Notice of Audit of the Fiscal Affairs of
Groton Area School District No. 06-6
Notice is hereby given that the records and books of account of Groton Area School District No. 06-6 of Brown County, South Dakota have been audited by Eide Bailly LLP for the fiscal year ended June 30, 2017 and that a detailed report thereon is filed with the governing board, the Director of Finance, and the Department of Legislative Audit, 427 South Chapelle, Pierre, South Dakota, for public inspection.
This notice is published in compliance with the provisions of SDCL 4-11-7.2.
Current Audit Findings and Recommendations
Finding 2017-A Preparation of Financial Statements and Footnotes, and Material Proposed Adjustments to the Financial Statements
Criteria: The School District’s internal control structure should be designed to provide for the preparation of the financial statements and footnotes, which includes having an adequate system for recording and processing entries material to the financial statements being audited in accordance with generally accepted accounting principles.
Condition: Groton Area School District 06-6 requested the external auditors to assist in the preparation of the financial statements and related footnotes for the year ended June 30, 2017. As part of the financial statement preparation process, at times we propose material audit adjustments that are not identified as a result of the School District’s existing internal controls and, therefore, could result in a misstatement of the School District’s financial statements.
Cause: The limited size of the School District’s staff and resources cause the inability to prepare the financial statements and footnotes and could cause the need for auditors to at times propose material journal entries.
Effect: This condition may affect the School District’s ability to record, process, summarize and report financial data consistent with the assertions of management in the financial statements.
Recommendation: This circumstance is not unusual in an organization of this size. It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Also, a thorough review of the transactions in each fund should take place prior to the beginning of the audit, to ensure generally accepted accounting principles have been followed for each fund type, especially for transaction types infrequent in occurrence.
Views of Responsible Officials: Management agrees with the finding.
Published twice at the total approximate cost of $34.70. 15375