2012 Audit Report

1. 2012 Audit Report Ames Community School District

2. 2012 Financial Highlights • Fiscal 2012 General Fund revenues exceeded expenses by $5.7 million resulting in an increase in the fund balance from $10.2 million to $15.9 million

3. 2012 Financial Highlights • Revenues were $51.7 million vs. $50.6 million in fiscal 2011, and expenditures were $46.0 million vs. $46.2 million in fiscal 2011

4. 2012 Financial Highlights • The increase in General Fund revenues was attributable to an increase in state sources • The decrease in expenditures was due primarily to a decrease in negotiated salaries and benefits

5. Economic Highlights • The District has experienced declining enrollment in nine of the past eleven years. • Enrollment decreased 79 students for the October 2010 enrollment count and another 55 students for the October 2011 enrollment count. • The District experienced an increase of 4 students for the October 2012 enrollment count.

6. Economic Highlights • The District’s sales tax revenues remain strong with a small percentage of growth to help fund capital expenditures in the District.

7. Economic Highlights • On July 1, 2012, the IPERS increase to 8.67% will increase the Ames Community Schools employer benefit costs during fiscal 2013. • An additional increase to 8.93% is anticipated for FY14.

8. Unassigned Fund Balance and Solvency Ratio Comparison Solvency Ratio = Unassigned Fund Balance Revenues - AEA Flowthrough

9. General Fund Revenues Total General Fund Revenues of $51,662,662

10. General Fund Expenses Total General Fund Expenses of $45,945,827

11. Governmental Funds Restricted Fund Balance

12. Proprietary Fund Total Net Assets Page 24

13. Part II: Findings Related to the Financial Statements • Agency Fund - We noted that the District appears to be improperly accounting for Agency Fund accounts. • We noted pop funds, staff appreciation, MS teacher awards and the Environment Committee are reported in the Agency Fund. • Also noted the Academic Boosters are reported in the Agency Fund.

14. Part II: Findings Related to the Financial Statements • Infinite Campus - We noted that the District uses Infinite Campus software for the accounting of individual balances for lunch accounts. • The District does not appear to reconcile the balance in the individual student accounts to the General Ledger.

15. Part IV: Other Findings Related to Required Statutory Reporting • Certified Budget - District disbursements for the year ended June 30, 2012 exceeded the certified budget amounts in the non-instructional programs functional area.

16. Part IV: Other Findings Related to Required Statutory Reporting • Questionable Disbursements - We noted the District purchased volunteer t-shirts from the Student Activity Fund.

17. Part IV: Other Findings Related to Required Statutory Reporting • Certified Enrollment - We noted a variance in the basic enrollment data certified to the Department of Education. • The number of resident students was understated by 0.44.

18. Part IV: Other Findings Related to Required Statutory Reporting • Officiating Contracts - We noted that the Athletic Director was signing Activity Fund officiating contracts. • According to 291.1 of the Code of Iowa, the Board President shall sign all contracts entered into by the District.

19. Part IV: Other Findings Related to Required Statutory Reporting • Student Activity Fund - • Scholarship Awards: It appears that the District awards scholarships to students from proceeds generated from activities recorded in the Vocal Club within the High School account.

20. Part IV: Other Findings Related to Required Statutory Reporting • Student Activity Fund - • Commissions: We noted that Lifetouch commissions were recorded in the Student Activity Fund.

21. Thank you We’d like to thank the Board of Directors for selecting us as your independent auditors, as well as the management and staff in preparing for the audit. We recognize that many hours go into preparing for our audit and we appreciate your efforts.