jordan- elbridge central school district audit

October 2, 2013

To the Board of Education and Management of Jordan‐Elbridge Central School District

We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Jordan Elbridge Central School District as of and for the year ended June 30, 2013, and the related notes to the financial statements, which collectively comprise the Jordan Elbridge Central School District’s basic financial statements, and have issued our report thereon dated October 2, 2013. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Jordan Elbridge Central School District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Jordan Elbridge Central School District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Jordan Elbridge Central School District's internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over financial reporting that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as described in the accompanying attachment – schedule of findings, we identified certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies. A deficiency in internal control exists when the design or operation of a control does not allow management or employees in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies described in the accompanying attachment – schedule of findings to be material weaknesses: 2013‐1. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying attachment – schedule of findings to be significant deficiencies: 2013‐2 through 2013‐5.

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Compliance and Other Matters As part of obtaining reasonable assurance about whether the Jordan‐Elbridge Central School District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed instances of noncompliance or other matters that are required to be reported under Government Auditing Standards, and which are described in the accompanying attachment – schedule of findings as items 2013‐6 and 2013‐7.

In addition, we noted other matters involving internal control and its operation that we are reporting to management. These matters are described in the accompanying schedule as other internal control related matters are labeled 2013‐8 and 2013‐9. We have also provided updates to the prior year comments which are labeled 2012‐1 through 2012‐16.

The Jordan‐Elbridge Central School District’s Response to Findings The Jordan‐Elbridge Central School District’s response to the findings identified in our audit are described in the accompanying attachment – schedule of findings. The Jordan‐Elbridge Central School District’s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

GROSSMAN ST. AMOUR, CERTIFIED PUBLIC ACCOUNTANTS, PLLC

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Attachment – Schedule of Findings I) Material Weakness:

2013‐1 Annual Financial Closing Process

Observation: Management had not examined or reconciled certain accounts prior to the onset of the audit. This includes consideration of accounts payable, due from other governments and accounts receivable balances. Managements current procedures do not address the annual closing of account balances for financial statement purposes, especially those related to accrual based accounting. Numerous accounting adjustments were proposed as a result of the audit which was material to the individual funds. Management recorded all such adjustments whereby the approximate impact on the individual funds was:

General Fund ‐ $659,000

School Food Service ‐ $23,000

Special Aid Fund ‐ $(453,000)

Capital Fund ‐ $1,041,000

Recommendation: An annual closing process and procedure should be developed by management to reconcile all significant account balances with adequate supporting documentation. This should not only include the fund accounts but also the District‐wide accounts, such as fixed assets and long term debt. Management’s Corrective Action Plan: The conversion to a new software accounting system created some challenges in adapting to new procedures for processing and training new staff members. Issues were uncovered at the end of the year that required review and adjustments outside of normal year end procedures. Procedures for an annual closing process will be established and adhered to going forward; matters will be resolved for the closing process June 30, 2014.

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II) Significant Deficiencies:

2013‐2 Budget Monitoring Observation: A budget status report is required to be communicated to the Board of Education on at least a quarterly basis and on a monthly basis if budget transfers were completed by the District as required by section 170.2 of the New York State Education Departments Commissioner's Regulations. The District did not comply with these requirements as the first status report was not provided until the February 6, 2013 board meeting which was for the period ended December 31, 2012. Although such report was provided, it was not compliant with the level of detail mandated by the regulations as such report did not detail the appropriations by object code. The District provided reports for the months ended February, March and April. The March and April reports were in greater detail as required by the regulations. No reports were provided for the months of January, May or June. Recommendation: The District should consistently provide the budget status reports on a monthly basis within 15 days of each month end. These reports should be at the level of detail mandated by the Commissioner's regulations which includes both revenues and appropriations by object/function codes. These reports should be reviewed by the Board of Education whereby such review is documented in the boards' minutes.

Management’s Corrective Action Plan: Management will begin to provide the budget status reports in the detail required within 15 days after each month end beginning for the month ended September 30, 2013. Such reports will be included as an agenda item for the board to consider each month.

2013‐ 3 Cash Management – School Food Service Observation: The District has established a separate bank account to account for the daily sales activity related to the District's food service program. The bank balance of this account was $326,168 as of June 30, 2013. This bank account does not pay any of the food service expenses which are paid from a separate bank account associated with the General Fund. The District had not appropriately reconciled the ending cash balance to reflect the payments from the General fund. As such, the net cash in the school food service fund should have been $41,596. The District subsequently transferred the difference of $284,572 to the appropriate general fund bank account and recorded the adjustment accordingly. Recommendation: The District should implement procedures to record the net transfers of cash activity in a timely basis. The frequency of these transfers should at least quarterly, if not monthly to adjust the balances accordingly based on the bank reconciliation. Management’s Corrective Action Plan: Management will implement a policy to transfer school lunch funds on a quarterly basis beginning September 30, 2013.

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II) Significant Deficiencies (continued): 2013‐4 Interfund Accounting

Observation: The District routinely has transactions among different government funds which result in receivables / payables between funds. Many of these transactions are system designed transactions which automatically post certain activity across different funds, such as payroll and related benefit activity. Certain interfund transactions were not appropriately recorded or settled within the year resulting in adjustments to the balances. The adjustments recorded across the funds approximated the following:

General Fund ‐ $(20,000)

Special Aid Fund ‐ $304,000

Capital Fund ‐ $32,000 National Council on Governmental Accounting (NCGA) Statement No. 1, Governmental Accounting and Financial Reporting Principles, paragraphs 57 and 75 state that interfund transfers should be recognized in the period in which the interfund receivable and payable arise. If the interfund receivable and payable are not expected to be settled within a reasonable amount of time, the interfund balances should be reduced. Recommendation: Management should design a process to reconcile interfund activity on a monthly basis and to settle interfund activity on at least an annual basis. Management’s Corrective Action Plan: The District integrated a new accounting software system (Finance Manager) on July 1, 2012 that complicated this reconciliation process. Management will work to design a process to reconcile these accounts and implement this process by December 31, 2013.

2013‐5 Accounting for Fixed Assets Observation: A complete and accurate record of fixed assets, including consideration of related depreciation, is not maintained. In addition, a physical inventory of the District's fixed assets has not been recently conducted. In order to accurately reflect the District’s fixed asset balances, audit adjustments of approximately $623,000 and $359,000, respectively for asset additions and asset disposals were necessary to fairly state the account balances. Recommendation: Procedures should be implemented to ensure proper records and tracking of fixed assets. In addition, physical inventories should be performed on a periodic basis whereby the accounting records are reconciled to the physical inventory of assets. Management’s Corrective Action Plan: The District will establish a plan to create, monitor and maintain a fixed asset listing that reflects the District’s fixed assets and depreciation schedules. This will be completed by June 30, 2014.

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III) Other Internal Control Related Matters:

2013‐6 Program Expenditure Oversight Observation: There was not adequate oversight with respect to the preparation of federal reimbursement requests made by previous management under the 2011‐12 Race to the Top Program. The drawdowns received by the District exceeded actual expenditures by $13,195, with this amount being remitted back to the New York State Education Department for allocation to the 2013‐14 program budget. Recommendation: The District should continue to adhere to its recently implemented policies and procedures over federal grant expenditures, which include a consistent review of the budget status of all federal grant expenditures throughout the fiscal year. Management’s Corrective Action Plan: The District has remitted the excess drawdowns, in the amount of $13,195 to the New York State Department of Education to be applied to the 2013‐14 grant period. The District has also developed and implemented new procedures to closely monitor federal reimbursement requests and monitor grant status on a monthly basis.

2013‐7 Grant Drawdowns Observation: Although the District was able to reconcile its year‐to‐date federal grant expenditures and corresponding drawdowns to its general ledger as of June 30, 2013, supporting general ledger documentation was not maintained for the individual FS‐25 request for funds forms submitted to the New York State Education Department (NYSED) during the year. Recommendation: The District should implement procedures with respect to the drawdown of federal grant monies, which include the attachment of supporting general ledger documentation to the individual FS‐25 submissions made during the year. Management’s Corrective Action Plan: The District will ensure that general ledger documentation is maintained for all amounts included within its FS‐25 submissions. The District’s Treasurer and Assistant Superintendent for Instruction are responsible for carrying out this plan and such plan is expected to be completed by September 30, 2013.

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III) Other Internal Control Related Matters (continued):

2013‐8 Purchasing Procedures Observation: The District is required to obtain valid purchase orders prior to the purchase of goods and services. We noted ten instances of a total 40 tested (25% failure rate) that purchase orders were not approved prior to the actual invoice date. This would indicate that the purchase order was entered into the system after the goods or services had already been delivered. Recommendation: The District should adhere to its policies and procedures for purchases and ensure that purchase orders are initiated and approved prior the ordering of any goods or services. Management’s Corrective Action Plan: The District will reiterate policies and procedures to all individuals involved in the procurement process. They will continue to monitor staff purchases to ensure adherence to policy. The AP claims auditor identifies and reports any transactions that do not follow purchasing policy in warrant reports presented to the Board

monthly.

2013‐9 Payroll Certifications Observation: The Districts policy is for all employees that are paid through federal grants that a monthly time and effort be completed by such employee. We noted ten instances of a total of 25 tested (40% failure rate) that the monthly time and effort certifications were not complete or not able to be produced by management. Recommendation: The District should adhere to its policies and procedures for obtaining these certifications on a monthly basis. Management’s Corrective Action Plan: The District will ensure adherence to the monthly time and effort certifications and proper retention of such documentation.

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Update of control deficiencies communicated for the year ended June 30, 2012: 2012 – 1 Monthly Financial Closing Process Observation: Management had not examined or reconciled certain accounts prior to the start of the audit. This includes consideration of all accounts payable, accrued liability, deferred revenue, due from state and federal, and accounts receivable balances. Significant audit adjustments, with a net impact to governmental funds in aggregate of approximately $500,000, were necessary to reconcile and properly state the accounts payable, accrued liability, deferred revenue, due from state and federal, and accounts receivable balances as of June 30, 2012. Recommendation: Monthly financial closing policies and procedures designed by management should be implemented requiring timely reconciliation and review of account balances. Update: Although improvements were noted throughout various processes during the year, we continued to identify issues upon the year end annual closing with account reconciliations and supporting documentation for accounts. See comment 2013‐1. Management’s Corrective Action Plan: See response to the Annual Financial Closing Process, item 2013‐1. 2012‐2 Business Office Policies and Procedures Observation: The District has not fully implemented its policies and procedures for fiscal operations within the business office, including: cash receipts, cash disbursements and payroll. Certain transactions selected for testing were found to lack adequate required supporting documentation. The District designed policies and procedures during the fiscal year to address the business office functions. Such policies and procedures were not completed until May 2012 and were not fully implemented by June 2012. Recommendation: Management should continue working to implement the policies and procedures with respect to fiscal operation within the business office. Update: The District has prepared a comprehensive set of policies and procedures to address not only the monthly financial closing process, as previously discussed, but to address all significant accounting cycles within the District. Certain transactions selected for testing were again found to lack adequate supporting documentation, making it evident that the District’s implementation of these policies and procedures is not complete. The District will need to continue implementing its revised policies and procedures to address the monthly and annual closing process. Management’s Corrective Action Plan: See responses to 2013‐1, 2013‐8 and 2013‐9

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2012‐3 Preparation of Financial Statements Observation: Management has established a chart of accounts and has structured its trial balance to reflect New York State financial reporting requirements and requirements of the Governmental Accounting Standards Board. Although all adjusting and correcting audit entries were approved by management, management does not possess the ability to prepare external full fund basis and government‐wide financial statements, including all required financial statement disclosures, in accordance with governmental accounting standards, and required supplementary information.

Recommendation: Management should examine responsibilities and resources to identify an individual with the skillset to prepare the financial statements, including notes and supplementary information. Update: Management has examined its account structure within its accounting system and has simplified the account structure upon implementation of its new general ledger accounting system. The current general ledger system appears adequate for management to prepare its financial statements. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐4 Schedule of Federal Expenditures (SEFA) Observation: Management was not able to prepare the schedule of expenditures of federal awards. Circular A‐133, subpart C, Section 300, states that the auditee (the District) should identify in its accounts all federal awards received and expended, as well as the federal programs under which they were received. Federal program and award identification includes, as applicable, the CFDA title and number, the award number and year, the name of the federal granting agency, and the name of the pass‐through entity. Using this information, the auditee (the District) should be able to reconcile amounts presented in the financial statements to related amounts in the schedule of expenditures of federal awards. Total federal expenditures were $1,325,299 for the year ended June 30, 2012. Recommendation: We recommend the District seek out and provide the necessary training to the designated individual to prepare a complete and accurate SEFA. Update: Upon implementing its new general ledger accounting system, management has demonstrated its ability to produce complete and accurate federal grant expenditure reports to allow for preparation of the June 30, 2013 SEFA. Management’s Corrective Action Plan: Management has taken corrective action

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2012‐ 5 Cash Management – School Lunch Observation: The District currently maintains separate bank accounts for its respective funds. However, we noted instances whereby the District had not internally transferred the necessary cash balances to reimburse the General Fund for obligations paid on behalf of the School Food Service Fund throughout the year under audit. The total of these transfers should have been $284,712. Recommendation: We recommend the District continue to implement its cash management policies and procedures to ensure the necessary transfers are made between bank accounts to accurately reflect the cash balance and activity of each respective fund. Update: The District has not addressed this recommendation from the prior year. The District will need to continue implementing the policies and procedures necessary to ensure the necessary cash transfers are made between the General and School Food Service Funds throughout the year. See comment 2013‐2. Management’s Corrective Action Plan: See response to 2013‐3. 2012‐6 Interfund Accounting Observation: The District routinely has transactions among different governmental funds which result in receivables / payables between funds. Interfund activity has not been settled within one year, which is not consistent with requirements noted below. In addition, interfund activity was not properly recorded during the year under audit, requiring audit adjustments of approximately $398,000. National Council on Governmental Accounting (NCGA) Statement No. 1, Governmental Accounting and Financial Reporting Principles, paragraphs 57 and 75 state that interfund transfers should be recognized in the period in which the interfund receivable and payable arise. If the interfund receivable and payable are not expected to be settled within a reasonable amount of time, the interfund balances should be reduced. Recommendation: Management should complete the implementation process to ensure interfund activity is recorded and balances are settled within one year. Update: Although the new system automated certain aspects of interfund accounting, there continues to be issues with the interfund accounts causing significant adjustments required to be made to fairly state the balances. See comment 2013‐3. Management’s Corrective Action Plan: See response to 2013‐4.

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2012‐7 Payroll Expense Reconciliation Observation: The general ledger payroll expenditures for the year under audit were not reconciled to the District’s payroll registers on a periodic basis. The District treasurer prepared payroll reconciliation at the request of the auditors for the period ending June 30, 2012. This analysis reconciled over $11,600,000 of payroll expenditures. In addition, three individuals’ salaries of a total of eighteen possible selections were inappropriately charged to the 2010‐11 IDEA Part B, 611, Recovery Act budget code which had a contract period ending on June 30, 2011. These salaries totaled approximately $172,000. Recommendation: Policies and procedures to ensure payroll expenditures are reconciled to the general ledger and Federal grant budgets on a consistent basis throughout the year should be implemented. Update: Upon implementation of the new general ledger accounting system, wages for all employees were input at the beginning of the school year and automatically recorded to the appropriate expenditure accounts throughout the year. Given the fact that the payroll registers are generated automatically from the same system, no exceptions have been noted upon reconciling the payroll register to the general ledger as of June 30, 2013. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐8 General Ledger Cash Balances Observation: The District has implemented procedures that include independent review and approval of the bank reconciliations during the year under audit; however, the general ledger cash balances were not adjusted to reflect the reconciled balances on a consistent basis throughout the year under audit. Audit adjustments with a net effect on governmental funds of approximately $115,000 were necessary to accurately reflect the June 30, 2012 reconciled cash balances. Recommendation: Policies and procedures should be implemented requiring that general ledger cash accounts are adjusted on a consistent basis throughout the year to reflect the reconciled balances. Update: We noted improvements across all the cash balance accounts except for the Primary bank account. Further adjustments were required to be recorded to adjust this balance which was a result of the automated posting of certain cash transactions which also impacted the interfund accounts. See comments 2013‐1 and 2013‐3. Management’s Corrective Action Plan: See response to 2013‐1 and 2013‐4.

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2012‐9 Segregation of Duties – Treasury Functions Observation: Over the course of the year, the business office continued to have turnover in accounting personnel, which resulted in treasury functions not consistently being segregated according to function. The District Treasurer was responsible for recording cash receipts and making the bank deposits during the year under audit. Recommendation: Procedures should be implemented to ensure that treasury duties are appropriately segregated. Update: Through the addition of staff members, as well as re‐structuring of job duties among existing business office personnel, the District has appropriately segregated cash receipt and bank deposit duties. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐10 Journal Entries Observation: We noted that of the 64 budget adjusting entries selected for testing, 34 lacked supporting documentation; of the 30 remaining selections that contained supporting documentation, 7 lacked documentation of an independent review and approval. In addition, no independent review and approval process of manual adjusting journal entries was in place during the year under audit. Recommendation: Policies and procedures should be implemented to ensure that all such entries are independently reviewed and approved prior to posting. Supporting documentation for all adjustments should be retained. Update: Management has taken corrective action. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐11 Accounting for Fixed Assets Observation: A complete and accurate record of fixed assets, including consideration of related depreciation, was not maintained. In addition, a physical inventory of the District's fixed assets has not been recently conducted. Recommendation: Procedures should be implemented to ensure proper records and tracking of fixed assets, including documentation specific to federal funds utilized. In addition, physical inventories should be performed on a periodic basis. Update: The District has not addressed this recommendation. Management needs to begin recording all fixed asset additions into its accounting software on a monthly basis. In addition, management needs to begin to review all of its past fixed assets, and in connection with a physical inventory of fixed assets, adjust fixed assets accordingly. See comment 2013‐5. Management’s Corrective Action Plan: See management’s response to 2013‐5.

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2012‐12 Procurement Policies – Bid Documentation Observation: As part of cash disbursements testing 18 vendors were selected with competitive bid or quote documentation requirements in accordance with the District’s procurement policy; supporting documentation evidencing compliance with the procurement policy could not be provided. The selection sample for these 18 vendors amounted to approximately $460,000 with the average individual payment approximating $18,000. The District’s policy requires that at least three written quotes be obtained for purchases in excess of $1,500 and that competitive bids be solicited for purchase and public work contracts of $20,000 or higher. Professional services are exempt from competitive bid requirements. Recommendation: Policies and procedures should be implemented and monitored to ensure consistent adherence to District procurement policies and adequate retention of supporting documentation. Update: Management has taken corrective action. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐13 Budget Monitoring Observation: The District's business office and special education departments did not communicate throughout the school year to determine the amounts charged to each Federal grant, as well as the remaining grant budget balances. As such, the District over charged its 2010‐11 Title I, IDEA Part B 611 and IDEA Part B 611, Recovery Act Grants by a total of approximately $183,000. This resulted in an audit adjustment of approximately $183,000 to transfer these excess expenditures from the special aid fund back to the general fund. In addition, although the budget status reports were prepared by the District as required by New York State law and were distributed to the Board of Education for review, there was no evidence that these budget status reports were reviewed by appropriate staff levels within the District responsible for their specific portions of the budget. Recommendation: Procedures should implement to ensure adequate communication between departments to analyze the budget versus actual Federal grant expenditures to maximize available grants. In addition, a detailed review of the budget status reports should be reviewed on a monthly basis by those staff responsible for those portions of the budget. Update: The District has implemented policies and procedures that include a review of the budget status of all federal grants on a consistent basis throughout the fiscal year. Management’s Corrective Action Plan: See management's response for 2013‐2

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2012‐14 Conflict of Interest Forms Observation: Conflict of interest disclosure forms were not maintained during the period under audit for members of the Committee on Special Education (CSE). In accordance with Part 6 of the June 30, 2012 OMB Circular A‐133 Compliance Supplement, conflict‐of‐interest statements should be maintained for individuals who determine and review eligibility under Federal award programs. Recommendation: The District should distribute and collect conflict of interest disclosure forms from all CSE members on at least an annual basis. Update: Management has distributed and collected conflict of interest forms from all CSE members for the 2012‐13 school year. Management’s Corrective Action Plan: Management has taken corrective action. 2012‐15 Program Expenditure Oversight Observation: There was not adequate oversight with respect to the preparation of federal reimbursement requests. The District requested total 2010‐11 Title IIa and Mentor Teacher Internship Program (ARRA) funding based on contract amounts rather than actual allowable expenditures during the grant periods. For the Title IIa grant, the grant budget was $74,376 while the actual allowable expenditure was $58,059. The District requested and received reimbursement of $74,376, therefore receiving $16,317 in excess of the allowable amount per the grant agreement.

For the Mentor Teacher Internship Program, the grant budget was $15,000 while the actual allowable expenditure was $6,463. The District requested and received reimbursement of $15,000, therefore receiving $8,537 in excess of the allowable amount per the grant agreement. Recommendation: The District should implement an oversight function with respect to federal requests; in addition communication between fiscal and special aid departments should be enhanced. Update: The District was required to repay $13,195 of 2011‐12 Race to the Top proceeds that were requested under previous management in excess of actual grant expenditures (see comment 2013‐6) However, it was evident through the fact that no such issues were noted with regard to 2012‐13 programs, that management has implemented additional policies and procedures with regard to the oversight of federal grant expenditures. Management’s Corrective Action Plan: See management’s response to 2013‐8.

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2012‐16 Wire Transfers and Electronic Disbursements Observation: It was noted that wire transfers for short and long‐term debt for principal and interest of approximately $4,100,000 were made without an independent review or approval of such wire transfer before such transfer took place. Section 1724 of the New York State Education Law requires all school districts to audit each voucher package before it is paid. The District has appointed a claims auditor to carry out this responsibility. It wasn’t evident that a review of the voucher package took place prior to the disbursement. Recommendation: All transfers should be approved and reviewed by the claims auditor. Management should adopt procedures to ensure all wires are appropriately approved. Update: The District has implemented policies and procedures that now provide for an email notification to be issued to the Superintendent upon initiation of electronic wire payments. In addition, all such payments are now included within the warrants approved by the claims auditor. Management’s Corrective Action Plan: Management has taken corrective action.

October 2, 2013 To the Audit Committee and Management of Jordan‐Elbridge Central School District In planning and performing our audit of the statement of cash receipts and disbursements of the Extraclassroom Activity Funds of Jordan‐Elbridge Central School District as of and for the year ended June 30, 2013, in accordance with auditing standards generally accepted in the United States of America, we considered Jordan‐Elbridge Central School District’s internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District’s internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be significant deficiencies or material weaknesses and therefore there can be no assurance that all such deficiencies have been identified. However, as discussed below, we identified a certain deficiency in internal control that we consider to be a material weakness and another deficiency that we consider to be a significant deficiency. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency or combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiency noted in Exhibit A to be a material weakness. In addition, we noted other matters that are opportunities for strengthening internal controls and operating efficiency that we have included within Exhibit B of this letter The purpose of this communication, which is an integral part of our audit, is to describe for management, the audit committee, the board of education and others within the organization, and the New York State Department of Education, the scope of our testing of internal control and the results of that testing. Accordingly, this communication is not intended to be and should not be used for any other purpose. GROSSMAN ST. AMOUR, CERTIFIED PUBLIC ACCOUNTANTS, PLLC

Material Weakness: Exhibit A Documentation of Cash Receipts Observation: The extraclassroom activity funds had $126,019 of receipts recorded during the fiscal year. We noted that the majority of the receipts lacked supporting documentation. Supporting documentation to be retained in accordance with the District’s policies and procedures includes duplicate deposit tickets, receipt for the money deposits and back‐up indicating the source from which the funds were received that agrees to the deposit. Although the District implemented new procedures and policies for cash receipts, these policies and procedures were not consistently applied throughout the fiscal year. Recommendation: The District should continue to reinforce its policies and procedures to ensure all activities have appropriate documentation to support the receipts. This documentation should include detailed deposit breakdowns by student activity, use of profit and loss statements for significant fundraising events and tracking ticket sales for events. Management Response: The District will continue to review procedures with staff to confirm an understanding of what is required to comply with documentation policies.

Exhibit B Other Control Deficiencies: Documentation of Cash Disbursements Observation: The District implemented new policies and procedures related to cash disbursements. These new policies and procedures were for the most part, appropriately carried out by the different clubs. We examined 25 disbursements and noted:

a) Two transactions totaling $475 did not have adequate documentation for the disbursement, such as an invoice. For one transaction, the only documentation was a verbal approval.

b) Seven transactions, totaling $11,411 did not have appropriate approval from the student activity treasurer or faculty advisor; and

c) One advance, totaling $1,300, did not have appropriate supporting documentation for the advanced amount.

Recommendation: The District should continue to reinforce its policies and procedures to ensure all appropriate procedures are carried out related to cash disbursements, especially related to advances. Management Response: The District will continue to review policies with staff to confirm an understanding of what is required to comply with cash disbursement procedures. The practice of cash advances will continue to be reviewed.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT

STATEMENT OF CASH RECEIPTS AND

DISBURSEMENTS OF THE EXTRACLASSROOM ACTIVITY FUNDS

June 30, 2013

INDEPENDENT AUDITOR’S REPORT

Board of Education Jordan‐Elbridge Central School District Jordan, New York Report on the Financial Statements We have audited the accompanying statement of cash receipts and disbursements of the Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District for the year ended June 30, 2013, and the related notes to the financial statements Management’s Responsibility for the Financial Statements Jordan‐Elbridge Central School District’s management is responsible for the preparation and fair presentation of these financial statements in accordance with the cash basis of accounting as described in Note 1; this includes determining that the cash basis of accounting is an acceptable basis for the preparation of the financial statements in the circumstances. Management is also responsible for the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to error or fraud. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. Insufficient accounting controls are exercised over cash receipts at the point of collection to the time of submission to the Central Treasurer. Accordingly, it was impracticable to extend our audit of such receipts beyond the amounts recorded.

As described in the note to the statement of cash receipts and disbursements, this financial statement has been prepared on the cash receipts and disbursements basis of accounting, which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America. In our opinion, except for the effects of such adjustments, if any, as might have been determined to be necessary had we been able to audit the cash receipts, the financial statement referred to in the first paragraph presents fairly, in all material respects, the cash receipts and disbursements of the Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District for the year ended June 30, 2013, on the basis of accounting described in the note to the statement of cash receipts and disbursements. Syracuse, New York October 2, 2013

Jordan‐Elbridge Central School District

Statement of Cash Receipts and Disbursements of the Extraclassroom Activity Funds For the Year Ended June 30, 2013

See notes to financial statements

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Cash Balance

July 1, 2012 Receipts Disbursements

Cash Balance

June 30, 2013

High School

Chemistry Club 591$ ‐$ 500$ 91$

Class of 2010 791 42 ‐ 833

Class of 2012 3,239 789 4,028 ‐

Class of 2013 3,125 11,540 13,106 1,559

Class of 2014 1,043 12,114 10,003 3,154

Class of 2015 1,518 5,597 3,963 3,152

Class of 2016 ‐ 7,923 5,119 2,804

Culture Club‐H.S. 659 35 ‐ 694

Drama Club‐H.S. 5,963 3,132 1,397 7,698

Eagle Card Shop 673 628 907 394

Honor Society 671 162 614 219

Art Club 208 102 200 110

J‐E Literary Magazine 5,791 10,233 15,421 603

J‐E Musical Players 13,274 23,364 25,365 11,273

Language Club 846 162 ‐ 1,008

School Store 3,612 4,949 4,171 4,390

Science Club 452 24 ‐ 476

Ski Club 554 3,680 3,946 288

Student Council (JEHS) 2,531 1,998 2,856 1,673

Varsity Club 5,786 7,695 5,570 7,911

Yearbook 4,395 9,862 12,535 1,722

Total High School 55,722 104,031 109,701 50,052

Middle School

Honor Society‐M.S. 852 2,611 2,970 493

Student Council Only‐M.S. 7,690 13,345 8,887 12,148

Yearbook‐M.S. 5,286 6,032 7,378 3,940

Total Middle School 13,828 21,988 19,235 16,581

TOTALS 69,550$ 126,019$ 128,936$ 66,633$

Jordan‐Elbridge Central School District Notes to Cash Receipts and Disbursements of the Extraclassroom Activity Funds

‐ 3 ‐

1. Significant Accounting Policies Organization The Student Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District represents funds of the students of the School District. The Board of Education exercises general oversight of these funds. Therefore, these funds are included in the Agency Fund of the School District’s basic financial statements. The Extraclassroom Activity Funds are independent of the School District with respect to its financial transactions and designation of student management. New York State Education Law (Title 8. Education Department, Chapter II. Regulations of the Commissioner, Subchapter L. Finance, Part 172) define the activity funds as an organization within a school district whose activities are conducted by students and whose financial support is raised other than by taxation or through charges of the board of education shall be known as an extraclassroom activity and the moneys received by it as extraclassroom activity funds. Basis of Accounting

The accounts of the Extraclassroom Activity Funds of the Jordan‐Elbridge Central School District are maintained on the cash basis of accounting, and the statement of cash receipts and disbursements reflects only cash received and disbursed. Therefore, receivables and payables, inventories, long‐lived assets and accrued income and expenses, which would be recognized under generally accepted accounting principles, and which may be material in amount, are not recognized in the accompanying statement of cash receipts and disbursements.

2. Taxes

The Student Extraclassroom Activity Funds of the District represent an organization within the school district which are exempt from income taxes. Although the organization is exempt from income taxes, the extraclassroom activities of the district are not included in the exemption granted to the District from New York State sales tax. As such, unless the activities are deemed not taxable, sales tax must be collected by the organization and remitted to the New York State Department of taxation and finance. The Extraclassroom Activities are prohibited from using the District’s sales tax exemption.

Grossman St. Amour Certified Public Accountants PLLC110 West Fayette Street, Suite 900, One Lincoln Center, Syracuse, NY 13202

P 315.422.1391 • F 315.423.0829 • www.gsacpas.com


Report to the Board of DirectorsOctober 2, 2013

Michael Lisson, CPA, Partner

Christopher R. Alger, CPA, Supervisor

Agenda

A. Communications with Those Charged with Governance

B. Basic Financial Statementsi. Independent Auditor’s Report

ii. Basic Financial Statements‐ Overview

C. Comments

D. Extraclassroom Activity Reports

E. Extraclassroom Comments

F. Single Audit Reports

A. Communication with Those Charged with Governance

• Management’s responsibility– The preparation and fair presentation of the financial statements in

accordance with GAAP, including the design, implementation andmaintenance of internal control.

• Our responsibility under GAAS– To express opinions on your financial statements in accordance with

GAAP ‐ governmental activities, each major fund, aggregate remainingfund information, each fiduciary fund

• Compliance with all ethics requirements regarding independence• Qualitative aspects of the entity’s significant accounting practices

– Significant accounting policies– Significant accounting estimates– Financial statement disclosures

• Significant difficulties encountered during the audit– None noted

A. Communication with Those Charged with Governance

• Uncorrected and corrected misstatements– Journal entries made during the course of the audit attached to the

required communications letter

• Disagreements with management– None

• Representations requested from management– Separate letter

• Management’s consultations with other accountants– None that we are aware of

• Other significant matters, findings or issues– Discussions not a condition to retention

B. Basic Financial Statements

Opinion: Unmodified (“clean” audit opinion) (pgs 1‐3)

Management’s Discussion and Analysis (pgs 4‐17)

Basic Financial Statements

District – Wide Financial Statements (pgs 18‐19)

Fund Financial Statements (pgs 20 & 22)

Reconciliations (pgs 21 & 23)

Fiduciary Fund Statements (pgs 24‐25)

Notes to the Financial Statements (pgs 26‐50)

Supplemental Schedules (pgs 51‐56)

Highlights:

Total expenses for functions and programs $28.9 million

Total revenues $28.9 million

C. Comments

• Material Weakness‐

– A deficiency or combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement in the financial statements would not be prevented or detected and corrected on a timely basis

– 2013‐1 Annual Financial Closing Process

C. Comments

• Significant Deficiency‐

– A deficiency or combination of deficiencies in internal control that is less severe than a material weakness, yet important enough to merit the attention of those charged with governance

– 2013‐2 Budget Monitoring

– 2013‐3 Cash Management – School Food Service

– 2013‐4 Interfund Accounting

– 2013‐5 Accounting for Fixed Assets

C. Comments

• Other observations and recommendations

– During the course of the audit certain other opportunities for improvement of internal controls came to our attention.

– 2013‐6 Program Expenditure Oversight

– 2013‐7 Grant Drawdowns

– 2013‐8 Purchasing Procedures

– 2013‐9 Payroll Certifications

D. & E. Extraclassroom Activities

• Statement of Cash Receipts and Disbursements

– Opinion: Modified for Scope Limitation – Cash Receipt Information

• Comments

– Material Weakness

• Lack of Supporting Documentation of Cash Receipts

– Other Control Deficiency

• Lack of Supporting Documentation of Cash Disbursements

F. Single Audit Reports

• Reports:– Internal Control – unmodified– Compliance – unmodified

• Major Programs:– 84.010‐ Title I – 84.027‐ Special Education – Grants to States (IDEA, B)– 84.173‐ Special Education – Preschool Grants (IDEA Preschool)

• Not a Low risk auditee• Findings:

– Financial Statement Findings – 2013‐1 thru 2013‐5– Federal Award Findings and Questioned Costs‐ NONE

FINANCIAL STATEMENTS AND

SUPPLEMENTARY INFORMATION

June 30, 2013

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT

Table of Contents Page Independent Auditor’s Report 1‐3 Management’s Discussion and Analysis 4‐17 Basic Financial Statements Statement of Net Position 18 Statement of Activities and Changes in Net Position 19 Balance Sheet‐ Governmental Funds 20 Reconciliation of Governmental Funds Balance Sheet to the Statement of Net Position 21 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 22 Reconciliation of Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Equity to the Statement of Activities 23 Statement of Fiduciary Net Position 24 Statement of Changes in Fiduciary Net Position 25 Notes to Basic Financial Statements 26‐50 Required Supplementary Information Schedule of Funding Progress‐ Other Postemployment Benefit Plan 51

Schedule of Revenues, Expenditures and Changes in Fund Balance‐ Budget (Non‐GAAP Basis) and Actual – General Fund 52‐53 Supplementary Information Schedule of Change from Adopted to Final Budget and the Real Property

Tax Limit 54 Schedule of Capital Projects Fund‐Project Expenditures and Financing Resources 55

Net Investment in Capital Assets 56

INDEPENDENT AUDITOR’S REPORT

Board of Education Jordan‐Elbridge Central School District Jordan, New York Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Jordan‐Elbridge Central School District (the District), as of and for the year ended June 30, 2013, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents. We also have audited each fiduciary fund type of the District, as of and for the year ended June 30, 2013, as displayed in the District’s basic financial statements. Management’s Responsibility for the Financial Statements Jordan‐Elbridge Central School District’s management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the

reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information, and each fiduciary fund type of the District, as of June 30, 2013, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, schedule of funding progress other postemployment benefit plans and schedule of revenues, expenditures and changes in fund balance on pages 4–17, 51 and pages 52‐53, respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise Jordan‐Elbridge Central School District’s basic primary government financial statements. The schedule of change from adopted to final and the real property tax limit, the schedule of project expenditures – capital projects fund and net investment in capital assets (the supplemental information) on pages 54‐56 are presented for purposes of additional analysis and are not a required part of the basic financial statements. The supplemental information is the responsibility of management and has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on it.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 2, 2013 on our consideration of Jordan‐Elbridge Central School District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance.

Syracuse, New York October 2, 2013

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Management's Discussion and Analysis (MD&A) ‐ Unaudited

For the year ended June 30, 2013

‐4‐

The following is a discussion and analysis of the School District's financial performance for the fiscal year ended June 30, 2013. This section is a summary of the School District's financial activities based on currently known facts, decisions, or conditions. It is also based on both the District‐wide and fund‐based financial statements. The results of the current year are discussed in comparison with the prior year, with an emphasis placed on the current year. The Management's Discussion and Analysis (MD&A) section is only an introduction and should be read in conjunction with the School District's financial statements, which immediately follow this section. Financial Highlights

● The District completed the year ended June 30, 2013 with a net position of $10,181,553 compared to $10,170,664 in 2012, an increase of $10,889. Unrestricted net deficit decreased by $18,438,918, to $(8,052,642).

● Capital asset additions during 2013 amounted to $3,183,768, most of which was the result of the ongoing

$21,900,000 voter‐approved capital project. The District’s additions included $2,561,173 of capital improvements related to buildings, $19,892,420 of reclassifications from construction in progress and $622,595 related to furniture and equipment. Significant additions included the following:

Buses $360,000 Fire Alarms $400,000

Stage $225,000 Building Construction $1,100,000

● The overall long‐term indebtedness of the School District decreased $2,029,000, to $28,186,000, which is the result of the District making principal payments of $2,395,000, as well as issuing serial bonds in the amount of $366,000 for the purchase of school buses.

● Total General Fund fund balance, including reserves, was $5,179,153 at June 30, 2013, compared to

$5,803,309 in 2012. The unassigned fund balance in the General Fund decreased by $132,437 from 2012, with a balance of $704,381 at June 30, 2013. The assigned appropriated fund balance in the General Fund increased $115,000 from 2012, with a balance of $1,000,000 at June 30, 2013. This $1,000,000 represents the amount of unassigned fund balance expected to be used in the 2013‐2014 budget of the District which was approved by District voters in May 2013.

Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the District’s basic financial statements. The basic financial statements consist of four sections: MD&A (this section), the basic financial statements, required supplementary information and supplementary information required by New York State law.



‐5‐

Overview of the Financial Statements, continued The basic financial statements include two (2) kinds of statements that present different views of the School District.

● The Statement of Net Position and Statement of Activities & Changes in Net Position provide information on a government‐wide basis. These statements present an aggregate view of the District’s finances. The government‐wide financial statements provide both long‐term and short‐term information about the District’s overall financial status.

● The fund financial statements focus on the individual parts of the District, reporting the District's

operations with more information and detail than the government‐wide statements. The fund financial statements concentrate on the District's most significant funds, called major funds. The District currently classifies all of its government funds as major funds.

Both perspectives (government‐wide and fund) allow the user to address relevant questions, broaden the basis of comparison (year‐to‐year, or government to government) and enhance the District’s accountability. The notes to the financial statements explain some of the information in the statements and provide additional disclosures so that the statement users have a complete picture of the District’s financial activities and position. The required supplementary information and supplementary information required by New York State further explains and supports the financial statements. Government‐wide Statements The government‐wide statements report information about the District as a whole using accounting methods similar to those used by private‐sector companies. The Statement of Net Position includes all of the District’s assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private‐sector companies. All of the current year's revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid. The two (2) District‐wide statements report the School District's net position and how it has changed. Net position, the difference between the School District’s assets and liabilities, is one way to measure the School District's financial health or position. Over time, increases or decreases in the School District's net position is an indicator of whether its financial position is improving or deteriorating, respectively. To assess the District's overall health, one needs to consider additional nonfinancial factors such as changes in the District's property tax base and the condition of school buildings and other facilities. In the government‐wide financial statements, the District's activities are shown as Governmental Activities. Most of the District's basic services are included here, such as regular and special education, transportation, and administration. Property taxes and State formula aid finance the majority of these activities.



‐6‐

Overview of the Financial Statements, continued Fund Financial Statements The fund financial statements provide more detailed information about the District's funds, focusing on its most significant or "Major" Funds – not the School District as a whole. Funds are accounting devices the School District uses to keep track of specific sources of funding and spending on particular programs. The School District has two (2) categories of funds:

● Governmental Funds: The majority of the District's basic services are included in Governmental Funds, which generally focus on (1) how cash and other financial assets that can readily be converted to cash flow in and out and (2) the balances left at year‐end that are available for spending. Consequently, the Governmental Funds statements provide a detailed short‐term view that helps one determine whether there are more or fewer financial resources that can be spent in the near future to finance the District's programs. Because this information does not encompass the additional long‐term focus of the government‐wide statements, additional information following the Governmental Funds statements explains the relationship (or differences) between them.

● Fiduciary Funds: The District is the trustee, or fiduciary, for assets that belong to others, such as the

Scholarship Fund and the Student Activities Funds. The District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The District excludes these activities from the government‐wide financial statements because the District cannot use these assets to finance its operations.



‐7‐

Financial Analysis of the School District as a Whole The School Districts combined net position for fiscal year ended June 30, 2013 increased by $10,889. Our analysis below focuses on the net position (Figure 1) and changes in net position (Figure 2) of the School District's Governmental Activities.

2012 2013 2012‐13

Current and Other Assets 28,939,263$ 7,546,138$ ‐73.92%

Capital Assets 40,169,740 41,388,752 3.03%

Total Assets 69,109,003$ 48,934,890$ ‐29.19%

Current Liabilities 23,380,886$ 3,925,191$ ‐83.21%

Noncurrent Liabilities 35,557,453 34,828,146 ‐2.05%

Total Liabilities 58,938,339$ 38,753,337$ ‐34.25%

Net Position:

Net Investment in Capital Assets 11,135,892$ 13,202,752$ 18.56%

Restricted 25,526,332 5,031,443 ‐80.29%

Unrestricted Deficit (26,491,560) (8,052,642) ‐69.60%

Total Net Position 10,170,664$ 10,181,553$ 0.11%

Financial Analysis of the School District as a Whole

(Figure 1)

Total

Percentage

Change Governmental Activities

The District’s current and other assets decreased over $21,300,000 (‐74%). This was primarily due to the decrease in restricted cash, which decreased $21,700,000. Restricted cash is cash that cannot be used for general expenditures of the District and must be used by the District for its specified purposes. The majority of the 2012 restricted cash balance pertained to the unspent proceeds from the $18,145,000 of serial bonds issued in June 2012 which were restricted to be used to repay the outstanding bond anticipation note of $19,000,000 outstanding as of June 30, 2012. This bond anticipation note was paid in July 2012.



‐8‐

Financial Analysis of the School District as a Whole (continued) The District’s capital assets, net of depreciation, increased by approximately $1,200,000 (3%). This is the result of District’s ongoing capital projects, whereby the District expended approximately $3,200,000 related to its capital projects, offset by depreciation of approximately $2,000,000 recorded during the year. The capital projects included significant additions of buses and building improvements, including fire alarms and staging. Current liabilities have decreased over $19,400,000 (‐83%) primarily due to the District repayment of the $19,000,000 of bond anticipation notes relating to the ongoing capital project that were outstanding as of June 30, 2012. These notes were paid fully by the District in July 2012 with proceeds from $18,145,000 of serial bonds that were issued in May 2012. Noncurrent liabilities have decreased approximately $2,100,000 (‐6%) due to the District making principal payments of $2,395,000, as well as issuing serial bonds in the amount of $366,000 for the purchase of school buses. Restricted net position decreased over $20,400,000 (‐80%) due to the utilization of the proceeds from the serial bonds issued by the District in May 2012. These serial bonds were issued to repay the outstanding bond anticipation notes totaling $19,000,000 in July 2012. The District used the proceeds from the serial bond issuance of $18,145,000 plus $855,000 from current year appropriations to pay off the outstanding bond anticipation note of $19,000,000. Unrestricted net deficit decreased by approximately $18,500,000 (70%) mainly due to the $19,000,000 in restricted cash held at June 30, 2012 being utilized to repay the outstanding bond anticipation note in July of 2012. Net investment in capital assets, net of related debt increased $2,066,860. Total related debt decreased to $28,186,000 due primarily to principal payments made by the District.



‐9‐

Financial Analysis of the School District as a Whole (continued) Revenues for the District are highly concentrated from two significant sources, which include New York State aid and real property taxes. The following two charts are a summary of significant revenue sources for the District.



‐10‐

Financial Analysis of the School District as a Whole (continued) Although the District has received approximately $1,186,000 of additional aid from New York State, as compared to 2012, the amount of state aid is highly dependent on New York State’s annual budget and legislation in New York State. The District expects that state aid will remain relatively flat given the current economic affairs of the state. The District’s overall property tax revenues increased slightly over the prior year. Property tax levies are based on the voter approved budgets. The property tax cap law establishes a limit on the annual growth of property taxes levied by local governments and school districts to two percent (2%) or the rate of inflation, whichever is less. The District believes it was in compliance with the law when the 2013‐2014 budget, which included a 1.9% tax levy increase, was presented to and approved by votes on May 21, 2013. The District also receives various funding through Federal grant programs, which are generally administered by the New York State Education Department. The District routinely receives federal grants from the U.S. Department of Agriculture related to our school breakfast and lunch programs which totaled approximately $239,000 and $245,000 for the years ended June 30, 2013 and 2012, respectively. In addition, the District routinely receives funding from the U.S. Department of Education under the Individuals with Disabilities Act (IDEA) and under Title I, part A of the Elementary and Secondary Education Act (ESEA) whereby amount received under these grants totaled approximately $578,000 and $543,000 for the years ended June 30, 2013 and 2012, respectively. The District also received grant monies from the American Recovery and Reinvestment Act of 2009 (ARRA) which provided monies for a number of programs throughout the United States. ARRA was enacted by lawmakers to (1) preserve and create jobs and promote economic recovery, (2) assist those most impacted by the recession, (3) provide investments needed to increase economic efficiency by spurring technological advances in science and health, (4) to invest in transportation, environmental protection, and other infrastructure that will provide long‐term economic benefits, and (5) to stabilize state and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases. The District received ARRA monies directly related to the stabilization purposes of the act totaling approximately $202,000 and $601,000 for the years ended June 30, 2013 and 2012, respectively. Unlike federal grant programs for IDEA and Title I, ARRA is a temporary grant program and the District is likely to see significant decreases in ARRA related grants in the future.



‐11‐

Financial Analysis of the School District as a Whole (continued) Program costs for the District are generally related to instruction and related benefits. The following two charts are a summary of significant program costs for the District.



‐12‐

Financial Analysis of the School District as a Whole (continued) The District’s program expenses consist of all activities necessary to educate students of the district. Naturally, the most significant expense for the District relates to instruction which represents close to half of all the District’s program expenses. The District increased its workforce in the current fiscal year, which resulted in additional costs to the District for instructional salaries of approximately $620,000. However, the cost of providing employee benefits within the governmental funds decreased by approximately $350,000, primarily as a result of a reduction in retirement incentives, workers’ compensation and unemployment insurance costs. Employee benefits presented on the Government‐wide basis reflect an increase over the prior year of $138,639, including considerations for other postemployment benefits. Similar to the past year, the most significant benefit is for health insurance which totals approximately $3,329,000 for 2013, while health insurance was approximately $3,249,000 in the prior year. Health insurance includes both active and retired employees who participate in the District’s health care plan. The annual net other postemployment obligation increase approximated $1,380,000 and 960,000 for the years ended June 30, 2013 and 2012, respectively. Included within benefits is the statutory payroll taxes for social security and Medicare which totaled $904,000 and $848,000 for the years ended June 30, 2013 and 2012, respectively. In addition, the District’s ERS contributions totaled $407,000 and $342,000 for the years ended June 30, 2013 and 2012 respectively, while the TRS contribution totaled $1,035,000 and $1,192,000 for the years ended June 30, 2013 and 2012, respectively. The District has been notified by the New York State Teachers’ Retirement System that the District’s contribution rate applicable to 2012‐2013 salaries is 11.84% and for 2013‐2014 salaries is 16.25%. The 2012‐2013 contribution will be paid in the fall of 2013 and is recorded as a liability of $1,025,050 on these financial statements. The District believes that the costs of both health insurance and contributions to both ERS and TRS will continue to increase in future years. Depreciation expense, which is non‐cash expenditure, increased slightly from 2012 to 2013, increasing approximately $20,000. This was the result of 2013 representing the first full year of depreciation for various pieces of equipment purchased in the prior year. Depreciation can be viewed as the process by which the District gradually records the loss in value of its capital assets over a period of time. Depreciation is considered a non‐cash item as no money is actually paid at the time depreciation is recorded.



‐13‐

Financial Analysis of the School District as a Whole (continued) Our analysis in Figure 2 considers the operations of the School District's activities in greater detail. The majority of the significant variances have been discussed throughout this MDA.

2012 2013 2012‐13

REVENUES:

Program Revenues:

Charges for Services 242,884$ 217,743$ ‐10.35%

Operating Grants & Contributions 1,497,819 1,272,331 ‐15.05%

General Revenues:

Property Taxes & Other Tax Items 12,005,404 12,278,843 2.28%

State Sources 13,201,602 14,826,110 12.31%

Use of money and property 14,790 31,102 110.29%

Other General Revenues 440,992 250,840 ‐43.12%

Total Revenues 27,403,491$ 28,876,969$ 5.38%

PROGRAM EXPENSES:

General Support 3,395,407$ 3,867,085$ 13.89%

Instruction 14,277,405 15,006,748 5.11%

Pupil Transportation 1,471,744 1,467,164 ‐0.31%

Employee benefits 6,988,420 7,127,059 1.98%

School Food Service 469,970 420,714 ‐10.48%

Debt Service 548,931 977,310 78.04%

Total Expenses 27,151,877$ 28,866,080$ 6.31%

Change In Net Position 251,614$ 10,889$

Financial Analysis of the School District as a Whole

(Figure 2)

Total

Percentage


Debt service expense increased approximately $400,000 (78%) due to new borrowings; more of the payment is applied to interest initial years of debt, whereas more principal is applied as debt nears maturity.



‐14‐

Financial Analysis of the School District's Funds Figure 3 shows the changes for the year in total fund balances for the District’s major funds and reflects a net decrease of $1,679,747 which is primarily attributable to the fact that the Capital Project Fund has not yet issued additional borrowings related to the ongoing $21,900,000 capital project.

% Change

2012 2013 2012‐13

General Fund 5,803,309$ 5,179,153$ ‐10.76%

School Food Service Fund 117,460 48,288 ‐58.89%

Special Aid Fund ‐ ‐ 0.00%

Debt Service Fund 898,972 900,633 0.18%

Capital Project Fund 1,148,937 160,857 ‐86.00%

Totals 7,968,678$ 6,288,931$

Financial Analysis of the School District's Fund Balances

(Figure 3)

The General Fund decreased its balance by $624,156, as compared to the prior year. This was primarily the result of increases in instructional and debt service expenditures of approximately $822,000 and $261,000, respectively. The instructional expenditures increased due to an increased workforce and debt service expenditures increased primarily as a result of the conversion of the bond anticipation note for $19,000,000 to the long term serial bond totaling $18,145,000. Next year’s principal payment is expected to be $1,125,000. These increases offset the fact that total General Fund revenues increased by approximately $1,500,000 in 2013 due primarily to an increase in state aid of approximately $1,185,000. The School Food Service Fund decreased by $69,172 compared to the prior year. The decrease is primarily the result of cafeteria equipment purchases made during the current year. This fund oversees the activity of our school food services (breakfast, lunch, etc.) and has been able to operate efficiently without a need to be subsidized from the General fund. The District has been able to effectively management its costs compared to its revenues which has allowed the food service fund to be self‐sufficient. The Debt service fund of the District represents monies previously set aside to pay principal and interest related to the District’s outstanding long‐term debt. This fund is invested in a nominal money market account which has added to the balance of the fund. The District expects to begin utilizing this fund in the future to pay the principal and interest on our long‐term debt. During the current year, all principal and interest payments were made by the General fund.



‐15‐

Financial Analysis of the School District's Funds (continued) The Capital Fund decreased by $988,080 compared to the prior year, which is primarily due to the fact that there has not yet been additional long‐term debt borrowings issued to fund the ongoing $21,900,000 capital project. A total of $19,000,000 of bonds have been issued to fund the $21,900,000 project. The District may obtain additional bonding of $2,355,000 based on the voter approved December 2008 proposition. Figure 4 summarizes the original voter approved budget of $27,200,000, plus prior year’s encumbrances of $205,298, compared to the actual revenues and expenditures, and the variances for the year ending June 30, 2013.

REVENUES:

Real property taxes and other tax items 11,984,181$ 12,278,843$ 294,662$

State sources 13,838,819 14,387,228 548,409

Other revenues and

financing sources 1,492,408 315,441 (1,176,967)

Total Revenues and

Financing Sources 27,315,408$ 26,981,512$ (333,896)$

EXPENDITURES:

General support 4,257,549$ 4,000,054$ (257,495)$

Instruction 10,728,160 12,327,092 1,598,932

Pupil transportation 1,585,441 1,329,631 (255,810)

Employee benefits 6,309,065 5,766,366 (542,699)

Debt Service 4,435,193 4,030,627 (404,566)

Capital outlay ‐ 151,898 151,898

Total Expenditures and Other

Financing Uses 27,315,408$ 27,605,668$ 290,260$

General Fund Budgetary Highlights

(Figure 4)

Total Dollar

Variance

2012‐13

Operating

Budget Actual

Condensed Budgetary Comparison

General Fund ‐ 2013



‐16‐

Capital Assets and Debt Administration Capital Assets At the end of June 30, 2013, the School District had invested in a broad range of capital assets.

Changes in Capital Assets, net

2012 2013 2012‐13

Land 74,885$ 74,885$ 0.00%

Construction in process 17,748,573 417,327 ‐97.65%

Buildings and Improvements 42,845,470 62,737,890 46.43%

Equipment 5,215,245 5,478,845 5.05%

Accumulated depreciation (25,714,433) (27,320,195) 6.24%

Total 40,169,740$ 41,388,752$ 3.03%

Capital Assets

(Figure 5)

Governmental Activities

Total

Percentage

Change

Debt Administration Debt, both short and long‐term, is considered a liability of Governmental Activities. Although the District’s total debt decreased over $21 million year over year, this is primarily due to the timing of the 2012 serial bond‐ series B issuance for $18,145,000 which took place in May 2012. The District issued these bonds to fully redeem the outstanding bond anticipation note of $19,000,000. The bond anticipation note was not redeemed until July 2012, as such, this bond anticipation note continued to be presented as a liability for the District as of June 30, 2012.



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Capital Assets and Debt Administration (continued)

Outstanding Debt

2012 2013 2012‐13

Serial Bonds 30,215,000$ 28,186,000$ ‐6.72%

BAN 19,000,000 ‐ ‐100.00%

Total Outstanding Debt 49,215,000$ 28,186,000$ ‐42.73%

Debt Administration

(Figure 6)

Total

Percentage


Additional information on the maturities and terms of the School District’s outstanding debt can be found in the notes to these financial statements. Factors Bearing on the District's Future

The School District has concerns with the condition of the New York State economy and the effect on future school funding. The district is anticipating potential flat to decreasing state aid for next year. The District also anticipates a significant increase in expenditures for ERS and TRS retirement benefits.

The greater 45 square mile of the District includes the Villages of Jordan and Elbridge and various portions of the Towns of Elbridge, Camillus, Van Buren, Lysander, Skaneateles, Brutus and Sennett. The character of the District is primarily rural with the majority of homes being single family. Commercial activity in the district is centered in and around the Villages of Jordan and Elbridge. Industrial development within the district is centered within the Town of Elbridge. The overall area has a fairly stable level of tax assessments which impact the amounts of revenues the District can raise through property tax levies. Significant, stable and international companies such as Welch Allyn, Tessy Plastics and AllRed provide a very strong economic base for the District and the region.

Contacting the School District's Financial Management This financial report is designed to provide the District’s citizens, taxpayers, customers, investors, and creditors with a general overview of the District’s finances and to demonstrate the District's accountability for the money it receives. If you have questions about this report or need additional financial information concerning the District, contact the District's Business Office at PO Box 902, Jordan, NY 13080, (315) 689‐8500 for additional information. This financial statement is also available by visiting the District’s website at www.jecsd.org.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Statement of Net Position Governmental Activities

June 30, 2013

The accompanying notes are an integral part of these financial statements ‐18‐

Cash

Unrestricted 1,389,508$

Restricted 3,833,424

Receivables

Accounts receivable 3,607

Due from other governments 2,315,585

Inventories 4,014

Capital assets, net 41,388,752

Total assets 48,934,890$

Payables

Accounts payable 109,638$

Accrued liabilities 216,984

Deferred revenue 4,104

Long‐term liabilities

Due and payable within one year

Bonds payable 2,451,000

Due to teachers' retirement system 1,025,050

Due to employees' retirement system 118,415

Due and payable after one year

Compensated absences 173,419

Other postemployment benefits payable 8,919,727

Bonds payable, net 25,735,000

Total liabilities 38,753,337

NET POSITION

Net investment in capital assets 13,202,752

Restricted 5,031,443

Unrestricted deficit (8,052,642)

Total net position 10,181,553

Total liabilities and net position 48,934,890$

LIABILITIES

ASSETS

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Statement of Activities and Changes in Net Position



Net (Expense)

Program Revenues Revenue and

Charges for Operating Changes in

Expenses Services Grants Net Position

FUNCTIONS/PROGRAMS

General support (3,867,085)$ 44,968$ ‐$ (3,822,117)$

Instruction (15,006,748) ‐ 1,021,866 (13,984,882)

Pupil transportation (1,467,164) ‐ ‐ (1,467,164)

Employee benefits (7,127,059) ‐ ‐ (7,127,059)

Debt service (977,310) ‐ ‐ (977,310)

School food service program (420,714) 172,775 250,465 2,526

Total functions and programs (28,866,080)$ 217,743$ 1,272,331$ (27,376,006)

GENERAL REVENUES

Real property taxes 12,203,343

Nonproperty tax items 75,500

Use of money and property 17,671

Sale of property and compensation for loss 13,431

Miscellaneous 187,195

State sources 14,826,110

Federal sources 63,645

Total general revenues 27,386,895

Change in net position 10,889

Total net position‐ beginning of year 10,170,664

Total net position ‐ end of year 10,181,553$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Balance Sheet – Governmental Funds

June 30, 2013


Total

School Food Special Debt Capital Governmental

General Service Aid Service Projects Funds

ASSETS

Cash

Unrestricted 1,389,508$ ‐$ ‐$ ‐$ ‐$ 1,389,508$

Restricted 2,869,083 41,596 ‐ 900,633 22,112 3,833,424

Receivables

Due from other funds 645,956 ‐ ‐ ‐ 302,402 948,358

Due from other governments 1,778,125 3,175 95,403 ‐ 438,882 2,315,585

Accounts receivable ‐ 3,607 ‐ ‐ ‐ 3,607

Inventory ‐ 4,014 ‐ ‐ ‐ 4,014

Total assets 6,682,672$ 52,392$ 95,403$ 900,633$ 763,396$ 8,494,496$

LIABILITIES

Accounts payable 57,652$ ‐$ ‐$ ‐$ 51,986$ 109,638$

Deferred revenues and deposits ‐ 4,104 ‐ ‐ ‐ 4,104

Due to other funds 302,402 ‐ 95,403 ‐ 550,553 948,358

Due to teachers' retirement system 1,025,050 ‐ ‐ ‐ ‐ 1,025,050

Due to employees' retirement system 118,415 ‐ ‐ ‐ ‐ 118,415

Total liabilities 1,503,519 4,104 95,403 ‐ 602,539 2,205,565

FUND BALANCES

Non spendable

Reserved for inventory ‐ 4,014 ‐ ‐ ‐ 4,014

Restricted

Reserved for unemployment insurance 519,083 ‐ ‐ ‐ ‐ 519,083

Reserved for liability claims 825,000 ‐ ‐ ‐ ‐ 825,000

Reserved for tax certiorari 70,000 ‐ ‐ ‐ ‐ 70,000

Reserved for employee benefits 693,654 ‐ ‐ ‐ ‐ 693,654

Reserved for ERS 150,000 ‐ ‐ ‐ ‐ 150,000

Building Capital Reserve Fund 311,000 ‐ ‐ ‐ ‐ 311,000

School Bus Reserve Fund 750,000 ‐ ‐ ‐ ‐ 750,000

Operations Capital Reserve Fund ‐ ‐ ‐ ‐ ‐ ‐

Restricted ‐ other:

Restricted for school food service ‐ 43,361 ‐ ‐ ‐ 43,361

Restricted for capital project ‐ ‐ ‐ ‐ 270,000 270,000

Restricted for debt service ‐ ‐ ‐ 900,633 ‐ 900,633

Restricted for carryover encumbrances ‐ 913 ‐ ‐ 493,785 494,698

Total restricted fund balance 3,318,737 44,274 ‐ 900,633 763,785 5,027,429

Assigned

Assigned appropriated fund balance 1,000,000 ‐ ‐ ‐ ‐ 1,000,000

Assigned unappropriated fund balance

(includes carryover encumbrances) 156,035 ‐ ‐ ‐ ‐ 156,035

Total assigned fund balance 1,156,035 ‐ ‐ ‐ ‐ 1,156,035

Unassigned

Unassigned fund balance 704,381 ‐ ‐ ‐ (602,928) 101,453

Total unassigned fund balance 704,381 ‐ ‐ ‐ (602,928) 101,453

Total fund balances 5,179,153 48,288 ‐ 900,633 160,857 6,288,931

Total liabilities and fund balances 6,682,672$ 52,392$ 95,403$ 900,633$ 763,396$ 8,494,496$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Reconciliation of Governmental Funds Balance Sheet to the Statement of Net Position

June 30, 2013


Total Long‐term Reclassifications Statement of

Governmental Assets, and Net Position

Funds Liabilities Eliminations Totals

ASSETS

Cash

Unrestricted 1,389,508$ ‐$ ‐$ 1,389,508$

Restricted 3,833,424 ‐ ‐ 3,833,424

Receivables

Due from other funds 948,358 ‐ (948,358) ‐

Due from other governments 2,315,585 ‐ ‐ 2,315,585

Accounts receivable 3,607 ‐ ‐ 3,607

Inventory 4,014 ‐ ‐ 4,014

Capital assets, net ‐ 41,388,752 ‐ 41,388,752

Total assets 8,494,496$ 41,388,752$ (948,358)$ 48,934,890$

LIABILITIES

Accounts payable 109,638$ ‐$ ‐$ 109,638$

Accrued liabilities ‐ 216,984 ‐ 216,984

Deferred revenues 4,104 ‐ ‐ 4,104

Due to other funds 948,358 ‐ (948,358) ‐

Long‐term debt‐due within one year

Due to employees' retirement system 118,415 ‐ ‐ 118,415

Due to teachers' retirement system 1,025,050 ‐ ‐ 1,025,050

Bonds payable ‐ 2,451,000 ‐ 2,451,000

Long‐term debt‐due in more than one year

Compensated absences payable, net ‐ 173,419 ‐ 173,419

Postemployment benefits payable ‐ 8,919,727 ‐ 8,919,727

Bonds payable ‐ 25,735,000 ‐ 25,735,000

Total liabilities 2,205,565 37,496,130 (948,358) 38,753,337

FUND BALANCE/NET POSITION

Total fund balance/net position 6,288,931 3,892,622 ‐ 10,181,553

Total liabilities and fund balance/net position 8,494,496$ 41,388,752$ (948,358)$ 48,934,890$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds



Total

School Food Special Debt Capital Governmental

General Service Aid Service Projects Funds

REVENUES

Real property taxes 12,203,343$ ‐$ ‐$ ‐$ ‐$ 12,203,343$

Nonproperty tax items 75,500 ‐ ‐ ‐ ‐ 75,500

Charges for services 44,968 ‐ ‐ ‐ ‐ 44,968

Use of money and property 6,202 597 ‐ 1,661 9,211 17,671

Sale of property and compensation for loss 13,431 ‐ ‐ ‐ ‐ 13,431

Miscellaneous 187,195 ‐ ‐ ‐ ‐ 187,195

State sources 14,387,228 11,163 164,673 ‐ 438,882 15,001,946

Federal sources 63,645 239,302 857,193 ‐ ‐ 1,160,140

Sales ‐ school food service ‐ 172,775 ‐ ‐ ‐ 172,775

Total revenues 26,981,512 423,837 1,021,866 1,661 448,093 28,876,969

EXPENDITURES

General support 3,690,257 ‐ ‐ ‐ ‐ 3,690,257

Instruction 12,327,092 ‐ 1,029,261 ‐ ‐ 13,356,353

Pupil transportation 1,329,631 ‐ ‐ ‐ ‐ 1,329,631

Employee benefits 5,766,366 ‐ ‐ ‐ ‐ 5,766,366

Debt service ‐ principal 2,390,000 ‐ ‐ ‐ ‐ 2,390,000

Debt service ‐ interest 785,627 ‐ ‐ ‐ ‐ 785,627

Cost of sales ‐ 420,714 ‐ ‐ ‐ 420,714

Capital outlay 151,898 72,295 ‐ ‐ 2,959,575 3,183,768

Total expenditures 26,440,871 493,009 1,029,261 ‐ 2,959,575 30,922,716

Excess of revenues

Over (under) expenditures 540,641 (69,172) (7,395) 1,661 (2,511,482) (2,045,747)

OTHER FINANCING SOURCES AND USES

Interfund transfers (309,797) ‐ 7,395 ‐ 302,402 ‐

BANs redeemed from appropriations (855,000) ‐ ‐ ‐ 855,000 ‐

Proceeds from debt ‐ ‐ ‐ ‐ 366,000 366,000

Total other sources (uses) (1,164,797) ‐ 7,395 ‐ 1,523,402 366,000

Excess (deficiency) of revenues

and other sources over

expenditures and other (uses) (624,156) (69,172) ‐ 1,661 (988,080) (1,679,747)

Fund balances ‐ beginning of year 5,803,309 117,460 ‐ 898,972 1,148,937 7,968,678

Fund balances (deficit) ‐ end of year 5,179,153$ 48,288$ ‐$ 900,633$ 160,857$ 6,288,931$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Reconciliation of Governmental Funds Revenues, Expenditures, and Changes in

Fund Equity to the Statement of Activities For the year ended June 30, 2013


Total Long‐term Capital Long‐term Statement of

Governmental Revenue, Related Debt Activities

Funds Expenses Items Transactions Totals

REVENUES

Real property taxes 12,203,343$ ‐$ ‐$ ‐$ 12,203,343$

Nonproperty tax items 75,500 ‐ ‐ ‐ 75,500

Charges for services 44,968 ‐ ‐ ‐ 44,968

Use of money and property 17,671 ‐ ‐ ‐ 17,671

Sale of property and compensation for loss 13,431 ‐ ‐ ‐ 13,431

Miscellaneous 187,195 ‐ ‐ ‐ 187,195

State sources 15,001,946 ‐ ‐ ‐ 15,001,946

Federal sources 1,160,140 ‐ ‐ ‐ 1,160,140

Sales ‐ school food service 172,775 ‐ ‐ ‐ 172,775

Total revenues 28,876,969$ ‐$ ‐$ ‐$ 28,876,969$

EXPENDITURES/EXPENSES

General support 3,690,257$ ‐$ 176,828$ ‐$ 3,867,085$

Instruction 13,356,353 ‐ 1,650,395 ‐ 15,006,748

Pupil transportation 1,329,631 ‐ 137,533 ‐ 1,467,164

Employee benefits 5,766,366 1,360,693 ‐ ‐ 7,127,059

Debt service ‐ principal 2,390,000 ‐ ‐ (2,390,000) ‐

Debt service ‐ interest 785,627 ‐ ‐ 191,683 977,310

Cost of sales 420,714 ‐ ‐ ‐ 420,714

Capital outlay 3,183,768 ‐ (3,183,768) ‐ ‐

Total expenditures/expenses 30,922,716$ 1,360,693$ (1,219,012)$ (2,198,317)$ 28,866,080$

Excess (deficiency) of revenues

over expenditures/expenses (2,045,747)$ (1,360,693)$ 1,219,012$ 2,198,317$ 10,889$

OTHER SOURCES AND USES

Proceeds from debt 366,000 ‐ ‐ (366,000) ‐

Total other sources (uses) 366,000 ‐ ‐ (366,000) ‐

Net change for the year (1,679,747)$ (1,360,693)$ 1,219,012$ 1,832,317$ 10,889$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Statement of Fiduciary Net Position

June 30, 2013


Private

Purpose

Trusts Agency

ASSETS

Cash 40,676$ 66,633$

LIABILITIES

Extraclassroom activity balances ‐$ 66,633$

NET POSITION

Reserved for scholarships 40,676$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Statement of Changes in Fiduciary Net Position



Private

Purpose

Trusts

ADDITIONS

Investment earnings 44$

REDUCTIONS

Scholarships 2,050

Change in net position (2,006)

Net position ‐ beginning of year 42,682

Net position ‐ end of year 40,676$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Notes to Financial Statements


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Note 1 – Summary of certain significant accounting policies

The financial statements of theJordan‐Elbridge Central School District (the “District”) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. Those principles are prescribed by the Governmental Accounting Standards Board (GASB), which is the accepted standard‐setting body for establishing governmental accounting and financial reporting principles. Certain significant accounting principles and policies utilized by the District are described below:

A) Reporting entity:

The District is located in Upstate New York and its geographical coverage includes portions of both Onondaga and Cayuga Counties. The District’s coverage includes portions of the towns of Camillus, Elbridge, Lysander, Skaneateles and Van Buren in Onondaga County and the towns of Brutus and Sennett in Cayuga County. The District has three facilities which are used to provide educations for pupils, including the Jordan‐Elbridge High School (grades 9 through 12), Ramsdell Middle School (grades 5 through 8) and Elbridge Elementary (universal pre‐kindergarten through the 4th grade). The District also has a bus garage located next to the Ramsdell Middle School to support its transportation needs. The Districts central administration is located at the Ramsdell Middle School. Essentially, the primary function of the School District is to provide educations for pupils. Services such as transportation of pupils, administration, finance, and plant maintenance support the primary function.

The District is governed by the laws of New York State. The District is an independent entity governed by an elected Board of Education consisting of seven members. The President of the Board serves as the chief fiscal officer and the Superintendent is the chief executive officer. The Board is responsible for, and controls all activities related to public school education within the District. Board members have authority to make decisions, power to appoint management, and primary accountability for all fiscal matters.

The reporting entity of the District is based upon criteria set forth by GASB Statement 14, The Financial Reporting Entity, as amended by GASB Statement 39, Component Units. The financial reporting entity consists of the primary government, organizations for which the primary government is financially accountable and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete.

The accompanying financial statements present the activities of the District and other organizational entities determined to be includable in the District’s financial reporting entity. The District is not a component unit of another reporting entity. The decision to include a potential component unit in the District’s reporting entity is based on several criteria including legal standing, fiscal dependency, and financial accountability. Based on the application of these criteria, the following is a brief description of certain entities included in the District’s reporting entity.



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Note 1 – Summary of certain significant accounting policies (continued)

i) Extraclassroom activity funds The Extraclassroom Activity Funds of the District represent funds of the students of the District. The Board of Education exercises general oversight of these funds. The Extraclassroom Activity Funds are independent of the District with respect to its financial transactions and the designation of student management. Separate audited financial statements (cash basis) of the Extraclassroom Activity Funds can be found at the District’s business office, located at the Ramsdell Middle School. The District accounts for assets held as an agent for various student organizations in an agency fund.

B) Joint venture:

The District is a component district in Cayuga‐Onondaga Board of Cooperative Education Services (BOCES). A BOCES is a voluntary, cooperative association of school districts in a geographic area that shares planning, services, and programs which provide educational and support activities. There is no authority or process by which a school district can terminate its status as a BOCES component. The District joined the BOCES on July 1, 1982.

BOCES are organized under §1950 of the New York State Education Law. A BOCES Board is considered a corporate body. Members of a BOCES’ Board are nominated and elected by their component member boards in accordance with provisions of §1950 of the New York State Education Law. All BOCES property is held by the BOCES Board as a corporation (§1950(6)). In addition, BOCES Boards also are considered municipal corporations to permit them to contract with other municipalities on a cooperative basis under §119‐n (a) of the New York State General Municipal Law.

A BOCES’ budget is comprised of separate budgets for administrative, program and capital costs. Each component district’s share of administrative and capital cost is determined by resident public school district enrollment, as defined in the New York State Education Law, §1950(4)(b)(7). In addition, component districts pay tuition or a service fee for programs in which its students participate.

During the year, the District paid $3,572,437 for BOCES administrative and program costs.

Participating school districts may issue debt on behalf of BOCES. During the year ended June 30, 2013, the District did not issue serial bonds on behalf of BOCES. As of June 30, 2013, the District had debt outstanding related to a BOCES reconstruction project of $4,105,000.

The District’s share of BOCES aid amounted to $1,525,900.

Financial statements from the BOCES are available from the BOCES administrative office located at 1879 West Genesee Street Road, Auburn, New York 13021.



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C) Basis of presentation:

i) District‐wide statements: The Statement of Net Position and the Statement of Activities present financial information about the District’s governmental activities. These statements include the financial activities of the overall government in its entirety, except those that are fiduciary. Eliminations have been made to minimize the double counting of internal transactions. Governmental activities generally are financed through property taxes, New York state aid, intergovernmental revenues, and other exchange and non‐exchange transactions. Operating grants include operating‐specific and discretionary (either operating or capital) grants.

The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the District’s governmental activities. Direct expenses are those that are specifically associated with and are clearly identifiable to a particular function. Indirect expenses, principally employee benefits, are allocated to functional areas in proportion to the payroll expended for those areas. Program revenues include charges paid by the recipients of goods or services offered by the programs, and grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.

ii) Fund financial statements:

The fund statements provide information about the District’s funds, including fiduciary funds. Separate statements for each fund category (governmental and fiduciary) are presented. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.

The District reports the following major governmental funds:

General Fund: This is the District’s primary operating fund. It accounts for all financial transactions that are not required to be accounted for in another fund. Special Revenue Funds: Special revenue funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. The term proceeds of specific revenue sources establishes that one or more specific restricted or committed revenues should be the foundation for a special revenue fund. The District has two special revenue funds, the School Food Service and Special Aid funds.



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Capital Projects Funds: Capital projects funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. Capital projects funds exclude those types of capital‐related outflows financed by proprietary funds or for assets that will be held in trust for individuals, private organizations, or other governments. The District has one voter authorized capital project ongoing which is a $21,900,000 authorization for various capital improvements across the District facilities. As of June 30, 2013 $20,101,326 has been incurred on this project. In addition, significant acquisitions of capital assets, such as school buses are recorded within capital project funds. Debt Service Fund: Debt service funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for principal and interest. Debt service funds should be used to report resources if legally mandated. Financial resources that are being accumulated for principal and interest maturing in future years also should be reported in debt service funds. The District’s debt service fund represents prior year’s accumulation of resources to pay both principal and interest. The District is not legally mandated to accumulate its resources within the debt service fund based on its outstanding debt. The District did not use the debt service fund to pay any of its principal and interest for the year as such resources were from appropriations within the general fund.

The District reports the following fiduciary funds:

Fiduciary Funds: Fiduciary activities are those in which the District acts as trustee or agent for resources that belong to others. These activities are not included in the District‐wide financial statements, because their resources do not belong to the District, and are not available to be used. There are two classes of fiduciary funds applicable for the District:

Private Purpose Trust Funds: These funds are used to account for trust arrangements in which principal and income benefits annual third party awards and scholarships for students. Established criteria govern the use of the funds and members of the District or representatives of the donors may serve on committees to determine who benefits.

Agency Funds: These funds are strictly custodial in nature and do not involve the measurement of results of operations. Assets are held by the District as agent for various student groups or extraclassroom activity funds and for payroll or employee withholding.



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D) Measurement focus and basis of accounting:

The District‐wide and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash transaction takes place. Non‐exchange transactions, in which the District gives or receives value without directly receiving or giving equal value in exchange, include property taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. The governmental fund statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The District considers all revenues reported in the governmental funds to be available if the revenues are collected within ninety days after the end of the fiscal year.

Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long‐term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long‐term debt and acquisitions under capital leases are reported as other financing sources. Proceeds of short‐term debt, such as a bond anticipation note (BAN) are not recorded as other financing source until such debt is converted into a long‐term note.

E) Cash and investments:

The District’s cash and cash equivalents consist of cash on hand, demand deposits, and short‐term investments with original maturities of three months or less from date of acquisition. New York State law governs the District’s investment policies. Resources must be deposited in Federal Deposit Insurance Corporation (FDIC) insured commercial banks or trust companies located within the State. Permissible investments include obligations of the United States Treasury, United States Agencies, repurchase agreements and obligations of New York State or its localities. Collateral is required for demand and time deposits and certificates of deposit not covered by FDIC insurance. Obligations that may be pledged as collateral are obligations of the United States and its agencies and obligations of the State and its municipalities and Districts. Investments are stated at fair value. The District's restricted cash balance of $3,833,424 at June 30, 2013 represents cash and cash equivalents where use is limited by legal requirements. Such balances include General Fund reserves established under New York State General Municipal and Education Law and balances restricted for use in the District's special revenue funds.



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F) Property taxes: Taxes are collected in Onondaga County and Cayuga County. Real property taxes are levied annually by the Board of Education no later than September 1 and become a lien on August 31, 2012. Unpaid taxes are submitted to the respective county treasurers no later than November 15. Uncollected real property taxes are subsequently enforced by Onondaga County and Cayuga County. The counties pay an amount representing the uncollected real property taxes transmitted to the counties by the School Tax Collector no later than April 1 of the following year.

G) Inventories:

Inventories of food in the school food fund are recorded at cost on a first‐in, first‐out basis, or in the case of surplus food, at stated value which approximates market.

H) Accounts receivable: Accounts receivable are shown gross, with uncollectible amounts recognized under the direct write‐off method. No allowance for uncollectible accounts has been provided since it is believed that such an allowance would not be material. All receivables are expected to be collected within the subsequent fiscal year.

I) Interfund transactions:

The operations of the District include transactions between funds. These transactions may be temporary in nature, such as with interfund borrowings. The District typically loans resources between funds for the purpose of providing cash flow. These interfund receivables and payables are expected to be repaid with one year. Permanent transfers of funds include the transfer of expenditure and revenues to provide financing or other services.

In the district‐wide statements, the amounts reported on the Statement of Net Position for interfund receivables and payables represent amounts due between different fund types (governmental activities and fiduciary funds). Eliminations have been made for all interfund receivables and payables between the funds, with the exception of those due from or to the fiduciary funds. The governmental funds report all interfund transactions as originally recorded. Interfund receivables and payables may be netted on the accompanying governmental funds balance sheet when it is the District’s practice to settle these amounts at a net balance based upon the right of legal offset.



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J) Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions are made in a variety of areas, including computation of encumbrances, compensated absences, potential contingent liabilities and useful lives of long‐lived assets.

K) Capital assets:

Capital asset acquisitions are reported at actual cost. Assets acquired prior to June 30, 2003 were valued at estimated historical cost, based on an appraisal conducted by an independent third party. Donated assets are reported at estimated market value at the time received.

Capitalization thresholds (the dollar value above which asset acquisitions are added to the capital asset accounts), depreciation methods, and estimated useful lives of capital assets reported in the District‐wide statements are as follows:

Capitalization Depreciation Estimated

Threshold Method Useful Life

Land 5,000$ Straight Line N/A

Buildings and improvements 5,000 Straight Line 20‐30 years

Vehicles and equipment 5,000 Straight Line 5‐10 years

L) Vested employee benefits:

The District employees are granted vacation in varying amounts, based primarily on length of service and service position. Some earned benefits may be forfeited if not taken within varying time periods. Sick leave eligibility and accumulation is specified in negotiated labor contracts, and in individual employment contracts. Sick leave use is based on a last‐in first‐out (LIFO) basis. Upon retirement, resignation or death, employees may receive a payment based on unused accumulated sick leave, based on contractual provisions. An accrual for accumulated sick leave is included in the compensated absences liability at year‐end. The compensated absences liability is calculated based on the contractual amount to be paid to the employee while vacation is based on the current pay rate as of June 30, 2013.



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Note 1 – Summary of certain significant accounting policies (continued) District employees participate in the New York State Employees' Retirement System and the New York State Teachers' Retirement System. See Note 9 for further description surrounding pension plans. In addition to providing pension benefits, the District provides health insurance coverage and survivor benefits for retired employees and their survivors. Substantially all of the District's employees may become eligible for these benefits if they reach normal retirement age while working for the District. Health care benefits are provided through plans whose premiums are based on the benefits paid during the year. The cost of providing post‐retirement benefits is shared between the District and the retired employee. The District recognizes the cost of providing health insurance by recording its share of insurance premiums as an expenditure or operating transfer to other funds in the General fund, in the year paid. See Note 10 for further description surrounding other postemployment benefits offered by the District.

M) Deferred revenue:

Deferred revenues are reported when potential revenues do not meet both the measurable and available criteria for recognition in the current period. Deferred revenues also arise when resources are received by the District before it has legal claim to them, as when grant monies are received prior to the incidence of qualifying expenditures. In subsequent periods, when both recognition criteria are met, or when the District has legal claim to the resources, the liability for deferred revenues is removed and revenues are recorded. The District’s deferred revenues relate to its school food program whereby students have paid monies for future purchases. Deferred revenues for the school food program totaled $4,104 as of June 30, 2013.

Statute provides the authority for the District to levy taxes to be used to finance expenditures within the first 120 days of the succeeding fiscal year. Consequently, such amounts are recognized as revenue in the subsequent fiscal year, rather than when measurable and available.

Deferred revenues recorded in governmental funds are recorded in the District‐wide statements.

N) Deposits:

The District has received a performance security deposit related to vendor in the amount of $36,542. This amount will be returned to the vendor upon completion or termination of such contract, in accordance with the terms and conditions within the contract.

O) Restricted resources: When an expense is incurred for purposes for which both restricted and unrestricted net position are available, the District’s policy concerning which to apply first varies with the intended use, and with associated legal requirements, many of which are described elsewhere in these Notes.



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P) Short‐term debt: The District may issue Revenue Anticipation Notes (RAN) and Tax Anticipation Notes (TAN), in anticipation of the receipt of revenues. These notes are recorded as a liability of the fund that will actually receive the proceeds from the issuance of the notes. The RAN’s and TAN’s represent a liability that will be extinguished by the use of expendable, available resources of the fund.

The District may issue budget notes up to an amount not to exceed 5% of the amount of the annual budget during any fiscal year for expenditures for which there is an insufficient or no provision made in the annual budget. The budget note must be repaid no later than the close of the second fiscal year succeeding the year in which the note was issued. The District may issue Bond Anticipation Notes (BAN), in anticipation of proceeds from the subsequent sale of bonds. These notes are recorded as current liabilities of the funds that will actually receive the proceeds from the issuance of bonds. State law requires that BAN’s issued for capital purposes be converted to long‐term financing within five years after the original issue date.

Q) Accrued liabilities and long‐term obligations:

Payables, accrued liabilities and long‐term obligations are reported in the district‐wide financial statements. In the governmental funds, payables and accrued liabilities are paid in a timely manner and in full from current financial resources. Claims and judgments, other postemployment benefits payable and compensated absences that will be paid from governmental funds, are reported as a liability in the funds financial statements only to the extent that they are due for payment in the current year. Bonds and other long‐term obligations that will be paid from governmental funds are recognized as a liability in the fund financial statements when due.

Long‐term obligations represent the District’s future obligations or future economic outflows. The liabilities are reported as due in one year or due within more than one year in the Statement of Net Position.



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R) Equity classifications

District‐wide statements:

In the district‐wide statements there are three classes of net position:

i. Net investment in capital assets – consists of net capital assets (cost less accumulated depreciation) reduced by outstanding balances of related debt obligations from the acquisition, construction or improvement of those assets.

ii. Restricted net position – reports net position when constraints placed on the assets are either externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments, or imposed by law through constitutional provisions or enabling legislation.

iii. Unrestricted net position – reports the balance of net position that does not meet the definition of the above two classifications and are deemed to be available for general use by the District.

Fund statements: In the fund basis statements there are five classifications of fund balance:

Non‐spendable fund balance ‐ Includes amounts that cannot be spent because they are either not in spendable form or legally or contractually required to be maintained intact. Non‐spendable fund balance includes the inventory recorded in the School Food Service Fund of $4,014. Restricted fund balance ‐ includes amounts with constraints placed on the use of resources either externally imposed by creditors, grantors, contributors or laws or regulations of other governments; or imposed by law through constitutional provisions or enabling legislation. The District’s restricted balance includes all reserves established in accordance with New York State General Municipal Law and New York State Education Law and the remaining fund balance in the school food service, capital projects, and debt service funds.

Committed fund balance ‐ Includes amounts that can only be used for the specific purposes pursuant to constraints imposed by formal action of the school districts highest level of decision making authority, i.e., the Board of Education. The School District has no committed fund balances as of June 30, 2013. Assigned fund balance ‐ Includes amounts that are constrained by the school district’s intent to be used for specific purposes, but are neither restricted nor committed. All encumbrances are classified as Assigned Fund Balance in the respective fund. Encumbrances reported at June 30, 2013 amounted to $156,035.



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Note 1 – Summary of certain significant accounting policies (continued) Unassigned fund balance ‐ Includes all other General Fund net position that do not meet the definition of the above four classifications and are deemed to be available for general use by the School District. In funds other than the General Fund, the unassigned fund balance includes deficit balances resulting from overspending of restricted, committed or assigned fund balance.

Order of Use of Fund Balance: The Board of Education is the highest level of decision‐making authority at the District in relation to committing or assigning fund balances. Assignments are generally authorized through voter approvals during the annual budget vote. The assigned appropriated fund balance represents the amounts approved by voters in May 2013 for the 2013‐2014 fiscal year budget which totaled $1,000,000. The assigned unappropriated fund balance of $156,035 generally represents encumbrances and other items which were authorized through voter approvals through approval of the 2012‐2013 fiscal year budget which was approved by voters in May 2012. The District’s policy is to apply expenditures first against restricted balances, then to assigned fund balances and finally to unassigned fund balances. Unexpended Surplus Funds:

New York State Real Property Tax Law (section 1318) limits the amount of unexpended surplus funds a school district can retain to no more than 4 percent of the next year’s budgetary appropriations. The 4% limitation is $1,100,000 which is derived from the 2012‐2013 budget of $27,500,000 approved by voters in May 2013.

Funds properly retained under other sections of law (i.e., reserve funds established pursuant to New York State Education Law or New York State General Municipal Law) are excluded from the 4 percent limitation.

Unexpended surplus are interpreted to be applied to unrestricted fund balance (the total of the committed, assigned, and unassigned classifications), minus appropriated fund balance and encumbrances included in committed and assigned fund balance. The District’s unrestricted fund balance is $704,381 which is less than 4% of next year’s budgetary appropriations, which is less than the 4% maximum limitation.



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Note 1 – Summary of certain significant accounting policies (continued) S) Reserves:

The establishment of reserves is generally authorized by either the General Municipal Law (GML) or Education Law of New York State. New York State statutes define the underlying purpose and use of such reserves, including the appropriate recordkeeping for such reserves. Reserves are mechanisms for accumulating cash for future capital outlays and other allowable purposes. The District has the following reserves: a) Unemployment Insurance Reserve

Unemployment Insurance Reserve (GML §6‐m) is used to pay the cost of reimbursement to the State Unemployment Insurance Fund for payments made to claimants where the employer has elected to use the benefit reimbursement method. The reserve may be established by Board action and is funded by budgetary appropriations and such other funds as may be legally appropriated. Within sixty days after the end of any fiscal year, excess amounts may either be transferred to another reserve or the excess applied to the appropriations of the next succeeding fiscal year’s budget. If the District elects to convert to tax (contribution) basis, excess resources in the fund over the sum sufficient to pay pending claims may be transferred to any other reserve fund. This reserve is accounted for in the General Fund.

b) Property Loss and Liability Claims Reserve (Education Law ‐ § 1709[8‐c]) The purpose of this reserve is to cover property loss and liability claims. The reserve was created by a resolution of the Board of Education and there are no referendum requirements to create the funds or expend money from the funds for property loss and liability claims. Funding for the reserve is from budgetary appropriations. The maximum amount of the reserve is the greater of $15,000 or 3% of the annual budget. The annual budget approved by voters in May 2013 was $27,500,000; as such the District’s maximum reserve cannot exceed $825,000.

c) Tax Certiorari Reserve (Education Law – § 3651[1‐a]) The purpose of this reserve is to pay judgments and claims in tax certiorari proceedings in accordance with article 7 of the New York State Real Property Tax Law. There is no requirement for voters to approve such reserve and the reserve is funded from budgetary appropriations. The total amount of the reserve may not exceed the amount that might reasonably be deemed necessary to meet anticipated tax certiorari judgments and claims. Monies not expended for the payment of judgments or claims arising out of tax certiorari proceedings must be returned to the general fund on or before the first day of the 4th fiscal year following the deposit of such monies. The reserve is accounted for in the General fund.



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d) Employee Benefit Accrued Liability Reserve Fund (GML § 6‐p) The purpose of this reserve is to pay for any accrued employee benefit due an employee on termination of the employee’s service. The reserve is created by resolution of the Board of Education and there is no requirement for a referendum to create or expend monies from the reserve. The reserve is generally funded from budgetary appropriations. Employee benefits for this reserve are defined as the cash payment of the monetary value of accrued and accumulated but unused and unpaid sick leave, personal leave, holiday leave, vacation time and other time allowances earned by employees of the District. The District is not allowed to use this fund to pay the cost of health insurance for retired employees. The 2012‐13 New York State Budget allowed districts to withdraw excess amounts from this reserve; the excess amount is the lesser of the dollar value of excess funding as determined by the New York State Comptroller’s office or the amount of the school district’s remaining gap elimination adjustment as calculated but the Commissioner of Education. In the year ended June 30, 2013 the District utilized $206,346 of this excess reserve.

e) ERS Retirement Reserve (GML § 6‐r) The purpose of this reserve fund is to accumulate moneys for the payment of retirement contributions to the New York State and Local Employees’ Retirement System (“ERS”), pursuant to the Retirement and Social Security Law. The establishment of this reserve was approved by the Board of Education on June 20, 2012.

f) Capital Reserve Funds (Education Law – § 3651)

The purpose of these reserves are to pay the cost of any object or purpose for which bonds may be issued by, or for the objects or purposes of, a school district pursuant to the Local Finance Law. Establishment of such reserves requires an approval by a majority of qualified voters. Each capital reserve that is established must specify the purpose for such capital reserve, the ultimate amount of the reserve and the probable term and source from which funding will be obtained for the reserve. The source of the funding is generally an annual amount necessary to meet the requirements of the voter proposition. The maximum reserve amount represents the gross amounts that the District can include as a reserve; reductions/uses of capital reserves cannot be further replenished. The District has the following capital reserves:

(1) School Bus Reserve fund – This reserve was approved by District voters on May 15, 2012. This reserve was established for the purchase of school buses, vehicles and equipment, and costs related to such purchases. This reserve has a maximum funding of $750,000 plus earnings thereon and the term of the fund is for a 5 year period, ending May 15, 2017. As of June 30, 2013, this reserve has been funded to its maximum limit. On May 21, 2013, voters approved the use of $150,000 to fund the purchase of buses for the 2013‐2014 school year.



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f) Capital Reserve Funds (Education Law – § 3651) (continued)

(2) Building Capital Reserve fund – This reserve was approved by District voters on May 15, 2007. This reserve was established for site work, reconstruction, and equipping of school buildings and facilities, and costs related to such activities. This reserve has a maximum funding of $1,000,000 plus earnings thereon and the term of the fund is for a 10 year period, ending May 15, 2017. As of June 30, 2013, this reserve has been funded to its maximum limit. On May 21, 2013 voters approved the use of $270,000 to fund the purchase and installation of security locks throughout the District, resurfacing of the athletic track and the purchase of a lathe for the Project Lead the Way program for the 2013‐2014 school year.

(3) Operations Capital Reserve fund – This reserve was approved by District voters on May

19, 2009. This reserve was established to finance the purchase of equipment and costs related to such equipment. This reserve has a maximum funding of $250,000 plus earnings thereon and the term of the fund is for a 5 year period, ending May 19, 2014. As of June 30, 2013, this reserve has been funded to its maximum limit and since the District did not embark on a capital project for this reserve the reserve has been reclassified to unassigned fund balance.

T) Encumbrances: Encumbrances represent formal commitments (usually contracts or purchase orders) to acquire goods or services not yet received. The use of encumbrances is a component of budgetary control used by the District to lessen the risk that expenditures exceed appropriations. Encumbrances outstanding as of June 30th do not represent expenditures of the district for the year ended June 30, 2013. Encumbrances are included within restricted resources for such activities that are restricted and other encumbrances are considered assigned based on the formal commitment.

U) New Accounting Standards: The District has adopted all current Statements of the Governmental Accounting Standards Board (GASB) that are applicable. At June 30, 2013, the District implemented the following new standard issued by GASB: GASB has issued Statement 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre‐November 30, 1989 FASB and AICPA Pronouncements, which incorporates into the GASB's authoritative literature, certain accounting and financial reporting guidance that is included in certain pronouncements issued on or before November 30, 1989, which does not conflict with or contradict GASB pronouncements. GASB has also issued Statement 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, which provides financial reporting guidance for deferred outflows of resources and deferred inflows of resources.



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V) Future Changes in Accounting Standards:

GASB has also issued Statement 65, Items Previously Reported as Assets and Liabilities, which clarifies the appropriate reporting of deferred outflows of resources and deferred inflows of resources to ensure consistency in financial reporting. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2014 financial statements. GASB has also issued Statement 66, Technical Corrections – 2012, which enhances the usefulness of financial reports by resolving conflicting accounting and financial reporting guidance that could diminish the consistency of financial reporting. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2014 financial statements.

GASB has also issued Statement 67, Financial Reporting for Pension Plans, revises existing guidance for the financial reports of most pension plans. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2014 financial statements.

GASB has also issued Statement 68, Accounting and Financial Reporting for Pensions, revises and establishes new financial reporting requirements for most governments that provide their employees with pension benefits. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2015 financial statements. GASB has issued Statement 69, Government Combinations and Disposals of Government Operations, effective for the year ending June 30, 2015. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2015 financial statements.

GASB has issued Statement 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees, effective for the year ending June 30, 2015. The District is currently studying the statement and plans on adoption if and when required, which will be for the June 30, 2015 financial statements.

Note 2 – Explanation of certain differences between governmental fund statements and District‐wide statements Due to the differences in the measurement focus and basis of accounting used in the governmental fund statements and the District‐wide statements, certain financial transactions are treated differently. The basic financial statements contain a full reconciliation of these items. The differences result primarily from the economic focus of the Statement of Activities, compared with the current financial resources focus of the governmental funds.

A) Total fund balances of governmental funds versus net position of governmental activities:

Total fund balances of the District’s governmental funds differ from “Net Position” of governmental activities reported in the Statement of Net Position. This difference primarily results from the additional long‐term economic focus of the Statement of Net Position versus the solely current financial resources focus of the governmental fund Balance Sheets.



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Note 2 – Explanation of certain differences between governmental fund statements and District‐wide statements (continued) B) Statement of Revenues, Expenditures and Changes in Fund Balance vs. Statement of Activities:

Differences between the governmental funds Statement of Revenues, Expenditures and Changes in Fund Balance and the Statement of Activities fall into one of three broad categories. The amounts shown below represent:

i) Long‐term revenue differences:

Long‐term revenue differences arise because governmental funds report revenues only when they are considered “available”, whereas the Statement of Activities reports revenues when earned. Differences in long‐term expenses arise because governmental funds report on a modified accrual basis, whereas the accrual basis of accounting is used on the Statement of Activities.

ii) Capital related differences:

Capital related differences include the difference between proceeds for the sale of capital assets reported on governmental fund statements and the gain or loss on the sale of assets as reported on the Statement of Activities, and the difference between recording an expenditure for the purchase of capital items in the governmental fund statements and depreciation expense on those items as recorded in the Statement of Activities.

iii) Long‐term debt transaction differences:

Long‐term debt transaction differences occur because both interest and principal payments are recorded as expenditures in the governmental fund statements, whereas interest payments are recorded in the Statement of Activities as incurred, and principal payments are recorded as a reduction of liabilities in the Statement of Net Position.

Note 3 – Stewardship, compliance and accountability

Budgets: The District administration prepares a proposed budget for approval by the Board of Education for the General Fund which legal (appropriated) budgets are adopted. This budget must be presented to the voters in three components: (1) a Program Component, (2) a Capital Component, and (3) and Administrative Component. The budget must be written in plain language and include categories of revenues, expenditures and fund balance information, as well as comparison data from the prior year’s budget. The budget and/or proposition(s) may be submitted to voters no more than two times. If the voters fail to approve the budget after the second submission, the Board of Education must adopt a contingency budget. The District’s 2012‐2013 budget was approved by voters in May 2012 and the District’s 2013‐2014 budget was approved by voters in May 2013.



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Note 3 – Stewardship, compliance and accountability (continued)

Budgets: (continued) Appropriations established by the adoption of the budget constitute a limitation on expenditures (and encumbrances) that may be incurred. Appropriations lapse at the end of the fiscal year unless expended or encumbered. Encumbrances will lapse if not expended in the subsequent year. Appropriations authorized for the current year are increased by the planned use of specific reserves, and budget amendments approved the Board of Education as a result of selected new revenue sources not included in the original budget (when permitted by law). These supplemental appropriations may occur subject to legal restrictions, if the Board approves them because of a need that exists which was not determined at the time the budget was adopted. No supplemental appropriations occurred during the year.

Budgets are adopted annually on a basis consistent with accounting principles generally accepted in the United States of America. Appropriations authorized for the year are increased by the amount of encumbrances carried forward from the prior year. The budget and actual comparison reflects budgeted and actual amounts for funds with legally authorized (appropriated) budgets.

Budgets are also required to be prepared for the school food service, special aid, debt service and capital projects fund as required by the New York State Uniform System of Accounts for School Districts and the State of New York Office of the State Comptroller. These budgets are considered to be non‐appropriated budgets, which exempts the District from presenting the required budgetary comparison information within these financial statements. Since the General Fund is the only appropriated budget for the District, the budgetary comparison is presented as required supplementary information in these financial statements. Note 4 – Cash and cash equivalents – custodial credit and concentration of credit Custodial credit risk is the risk that in the event of a bank failure, the District’s deposits may not be returned to it. While the District does not have a specific policy for custodial credit risk, New York State statutes govern the District’s investment policies, as discussed previously in these Notes. The District’s aggregate bank balances of $5,693,667 are either insured or collateralized with securities held by the pledging financial institution in the District’s name.



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Note 5 – Capital assets

Capital asset balances and activity for the year ended June 30, 2013 were as follows:

Beginning Retirements/ Ending

Balance Additions Reclassifications Balance

Governmental activities:

Capital assets that are not depreciated:

Land 74,885$ ‐$ ‐$ 74,885$

Construction in process 17,748,574 2,561,173 (19,892,420) 417,327

Total nondepreciable historical cost 17,823,459 2,561,173 (19,892,420) 492,212

Capital assets that are depreciated:

Buildings 42,845,470 ‐ 19,892,420 62,737,890

Furniture and equipment 5,215,245 622,595 (358,995) 5,478,845

Total depreciable historical cost 48,060,715 622,595 19,533,425 68,216,735

Less accumulated depreciation:

Buildings 22,624,456 1,339,808 ‐ 23,964,264

Furniture and equipment 3,089,978 514,496 (248,543) 3,355,931

Total accumulated depreciation 25,714,434 1,854,304 (248,543) 27,320,195

Total historical cost, net 40,169,740$ 1,329,464$ (110,452)$ 41,388,752$

governmental functions as follows:

General support 166,887$

Instruction 1,557,615

Pupil transportation 129,802

1,854,304$

Depreciation expense was charged to



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Note 6 – Short‐term debt The District may issue Bond Anticipation Notes (“BAN”), in anticipation of proceeds from the subsequent sale of bonds. These notes, including any discount or premium, are recorded as current liabilities of the funds that will actually receive the proceeds from the issuance of bonds. State law requires that BANs issued for capital purposes be converted to long‐term financing within five years after the original issue date. A summary of BAN activity for the year is as follows:

Beginning Ending

Balance Issued Redeemed Balance

BAN maturing 7/27/2012 @ 1.00% 13,500,000$ ‐$ 13,500,000$ ‐$

BAN maturing 7/27/2012 @ 1.50% 5,500,000 ‐ 5,500,000 ‐

19,000,000$ ‐$ 19,000,000$ ‐$

The $19,000,000 of BANs were redeemed with the issuance of 2012 Series B bonds in the amount of $18,145,000. The payment occurred on July 27, 2012. The remaining portion of the BAN, $855,000, was redeemed through appropriations from the general fund in the 2012‐2013 budget year. Note 7 – Long‐term debt Serial Bonds– the District borrows money in order to acquire land or equipment or construct buildings and improvements. The District’s serial bonds generally require payments of interest only in December and interest and principal in June each year. The following is a summary of the School District’s notes payable and long‐term debt for the year ended June 30, 2013:

Date of Original Year of Final Interest Rate Outstanding

Description Original Issue Amount Maturity (%) Amount

School District (serial) Bonds, 2006 (BOCES project) 6/15/2006 4,864,257 2032 4.125, 4.375 4,105,000$

School District (serial) Bonds, 2009 6/17/2009 400,000 2014 2.75‐3.19 85,000

School District (serial) Bonds, 2010 6/15/2010 356,238 2015 2.3 150,000

School District (serial) Bonds, 2011 6/15/2011 272,000 2016 2.47 165,000

School District (serial) Bonds, 2012 Series B 5/15/2012 18,145,000 2026 2.62 18,145,000

School District (serial) Bonds, 2012 Series A 5/15/2012 1,006,603 2025 2.79 820,000

School District (serial) Bonds, 2013 6/20/2013 366,000 2018 1.5‐2.0 366,000

School District (refunding serial) Bonds, 2013 6/20/2013 4,350,000 2022 1.05‐2.75 4,350,000

28,186,000$

Effective June 19, 2013, the District issued a $4,350,000 Refunding Bond to refund the District’s previously outstanding $4,355,000 principal balance of the School District (Serial) Bonds, 2002, 2003A, and 2003B. The present value of cash flow savings amounts to approximately $324,000 over the remaining nine year term of the Refunding Bond. The liability for the defeased bonds, $4.355 million, and the trust account assets are not included in the financial statements.



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Note 7 – Long‐term debt (continued): Interest paid and expensed on long‐term debt for the year was $785,627. Interest paid on the Serial Bonds varies from year to year, in accordance with the interest rates specified in the bond agreements. Bondholders are protected in the event of default by State Finance Law Section 99‐b, which constitutes a covenant with bondholders. In the event of default the State Comptroller is required to intercept state aid and assistance to apply to the payment of defaulted principal and/or interest. Long‐term liability balances and activity for the year are summarized below:

Amounts

Balance at Balance at Due within

June 30, 2012 Increase Decrease June 30, 2013 One Year

Government activities

Serial bonds 30,215,000$ 361,000$ 2,390,000$ 28,186,000$ 2,451,000$

Other postemployment benefits payable 7,539,742 2,873,594 1,493,609 8,919,727 ‐

Compensated absences 192,711 ‐ 19,292 173,419 ‐

37,947,453$ 3,234,594$ 3,902,901$ 37,279,146$ 2,451,000$ Total long‐term liabilities

The General Fund has typically been used to liquidate long‐term liabilities such as compensated absences. The following is a summary of the maturity of long‐term indebtedness:

Fiscal year ended June 30, Principal Interest Total

2014 2,451,000$ 838,680$ 3,289,680$

2015 2,435,000 767,869 3,202,869

2016 2,430,000 695,461 3,125,461

2017 2,430,000 619,232 3,049,232

2018 2,390,000 541,625 2,931,625

2019‐2023 8,295,000 1,910,896 10,205,896

2024‐2028 6,580,000 710,926 7,290,926

2029‐2033 1,175,000 131,468 1,306,468

Totals 28,186,000$ 6,216,157$ 34,402,157$



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Note 8 – Interfund balances and activity Interfund receivables and payables, other than between governmental activities and fiduciary funds, are eliminated on the Statement of Net Position. The District typically transfers from the General Fund to the Capital Fund to help fund capital renovations and additions. The district also transfers from the General Fund to the Special Aid fund the local portion of the Special Education Summer School Program. The District typically loans resources between funds for the purpose of mitigating the effects of transient cash flow issues. All interfund payables are expected to be repaid within one year. A summary of the interfund activity for the year ending June 30, 2013:

Receivable Payable Revenues Expenditures

General Fund 645,956$ ‐$ ‐$ 7,395$

Special Aid Fund ‐ 95,403 7,395 ‐

Capital Fund ‐ 550,553 ‐ ‐

Total government activities 645,956$ 645,956$ 7,395$ 7,395$

Note 9 – Pension plans The District participates in the New York State Employees’ Retirement System (ERS) and the New York State Teachers’ Retirement System (TRS). These are cost‐sharing multiple employer public employee retirement systems. The Systems offer a wide range of plans and benefits, which are related to years of service and final average salary, vesting of retirement benefits, death, and disability.

The New York State Teachers’ Retirement Board administers NYSTRS. The System provides benefits to plan members and beneficiaries as authorized by the Education Law and the Retirement and Social Security Law of the State of New York. The New York State Teacher’s Retirement System (TRS) was created and exists, pursuant to Article 11 of the New State Education Law. The System is the administrator of a cost‐sharing, multiple‐employer public employee retirement system, administered by a 10‐member Board to provide pension benefits for teachers employed by participating employers in the State of New York, excluding New York City. The benefits provided to members of the System are established by New York State law and may be amended only by the Legislature with the Governor’s approval. Benefit provisions vary depending on date of membership and are subdivided into the following six classes: Tier 1 – Members who last joined prior to July 1, 1973 are covered by the provisions of Article 11 of the

Education Law. Tier 2 – Members who last joined on or after July 1, 1973 and prior to July 27, 1976 are covered by the

provisions of Article 11 of the Education Law and Article 11 of the Retirement and Social Security Law. Tier 3 – Members who last joined on or after July 27, 1976 and prior to September 1, 1983 are covered by

the provisions of Article 14 and Article 15 of the Retirement and Social Security Law. Tier 4 – Members who last joined on or after September 1, 1983 and prior to January 1, 2010 are covered

by the provisions of Article 15 of the Retirement and Social Security Law.



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Note 9 – Pension plans (continued): Tier 5 – Members who joined on or after January 1, 2010 are covered by the provisions of Article 15 of the

Retirement and Social Security Law. Tier 6 – Members who joined on or after April 1, 2012 are covered by the provision of Article 15 of the

Retirement and Social Security Law. The District is required to contribute at an actuarially determined rate which is adopted by the Retirement Board. The employer contribution rate was 11.84% for 2012‐2013 salaries. In July 2013, the Retirement Board adopted an employer contribution rate of 16.25% for 2013‐2014 salaries which will be paid in the fall 2014. The amounts paid are withheld from the District’s State Aid payments. Members may or may not contribute depending on their Tier level. Members in Tier 1 and 2 do not contribute towards the plan. Members in Tier 3 and 4 who have less than 10 years of service or membership are required to contribute 3% of their salary to the system. Tier 5 members are required by law to contribute 3.5% of salary throughout their active membership. Tier 6 members will contribute 3.5% from April 1, 2012 through March 31, 2013. Beginning April 1, 2013, during any Tier 6 member’s first 3 school years of membership, the Tier 6 member will contribute a percentage based on a projection, by the employer, of annual wages during those school years in accordance with a Tier 6 contribution chart. The contribution rates range from 3% to 6% and are based on projected annual wages. Beginning in year 4 of membership, Tier 6 members’ contribution rate will be determined by TRS. TRS issues a publicly available financial report that contains financial statements and required supplementary information for the System. The report may be obtained by writing to NYSTRS, 10 Corporate Woods Drive, Albany, New York 12211‐2395 or by email at [email protected]. This report may be found also at www.nystrs.org. ERS provides retirement benefits as well as death and disability benefits. Obligations of employers and employees to contribute and benefits to employees are governed by the New York State Retirement and Social Security Law (NYSRSSL). As set forth in the NYSRSSL, the Comptroller of the State of New York (Comptroller) serves as sole trustee and administrative head of the NYSLRS. The Comptroller shall adopt and may amend rules and regulations for the administration and transaction of the business of the NYSLRS and for the custody and control of its funds. The NYSLRS issues a publicly available financial report that includes financial statements and required supplementary information. That report may be found at www.osc.state.ny.us/retire/publications/index.php or obtained by writing to the New York State and Local Retirement System, 110 State Street, Albany, NY 12244. The Systems are noncontributory for the employee who joined prior to July 27, 1976. For employees who joined the Systems after July 27, 1976, and prior to January 1, 2010, employees contribute 3% of their salary, except that employees in the Systems more than ten years are no longer required to contribute. For employees who joined after January 1, 2010, employees in ERS contribute 3% of their salary throughout their active membership and those in TRS contribute 3.5% throughout their active membership.



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Note 9 – Pension plans (continued): For ERS, under the authority of the NYSRSSL, the Comptroller annually certifies the actuarially determined rates expressly used in computing the employers’ contributions based on salaries paid during the ERS’ fiscal year ending March 31. Required contributions for NYSTRS and NYSERS were expensed as follows:

NYSTRS NYSERS

2012‐2013 1,011,578$ 406,499$

2011‐2012 1,112,032 411,755

2010‐2011 829,594 316,572

Note 10 – Postemployment (Health Insurance) Benefits The District provides postemployment (health insurance, dental insurance, etc.) coverage to retired employees in accordance with the provisions of various employment contracts. The benefit levels, employee contributions and employer contributions are governed by the District’s contractual agreements.

The District has implemented GASB Statement No. 45, Accounting and Financial Reporting by employers for Postemployment Benefits Other than Pensions. This requires the District to calculate and record a net other postemployment benefit obligation at year‐end. The net other postemployment benefit obligation is basically the cumulative difference between the actuarially required contribution and the actual contributions made. The District recognizes the cost of providing health insurance annually as expenditures in the General Fund of the funds financial statements as payments are made. For the year ended June 30, 2013, the District recognized $1,482,843 for its share of insurance premiums for 204 currently enrolled retired employees and beneficiaries. Currently, there are 468 eligible plan participants as of June 30, 2012. To be eligible for benefits, an employee must be 55 years of age with 10 years of service with the District for either medical or dental coverage. Medical coverage, the District pays 100% of the premium cost for the medical that was in effect at the time of retirement for employees, and 85% of the cost for spousal premiums. Effective February 1, 2009, the JECSD Transportation Local employees are not eligible for postemployment medical benefits with the exception of a grandfathered group of employees. Effective July 1, 2011, the District pays 90% of the premium cost for postemployment medical benefits for employees not represented by a collective bargaining unit. For Dental coverage, it pays a subsidy of up to, on average, $213 per retiree. This amount increases annually. The District has obtained an actuarial valuation report for the year ending June 30, 2012 dated July 25, 2012 which indicates that the total liability for other postemployment benefits is $40,070,220. The District has elected to amortize this liability over a period of 30 years, which has been determined by the actuarial valuation to be $1,634,372 each fiscal year. The annual required contribution of $2,419,420 reflects this amortization and the normal cost of the plan which is reflected in the Statement of Net Position.



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Note 10 – Postemployment (Health Insurance) Benefits (continued) Annual OPEB Cost and Net OPEB Obligation:

The District’s annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years.

Annual required contribution 2,884,326$

Interest on net OPEB obligation 301,590

Adjustment to annual required contribution (312,322)

Annual OPEB cost 2,873,594

Contributions made (1,493,609)

Increase in net OPEB obligation 1,379,985

Net OPEB obligation ‐ beginning of year 7,539,742

Net OPEB obligation ‐ end of year 8,919,727$

The District’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for the years ended June 30, 2009 ‐ 2012 were as follows:

Percentage of Annual Net OPEB

Fiscal Year Ended Annual OPEB Cost Contributions OPEB Cost Contributed Obligation

6/30/2009 2,726,436$ ‐$ 0.0% 2,726,436$

6/30/2010 2,726,436 ‐ 0.0% 5,452,872

6/30/2011 2,616,084 1,489,596 56.94% 6,579,360

6/30/2012 2,443,225 1,482,843 60.69% 7,539,742

6/30/2013 2,873,594 1,493,609 51.98% 8,919,727

Funded Status and Funding Progress: As of June 30, 2013, the most recent actuarial valuation date, the plan was not funded. The actuarial accrued liability for benefits was $44,636,614, and the actuarial value of assets was $ 0, resulting in an unfunded actuarial accrued liability (UAAL) of $44,636,614. The covered payroll (annual payroll of active employees covered by the plan) was approximately $10,873,000, and the ratio of the UAAL to the covered payroll was 410.53%. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future.



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Note 10 – Postemployment (Health Insurance) Benefits (continued) Actuarial Methods and Assumptions: Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short‐term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long‐term perspective of the calculations. In the June 30, 2013, actuarial valuation, the Entry Age Normal Method, over a level percent of pay was used. The actuarial assumptions included a 4.00% investment rate of return which is a blended rate of the expected long‐term investment returns on plan assets and on the employer’s own investments calculated based on the funded level of the plan at the valuation date, and a combined medical and dental cost trend rate of 13.00% initially, reduced by decrements to an ultimate rate of 10% after 7 years. Both rates included a 2.50% inflation assumption. The actuarial value of assets was determined using techniques that spread the effects of short‐term volatility in the market value of investments over a 30‐year period. The UAAL is being amortized as a level percentage of projected payroll on an open basis. The remaining amortization period at June 30, 2013, was 26 years. Note 11 – Risk Management The District is exposed to various risks of loss related to torts, theft, damage, injuries, errors and omissions, natural disasters, and other risks. These risks are generally covered by commercial insurance purchased from independent third parties. The District has an estimated reserve of $65,000 related to such risks. Note 12 – Donor‐restricted endowments The District administers endowment funds, which are restricted by the donor for the purposes of student scholarships. Donor‐restricted endowments are reported at fair value. The District authorizes expenditures from donor‐restricted endowments in compliance with the wishes expressed by the donor, which varies among the unique endowments administered by the District. Note 13 – Contingent liabilities The District has received grants, which are subject to audit by agencies of the State and federal governments. Such audits may result in disallowances and a request for a return of funds. Based on prior audits, the district’s administration believes disallowances, if any, will be immaterial. The District is also subject to ongoing litigation and believes that any contingent loss would not be significant to these financial statements. Note 14 – Subsequent Events On August 6, 2013 the District issued a BAN in the amount of $1,916,118 for the ongoing capital project. This now brings the total borrowing to the maximum allowed under the $21,900,000 project. Repayment of this BAN is scheduled for July 24, 2014.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Required Supplementary Information

Schedule of Funding Progress – Other Postemployment Benefit Plans For the year ended June 30, 2013


Actuarial

Valuation

Date

Acturaial

Value of

Assets

(a)

Accuarial

Accrued

Liability (AAL)

(in thousands)

(b)

Unfunded AAL

(UAAL)

(in thousands)

(b‐a)

Funded

Ratio (a/b)

Covered Payroll

(in thousands)

(c)

UAAL as a

Percentage

of Covered

Payroll

((b‐a)/c)

July 1, 2012 ‐$ 44,636,616$ 44,636,616$ 0.00% 10,873,000$ 410.53%

July 1, 2011 ‐$ 40,070,220$ 40,070,220$ 0.00% 10,608,000$ 377.74%

July 1, 2010 ‐$ 42,127,832$ 42,127,832$ 0.00% 10,200,000$ 413.02%

July 1, 2009 ‐$ 38,489,947$ 38,489,947$ 0.00% 10,548,020$ 364.90%


Schedule of Revenues, Expenditures and Changes in Fund Balance ‐ Budget (Non‐GAAP Basis) and Actual – General Fund For the year ended June 30, 2013


Final Budget

Original Final Actual Variance With

Budget Budget (Budgetary Basis) Budgetary Actual

REVENUES

Local sources

Real property taxes 11,972,181$ 11,972,181$ 11,791,699$ (180,482)$

Nonproperty taxes 12,000 12,000 75,500 63,500

Charges for services 45,000 45,000 44,968 (32)

Use of money and property 10,000 10,000 6,202 (3,798)

Sale of property and compensation for loss 2,000 2,000 13,431 11,431

Miscellaneous 185,000 185,000 187,195 2,195

Total local sources 12,226,181 12,226,181 12,118,995 (107,186)

State sources 13,938,819 13,938,819 14,387,228 448,409

Federal sources 100,000 100,000 63,645 (36,355)

Total revenues 26,265,000 26,265,000 26,569,868 304,868

OTHER FINANCING SOURCES

Transfers from other funds 50,000 50,000 ‐ (50,000)

Prior year encumbrances ‐ 205,298 205,298 ‐

Use of employee benefits reserve ‐ ‐ 206,346 206,346

Appropriated fund balance 885,000 885,000 ‐ (885,000)

Total revenues and other financing sources 27,200,000$ 27,405,298$ 26,981,512$ (423,786)$


Statement of Revenues, Expenditures and Changes in Fund Equity – Governmental Funds For the year ended June 30, 2013

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Final Budget

(a) (b) Variance With

Original Final Actual Year‐end Budgetary Actual

Budget Budget (Budgetary Basis) Encumbrances And Encumbrances

EXPENDITURES

General support

Board of education 30,688$ 22,511$ 22,401$ 110$ ‐$

Central administration 187,004 194,866 194,866 ‐ ‐

Finance 334,266 726,135 726,135 ‐ ‐

Staff 450,619 546,827 491,052 55,775 ‐

Central services 2,082,869 2,007,276 1,980,662 26,614 ‐

Special items 321,849 336,200 338,351 ‐ (2,151)

Total general support 3,407,295 3,833,815 3,753,467 82,499 (2,151)

Instruction

Instruction, administration and improvement 779,702 851,836 843,044 8,792 ‐

Teaching ‐ regular school 6,424,170 6,743,348 6,787,872 10,976 (55,500)

Programs for children with handicapping conditions 1,925,293 2,402,764 2,399,042 3,722 ‐

Teaching ‐ special school 84,615 90,943 90,943 ‐ ‐

Instructional media 1,184,170 1,167,562 1,138,901 28,661 ‐

Pupil services 1,109,912 1,167,832 1,155,978 11,854 ‐

Total instruction 11,507,862 12,424,285 12,415,780 64,005 (55,500)

Pupil transportation 1,590,441 1,334,457 1,329,631 4,826 ‐

Employee benefits 6,312,065 5,782,114 5,766,366 4,705 11,043

Debt service 4,382,337 4,030,627 4,030,627 ‐ ‐

Total expenditures 27,200,000 27,405,298 27,295,871 156,035 (46,608)

Other financing uses

Transfer to other funds ‐ ‐ 309,797 ‐ (309,797)

Total expenditures and other uses 27,200,000$ 27,405,298$ 27,605,668$ 156,035$ (356,405)$

Net change in fund balances (624,156)

Fund balance ‐ beginning 5,803,309

Fund balance ‐ ending 5,179,153$

(a) Includes the voter approved budget of $27,200,000 plus prior year encumbrances carried over of $205,298, in accordance with GASB Statement No 34,

Basic Financial Statements ‐ and Management's Discussion and Analysis ‐ for State and Local Governments

(b) Includes all transfers and other legally authorized changes applicable to the fiscal year as approved by the Board of Education

(c) Includes the May 2013 voter approved use of the capital reserve for the next year in the amount of $270,000, the May 2012 voter approved use of General

fund revenue to cover a portion of the bus purchases in the amount of $32,402 and the General fund required match for the section 4408 program in

the amount of $7,395

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Supplementary Information

Schedule of Change from Adopted Budget to Final Budget and the Real Property Tax Limit For the Year Ended June 30, 2013

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CHANGE FROM ADOPTED BUDGET TO FINAL BUDGET

Adopted budget 27,200,000$

Add: Prior year's encumbrances 205,298

Original budget 27,405,298

Budget revision ‐

Final budget 27,405,298$

SECTION 1318 OF REAL PROPERTY TAX LAW LIMIT CALCULATION

2013‐14 voter‐approved expenditure budget 27,500,000$

maximum allowed (4% of 2013‐14 budget)

General fund fund balance subject to Section 1318 of Real Property Tax Law*:

Unrestricted fund balance:

Assigned fund balance 1,156,035

Unassigned fund balance 704,381

Total unrestricted fund balance 1,860,416

Less:

Appropriated fund balance 1,000,000

Encumbrances included in committed and assigned fund balance 156,035

Total adjustments 1,156,035

General fund fund balance subject to Section 1318 of Real Property Tax Law 704,381$

Actual percentage 2.6%

*Per Office of the State Comptroller's "Fund Balance Reporting and Governmental Fund Type

Definitions", Updated April 2011 (Originally Issued November 2010), the portion of General Fund fund

balance subject to Section 1318 of the Real Property Tax Law is: unrestricted fund balance (i.e., the total

of the committed, assigned, and unassigned classifications), minus appropriated fund balance, amounts

reserved for insurance recovery, amounts reserved for tax reduction, and encumbrances included in

committed and assigned fund balance.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Supplementary Information

Schedule of Project Expenditures – Capital Projects Fund For the Year Ended June 30, 2013

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Original

Appropriation

Revised

Appropriation Prior Years Current Year Total

Unexpended

Balance

Proceeds of

Obligations (a) State Aid (b)

Local Sources

(c) Total

Fund Balance

June 30, 2013

Project Title

Renovations 21,900,000$ 21,900,000$ 17,540,063$ 2,561,173$ 20,101,236$ 1,798,764$ 19,000,000$ 438,882$ 992,093$ 20,430,975$ 329,739$

Buses 505,745 505,745 ‐ 398,402 398,402 107,343 366,000 ‐ 32,402 398,402 ‐

Totals 22,405,745$ 22,405,745$ 17,540,063$ 2,959,575$ 20,499,638$ 1,906,107$ 19,366,000$ 438,882$ 1,024,495$ 20,829,377$ 329,739$

Expenditures Methods of Financing

(a) Proceeds of obligations only include obligations that impact fund balance which only include long‐term debt. Long‐term debt is recognized as revenue when issued which increases fund balance.

(b) Local sources represent the monies directly from the Districts appropriations and capital reserves established by the District. All local

sources are approved by District voters for use in specific voter approved capital projects.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT SUPPLEMENTARY INFORMATION Net Investment in Capital Assets For the Year Ended June 30, 2013

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Capital assets, net 41,388,752$

Deduct:

Short‐term portion of bonds payable (2,451,000)

Long‐term portion of bonds payable (25,735,000)

(28,186,000)

Net investment in capital assets 13,202,752$

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON

COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Independent Auditor’s Report Board of Education Jordan‐Elbridge Central School District Jordan, New York We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Jordan‐Elbridge Central School District (the District) as of and for the year ended June 30, 2013, and the related notes to the financial statements, which collectively comprise Jordan‐Elbridge Central School District’s basic financial statements and have issued our report thereon dated October 2, 2013. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered Jordan‐Elbridge Central School District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Jordan‐Elbridge Central School District’s internal control. Accordingly, we do not express an opinion on the effectiveness of Jordan‐Elbridge Central School District’s internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over financial reporting that might be significant deficiencies or material weaknesses and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as described in the accompanying schedule of findings and questioned costs, we identified certain deficiencies in internal control over financial reporting that we consider to be material weaknesses and other deficiencies that we consider to be significant deficiencies. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiency described in the accompanying schedule of findings and questioned costs, which is described as item 2013‐1, to be a material weakness.

A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and questioned costs, which are described as items 2013‐2 through 2013‐5, to be significant deficiencies. Compliance and Other Matters As part of obtaining reasonable assurance about whether Jordan‐Elbridge Central School District’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. We noted certain other matters that we reported to management of Jordan‐Elbridge Central School District in a separate letter dated October 2, 2013. Jordan Elbridge Central School District’s Response to Findings Jordan‐Elbridge Central School District’s responses to the findings identified in our audit are described in the accompanying schedule of findings and questioned costs. Jordan‐Elbridge Central School District’s responses were not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on them. Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. This report is intended solely for the information and use of the Board of Education, management, federal awarding agencies and pass‐through entities and is not intended to be and should not be used by anyone other than these specified parties. Syracuse, New York October 2, 2013

REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A‐133

Independent Auditor’s Report Board of Education Jordan‐Elbridge Central School District Jordan, New York Report on Compliance for Each Major Federal Program

We have audited Jordan Elbridge Central School District’s compliance with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A‐133 Compliance Supplement that could have a direct and material effect on each of Jordan Elbridge Central School District’s major federal programs for the year ended June 30, 2013. Jordan Elbridge Central School District’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs. Management’s Responsibility

Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs.

Auditor’s Responsibility

Our responsibility is to express an opinion on compliance for each of Jordan Elbridge Central School District’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A‐133, Audits of States, Local Governments, and Non‐Profit Organizations. Those standards and OMB Circular A‐133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Jordan Elbridge Central School District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of Jordan Elbridge Central School District’s compliance.

Opinion on Each Major Federal Program

In our opinion, Jordan Elbridge Central School District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2013.

Report on Internal Control over Compliance

Management of Jordan‐Elbridge Central School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Jordan‐Elbridge Central School District’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program as a basis for designing auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A‐133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of Jordan‐Elbridge Central School District’s internal control over compliance.

Our consideration of internal control over compliance was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies, and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as discussed below, we identified certain deficiencies in internal control over compliance that we consider to be material weaknesses and significant deficiencies.

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected on a timely basis. We consider the deficiency in internal control over compliance described in the accompanying schedule of findings and questioned costs as item 2013‐1 to be a material weakness. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. We consider the deficiency in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2013‐4 to be significant deficiencies. Schedule of Expenditures of Federal Awards We have audited the financial statements of Jordan‐Elbridge Central School District as of and for the year ended June 30, 2013, and have issued our report thereon dated October 2, 2013, which contained an

unqualified opinion on those financial statements. Our audit was performed for the purpose of forming an opinion on the financial statements as a whole. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by Circular A‐133 and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain other procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated, in all material respects, in relation to the financial statements as a whole. Restricted Use The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A‐133. Accordingly, this report is not suitable for any other purpose. Syracuse, New York October 2, 2013

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Notes to Schedule of Expenditures of Federal Awards

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Federal

CFDA

Number

Pass‐through

Number

Current Year

Expenditures

U.S. Department of Agriculture:

(Passed through the State Department of Education)

(Grantor's No. 251601060000)

Child Nutrition Cluster

National School Breakfast Program 10.553 44,117$

National School Lunch Program 10.555 195,185

National School Lunch Program ‐ commodities 10.555 40,604

Total U.S. Department of Agriculture 279,906

U.S. Department of Education:

(Passed through the State Department of Education)

(Grantor's No. 251601060000)

Special Education Cluster (IDEA)

Special Education‐Grants to States (IDEA, B) 84.027A 0032‐12‐0643 354,467

Special Education‐Preschool Grants (IDEA, Preschool) 84.173A 0033‐12‐0643 13,654

Total Special Education Cluster (IDEA) 368,121

Title I Grants to Local Educational Agencies

(Title I, Part A of the ESEA) 84.010A 0021‐12‐2105 210,240

Recovery ‐ Education Jobs Fund (Ed Jobs) 84.410A 5400‐12‐2105 171,532

Recovery ‐ Race to the Top 84.395A 5500‐13‐2105 30,380

Mentor Teacher Internship Program 84.397A 0663‐13‐0104 9,024

Improving Teacher Quality State Grants (Title II, A) 84.367A 0147‐12‐2105 67,896

Total U.S. Department of Education 857,193

Total Expenditures of Federal Awards 1,137,099$

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Notes to Schedule of Expenditures of Federal Awards

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1. Significant Accounting Policies

The accompanying schedule of expenditures of federal awards is a summary of the activity of Jordan‐Elbridge Central School District’s federal award programs and presents transactions that are included in the basic financial statements of the District presented on the modified accrual basis of accounting, as required by accounting principles generally accepted in the United States of America.

2. Basis of Accounting

The accompanying schedule of expenditures of federal awards includes the federal grant activity of Jordan‐Elbridge Central School District and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A‐133, Audits of States, Local Governments and Non Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. CFDA numbers and pass‐through numbers are provided when available. During the year ended June 30, 2013, Jordan‐Elbridge Central School District received funds from the American Recovery and Reinvestment Act of 2009 (“Recovery Act”). Such funds are designated as “Recovery” on the schedule of expenditures of federal awards and amounted to $201,912 for the year ended June 30, 2013.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Status of Prior Audit Findings and Recommendations

‐13‐

Financial Statement Findings Material Weaknesses:

2012‐1 Monthly Financial Closing Process

Condition: Management had not examined or reconciled certain accounts prior to the start of the audit. This includes consideration of all accounts payable, accrued liability, deferred revenue, due from state and federal, and accounts receivable balances. Significant audit adjustments, with a net impact to governmental funds in aggregate of approximately $500,000, were necessary to reconcile and properly state the accounts payable, accrued liability, deferred revenue, due from state and federal, and accounts receivable balances as of June 30, 2012.

Recommendation: Monthly financial closing policies and procedures designed by management should be implemented requiring timely reconciliation and review of account balances Current status: See current year finding 2013‐1.

2012‐2 Business Office Policies and Procedures

Condition: The District has not fully implemented its policies and procedures for fiscal operations within the business office, including: cash receipts, cash disbursements and payroll. Certain transactions selected for testing were found to lack adequate required supporting documentation. The District designed policies and procedures during the fiscal year to address the business office functions. Such policies and procedures were not completed until May 2012 and were not fully implemented by June 2012.

Recommendation: Management should continue working to implement the policies and procedures with respect to fiscal operation within the business office.

Current status: Management has taken corrective action.


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Financial Statement Findings (continued)

Material Weaknesses (continued): 2012‐3 Preparation of Financial Statements

Condition: Management has established a chart of accounts and has structured its trial balance to reflect New York State financial reporting requirements and requirements of the Governmental Accounting Standards Board. Although all adjusting and correcting audit entries were approved by management, management does not possess the ability to prepare external full fund basis and government‐wide financial statements, including all required financial statement disclosures, in accordance with governmental accounting standards, and required supplementary information.

Recommendation: Management should examine responsibilities and resources to identify an individual with the skillset to prepare the financial statements, including notes and supplementary information. Current status: Management has taken corrective action.

Significant Deficiencies:

2012‐4 Schedule of Expenditures of Federal Awards (SEFA)

Condition: Management was not able to prepare the schedule of expenditures of federal awards. Circular A‐133, subpart C, Section 300, states that the auditee (the District) should identify in its accounts all federal awards received and expended, as well as the federal programs under which they were received. Federal program and award identification includes, as applicable, the CFDA title and number, the award number and year, the name of the federal granting agency, and the name of the pass‐through entity. Using this information, the auditee (the District) should be able to reconcile amounts presented in the financial statements to related amounts in the schedule of expenditures of federal awards. Total federal expenditures were $1,325,299 for the year ended June 30, 2012.

Recommendation: We recommend the District seek out and provide the necessary training to the designated individual to prepare a complete and accurate SEFA.



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Other Control Deficiencies:

2012‐5 Cash Management

Condition: The District currently maintains separate bank accounts for its respective funds. However, we noted instances whereby the District had not internally transferred the necessary cash balances to reimburse the General Fund for obligations paid on behalf of the School Food Service Fund throughout the year under audit. The total of these transfers should have been $284,712.

Recommendation: We recommend the District continue to implement its cash management policies and procedures to ensure the necessary transfers are made between bank accounts to accurately reflect the cash balance and activity of each respective fund.

Current status: See current year finding 2013‐3.

2012‐6 Interfund Accounting

Condition: The District routinely has transactions among different governmental funds which result in receivables / payables between funds. Interfund activity has not been settled within one year, which is not consistent with requirements noted below. In addition, interfund activity was not properly recorded during the year under audit, requiring audit adjustments of approximately $398,000.

National Council on Governmental Accounting (NCGA) Statement No. 1, Governmental Accounting and Financial Reporting Principles, paragraphs 57 and 75 state that interfund transfers should be recognized in the period in which the interfund receivable and payable arise. If the interfund receivable and payable are not expected to be settled within a reasonable amount of time, the interfund balances should be reduced.

Recommendation: Management should complete the implementation process to ensure interfund activity is recorded and balances are settled within one year. Current status: See current year finding 2013‐4.


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Financial Statement Findings (continued) Other Control Deficiencies: (continued) 2012‐7 Payroll Expense Review

Condition: The general ledger payroll expenditures for the year under audit were not reconciled to the District’s payroll registers on a periodic basis. The District treasurer prepared payroll reconciliation at the request of the auditors for the period ending June 30, 2012. This analysis reconciled over $11,600,000 of payroll expenditures.

In addition, three individuals’ salaries of a total of eighteen possible selections were inappropriately charged to the 2010‐11 IDEA Part B, 611, Recovery Act budget code which had a contract period ending on June 30, 2011. These salaries totaled approximately $172,000.

Recommendation: Policies and procedures to ensure payroll expenditures are reconciled to the general ledger and Federal grant budgets on a consistent basis throughout the year should be implemented. Current status: Management has taken corrective action.

2012‐8 General Ledger Cash Balances

Condition: The District has implemented procedures that include independent review and approval of the bank reconciliations during the year under audit; however, the general ledger cash balances were not adjusted to reflect the reconciled balances on a consistent basis throughout the year under audit. Audit adjustments with a net effect on governmental funds of approximately $115,000 were necessary to accurately reflect the June 30, 2012 reconciled cash balances. Recommendation: Policies and procedures should be implemented requiring that general ledger cash accounts are adjusted on a consistent basis throughout the year to reflect the reconciled balances.

Current status: See current year findings 2013‐1 and 2013‐4.


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Other Control Deficiencies: (continued) 2012‐9 Segregation of Duties – Treasury Functions

Condition: Over the course of the year, the business office continued to have turnover in accounting personnel, which resulted in treasury functions not consistently being segregated according to function. The District Treasurer was responsible for recording cash receipts and making the bank deposits during the year under audit.

Recommendation: Procedures should be implemented to ensure that treasury duties are appropriately segregated.


2012‐10 Journal Entries

Condition: We noted that of the 64 budget adjusting entries selected for testing, 34 lacked supporting documentation; of the 30 remaining selections that contained supporting documentation, 7 lacked documentation of an independent review and approval. In addition, no independent review and approval process of manual adjusting journal entries was in place during the year under audit.

Recommendation: Policies and procedures should be implemented to ensure that all such entries are independently reviewed and approved prior to posting. Supporting documentation for all adjustments should be retained. Current status: Management has taken corrective action.

2012‐11 Accounting for Fixed Assets

Condition: A complete and accurate record of fixed assets, including consideration of related depreciation, was not maintained. In addition, a physical inventory of the District's fixed assets has not been recently conducted.

Recommendation: Procedures should be implemented to ensure proper records and tracking of fixed assets, including documentation specific to federal funds utilized. In addition, physical inventories should be performed on a periodic basis. Current status: See current year finding 2013‐5.


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Other Control Deficiencies: (continued) 2012‐12 Procurement Policies – Bid Documentation

Condition: As part of cash disbursements testing 18 vendors were selected with competitive bid or quote documentation requirements in accordance with the District’s procurement policy; supporting documentation evidencing compliance with the procurement policy could not be provided. The selection sample for these 18 vendors amounted to approximately $460,000 with the average individual payment approximating $18,000. The District’s policy requires that at least three written quotes be obtained for purchases in excess of $1,500 and that competitive bids be solicited for purchase and public work contracts of $20,000 or higher. Professional services are exempt from competitive bid requirements.

Recommendation: Policies and procedures should be implemented and monitored to ensure consistent adherence to District procurement policies and adequate retention of supporting documentation.


2012‐13 Budget Monitoring

Condition: The District's business office and special education departments did not communicate throughout the school year to determine the amounts charged to each Federal grant, as well as the remaining grant budget balances. As such, the District over charged its 2010‐11 Title I, IDEA Part B 611 and IDEA Part B 611, Recovery Act Grants by a total of approximately $183,000. This resulted in an audit adjustment of approximately $183,000 to transfer these excess expenditures from the special aid fund back to the general fund.

In addition, although the budget status reports were prepared by the District as required by New York State law and were distributed to the Board of Education for review, there was no evidence that these budget status reports were reviewed by appropriate staff levels within the District responsible for their specific portions of the budget.

Recommendation: Procedures should implement to ensure adequate communication between departments to analyze the budget versus actual Federal grant expenditures to maximize available grants. In addition, a detailed review of the budget status reports should be reviewed on a monthly basis by those staff responsible for those portions of the budget.


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Other Control Deficiencies: (continued) 2012‐14 Wire Transfers and Electronic Disbursements

Condition: It was noted that wire transfers for short and long‐term debt for principal and interest of approximately $4,100,000 were made without an independent review or approval of such wire transfer before such transfer took place. Section 1724 of the New York State Education Law requires all school districts to audit each voucher package before it is paid. The District has appointed a claims auditor to carry out this responsibility. It wasn’t evident that a review of the voucher package took place prior to the disbursement. Recommendation: All transfers should be approved and reviewed by the claims auditor. Management should adopt procedures to ensure all wires are appropriately approved.


Federal Award Findings and Questioned Costs:

2012‐15 Conflict of Interest Forms

Condition: Conflict of interest disclosure forms were not maintained during the period under audit for members of the Committee on Special Education (CSE). In accordance with Part 6 of the June 30, 2012 OMB Circular A‐133 Compliance Supplement, conflict‐of‐interest statements should be maintained for individuals who determine and review eligibility under Federal award programs. Recommendation: The District should distribute and collect conflict of interest disclosure forms from all members of management and those charged with governance on at least an annual basis.



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Other Control Deficiencies: (continued) 2012‐16 Program Expenditure Oversight

Condition: There was not adequate oversight with respect to the preparation of federal reimbursement requests. The District requested total 2010‐11 Title IIa and Mentor Teacher Internship Program (ARRA) funding based on contract amounts rather than actual allowable expenditures during the grant periods. For the Title IIa grant, the grant budget was $74,376 while the actual allowable expenditure was $58,059. The District requested and received reimbursement of $74,376, therefore receiving $16,317 in excess of the allowable amount per the grant agreement. For the Mentor Teacher Internship Program, the grant budget was $15,000 while the actual allowable expenditure was $6,463. The District requested and received reimbursement of $15,000, therefore receiving $8,537 in excess of the allowable amount per the grant agreement. Recommendation: The District should implement an oversight function with respect to federal requests; in addition communication between fiscal and special aid departments should be enhanced. Also, the District should contact the New York State Education Department (NYSED) to determine the appropriate course of action.

Current status: See current year finding 2013‐6.

JORDAN‐ELBRIDGE CENTRAL SCHOOL DISTRICT Schedule of Findings and Questioned Costs


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Section I. Summary of Audit Results

Financial Statements

Type of auditor’s report issued: unmodified

Internal control over financial reporting:

Material weaknesses identified? X Yes _______No

Significant deficiencies identified that are not considered to be material weaknesses? X Yes _______No

Noncompliance material to financial statements noted? Yes ___X___No

Federal Awards

Internal control over major programs:

Material weaknesses identified? X Yes _______No

Significant deficiencies identified that are not considered to be material weaknesses? X Yes _______No

Type of auditor’s report issued on compliance for major programs: unmodified Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A‐133? Yes ___X___No

Identification of major programs tested:

CFDA Number(s) Name of Federal Program or Cluster

Special Education Cluster: 84.027 Special Education – Grants to States (IDEA, Part B) 84.173 Special Education – Preschool Grants (IDEA Preschool) 84.010 Title I Grants to Local Education Agencies (Title I, Part A of the ESEA)

Dollar threshold used to distinguish between type A and type B programs: $300,000

Auditee qualified as low‐risk auditee? Yes X No



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Section II. Financial Statement Findings Material Weaknesses:

2013‐1 Annual Financial Closing Process

Condition: Management had not examined or reconciled certain accounts prior to the onset of the audit. This includes consideration of accounts payable, due from other governments and accounts receivable balances. Managements current procedures do not address the annual closing of account balances for financial statement purposes, especially those related to accrual based accounting. Criteria: Formal policies and procedures should be implemented to ensure that all necessary adjustments are posted to the general ledger in a timely manner rather than allowing such misstatements to be detected during the external audit. In accordance with 34 CFR 80.41(b)(2), the District did not implement a process to convert its cash basis accounting records to accrual basis records as required by New York State Education Department requirements. New York State Education Department requires the financial statements and related accounts to be presented in accordance with governmental accounting standards which require the accrual basis of accounting for financial reporting.

Cause: The District has not fully implemented procedures ensuring all account balances are examined and reconciled throughout the fiscal year during the monthly financial closing process.

Effect: Numerous accounting adjustments were proposed as a result of the audit which was material to the individual funds. Management recorded all such adjustments whereby the approximate impact on the individual funds was:

General Fund ‐ $659,000

School Food Service ‐ $23,000

Special Aid Fund ‐ $(453,000)

Capital Fund ‐ $1,041,000 Recommendation: An annual closing process and procedure should be developed by management to reconcile all significant account balances with adequate supporting documentation. This should not only include the fund accounts but also the District‐wide accounts, such as fixed assets and long term debt. Views of Responsible Official and Planned Corrective Actions: The conversion to a new software accounting system created some challenges in adapting to new procedures for processing and training new staff members. Issues were uncovered at the end of the year that required review and adjustments outside of normal year end procedures. Procedures for an annual closing process will be established and adhered to going forward; matters will be resolved for the closing process June 30, 2014.



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Section II. Financial Statement Findings (continued)

Significant Deficiencies:

2013‐2 Budget Monitoring

Condition: A budget status report is required to be communicated to the Board of Education on at least a quarterly basis and on a monthly basis if budget transfers were completed by the District as required by section 170.2 of the New York State Education Departments Commissioner's Regulations. The District did not comply with these requirements as the first status report was not provided until the February 3, 2013 board meeting which was for the period ended December 31, 2012. Although such report was provided, it was not compliant with the level of detail mandated by the regulations as such report did not detail the appropriations & revenues by object code. The District provided reports for the months ended February, March and April. The March and April reports were in greater detail as required by the regulations. No reports were provided for the months of January, May or June. Criteria: Budget status reports should be provided on a monthly basis to the Board of Education. Cause: Management has failed to comply with the regulations to provide such reports on a monthly basis in the detail mandated to the Board of Education. Effect: Management did not comply with the New York State Department of Education Commissioner's regulations for the frequency and format of its budget status reports. Recommendation: The District should consistently provide the budget status reports on a monthly basis within 15 days of each month end. These reports should be at the level of detail mandated by the Commissioner's regulations which includes both revenues and appropriations. These reports should be reviewed by the Board of Education whereby such review is documented in the boards' minutes. Management’s Corrective Action Plan: Management will begin to provide the budget status reports in the detail required within 15 days after each month end beginning for the month ended September 30, 2013. Such reports will be included as an agenda item for the board to consider each month.



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Section II. Financial Statement Findings (continued) 2013‐3 Cash Management

Condition: The District has established a separate bank account to account for the daily sales activity related to the District's food service program. The bank balance of this account was $326,168 as of June 30, 2013. This bank account does not pay any of the food service expenses which are paid from a separate bank account associated with the General Fund. The District had not appropriately reconciled the ending cash balance to reflect the payments from the General fund. As such, the net cash in the school food service fund should have been $41,596. The District subsequently transferred the difference of $284,572 to the appropriate general fund bank account and recorded the adjustment accordingly. Criteria: Cash management procedures should be designed and implemented to ensure that the District's separate bank account balances and individual funds cash position accurately reflect the revenue and expenditures recognized within each respective fund.

Cause: Management has not fully implemented developed policies and procedures to consistently monitor the cash balances within all of the District's bank accounts and funds.

Effect: As such, the net cash in the school food service fund should have been $41,596. The District subsequently transferred the difference of $284,572 to the appropriate general fund bank account and recorded the adjustment accordingly. Recommendation: We recommend the District continue to implement its cash management policies and procedures to ensure the necessary transfers are made between bank accounts to accurately reflect the cash balance and activity of each respective fund. Views of Responsible Official and Planned Corrective Actions: Management will implement a policy to transfer school lunch funds on a quarterly basis beginning September 30, 2013.



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Section II. Financial Statement Findings (continued) Significant Deficiencies: (continued) 2013‐4 Interfund Accounting

Condition: The District routinely has transactions among different government funds which result in receivables / payables between funds. Many of these transactions are system designed transactions which automatically post certain activity across different funds, such as payroll and related benefit activity.

Criteria: National Council on Governmental Accounting (NCGA) Statement No. 1, Governmental Accounting and Financial Reporting Principles, paragraphs 57 and 75 state that interfund transfers should be recognized in the period in which the interfund receivable and payable arise. If the interfund receivable and payable are not expected to be settled within a reasonable amount of time, the interfund balances should be reduced.

Cause: Management has not fully implemented procedures to ensure proper recording and settling of interfund balances.

Effect: Certain interfund transactions were not appropriately recorded or settled within the year resulting in adjustments to the balances. The adjustments recorded across the funds approximated the following:

General Fund ‐ $(20,000)

Special Aid Fund ‐ $304,000

Capital Fund ‐ $32,000 Recommendation: Management should design a process to reconcile interfund activity on a monthly basis and to settle interfund activity on at least an annual basis. Views of Responsible Official and Planned Corrective Actions: The District integrated a new accounting software system (Finance Manager) on July 1, 2012 that complicated this reconciliation process. Management will work to design a process to reconcile these accounts and implement this process by December 31, 2013.



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Section II. Financial Statement Findings (continued)

Significant Deficiencies: (continued)

2013‐5 Accounting for Fixed Assets

Condition: A complete and accurate record of fixed assets, including consideration of related depreciation, is not maintained. In addition, a physical inventory of the District's fixed assets has not been recently conducted. Criteria: In accordance with 34 CFR 80.32 (4), Property records must be maintained that include a description of the property, a serial number or other identification number, the source of property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the cost of the property, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. In addition, a physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Cause: Policies and procedures requiring the recording, disposal and tracking the District's fixed assets have not been implemented.

Effect: In order to accurately reflect the District’s fixed asset balances, audit adjustments of approximately $623,000 and $359,000, respectively for asset additions and asset disposals were necessary to fairly state the account balances. Recommendation: Procedures should be implemented to ensure proper records and tracking of fixed assets. In addition, physical inventories should be performed on a periodic basis whereby the accounting records are reconciled to the physical inventory of assets. Views of Responsible Official and Planned Corrective Actions: The District will establish a plan to create, monitor and maintain a fixed asset listing that reflects the District’s fixed assets and depreciation schedules. This will be completed by June 30, 2014.



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Section III. Federal Award Findings and Questioned Costs 2013‐1 Annual Financial Closing Process Department of Education U.S. Department of Education (Passed through the State Department of Education) Special Education – Grants to States (IDEA, B) – CFDA No. 84.027 Special Education – Preschool Grants (IDEA Preschool) – CFDA No. 84.173 Grants to Local Education Agencies – CFDA No. 84.010

Condition: See Section II‐ Financial Statement Finding 2013‐1. Criteria: See Section II‐ Financial Statement Finding 2013‐1.

Cause: See Section II‐ Financial Statement Finding 2013‐1.

Effect: See Section II‐ Financial Statement Finding 2013‐1. Questioned Costs: None Recommendation: See Section II‐ Financial Statement Finding 2013‐1. Views of Responsible Official and Planned Corrective Actions: See Section II‐ Financial Statement Finding 2013‐1.



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Section III. Federal Award Findings and Questioned Costs (continued)

2013‐4 Interfund Accounting Department of Education U.S. Department of Education (Passed through the State Department of Education) Special Education – Grants to States (IDEA, B) – CFDA No. 84.027 Special Education – Preschool Grants (IDEA Preschool) – CFDA No. 84.173 Grants to Local Education Agencies – CFDA No. 84.010

Condition: See Section II‐ Financial Statement Finding 2013‐4. Criteria: See Section II‐ Financial Statement Finding 2013‐4.

Cause: See Section II‐ Financial Statement Finding 2013‐4.

Effect: See Section II‐ Financial Statement Finding 2013‐4. Questioned Costs: None Recommendation: See Section II‐ Financial Statement Finding 2013‐4. Views of Responsible Official and Planned Corrective Actions: See Section II‐ Financial Statement Finding 2013‐4.

October 2, 2013 To the Board of Education Jordan‐Elbridge Central School District Jordan, New York We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Jordan‐Elbridge Central School District (the District) as of and for the year ended June 30, 2013, and have issued our report thereon dated October 2, 2013. Professional standards require that we advise you of the following matters relating to our audit. Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter dated June 3, 2013, our responsibility, as described by professional standards, is to form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in conformity with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities. Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the internal control of the District solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you. We have provided our findings regarding control deficiencies over financial reporting and other matters noted during our audit in a separate letter to you dated October 2, 2013.

Planned Scope and Timing of the Audit We conducted our audit consistent with the planned scope and timing we previously communicated to you. Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate, our firm, and our network firms have complied with all relevant ethical requirements regarding independence. Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the District is included in Note 1 to the financial statements. There have been no initial selection of accounting policies and no changes in significant accounting policies or their application during 2013. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Significant Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments. The most sensitive accounting estimates affecting the financial statements are management’s estimate of: the post‐employment benefit obligation, the liability for compensated absences, and the useful lives of depreciable assets. We have evaluated the key factors and assumptions used to develop these estimates and determined they are reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units. The disclosures in the financial statements are neutral, consistent, and clear. Significant Difficulties Encountered during the Audit We encountered no significant difficulties in dealing with management relating to the performance of the audit.

Uncorrected and Corrected Misstatements For purposes of this communication, professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit. There were no uncorrected misstatements. In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. The attached schedule presents a summary of the misstatements detected as a result of our audit procedures and corrected by management. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the District’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit. Representations Requested from Management We have requested certain written representations from management, which are included in the attached letter dated October 2, 2013. Management’s Consultations with Other Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters.

Other Significant Matters, Findings, or Issues In the normal course of our professional association with the District, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the District’s auditors.

This information is intended solely for the information and use of the Board of Education and management of Jordan‐Elbridge Central School District and is not intended to be and should not be used by anyone other than these specified parties. GROSSMAN ST. AMOUR CERTIFIED PUBLIC ACCOUNTANTS, PLLC


Accumulation of Audit Adjustments

June 30, 2013

General Fund:

Description of Adjustment Assets Liabilities Fund Balance Revenues Expenditures

To adjust school tax relief (STAR) aid (531,994)$ ‐$ (531,994)$ (531,994)$ ‐$

To record additional NYS basic formula aid 1,179,414 ‐ 1,179,414 1,179,414 ‐

To adjust other NYS aid (346,990) ‐ (346,990) (346,990) ‐

To record outstanding transfer from School Food Service Fund 284,571 ‐ 284,571 284,571 ‐

To transfer reserve monies to the Capital Fund ‐ 270,000 (270,000) ‐ 270,000

Aggregate remaining entries 216,913 206,464 10,449 216,913 206,464

Total 801,914$ 476,464$ 325,450$ 801,914$ 476,464$

General Fund totals 6,682,672$ 1,503,519$ 5,179,153$ 26,981,512$ 27,605,668$

Percentage of fund totals 12.00% 31.69% 6.28% 2.97% 1.73%

School Food Service Fund:


To adjust NYS aid revenue (5,274)$ ‐$ (5,274)$ (5,274)$ ‐$

To adjust cafeteria sales revenue 20,912 (4,228) 25,140 25,140 ‐

Aggregate remaining entries 3,470 ‐ 3,470 2,112 (1,358)

Total 19,108$ (4,228)$ 23,336$ 21,978$ (1,358)$

School Food Service Fund totals 52,392$ 4,104$ 48,288$ 423,837$ 493,009$

Percentage of fund totals 36.47% ‐103.02% 48.33% 5.19% ‐0.28%

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Accumulation of Audit Adjustments

June 30, 2013

Special Aid Fund:


To record Education Jobs Fund salaries ‐$ 171,532$ (171,532)$ ‐$ 171,532$

To adjust NYS summer school aid ‐ 11,455 (11,455) (11,455) ‐

To adjust Federal grant revenues (149,375) 120,763 (270,138) (270,138) ‐

Total (149,375)$ 303,750$ (453,125)$ (281,593)$ 171,532$

Special Aid Fund totals 95,403$ 95,403$ ‐$ 1,029,261$ 1,029,261$

Percentage of fund totals ‐156.57% 318.39% ‐100.00% ‐27.36% 16.67%

Capital Projects Fund:


To adjust retainage payable ‐$ (572,595)$ 572,595$ ‐$ (572,595)$

To record NYS Excel aid revenue 438,882 ‐ 438,882 438,882 ‐

To record General Fund coverage of 2012‐13 bus purchases 32,402 ‐ 32,402 32,402 ‐

To record transfer of reserve monies from General Fund 270,000 ‐ 270,000 270,000 ‐

Aggregate remaining entries ‐ 2,806 (2,806) ‐ 2,806

Total 741,284$ (569,789)$ 1,311,073$ 741,284$ (569,789)$

Capital Fund totals 763,396$ 602,539$ 160,857$ 1,971,495$ 2,959,575$

Percentage of fund totals 97.10% ‐94.56% 815.05% 37.60% ‐19.25%

Agency Fund


To clear out automated posting activity (138,359)$ (33,828)$ (104,531)$ ‐$ 104,531$

Agency Fund totals 66,633$ ‐$ 66,633$ ‐$ ‐$

Percentage of fund totals ‐207.64% 100.00% ‐156.88% 0.00% 100.00%

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jordan- elbridge central school district audit

Documents

material weaknesses

significant deficiencies

internal control existswhen

material misstatement

acombination of deficiencies

reasonable assurance

reasonable possibility

certain provisions of