Marcellus Central School DistrictLocal Government

Condition: During testing of accounts payable, it was determined that approximately $1.1 million of capital expenditures were paid subsequent to June 30 related to services performed in the 2022‐2023 school year, but were inadvertently excluded from accounts payable. The understatement was primarily the result of the transition of OCM BOCES taking over the accounts payable process. Criteria: As the District presents financial information on the accrual basis of accounting, General Accepted Accounting Principles (GAAP) require the accrual of expenditures for services performed or goods delivered prior to year‐end. Cause: This error was due to a transition to OCM BOCES taking over the accounts payable process in July 2023 and invoices were not marked by the District as relating to fiscal year 2023. Effect: A review of capital expenditures paid subsequent to June 30, 2023 resulted in an additional accrual of approximately $1,100,000. Recommendation: We recommend the District communicate with OCM BOCES regarding invoices that pertain to work conducted within the fiscal year to ensure that all expenditures are accrued in accounts payable at year‐end. Views of Responsible Official and Planned Corrective Actions: The District agrees with this finding and will strengthen procedures to identify and label claims with the appropriate fiscal year from which pertain to. The District will communicate with OCM BOCES regarding invoices that pertain to work conducted within the fiscal year to ensure that all expenditures are accrued in accounts payable at year‐end.