Auditors give Flint an unmodified opinion but flag material weaknesses; ESSER spending reviewed

Stevenson & Company presented the Flint School District's fiscal year audit and issued an unmodified opinion, while calling out several areas needing improved internal control and month‑end discipline.

Auditor Cindy Scott told the board the consolidated, government‑wide statements are free of material misstatement and highlighted key balances: a net pension liability (approx. $37.7 million) and a net OPEB asset (approx. $6.26 million). The audit showed the district's consolidated position reflects significant capital investments and a decrease in cash driven by construction activity.

The auditors identified three material weaknesses: (1) material proposed audit entries that had to be made to present the financials accurately; (2) bank reconciliations that fell months behind during an extended staff absence, which contributed to a prior period adjustment; and (3) duplicate payments tied to construction activity that were ultimately recovered but reflected weak prepayment controls. They also disclosed two single‑audit findings: a Title I overdraw (questioned cost of ~$53,005) related to final expenditure reporting and inconsistent time‑and‑effort documentation for staff funded across multiple cost objectives. Auditors noted management's corrective actions and said training and closer monitoring had already begun for time‑and‑effort forms.

The report underscored that ESSER III funds (reported at $99,423,507 in one grant cycle) were spent without questioned costs; auditors commended the finance staff for that result while cautioning about the district's reliance on one‑time grant funds going forward. The general fund balance at June 30 was reported at roughly $46.7 million with about $12.6 million assigned to the next year's budget, leaving an unassigned balance of roughly $33.7 million (about 34.7% of current year expenditures).

Auditors urged monthly close discipline, cross‑training to avoid single points of failure, and improved controls around contract payments and bank reconciliations. Board members asked for specifics on corrective actions and staffing plans for finance positions; auditors recommended careful recruitment for the finance director role and better internal coverage for key duties.

Trustees praised staff for securing and spending ESSER funds appropriately while acknowledging the need to remediate the material weaknesses.