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Littleton Public Schools Policy |
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Policy Code DIE Policy Name Audits/Financial Monitoring Adoption July 2, 1984 Revised August 28, 2008 |
An audit is an examination of documents, records, and accounts for the purpose of:
In accordance with state statutes, all financial records of the District shall be audited yearly, following the close of the fiscal year.
Internal Auditing
Internal auditing, which is an important part of an effective system of internal management and control, shall be conducted periodically by technically trained staff personnel in business services. The internal audit shall be an evaluation of the manner in which the schools and administrative areas in the District carry out the Board of Education’s and state’s financial policies.
External Auditing
The Board of Education shall provide for and cause to be made annual audits, in accordance with generally accepted auditing standards, of the general purpose financial statements of the District by an independent (external) auditor, as prescribed by law. The contract with the external auditor will be on an annual basis. It shall be the policy of the District to limit the service of an external auditor to a maximum of five (5) consecutive years without a selection process being conducted. The District may change external auditors more frequently.
In order to select external auditors, the Board of Education shall issue a request for proposal (RFP) or use some other similar process for selection of an independent auditor licensed to practice in Colorado and knowledgeable in government accounting to conduct the audit. The Board of Education shall establish an audit selection committee at the issuance of the RFP that includes at least two members of the Board of Education. The treasurer of the Board of Education shall serve as one of the committee members. The current audit firm shall not be excluded from participating in the RFP process.
The independent auditor will audit the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate discretely presented component units and remaining fund information, which collectively comprise the basic financial statements of the District. The auditor shall issue an opinion as to whether the basic financial statements are fairly presented in all material respects.
In addition, the combining and individual fund statements and schedules, the schedule of expenditures of federal awards, and the auditor’s integrity report will be subjected to the auditing procedures applied in the financial statements, upon which an opinion will be issued in relation to the basic financial statements.
The audit objective shall also include reporting on the following:
· Internal control related to the financial statements and compliance with the provisions of applicable laws, regulations, contracts or grant agreements, noncompliance with which could have a material effect on the financial statements in accordance with Government Auditing Standards.
· Internal control related to major programs and an opinion on compliance with laws, regulations, and the provisions of contracts or grant agreements that could have a direct and material effect on each major program in accordance with the Single Audit Act Amendments of 1996 and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations.
· Disclosure of all instances of noncompliance with state law, including the Public School Finance Act of 1994, irrespective of materiality.
· A supplemental listing of all investments held by the District at the date of the financial statement.
The independent auditor shall meet with the Board of Education to discuss the audit report, make recommendations to the Board of Education concerning its accounting records, procedures, and related activities as may appear necessary or desirable, and perform such other related services as may be requested by the Board of Education.
The audit report shall be completed and submitted by the independent auditor to the District within five months after the close of the fiscal year unless a request for an extension of time is granted by the state auditor. Within 30 days after the Board of Education receives the audit, it shall be submitted to the state auditor and the state commissioner of education. In addition, administration shall provide the Board of Education a written response to each of the auditor’s management letter recommendations within 60 days after the audit reports are accepted by the Board of Education.
Legal Reference: C.R.S. 22-32-109(1)(k)
C.R.S. 22-44-204(3)
C.R.S. 24-75-601.3
C.R.S. 29-1-601 through 608