Preparing your school district’s financial reporting package? SAO’s updated review checklist can help

The long, hot summer days are waning, which means the end of another school district fiscal year is upon us. Yes, it is time again to close the books and prepare your annual financial reporting package. And, as we do every year to help you get ready, we published an updated Checklist for Preparing and Reviewing School District Financial Statements.

The updated 2022-23 checklist is now available in SAO’s Resource Library. Before you download it, we want to highlight a few things and share some advice.

SBITA reporting reminder is now on the checklist

The most significant change on the updated checklist is the inclusion of subscription-based information technology arrangements (SBITAs). School districts and other governments may enter into contracts to pay to use someone else’s information technology software, rather than purchase it outright. While these agreements are similar to a lease, they were excluded from the implementation of last year’s lease accounting changes. This year, you should explore if you have any of these contracts and prepare to account for them.

Lack of reviews is an ongoing audit issue

Your district should do many reviews for financial reporting purposes, including reviews of the county treasurer reconciliations, journal entries, and your entire financial reporting package. Take time to double-check your work, and have a second person review the information to ensure it is accurate and complete. The point of a secondary review is to detect errors and omissions, not merely to document a review was done. Our checklist prompts you to complete these reviews.

Bond refunding accounting continues to be a challenge

It is important that you consult the guidance in the School District Accounting Manual when accounting for a bond refunding, as mistakes are common. Make sure that you avoid netting the refunding activity on the Schedule of Long-Term Liabilities. Our checklist includes a question about bond refundings, due to the ongoing accounting issues with them.

Consider using our checklist before you file with the Office of Superintendent of Public Instruction. It can help you identify changes that need to be made to your annual report.

For help

Remember, we are here to help. If you have specific technical accounting questions, 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.