POTSDAM - After spending approximately $250,000 of their unallocated fund balance last year, the Potsdam Central School District is now in compliance with recommendations limiting a school districts unallocated fund balance.
Last year you had a 5 percent fund balance, according to Roy J. Chip Clark, an accountant with DArcangelo & Co., Syracuse.
Your fund balance is down roughly $250,000, Mr. Clark said, explaining the usage of that money decreased the districts fund balance from 5 percent to 3.8 percent.
Your now in compliance with Real Property tax law, he said, adding that at the close of the year the district had an unallocated fund balance of $1,012,002.
Board President Christopher C. Cowen asked Mr. Clark how their districts finances compare to others.
I think youre right in the middle, he said. I have some districts with no fund balance and some districts with extreme fund balances.
The lone mark on the audit, which Mr. Clark said he notes on every school audit he completes, is for a lack of controls over the districts extra classroom activities fund.
Mr. Clark explained that with students participating in fundraisers and handling money outside of school it is impossible to be sure all of the money is properly accounted for.
Superintendent Patrick H. Brady said he was pleased with the report.
Mr. Clark provided a clean opinion on the districts fiscal accounting, which indicates appropriate measures are being used to carry out our budgetary responsibilities, he said. This is a strong reflection on our business office, which manages district accounts so we can provide the best educational program possible within our available resources.
Mr. Brady also noted the audits mention of trends noticed in the districts finances over the past several years.
What Mr. Clark also indicated is that schools like Potsdam who have been hardest hit by losses in state aid over the last few years are using considerable reserves and fund balance to maintain staffing and programs, he said.
He pointed to data which shows we have held the line on spending, but the loss of revenue has been challenging to overcome. This will be difficult to sustain over the long term unless we are very conservative in our budgeting approach and the economic climate turns much more favorable.
Mr. Brady said the auditors report reiterates what he and other members of the school board have been saying over the past few years.
We also need the support of our state legislators to resolve the inequity problem in distributing state aid and to provide relief from costly mandates. Unless these problems are dealt with effectively, schools like Potsdam will continue to face serious threats to livelihood, regardless of our responsible stewardship of the publics monies.
According to Mr. Clarks report ,7.9 percent of the districts revenues last year came from appropriated fund balance and reserves.
Sustaining this level of appropriated fund balance through the revenue side will be difficult, he said.
On the revenue side of things, he noted the districts actual expenditures for the year totaled $24,851,111, a 5 percent difference from the $26,219,095 budgeted for the year.
As expenditure budgets get tighter sustaining this level of appropriated fund balance through the expenditure side will be more difficult, Mr. Clark said.
He further warned the district that with $1.6 million from reserves and the fund balance included in this years budget, the amount they have in their accounts is likely to decrease further.
I would just raise caution on the expenditure side. Know you have $1.6 million out there, he said. In order to sustain it, youll have to have that much left, otherwise, youll be dipping into that.