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Educational Entity Financial Reporting - Joint Legislative Auditing Committee

Joint Legislative Auditing Committee

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Educational Entity Financial Reporting (District School Boards, Charter Schools, and Charter Technical Career Centers)

The Joint Legislative Auditing Committee (Committee) has the authority to enforce provisions against district school boards, charter schools, and charter technical centers when they fail to submit financial reports required by law. The following information is provided to assist these entities with questions regarding financial reporting requirements. Contact information is provided for various offices with responsibilities related to financial reporting if additional assistance is needed.

All district school boards are required to complete an annual financial report (AFR) for each fiscal year and electronically submit the AFR to the Department of Education (DOE).¹ Charter schools² and charter technical career centers³ are required to provide financial reports annually to their sponsoring district school board or community college.

In addition, all district school boards, charter schools, and charter technical careers are required to have an annual financial audit (audit) of their accounts and records. Pursuant to s. 218.39, F.S., if the entity has not been notified, by the first day in any fiscal year, that the Auditor General will perform a financial audit for that fiscal year, the entity must have the annual financial audit completed within 9 months after the end of its fiscal year by an independent certified public accountant (CPA) retained by it and paid from its public funds. Each district school board must submit a copy of its audit report to the Auditor General4 and the DOE. Each charter school and charter technical career center must submit a copy of its audit report to its sponsoring entity; the local district school board, if it is not the sponsoring entity; the Auditor General; and the DOE.5

Each year, the Auditor General provides the Committee with a list of all entities that have failed to comply with these financial reporting requirements. The Committee may choose to conduct a hearing and take action against noncompliant entities pursuant to s. 11.40(2), F.S. For district school boards, the Committee may direct the Department of Revenue (DOR) and the Department of Financial Services (DFS) to withhold any funds due to the entity that are not pledged for bond debt service satisfaction until the entity has complied with the law. For charter schools and charter technical career centers, the Committee may notify the sponsoring entity, which may terminate the charter pursuant to ss. 1002.33 and 1002.34, F.S.


¹References: ss. 1011.60(1), and 1010.20,F.S.; SBE Rule 6A-1.0071, Florida Administrative Code
²See s. 1002.33(9)(g), F.S.
³See s. 1002.34(14), F.S.
4Pursuant to s. 218.39(7), F.S.
5Pursuant to s. 218.39(10), F.S.

Annual Financial Audit Report (Audit) Required by Section 218.39, Florida Statutes

1. Are all district school boards, charter schools, and charter technical career centers required to obtain a financial audit?

Yes. All district school boards, charter schools as defined in s. 1002.33, F.S., and charter technical career centers as defined in s. 1002.34, F.S., must have an audit of their accounts and records by an independent CPA. If, by the first day in any fiscal year, a district school board, charter school, or charter technical career center has not been notified that a financial audit for that fiscal year will be performed by the Auditor General, the entity must have the audit completed within 9 months after the end of its fiscal year by an independent certified public accountant retained by it.

The Auditor General may conduct an audit of a district school board, charter school, or charter technical career center on her own accord, but is required by law to conduct audits of certain district school boards based on county populations, according to the most recent federal decennial statewide census.

District School Boards: Annual Audit by Auditor General

The Auditor General conducts annual audits of district school boards in counties with populations of less than 150,000.6 Based on the most recent federal decennial statewide census figures (2010), the Auditor General conducts an annual audit for 37 district school boards, which are listed below.

Baker Gilchrist Jefferson Sumter
Bradford Glades Lafayette Suwannee
Calhoun Gulf Levy Taylor
Citrus Hamilton Liberty Union
Columbia Hardee Madison Wakulla
DeSoto Hendry Martin Walton
Dixie Highlands Monroe Washington
Flagler Holmes Nassau  
Franklin Indian River Okeechobee  
Gadsden Jackson Putnam  

District School Boards: Rotational Audit by Auditor General

The Auditor General conducts audits of district school boards in counties with populations of 150,000 or more once every three years.7 Based on the most recent federal decennial statewide census figures (2010), there are 30 district school boards that meet this population threshold. Therefore, the Auditor General conducts 10 rotational audits per year, requiring the remaining 20 district school boards to obtain an audit from an independent CPA firm. The 30 district school boards that receive a rotational audit from the Auditor General are listed below.

Fiscal Year-End 6-30-15 Fiscal Year-End 6-30-16 Fiscal Year-End 6-30-17
Alachua Brevard Bay
Broward Charlotte Escambia
Clay Duval Hillsborough
Collier Manatee Lake
Hernando Miami-Dade Lee
Okaloosa Orange Leon
Polk Osceola Marion
Sarasota Palm Beach Pinellas
St. Lucie Pasco Seminole
Volusia Santa Rosa St. Johns



6Pursuant to s. 11.45(2)(d), F.S.
7Pursuant to s. 11.45(2)(e), F.S.

 

2. When is the audit due?

The audit report must be submitted to the Auditor General within 45 days after the audit report is provided to the entity's governing body (i.e., the elected district school board or the board of directors of the charter school or charter technical career center), but no later than 9 months after the end of the entity's fiscal year.8 For example, the audit report for the 2014-15 fiscal year is due no later than March 31, 2016.


8Senate Bill 224 (now Chapter 2011-144, Laws of Florida), revised the due date for audits to be completed.

3. How can I find a CPA/CPA firm to conduct an audit for our entity?

While we cannot suggest the name of a CPA/CPA firm, you may wish to check with district school boards in surrounding counties or the local governmental entities in your community or in neighboring communities to obtain the names of some CPA/CPA firms in your area that conduct audits of governmental entities. You can also contact the Auditor General's Office and request a list of CPAs/CPA firms that have performed audits of district school boards in surrounding counties or local governmental entities in your community or neighboring communities.

Additional information about audit requirements, including guidelines relating to the auditor selection process, can be found on the Auditor General's website. See "Rules and Guidelines - District School Board and Charter Schools."

4. Where is the audit report required to be sent?

Each district school board must file a copy of its audit report with the DOE and with the Auditor General, if the audit was not conducted by the Auditor General. Each charter school and charter technical career center must file a copy of its audit report with the sponsoring entity; the local district school board, if it is not the sponsoring entity; the Auditor General; and the DOE.

To file with the DOE:

District school boards must submit their audit reports to the DOE in accordance with the requirements of the Office of Funding and Financial Reporting. For more information, please contact the Office of Funding and Financial Reporting at (850) 245-0405.

Charter schools will be prompted during the electronic submission of their annual Charter School Accountability Report to upload their audit report as well. For further information on charter school and charter technical career center audit submissions to the DOE, please contact Lacrest McCary at (850) 245-0502 or send an e-mail to charterschools@fldoe.org.

To file with the Auditor General:

Instructions for electronically filing audit reports are posted on the Auditor General's website. In addition, an audit report submittal checklist must be completed and sent with one paper copy of the audit report to:

Auditor General
Claude Pepper Building, Room G72
111 West Madison Street
Tallahassee, FL 32399-1450

 

5. How can I tell if a district school board, charter school, or charter technical career center has submitted its audit report?

Audit reports received are posted on the Auditor General's website. To view the audit reports posted, go to the Auditor General's website and proceed as follows: (1) scroll to "Reports Filed with the Auditor General" (on left side of page), (2) hover over "Filed Reports," and (3) select the type of entity (District School Boards, Charter Schools and Centers, etc.). The list includes all entities that have filed an audit report for the specified fiscal year. You may access the available audit reports by selecting an individual entity.

Note: An audit report may have been received by the Auditor General but not yet listed online as received. This may be due to the time required for review of the audit report. To determine if the Auditor General has received an audit report that has not been posted online, send an e-mail to the Auditor General at flaudgen_dsb_charter@aud.state.fl.us. Specify the name of the school and the fiscal year audit report you are interested in.

General Questions:

6. What happens if a district school board, charter school, or charter technical career center does not file an audit report with the Auditor General?

Following notification by the Auditor General, the Committee may hold a hearing to discuss whether the entity should be subject to state action pursuant to s. 11.40(2), F.S.

If the Committee decides state action should be taken:

(1) In the case of a district school board, the Committee shall direct the DOR and the DFS to withhold any funds not pledged for bond debt service satisfaction which are payable to such entity until the entity complies with the law. The Committee shall specify the date such action shall begin, and the directive must be received by the DOR 30 days before the date of the distribution mandated by law.

(2) In the case of a charter school or charter technical career center, the Committee shall notify the appropriate sponsoring entity, which may terminate the charter pursuant to ss. 1002.33 and 1002.34, F.S.

7. Has the Committee taken action against any district school board, charter school, or charter technical career center recently?

To date, the Committee has not had to take any state action against any of these types of entities.

8. Will an entity be notified before the Committee takes action?

Generally, yes. By the time the Committee would take action, multiple attempts would have been made to notify a representative of the entity of the reporting requirements and to determine if the entity intends to comply. However, there are times that attempts to contact a representative of an entity may be unsuccessful.

Ultimately, it is each entity's responsibility to comply with the laws of the State of Florida. In the past, there has not been an instance in which a district school board has been at risk for failing to submit an audit report. This is most likely due to the fact that the Auditor General conducts the audits for the majority of the district school boards. However, in previous years, the Auditor General and the Committee have notified charter schools and charter technical career centers that have failed to submit an audit report.

Usually within 45 days after the statutory deadline, the Auditor General sends a letter to each charter school or charter technical career center that is required to submit an audit report to the Auditor General but has failed to do so. These letters are commonly addressed to the financial contact of the entity as provided to the Auditor General on the audit report submittal checklist submitted with the audit report in a previous year. If such information is not available, the best contact information available from other sources is used (i.e., from DOE).

Once Committee staff is notified by the Auditor General, generally a couple of months after the report due date, an attempt is made to contact the entities that have failed to file the required audit report. Committee staff usually will send a certified letter to the charter school or charter technical career center director, requesting that the required audit report be submitted by a specified due date or the Committee may take action pursuant to s. 11.40(2), F.S. To ensure that your entity is promptly notified, please verify that your current contact information has been provided to one or more of the following locations, as applicable:

1. DOE
2. Auditor General - included on the District School Board, Charter School, and Similar Entities, Florida Virtual School, or Virtual Instruction Program Provider Audit Report Submittal Checklist provided with the audit report when submitted
3. Your entity's website

9. If an entity is notified that the Committee intends to take action, should the entity send the audit report to the Committee?

No. The entity should send the audit report to the Auditor General. Committee staff work closely with the Auditor General to determine which entities have submitted the required audit reports.

10. What has happened when the Committee has decided to take action?

To date, the Committee has not had to take any action against a district school board, charter school, or charter technical career center.

11. Who can I contact if I have any questions?

If you have general questions about reporting requirements or action taken against noncompliant entities, you may contact the Joint Legislative Auditing Committee at jlac@leg.state.fl.us or 850) 487-4110.

If you have questions about submitting a district school board, charter school, or charter school technical career center audit report electronically to the Auditor General's Office, you may contact Ted Waller (850) 412-2887 or tedwaller@aud.state.fl.us.

Other Financial Reporting Requirements:

The Committee has no oversight authority in ensuring that district school boards, charter schools, and charter technical career centers submit other appropriate budget and financial information to the proper authorities.

State Board of Education Rule 6A-1.0071, Florida Administrative Code, provides certain fiscal reporting requirements for district school boards. This Rule mandates that each district school board submit both its final approved budget and annual financial report to the Commissioner of Education. The final approved budget is due no later than the third business day following the day of adoption by the school board (generally in September of each year), and the annual financial report is due no later than September 11th of each year. District school boards can submit these documents by accessing http://www.fldoe.org/finance/fl-edu-finance-program-fefp/ For more information on the requirements of these financial documents, please review the Rule. For information on other charter school and charter technical career center financial reporting requirements, please review s. 1002.33, F.S., concerning charter schools and s. 1002.34, F.S., concerning charter technical career centers.

In addition, s. 1011.03, F.S., provides certain requirements for district school boards to post, on their official websites, the tentative budget, the final adopted budget, and any adopted budget amendments.

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Last updated: March 2016