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Show Audit Report Of School Board Books is Made By Salt Lake Firm; Suggestions Made To Improve Work The' auditing firm of Wood, Child, Mann & Smith of Salt Lake City, recently completed an audit of the books of the Duchesne County School District. Following is a summary 'of the report they submitted sub-mitted to the board at a recent meeting: General comments by the auditors aud-itors are listed in three categories Insurance, Bookkeeping and Fund Overdrafts. ' ' (Auditors' comments on insurance insur-ance carried by the district are): The district carried $1,466,070 of fire insurance on real and personal person-al property. Boiler insurance is carried on all school's with limits of $50,000 for each accident except ex-cept Altamont which is covered to limits of $100,000 for each accident. acci-dent. Fleet coverage is carried on busses and trucks for bodily injury in-jury liability to limits of $5,000 $50,000 and property damage liability lia-bility limted to $5,000. Damages caused by fire, lightning, theft and transportation are also included in the' fleet policy. The clerk of the board is bonded for $15,000. Workman's compensation insurance insur-ance is also in effect. Fire insurance insur-ance is not carried on office equipment equip-ment and furniture of the school district in its office in the new county courthouse. Bookkeeping. Comments by the Auditors are: Our examination disclosed that. during the two-year period under review, the district had maintained a cash receipts journal carrying accumulated total figures and also a warrant register from which postings of amounts expended were made to ledger accounts classified by schools and nature of expenditures, but complete self-balancing self-balancing ledger accounts by funds had not been kept. It was also found that bank accounts had not been completely checked and reconciled re-conciled with book records during the entire two year period covered by the audit. ' With reference to the clerk's contingency fund, we found that certain cash collections were deposited de-posited in this bank account and that vouchers supporting expenditures expendi-tures were not formally prepared. Complete Ledger Account We suggest that complete general gen-eral ledger accounts be maintained for each fund and that monthly trial balances thereof be prepared. Separate bank accounts for each fund are' desirable, but it is recognized recog-nized that such separation is not possible at the present time be-' cause of large overdrafts in certain cer-tain accounts. Bank reconciliations should be prepared monthly to as-1 sure- that the' cash transactions have been correctly recorded and summarized. With the adoption of the actions ac-tions outlined above accurate financial fi-nancial reports could readily be made from the bookkeeping records.. rec-ords.. In regard to the clerk's contingency contin-gency fund, we suggest that vouchers vouch-ers be prepared for expenditures designating the date, purpose' and payee. Reimbursement checks should be made periodically from the operating fund by a warrant made payable to the clerk's contingency con-tingency fund'. The expenditure vouchers reimbursed by this warrant war-rant should be filed as supporting evidence of the operating fund expenditures. ex-penditures. At any time the clerk of the board would then have either eith-er cash in bank or non-reimbursed expenditure vouchers totaling the authorized balance of $200 for the contingency fund. Cash receipts should not be deposited to the clerk's contingency fund. Pre-numbered checks should be used' for contingency fund disbursements dis-bursements and monthly bank reconciliations re-conciliations prepared. Claims inspected during the two- year period indicated that payments pay-ments of invoices were deing delayed. de-layed. This should be corrected in order to take advantage of cash discounts. Purchase orders should be carefully issued to assure greater great-er budgetary control. Fund Overdrafts: The' large overdrafts at June 20, 1955 in the operating fund and the regular building fund represent primarily deficiencies existent at the beginning of the two year period per-iod under the review which have been carried forward. At June 30, 1953, the status of these funds were as follows: Operating fund balance, $98,500.40. Less: Tax anticipation an-ticipation notes (outstanding at June 30, 1953 but paid during the fiscal year ended June 30, 1954 and charged against this fund), $200,000.00; Adjusted Operating Fund overdraft, $101,499.60; Building Build-ing Fund overdraft, $178,406.55; total overdrafts, $279,906.15. The Utah State Attorney General Gen-eral has held that "Boards are without authority to call' an election elec-tion to secure authorization to raise money to take care of a deficit defi-cit already incurred." It also appears that the deficit of the regular building funt cannot can-not be overcome by allocation of supplemental school building funds received from the State of Utah. Consequently the overdrafts must be overcome through budgeting procedures. , Section 53-20-2 of the Utah Code annotated 1953, provides that "in determining the estimated expendable expen-dable revenue any existing deficits arising through excessive expenditures expendi-tures from former years shall be deducted from the estimated revenue rev-enue for the ensuing year to the extent of at least ten per cent of the entire tax revenue of the district dis-trict for the previous year. We suggest that maximum tax levies be made until the existing fund overdrafts have been overcome. |