What does it mean for CUSD to have a Qualified Certified Interim Financial Report?

Posted by: Jeffrey Felix 3 years ago

What does it mean for CUSD to have a Qualified Certified Interim Financial Report?

Recently the CUSD Governing Board approved a First Interim Budget that was Qualified. This is the first time in Coronado Unified's 100 year history that a school board has ever needed to approve a financial plan that was less than Positive. At the last reporting period, less than 3% of all districts in California were certified as either Qualified or Negative (30 out of 1,028).  Here is what all of this means...

California school districts are called Local Educational Agencies (LEAs). They are required to file two reports during a fiscal year (interim reports) on the status of the LEA's financial health. The first interim report is due December 15 for the period ending October 31. The second interim report is due March 17 for the period ending January 31. Every county in California has a Superintendent who manages the county level of school governance. County superintendents are to report to the Superintendent of Public Instruction and the State Controller the certification for all districts in their county within 75 days after the close of the reporting period.

The interim reports must include a certification of whether or not the LEA is able to meet its financial obligations. The certifications are classified as positive, qualified, or negative. A positive certification is assigned when the district will meet its financial obligations for the current and two subsequent fiscal years (3 years in a row). A qualified certification is assigned when the district may not meet its financial obligations for the current or two subsequent fiscal years (2 years in a row). A negative certification is assigned when a district will be unable to meet its financial obligations for the remainder of the current year or for the subsequent fiscal year. In addition, the state Superintendent of Public Instruction may reclassify the certification of any county office of education or reclassify a certification based on an appeal of a school district in accordance with the above standards.

Practically speaking, this means that Coronado must prepare a third interim report. It also means we are not eligible for certain financial transactions without additional scrutiny by county government. It does not affect the district on a day to day basis, but it does mean that the future financial health of the district is bleak.