Delay in audit filing creates cash flow problem with RCAS
ROGERS CITY — Because of a delay in having their audit filed with the state, Rogers City Area Schools Superintendent Dave O’Bryant told the board Tuesday state officials were going to withhold the district’s November state aid payment.
While that will create a cash flow problem within the district, O’Bryant said he was confident district officials could survive. Until a cash flow starts again, however, he told the board that he has instituted a spending freeze on non-essential expenditures. He said only approved expenditures would be processed until the situation is corrected.
The financial problem arose because the district’s audit hasn’t been completed, or filed. The district missed a state filing deadline of Nov. 1. O’Bryant referred board members to several notes regarding the delay in the audit filing.
After talking with state officials, he said he learned that because of the delay, the November state aid payment has been put on hold – thus creating the cash flow problem.
“I’ve worked with Ms. Hughes (Robin Hughes, School Finance and Personnel Manager) and she assures me we can make payments and such until we receive our November and December state aid payments,” O’Bryant said. “Also in December we hit our tax revenue from the local townships. So we’ll have all of that coming in.”
O’Bryant said he communicated via email with Christopher May at the Michigan Department of Education, who is in charge of the report. In addition to the missed state deadline, the district faces a Nov. 22 federal filing deadline for the audit as well.
“That federal deadline is coming hard and fast. We have to have that in by Nov. 22. I emailed Mr. Sandula (Mark Sanduala, Accountant with Straley Lamp and Kraenzlein) who is handling our audit,” he said.
O’Bryant said he received contact from Sandula who said, “It’s been a very tedious process and we’re very close to understanding what’s gone wrong.” O’Bryant said Sandula noted the everything will be “cleaned up” this week.
O’Bryant assured the board it appears as if things will be resolved in the days ahead – at least from the state perspective. He said after talking with May, once the audit has been filed state officials will work hard to release the funds to the district as quickly as possible.
As for the federal government, the district needs to work diligently to meet the Nov. 22 and the state needs to inform them of the missed state filing deadline.
No one knows what will happen after that, O’Bryant said.
“Things may trickle down from there,” he said.
Jordan Spence can be reached via email at firstname.lastname@example.org or by phone at 358-5687.