms in order to conclude the final choice.

Once the auditor is selected the auditors come to the district throughout the year to conduct specialized visits.  They let the district know the time of their visit and which documents they will examine.  Towards the end of the audit, which differs based on the district’s financial cycle, the auditors will spend about two weeks going over final documents and conducting final interviews of pertinent staff.   

Once the audit is complete, the firm will prepare a document of their findings for the Board of Trustees.  Within this report the firm will determine if there are any areas of concern.  In the audit shared at our last Board Meeting no areas of difficulty were discovered.  There were two different occasions that funds were over extended, but due to the time of the accounting for those days the money was crossing paths at the bank.  This did not pose any concern for the auditors.

In the case of CISD the audit was given to the district and Board Members a week prior to the called Board Meeting.  During the Board Meeting the auditor shared his report and answered any questions posed by Board Members.  The audit was accepted and voted on for approval during the Board Meeting.

After discussing this process I was surprised to find that the report was not shared with the Superintendent in advance of sharing the report with the board.  There was no allowance for questioning or dispute.