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Board fixes $2.5 million budget glitch

Even when dealing with a $290-plus million expenditure budget, the loss of $2.5 million would certainly raise some questions.

For Independent School District 196, $2.5 million was enough of a warning flag to catch a discrepancy in its 2009-20 preliminary budget.

The district made a $2,517,712 adjustment Monday to the 2009-10 preliminary budget which was approved in June. The $2.5 million increase in the expenditure budget was the correction of an upload error discovered during a reconciliation of the finance system.

"It's a bit unusual with this one," said Jeff Solomon, the district's finance director. "We found the error early on and instead of waiting for the normal cycle to make that correction, we asked the board to make that adjustment now."

The change includes a $2.5 million budget in expenditures for the upcoming school year.

The error was related to one school's operating budget not being properly uploaded into the district's financial system. That caused the final budget numbers to be understated.

A change in software might have contributed to the error. The district recently began using a Web-based budgeting system.

"We moved from using spreadsheets in Excel to online because it gave us many advantages when going through the process," Solomon said. "It is a faster way to summarize data. It allows buildings to see more information and an opportunity to see more detail.

"It was not the fault of the new budget system. It didn't introduce anything new. An upload was always part of the process. But with the new system we were more vulnerable to error because it was new to us. We had allowed the opportunity to double-check the process."

The change increased the expenditure budget from $292.4 million to $294.9 million after the board approved the change on Monday.

The district's finance department discovered the error in July and warned the school board about the mistake.

"This is not a systemic error," board member Joel Albright said. "I want everyone to be aware. This is unusual, but we were informed and we were kept informed, and this is not a $2 million dollar loss or something that was spent and we didn't know about it.

"It was just the expenses, or budgeting, was there and it just didn't get uploaded properly. It's not a loss to the district. It's just now accounting for it."

The discovery of the error might have been due in part to the district's finance department paying close attention to the numbers of the district's five-year financial plan.

"Just having that extra sixth-sense on the finances of the district," board member Art Coulson said. "And knowing that the numbers didn't seem to add up, even though the programs were telling us they added up. i think that's what really sets it apart for me.

"You know that I'm appreciative that our finance team is as strong as it is and we are able to identify this as it happens and not go forward with that kind of mistake dogging behind us."

The preliminary budget, following normal procedure, is brought for approval in June and then reviewed before a final approval in late October. The October review includes the use of actual enrollment numbers and any adjustments that must be made for enrollment.

Typically, another review and adjustment is then made in the spring.