Monroe Local Schools officials have instituted new accounting policies to prevent falling again into fiscal emergency and state control.
Last fall, an independent review of the district’s financial records showed that Monroe was in a “significant deficit situation” that may have been ongoing since 2009. The district’s five-year forecast showed projected deficits of $1.6 million and $2.7 million for the 2012 and 2013 fiscal years respectively.
It was then learned that the district faced an operating deficit of around $1.62 million, plus money that was misused from a bond retirement fund. That misuse of funds created its own deficit of $3.1 million. Those funds were allegedly moved by the school’s former treasurer, Kelley Thorpe, without board approval.
“The new policies have been in place since January,” said district treasurer Holly Cahall. “Now that the board members know what it is, they want to see what’s going on with the bond retirement fund. We just go overboard now, but you have to. Of course now, it’s particularly important because we’re doing what we can to show where the money is.”
Cahall is now required to report updates on the district’s Bond Retirement Fund each month, and she is required to use state-approved accounting software to make the reports. She meets each month with the district’s Finance Committee, and she balances bank statements on a monthly basis. None of those policies had been in place prior to the fiscal emergency, according to the district.
Cahall said the extra work is worth it.
“We’re better off than schools who haven’t experienced (fiscal emergency) yet, because we have so many things in place, and we see value in it that other school districts don’t see,” she said.
Board member Amie Earls, who is a member of the district’s Finance Committee with fellow board member Tom Leeds, said she appreciates being informed.
“The finance committee gives the board members a chance to meet with Mrs. Cahall one on one to discuss and review the district’s financial information,” she said. “At this point, anything that we as a board can do to help monitor, explore and understand the financial position of our district is a positive and worthwhile thing.”
The district now also requires its treasurer to be a certified public accountant.
“She’s balancing an operating budget of almost $18 million, and that’s no small task,” interim superintendent Phil Cagwin said.
Many of the changes were enacted by former superintendent Elizabeth Lolli and the school board, according to Cahall. The board specifically wants to see the actual accounting reports. In the past, documents had been re-written with the intention of making the reports easier for non-accountants to follow.
“We’re probably the most thorough district around now, which is a good thing,” Cahall said.
Monroe voters passed Nov. 6 a 7.05-mill, 5-year emergency operating tax levy that will generate $2.5 million per year.
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