District's auditors use new system

PALMER -- A new federal law, General Accepted Standard Board 34, has the independent audit report for the Matanuska-Susitna Borough School District FY03 looking a bit different than in years past. The law requires nonprofits to depreciate assets, an accounting function the district had not faced before.

The Mat-Su Borough owns the school buildings, so they were not included in the district's depreciation; the district is required to depreciate all assets, such as desks and computers.

The district's net assets decreased by $2,677,610 for FY03; Superintendent of Business and Risk Management Jack Sherman said it is important to note that in the future, depreciation will not be so drastic, since it will now be done on a year-to-year basis. Future audit reports, he added, will show the changes from year to year, making it easier to analyze how the district is doing. Because this year's audit makeup is changed, there is nothing to compare it to.

"In the future we will start seeing patterns," Sherman said.

The state requires an external audit of school districts each year, but Sherman said that even without the requirement, the district would hire out an audit company such as Mikunda, Cottrell & Company, who performed the 2002-2003 school year audit, regardless.

"Even if the state didn't require it, it's just a good idea to have someone else not involved take a look," Sherman said.

The audit report looks at the district's "paper trail," which is not the same as looking at the actual dollars and cents spent in 2003. The auditors bestowed the district with an "unqualified opinion," the highest opinion the district could have received. All numbers were sound, says the report, and no corrective actions need to be taken.

"There are no indications to change any of our current policies and procedures," Sherman said.