Preparing your school district’s annual report? SAO’s updated tool can help
Aug 31, 2022
Aah, September: The kids are back in school, the leaves are starting to change colors, and pumpkin spice lattes once again dominate coffeehouse menus. It's also that time of year when school districts begin preparing their financial statements. And, as we do every year, we publish an updated Checklist for Preparing and Reviewing School District Financial Statements to help you get ready.
The updated 2021-2022 tool is now available in SAO's Resource Library. Before you download it, we want to highlight a few things and share some advice.
Leases are now on the checklist
There is a new checklist item for the most significant change for 2021-2022: lease accounting. Whether you're a lessee or a lessor, these changes will affect you. These changes affect all school districts including modified accrual and cash basis districts. Districts should refer to the Accounting Manual for Public School Districts in the State of Washington for authoritative guidance and example journal entries.
Our office published an article last May on lease accounting; read more here.
A new checklist item for recording transactions as they occur
We've also added a new question about recording your district's financial transactions as they occur, due to audit issues in this area. Accounting staff should promptly record deposits or disbursements as they occur so that your district's general ledger cash balance is always up to date. Then, at month-end, you should verify your general ledger balance accuracy by reconciling it to the county treasurer's statements. You might have a few items to record as a result of reconciling, but they should be minimal.
Pay extra attention to non-routine events or transactions
Our checklist has several questions about unique and one-time events, as well as other non-routine transactions. School districts often overlook these types of events or transactions, resulting in financial statement misstatements and audit issues. Make sure to spend some time on these questions, and research if and how such an event might affect financial reporting.
Consider using this tool before you file with the Office of Superintendent of Public Instruction, in case you identify changes that need to be made to your annual report.
Remember, we are here to help. If you have specific technical accounting questions about leases or other topics, please submit them using our HelpDesk in the client portal.
We also have financial management specialists at SAO's Center for Government Innovation available to talk with you about best practices, resources or internal controls. For assistance, reach out to us at Center@sao.wa.gov.