Though boasting only 700 students, the Dulce Independent School District has a total net position of $36 million — $7 million less than the Española School District, a district with an 82 percent greater enrollment.
Albuquerque-based firm Precision Accounting performed the audit which received an unmodified opinion with four findings. The District filed its audit with the office of State Auditor Hector Balderas on Sept. 5, more than two months before the filing deadline.
For the school year ending June 30, 2013, Rio Arriba County’s northern-most school district collected $8.1 million in revenue, a drop from the previous two years, which both boasted revenues more than $13 million.
The District took a large hit in property taxes, collecting only $4.3 million in property tax revenue. The prior year, the District collected $9.5 million. The audit states property taxes are assessed Jan. 1 of each year and are payable in two equal installments — on Nov. 10 of the year in which the tax bill is prepared and April 10 of the following year.
Revenues in Federal and state aid increased by $100,000. Dulce schools collected this funding from 31 separate Federal, state and local grants. Out of the 31 grants, 15 are Federal and equal $5 million of awarded funds.
Financial highlights
• Total liabilities of governmental activities was $35,111,941
• Net position of governmental activities was $36,040,125
• General fund revenues exceeded expenditures by $475,018
• Longterm debt was $34 million
Audit findings
The auditor determined two findings were significant deficiencies and two were material weaknesses.
Of the two material weaknesses found, the first was in purchasing. The auditor found seven checks for which the purchase order was for an amount different than the invoice. Checks differed from the purchase order from as little as $3.14 to $107.58.
Not only does this put the District in noncompliance with state regulation, but it also causes it to be in violation of procurement code. The audit states the cause for the purchasing error is a lack of a process for revising purchase orders if there is an increase in price from that listed on the purchase order.
District personnel are implementing a procedure for when the main depositor is absent a backup is in place, the audit states.
The last material weakness is in travel and per diem. The auditor noted several instances of employees and board members being over-reimbursed for travel and meals.
This places the District in noncompliance with state regulations and procurement code. The auditors recommend board members and employees receive specific policy training with respect to what meals are reimbursable.
The auditors also recommend the business manager and accounts payable clerk review purchasing policies so they may ensure only allowable reimbursements are made. The District will ensure there is trained backup personnel for the main depositor.
The audit states the District has a significant deficiency. Out of the 40 receipts the auditors pulled, two receipts were deposited after the 24-hour deadline.
The auditor projected this error would affect the accuracy of 38 receipts.
District personnel did not deposit the two receipts in a timely manner because they were waiting until the end of the collection period, the audit states.
District personnel have since begun to implement a procedure for when the main depositor is not at work, so a dependable backup is available to ensure all receipts are deposited within 24 hours.
The second significant deficiency the auditor found was expenditures over the District’s budget, which puts the District out of compliance with state regulation.
The capital project House Bill 33 fund was over budget by $117, and the capital project Senate Bill 9 was over budget by $137. Both over-expenditures were related to county collection costs associated with property taxes.
The District had budgeted based on prior year tax collection costs and forgot to amended the budget as necessary, the audit states.