©2018 CliftonLarsonAllen LLP

Park Rapids Area Schools
Independent School District No. 309
Executive Audit Summary (EAS)
June 30, 2020

WEALTH ADVISORY  |  OUTSOURCING  |  AUDIT, TAX, AND CONSULTING
Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC‐registered investment advisor
 ©2018 CliftonLarsonAllen LLP
REQUIRED COMMUNICATIONS
• Our Responsibility Under Generally Accepted Auditing Standards, Government
Auditing Standards, and Uniform Guidance
– Primary responsibility is to provide our opinion on the fairness of presentation of
the financial statements
– Reviewed internal accounting controls
– Risk based audit approach
– Based on internal controls, determined scopes, and tests of transactions
– Expressed opinion based on tests
– Review internal controls and compliance – federal awards

• Planned Scope and Timing of the Audit

– Communicated during the audit preliminary work and field work
– A majority of the audit was performed remotely due to COVID‐19. Audit team
spent one day onsite.

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REQUIRED COMMUNICATIONS (Continued)
• Significant Accounting Policies
– Outlined in Note 1 to the financial statements
– Unusual transactions – None noted

• New Accounting Standards

– GASB 84, Fiduciary Activities, was applicable for fiscal year 2020. The student activity
fund and the scholarship fund are now included in the general fund. Beginning fund
balance in the General Fund and beginning net position were restated by $566,403
for the change in accounting principle.
– The following were adopted in fiscal year 2020 and will have no financial statement 
impact to the District: 
◊ GASBS 83 Certain Asset Retirement Obligations
◊ GASBS 88 Debt Disclosures
◊ GASBS 90 Majority Equity Interests

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REQUIRED COMMUNICATIONS (Continued)
• Management Judgments and Accounting Estimates ‐ We evaluated the key
factors and assumptions used to develop the estimates in determining that it is
reasonable in relation to the financial statements taken as a whole
– Special Education Aid from State of Minnesota
– Allowance for doubtful accounts
– Useful lives of capital assets
– Other Postemployment Benefits payable
– Net Pension Liability & Related Deferred Inflows and Deferred Outflows of
Resources

• Disclosures are Adequate, Clear and Complete

• Other Information in Documents Containing Audited Financial Statements
– Required Supplementary Information ‐ We made inquiries and evaluated the
comparability – No opinion
– Supplementary Information – We made inquiries and evaluated the content –
Opinion

• Disagreements with Management

– There have been no disagreements with management about matters that could be
significant to the financial statements

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 ©2018 CliftonLarsonAllen LLP
REQUIRED COMMUNICATIONS (Continued)
• Management Representations
– We have requested certain representations from management included in the
management representation letter

• Consultations with Other Accountants

– There were no consultations with other independent accountants

• Major Issues Discussed With Management Prior to Retention

– No issues, other than normal planning issues, were discussed prior to our retention
as auditors

• Difficulties Encountered in Performing the Audit (None)

– Management was most cooperative and helpful
– Personnel and records were available

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 ©2018 CliftonLarsonAllen LLP
REQUIRED COMMUNICATIONS (Continued)
• Uncorrected Misstatements ‐ None
• Corrected
– Material audit adjustments to the prior period in the following funds related to tax 
advance in prior year. There was also a material audit adjustment to allocate the 
taxes among the funds, after this prior period adjustment. 
◊ General Fund $154,793
◊ Community Service Fund $12,043
◊ Debt Service Fund $166,769
– Current year material audit adjustment to the taxes receivable in the debt service 
fund for $51,106.

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 ©2018 CliftonLarsonAllen LLP
SUMMARY OF AUDIT RESULTS
• Financial Statements
– Unmodified (“clean”) opinion 

• Internal Control Over Financial Reporting under Government Auditing 
Standards
– Three material weakness:
◊ Segregation of duties
◊ Auditor drafts financial statements and notes
◊ Material audit adjustment and prior period restatement 

• Uniform Guidance (Single Audit)
– Unmodified Opinion
– Major Programs – Child Nutrition Cluster and Title I
– Noncompliance and Significant Deficiency in Internal Control – None
◊ Prior year significant deficiency for procurement was resolved in FY20

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SUMMARY OF AUDIT RESULTS (Continued)

• Minnesota Legal Compliance
– None noted

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 ©2018 CliftonLarsonAllen LLP
Average Daily Memberships

1800
1700
1600
1500
1400
1300 705.21 689.69
725.12 659.99
1200 644.30
1100
1000
900
800
700
600 776.20 760.38
733.40 764.50 753.46
500
400
300
200
100 181.54 188.78 187.81 176.34 147.98
0
2020 2019 2018 2017 2016
Year
Kindergarten and Others Elementary Secondary

Resident Average Daily Membership (ADM) 2020 2019 2018 2017 2016

Total ADM 1,640.06 1,670.19 1,637.88 1,600.83 1,545.74

Total Weighted ADM (WADM) 1,785.08 1,811.27 1,775.82 1,732.83 1,674.60

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 ©2018 CliftonLarsonAllen LLP
Independent School District No. 309
Fund Trends

General Fund
For the Year Ended June 30, 2020 2019 2018 2017 2016
Total Revenues $ 21,086,970 $ 20,113,783 $ 19,034,667 $  18,489,551 $ 17,637,493
Total Expenditures        20,147,035        19,469,899        19,249,157        17,608,091        17,223,145

Other Financing Sources          123,343               4,187          294,791             93,072          289,371

Net Change in Fund Balance          1,063,278             648,071                80,301              974,532             703,719

Prior Period Adjustment             721,196                           ‐                           ‐                           ‐                           ‐

Fund Balance ‐ Beginning          9,506,668          8,858,597          7,768,889          6,794,357          6,090,638

Unassigned Fund Balance          5,515,041          4,760,783          4,326,936          3,714,076          3,213,549

Nonspendable Fund Balance                82,591             147,671             156,250              193,622             237,416
Restricted Fund Balance          4,064,783          2,807,863          2,340,714          1,861,758          1,533,431
Committed Fund Balance             784,241             784,241             784,241              741,430             741,465
Assigned Fund Balance             844,486          1,006,110          1,250,456          1,258,003          1,068,496

Fund Balance ‐ Ending $    11,291,142 $       9,506,668 $       8,858,597 $       7,768,889 $       6,794,357

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 ©2018 CliftonLarsonAllen LLP
General Fund – Fund Balance by Category
 $6,000,000
 $5,750,000
 $5,500,000
 $5,250,000
 $5,000,000
 $4,750,000
 $4,500,000
 $4,250,000
 $4,000,000
 $3,750,000
 $3,500,000
 $3,250,000
 $3,000,000
 $2,750,000
 $2,500,000
 $2,250,000
 $2,000,000
 $1,750,000
 $1,500,000
 $1,250,000
 $1,000,000
 $750,000
 $500,000
 $250,000
 $‐
Nonspendable Restricted Committed Assigned Unassigned

 June 30, 2020  June 30, 2019  June 30, 2018  June 30, 2017  June 30, 2016

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 ©2018 CliftonLarsonAllen LLP
General Fund – Fund Balance by Category
Restricted - General Fund Committed - General Fund
Staff Development $ 138,896 Separation/Retirement Benefits $ 784,241
Operating Capital 1,166,969
Achievement/Integration 25,341
Student Activities 119,775
Scholarships 465,771
Safe Schools - Crime 101,039
Gifted and Talented 159,402
LTFM 1,748,221
Medical Assistance 55,949
Other Restricted 83,420
Total Restricted $4,064,783

Other Restricted Other Assigned - General Fund

3M Ingenuity Grant $ 785 iPad Insurance $ 12,172
Scoreboard 11,531 School Forest 23,514
Weight Room Donations 101 Logos and Signage for Sports Teams 8,850
Art/Music 1,343 BCBS Refund 3,045
Drama Donations 2,500 Be Kind Program 6,619
Wellness Grant 3,849 HVAC Update 260,000
Prime West Grant 121 Technology Updates 130,272
NWMN Grant 12,539 Future Equipment 400,014
Career Coordinator 39,619 Total Other Assigned $ 844,486
Ship Grant 1,144
ACES 9,888
Total Other Restricted $ 83,420

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 ©2018 CliftonLarsonAllen LLP
Food Service Fund
For the Year Ended June 30, 2020 2019 2018 2017 2016
Total Revenues $       946,876 $    1,048,815 $       980,194 $       972,716 $       979,219
Total Expenditures          1,056,999             954,883             887,314              910,495             957,498

Other Financing Sources             10,647               2,212                        ‐                        ‐                        ‐

Net Change in Fund Balance              (99,476)                96,144                92,880                62,221                21,721

Fund Balance ‐ Beginning             538,671             442,527             349,647              287,427             265,705

Restricted Fund Balance             392,150             499,899             386,195              309,651             248,726

Nonspendable Fund Balance                47,045                38,772                56,332                39,996                38,701

Fund Balance ‐ Ending $          439,195 $          538,671 $          442,527 $          349,647 $          287,427

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Community Service Fund
For the Year Ended June 30, 2020 2019 2018 2017 2016
Total Revenues $       805,725 $       907,998 $       941,242 $       890,313 $       818,709
Total Expenditures             890,195             894,947             894,466              913,008             743,858

Other Financing Sources                        ‐                        ‐                        ‐                        ‐                        ‐

Prior Period Adjustment             12,043                        ‐                        ‐                        ‐                        ‐

Net Change in Fund Balance              (84,470)                13,051                46,776               (22,695)                74,851

Fund Balance ‐ Beginning             239,885             226,834             180,058              202,753             127,902

Unassigned Fund Balance                           ‐                           ‐                           ‐                    (143)                           ‐

Nonspendable Fund Balance                34,959                33,535                36,007                34,938                31,529
Restricted Fund Balance             132,499             206,350             190,827              145,263             171,224

Fund Balance ‐ Ending $          167,458 $          239,885 $          226,834 $          180,058 $          202,753

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 ©2018 CliftonLarsonAllen LLP
Community Service Fund – Fund Balance by
Category
Restricted - Community Service
Community Education Programs $ 24,515
Early Childhood and Family Education Programs 21,698
School Readiness 66,024
Total Restricted $ 112,237

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 ©2018 CliftonLarsonAllen LLP
Independent School District No. 309
Fund Trends

Debt Service
For the Year Ended June 30, 2020 2019 2018 2017 2016
Total Revenues $    2,760,194 $    2,859,010 $   2,812,414 $   2,763,951 $   2,763,006
Total Expenditures          2,714,067          2,852,974         2,874,053         2,847,276         2,790,832

Other Financing Sources                        ‐      (3,840,000)                       ‐      4,002,038                       ‐

Net Change in Fund Balance                46,127         (3,833,964)              (61,639)         3,918,713             (27,826)

Prior Period Adjustment             166,769

Fund Balance ‐ Beginning             650,590          4,484,554         4,546,193            627,480            655,306

Restricted Fund Balance ‐ June 30 $          863,486 $          650,590 $      4,484,554 $      4,546,193 $         627,480

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 ©2018 CliftonLarsonAllen LLP
ISD #309 Park Rapids Area Schools
Debt Service Fund
Revenue, Expenses, Fund Balance, and Cash
$8,000,000

$7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

$0
15‐16 16‐17 17‐18 18‐19 19‐20

Revenue Expenses Fund Balance Cash and Investments

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 ©2018 CliftonLarsonAllen LLP
INDEPENDENT SCHOOL DISTRICT NO. 309
Administration and District Support per ADM
$1,200

$1,000

$800
Per ADM

$600

$400

$200

$0
15‐16 16‐17 17‐18 18‐19 19‐20

ISD 309 State 1000 to 1999

District and School Admin – all costs related to providing administration to the District (Board of Education, Superintendent,
Assistant Superintendent, Principals, etc.) District Support Services – activities provided by Central Office (Business
Services, Director of Building and Grounds, Legal, Data Processing, Other District-Wide support activities).

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INDEPENDENT SCHOOL DISTRICT NO. 309
Total Instruction per ADM
$10,000
$9,000
$8,000
$7,000
Per ADM

$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
15‐16 16‐17 17‐18 18‐19 19‐20

ISD 309 State 1000 to 1999

Total Instruction – includes vocational instruction, special education instruction and instructional support services.

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CLAconnect.com

Thank you for the opportunity to serve
the Park Rapids Area Schools.

CliftonLarsonAllen LLP
Mary Reedy, CPA, CGFM
Principal
320‐203‐5534
Mary.Reedy@CLAconnect.com