Audit Shows Largest Fund Balance in 18 Years

Audit Shows Largest Fund Balance in 18 Years
Posted on 11/15/2018

Florence County School District Three ended the 2017-2018 school year with a fund balance higher than it has been in 18 years, according to the district’s audit report.

The report was presented by Jim Lawrimore of Lawrimore & Lawrimore, an independent certified public accounting firm that conducted the district’s annual financial audit, during the monthly meeting of the FCSD3 Board of Trustees Thursday.

“Shortly after officially starting my position as superintendent on July 1, 2015, I learned that the 2015-2016 general fund budget was balanced with a fund balance that did not exist, which led to a deficit at the end of 2015-2016 school year” said Superintendent Laura Hickson.

A state law passed in 2017 requires school districts to have a fund balance of at least 8.33 percent of the current year’s expenditures. The district’s fund balance now stands at 9.13 percent with a goal of reaching 15 percent.

Mrs. Hickson noted that district implemented a plan to address the fund balance deficit.

“After developing a three-year plan to address the deficit under the direction of Dr. John Thames, a financial consultant hired by the district, and making key changes in the finance department, the district was able to eliminate the deficit in one year and completed the 2016-2017 school year with a $257,881 fund balance. The district and schools pulled together as a team to continue to implement the district financial corrective action plan and the results have been positive and huge,” she added.

To address the fund balance deficit, the district implemented a number of cost-cutting measures to save money in order to build the fund balance and also implemented other financial processes to improve cash flow.

To save money, schools and departments throughout the district delayed purchases when possible. Employee travel for professional development was reduced. Instead, professional development was conducted in-house when possible. Additionally, some staff vacancies were left unfilled and those job responsibilities were absorbed by other positions.

“Everybody in the district has had to sacrifice and work toward the common goal of building the fund balance,” said Michelle Humphrey, FCSD3 finance director.

To ensure adequate cash flow, the district changed from a biweekly to a bimonthly payroll schedule, meaning employees receive 24 paychecks per years instead of 26. In addition, accounts payable check runs were changed from weekly to bimonthly.

Mrs. Hickson said that by being good stewards of taxpayer money and continuing to spend wisely will allow the district to maintain a solid financial footing while saving to meet the 15 percent fund balance goal.