Case Study: Polk County, Florida School District

Cherry Bekaert Improves Financial Reporting Procedures to Reduce Deficiencies

Scenario

Polk County, Florida School District (“the District”) is the 8th largest school district in Florida and among the top 40 in the country.  The District had obtained external audits of their annual financial reports.  For many years the auditors had reported material weaknesses in control over the financial close process and significant deficiencies in financial reporting because of numerous errors in the annual financial statements. Early in 2010, Cherry  Bekaert was selected as the District’s new auditor for the year ended June 30, 2010. In May of 2010, the District hired a new Director of Financial Reporting with the intent of eliminating the deficiencies in financial reporting and preparing a comprehensive annual financial report (CAFR).

Cherry Bekaert’s Guidance

Cherry Bekaert worked closely with the new Director of Financial Reporting during the June 30, 2010 audit to assist in working through the prior financial reporting deficiencies and developing new procedures to ensure they would not reoccur.  Cherry Bekaert was also always available to answer questions and provide guidance to assist with the implementation of new standards and changes to existing standards, including the implementation of GASB 53, Financial Accounting and Reporting for Derivative Instruments, which was complicated by complex derivative instruments held by the District.

Results

The Director of Financial reporting, with the assistance of Cherry Bekaert, was able to assemble everything necessary for the comprehensive annual financial report (CAFR) for the year ended June 30, 2010.  The financial reporting procedures were improved and the control deficiencies were eliminated for the year ended June 30, 2011. The CAFR was also refined and improved, with the assistance and guidance of CB&H, and submitted to the Government Finance Officers Association for a Certificate of Achievement for Excellence in Financial Reporting.

In March 2012, the District was notified that it was awarded a Certificate by the Government Finance Officers Association less than two years after getting a material weakness in financial reporting.