School District of the City of Pontiac

Presented by

Kristi Krafft-Bellsky, CPA

Presented on

October 19, 2015

Yeo & Yeo, P.C.

School District of the City of Pontiac

2

Balance Sheet – Governmental FundsJune 30, 2015

2006 Total General Food Service Building & Site Governmental

Fund Fund Debt Service Funds

AssetsCash 3,163,860$ 1,217,895$ 1,467,799$ 5,849,554$ Accounts receivable 749,595 - - 749,595 Due from other governments 4,634,354 293,066 5,098 4,932,518 Due from other funds 169,936 - - 169,936 Inventory - 23,569 - 23,569 Prepaid items 63,778 - - 63,778

Total assets 8,781,523$ 1,534,530$ 1,472,897$ 11,788,950$

LiabilitiesState aid and tax anticipation notes payable 19,017,000$ -$ -$ 19,017,000$ Accrued salary and related fringe benefits 3,129,931 28,440 - 3,158,371 Deferred inflows of resources 1,171,176 - - 1,171,176 Unearned revenue 1,564,022 - - 1,564,022 Accounts payable and other liabilities 17,337,818 284,454 - 17,622,272

Total liabilities 42,219,947 312,894 - 42,532,841

Fund Balance (Deficit) (33,438,424) 1,221,636 1,472,897 (30,743,891)

Total liabilities and fund balance 8,781,523$ 1,534,530$ 1,472,897$ 11,788,950$

Yeo & Yeo, P.C.

School District of the City of Pontiac

3

2006 Nonmajor Total

General Food Service Building & Site Governmental GovernmentalFund Fund Debt Service Funds Funds

Revenues and other sources 61,490,775$ 3,312,862$ -$ 10,408,691$ 75,212,328$

Expenditures and other uses (66,025,626) (2,463,296) (1,555,249) (11,969,415) (82,013,586)

Other financing sources 10,174,074 - 3,028,146 - 13,202,220

Other financing uses - (156,097) - (3,719,529) (3,875,626)

Net change in fund balance 5,639,223 693,469 1,472,897 (5,280,253) 2,525,336

Fund balance (deficit), July 1, 2014 (39,077,647) 528,167 - 5,280,253 (33,269,227)

Fund balance (deficit), June 30, 2015 (33,438,424)$ 1,221,636$ 1,472,897$ -$ (30,743,891)$

Governmental FundsStatement of Revenues, Expenditures and Changes in Fund Balance

For the Year Ended June 30, 2015

Yeo & Yeo, P.C.

School District of the City of Pontiac

4

Original FinalBudget Budget Actual % Difference

Revenues and other sources 79,561,100$ 69,481,900$ 71,664,849$ 3.14%

Expenditures and other uses 74,828,300 66,340,000 66,025,626 -0.47%

Net change in fund balance 4,732,800$ 3,141,900$ 5,639,223$

Budgetary Comparison Schedule – General FundFor the Year Ended June 30, 2015

Yeo & Yeo, P.C.

School District of the City of Pontiac

5

Local$28,176,337

46%

State$13,643,407

22%Federal

$14,357,294 23%

Interdistrict$5,313,737

9%

General Fund Revenues For the Year Ended June 30, 2015

Total Revenue $61,490,775

In addition, there were $10,174,074 in other financing sources for the year ended June 30, 2015

Yeo & Yeo, P.C.

School District of the City of Pontiac

6

Salaries & Benefits$36,846,404

56%

Capital Outlay$4,343,991

7% Puchased Services$16,809,573

25%

Supplies and Other$8,025,658

12%

General Fund Expenditures and Other UsesFor the Year Ended June 30, 2015

Total Expenditures and Other Uses $66,025,626

Yeo & Yeo, P.C.

School District of the City of Pontiac

7

Per Pupil Analysis of General Fund Revenues and Expenditures

2011(5803 students)

2012(5629 students)

2013(5195 students)

2014(4531 students)

2015(4385 students)

Revenues and Sources $12,653 $12,942 $11,471 $16,780 $16,343

Expenditures and Uses $14,774 $15,278 $14,165 $14,266 $15,057

$11,000

$11,500

$12,000

$12,500

$13,000

$13,500

$14,000

$14,500

$15,000

$15,500

$16,000

$16,500

$17,000

$17,500

$18,000

Yeo & Yeo, P.C.

School District of the City of Pontiac

8

2011 2012 2013 2014 2015

Fund Balance compared to TotalExpenditures and Uses -28.6% -43.8% -68.6% -60.5% -50.6%

Fund Balance (Deficit) $(24,535,007) $(37,683,487) $(50,470,273) $(39,077,647) $(33,438,424)

$(60,000,000)

$(50,000,000)

$(40,000,000)

$(30,000,000)

$(20,000,000)

$(10,000,000)

$-

General Fund – Deficit Fund Balance

Yeo & Yeo, P.C.

School District of the City of Pontiac

9

Material Weakness

Significant Deficiency

Material Non-compliance

Non-compliance Description

2015-001 X X Operational Deficit

2015-002 X X Budgeting

Government Auditing Standards

Material Weakness

Significant Deficiency

Material Non-compliance

Non-compliance Description

2015-003 X X Title I Equipment

2015-004 X X SOS Reporting

Federal Award Findings

Yeo & Yeo, P.C.

School District of the City of Pontiac

10

Unmodified Opinion

Major Programs:Title I

Special Ed Cluster21st Century Community Learning Centers

Strengthening the Odds for Success

Federal Compliance

Yeo & Yeo, P.C.

School District of the City of Pontiac

11

Prior Year FindingsMaterial

WeaknessSignificant Deficiency

Material Non-compliance

Non-compliance Corrected Description

2014-001 X Yes Account reconciliations and AJEs

2014-002 X Yes Timely cutoff of information

2014-003 X Yes Prior period adjustment

2014-004 X X No2015-001

Operational Deficit

2014-005 X X No 2015-002

Budgeting

2014-006 X X Yes Title I - allowable indirect costs

2014-007 X X Yes Title I - supplement vs supplant

2014-008 X X Yes Title I - allowable budgeted costs

Yeo & Yeo, P.C.

School District of the City of Pontiac

12

Prior Year Findings (Continued)Material

WeaknessSignificant Deficiency

Material Non-compliance

Non-compliance Corrected Description

2014-009 X X Yes Title I - special test of priority schools

2014-010 X X Yes- Special EducationNo- Title I2015-003

Title I and Special Education Cluster - equipment management

2014-011 X X Yes 21st Century Community Learning Center – private non-public school participation

2014-012 X X Yes PRIDE & PLAY – parental involvement

2014-013 X X No 2015-004

SOS Grant - reporting

Yeo & Yeo, P.C.

School District of the City of Pontiac

13

Current Year – Documentation of Purchase Card Transactions Approval of Purchase Orders and Personnel Activity Reports Private School Correspondence Maintenance of Effort Parental Involvement School-Wide Plan Review

Prior Year - Documentation and Implementation of Internal Controls- Improvement made Time Documentation and Personnel Files- Corrected Private School Correspondence- Improvement made Athletic Cash Collections- Corrected Retention of Supporting Documentation- Corrected Monitoring of Grant and District Budgets- Corrected Fixed Asset Recording- Corrected Maintenance of Effort- Remains a recommendation Timely and Accurate Completion of Final Expenditure Reports- Corrected Indirect Cost Calculation- Corrected Staffing Requirements- Corrected Parental Involvement- Remains a recommendation

Management Comments

Kristi Krafft-Bellsky(800) 968-0010

krikra@yeoandyeo.com

Thank you!