The Alice Independent School District received a positive annual financial audit during a special meeting of the school board on Thursday afternoon.
Raul Hernandez, CPA, presented the audit.
The annual financial report, covering financial year ending Aug. 31, 2009, showed that the school district adhered to acceptable accounting standards throughout the year.
According to the financial highlights contained in the audit, AISD net assets decreased by $752,726 compared to the previous year, which is a 1.9 percent decrease. The district took in tax revenues of $13,385,331, which included $10,961,925 for property taxes levied for general purposes and $2,423,406 for property taxes levied for debt service.
The general fund ended the year with a fund balance of $6,100,761, which was a decrease of $3,695,124 from the prior year. The debt service fund ended the year with a fund balance of $1,459,241, which is an increase of $27,577 compared to last year.
“I believe he did a comprehensive job. He pointed out some facts that are important that we will take into consideration as we work on a budget for the 2010-2011 school year,” AISD Superintendent Dr. Salvador Cavazos said.
“We have a fund balance that has been affected by the expenses of the build out of William Adams Middle School…because of the cost overruns and the uniqueness of the project. So, we are ensuring that we take all matters into consideration as we work diligently and comprehensively to put together a budget for next school year.”
Cavazos said it is important to note that the 2010-2011 school year will be the last year of federal stimulus support for school districts.
At the end of his presentation, Hernandez indicated an adjustment was made by the district because of the situation with Greywolf Drilling rigs, which had an impact on tax collections two years ago.
Rigs owned by Greywolf were rendered in Jim Wells County as opposed to Harris County, because of their location here at the time taxes were collected, school officials said. It amounted to almost $1 million in extra tax revenue for the school district in 2007.
“What happened to us, typically, the more local revenue you get, the less state revenue you get. So when our tax collections report went in, and the state saw our extra million dollars, they adjusted our state revenue, to decrease it, due to the money we got from Greywolf,” AISD Assistant Superintendent for Business, Dr. Melonae Day said. “So that is why they decreased our state aid by $800,000. That was a one-time thing. And that was the adjustment referred to in the audit.”
Hernandez said after the meeting the adjustment was positive for the audit. He said had the district known about the adjustment several years ago, it would have been addressed in 2007.
“Accounting principles say if it occurred in 2007, take it back to 2007. Don’t throw this into your current year operations. It really washes out,” Hernandez said. “The adjustment is to the fund balance, but not to the current year. It’s $814,000, a direct adjustment of the fund balance, but I want to make it clear, it’s not anything negative.”
AISD board members approved the audit on Thursday.