Washington School District receives clean audit
Washington School District received a clean audit report following a review of its 2015-16 school year finances.
Steven Cypher, a CPA with the accounting firm of Cypher & Cypher, presented the firm’s findings to the school board Monday.
The report was an unmodified clean opinion, and Cypher concluded the district complied with good accounting practices in managing its general fund budget of $26.9 million in the 2015-16 school year.
As far as the financial performance of the district, the fund balance increased by about $187,000, raising it to $945,250, about $1.5 million less than recommended.
While the district was able to add to its reserves, Cypher said he recommends school districts keep their fund balance at no less than 5 percent of the general fund budget, and preferably 8 or 10 percent.
Following that formula, Washington should have approximately $2.5 million in its fund balance.
Cypher said administrators and the school board have done a good job of managing the district’s finances, despite challenges it has faced and will continue to encounter, such as little growth in revenue from real estate taxes because the district is landlocked.
“You’ve worked hard to get the budget where it is. You’re going to have to work harder to keep it there,” said Cypher, citing significant increased contributions from school systems within Pennsylvania to fund Pennsylvania School Employees’ Retirement System and other issues.
Washington School District’s pension contribution increased from 1.09 percent of its budget in 2001-02 to 30.03 percent in 2016-17. Cypher said the rate is projected to increase to more than 36 percent in 2020-21.
He also cautioned the stability of the district’s financial position could be affected if the so-called Property Tax Independence Act, which proposes replacing property taxes with increased sales and income taxes, goes into effect.
“That’s a tough one. If you go to an income and sales index, you’re out of control of your budget,” said Rick Mancini, director of district operations. “All of the revenue is coming from the state, and minimal taxes are coming in locally.”