UCS receives excellent financial rating from independent auditor
UCS receives excellent financial rating from independent auditor
Posted on 10/11/2016
A photo of the front page of the UCS Audit report

Utica Community Schools received an “excellent” rating on its annual audit for meeting the highest standards of financial accountability, according to Plante Moran.

The firm gave the district an “unmodified” opinion with no findings - the highest level of financial assurance. This is the 13th straight year the district’s financial audit has received this rating. 

“From our perspective, this report continues the district’s track record of excellent audits,” Laura Claeys, CPA and partner in the auditing firm of Plante Moran. “UCS is a financially well-run district and is operationally excellent.”

She added: “The district is using its resources appropriately to meet its high academic standards, as evidenced by its graduation rate being 12 points higher than the Michigan average.”

The district’s 2015-2016 financial audit was presented to the UCS Board on October 10. In addition to the “unmodified” opinion, Claeys noted the district’s compliance with standards required by Michigan’s Uniform Budgeting and Accounting Act.  

Dr. Robert Ross, the UCS Board of Education treasurer, said the report reflects one of the district’s key focus areas to ensure accountability to taxpayers. 

“This Board of Education is committed to meeting our community’s expectation of exemplary financial integrity and making sure our resources are directed to supporting students in their classrooms,” he said. 

The 2015-2016 audit reported that the district finished with $273.2 million in expenditures, with 81 percent of its costs directly supporting classroom instruction, including teachers, counselors and paraprofessionals.  

“That is a very high percentage (dollars in the classroom) compared to the other districts that we work with,” Claeys said in her report to the Board of Education. 

Overall, revenues for the school district are $265.1 million, with 83 percent of the funding coming from the State of Michigan.  UCS, like all Michigan districts, is dependent on the state for funding. 

Claeys noted that while the district has received “modest” revenue increases from the State of Michigan, a $470 per pupil revenue reduction approved by state lawmakers means the district has less operating funds than seven years ago. 

“UCS is not even back to where it was in 2009,” Claeys said.

She reported that as the audit reflects the district efforts to keep budget cuts away from classroom instruction, noting that the total percentage of the budget directed to instruction has grown from 74 to 81 percent since 2009. 

“As you have had to make decisions about how your resources are spent, you have done everything you can to continue spending money in the instructional area,” she said. “We commend you for that.”






 
Below are links for the 2015-16 audit:



The district has continued to address the fact that costs are exceeding available revenue through efficiencies, reductions, sale of property and the use of its fund balance. 

The audit reported a fund balance $17.9 million, or 6.6 percent of its total expenditures, which Claeys said reflects “a conscious decision to use the fund balance to keep the program at the level that you have decided as a Board.”

She added: “you can’t use that as a mechanism any longer because the number is getting low.” 

In terms of its audit of bond funds – which by law may only be used for capital improvements - Claeys reported that “proactively, the things that the district does benefits the community” by reducing interest costs from bonds issues to support improvements.  

She reported that this year’s refunding of the bonded debt resulted in $260,000 in lower interest payments for residents. 

Claeys also said that the district continues to reduce interest costs through a federal subsidy received during a recent building improvement project at Utica High School. The federal interest subsidy received in 2011 provides an annual interest savings of $740,000. 

In addition to presenting the audit report of the district’s financial status, auditors noted that for the fourth straight year the district has been nationally recognized for excellence in financial reporting.

The Association of School Business Officials International awarded UCS the 2015 Certificate of Excellence in Financial Reporting, which recognizes the highest standard of financial reporting. 

Auditors finished the report that noting the high level of student achievement supported by the district’s fiscal management. 

“When you look at all the challenges you have had from a statewide funding perspective and making decisions along the way as to how you allocate your resources, even though fund balance is lower than it was several years ago, the district is in outstanding financial shape in terms of the decisions that you have made,” Claeys said.