Williston High School in Williston, N.D. (contributed/Williston Basin School District #7)
WILLISTON, N.D. (North Dakota Monitor) – The Williston School District is in the process of fixing many of the concerns raised by an audit report released by the North Dakota State Auditor’s Office on Wednesday.
The audit examined financial activity from July 2022 to June 2024 and identified 14 issues. Many of the concerns focus on a lack of documentation, insufficient internal safeguards and discrepancies between internal records and bank statements.
The current leadership of the school district, most of whom were hired or elected after the time period under review, has implemented several changes to its internal procedures for record-keeping and oversight even before the audit was released, its business manager said.
“We’ve come a long way in the last couple years,” said Michael Arnold, the district’s business manager.
The identified issues include:
- An estimated $6 million discrepancy between bank statements and internal ledgers as a result of failing to conduct monthly comparisons of the two.
- Failing to include $2.6 million in state grants, federal grants, and property tax revenues on the district’s ledger in 2023.
- No documentation to prove the selection of a contractor to manage the construction of a career and technical education center complied with state procurement laws.
The issues led the State Auditor’s Office to include a “disclaimer of opinion” in the report stating the office cannot verify whether the district’s financial statements are accurate.
“When financial records are incomplete or inaccurate, the public cannot rely on the District’s reports,” the auditor’s office said in a press release. “We could not confirm whether the District’s financial records were correct.”
The report does not allege any fraud or wrongdoing occurred beyond missing documentation and poor internal procedures. There is no evidence of missing funds either, Arnold said.
“It just wasn’t recorded, so we ended up with more money than what we originally thought,” Arnold said. “They found money for us.”
The auditor’s office also identified a possible $2 million in overpayments to the Internal Revenue Service for payroll taxes in 2023 that did not have supporting documentation. Arnold said the district has already been in touch with the IRS to resolve that issue. “Everything is where it’s supposed to be now,” he said.
The corrective actions the district has implemented since 2024 include:
- The business manager conducts monthly reconciliations of bank statements with internal ledgers and presents the result to the Administrative Finance Committee.
- Additional oversight for changes to internal cash records.
- Maintaining additional documentation for procurement decisions, payroll tax withholdings and financials.
- Creating a new grants coordinator position to ensure grants are spent and documented appropriately.
Arnold was hired in September 2024, several months after the time period that was audited. He said one contributing factor was likely the merger of two districts in the Williston area into the current version, taking effect in the 2021-22 school year, and subsequent confusion in record-keeping.
Jason Germundson, the current superintendent, and Arnold were hired after the years of activity reviewed by the audit. Five of the seven current members of the school board were elected after the audited time period.
The district leadership is doing its best to be “transparent and above board” after those years of turnover, Arnold said.
“It’s an uphill challenge, but we’re working on it,” he said. “We’ve got good people here on the staff now. All is good.”
The auditor’s office will present its findings during the school board meeting at 5:30 p.m. on Monday. The meeting will be livestreamed on the district’s YouTube channel.
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