Proposition 39 General Obligation Bond Audits

Has your district recently passed a Proposition 39 General Obligation Bond?

Is your district in the market for auditors with Proposition 39 experience since 2001, along with hands-on knowledge in construction management?

Proposition 39 requires both a Financial Audit and a Performance Audit of the General Obligation Bond expenditures.  At VLS we have a team of individuals willing to assist you with this important compliance requirement.  We have been working with Districts throughout Southern California to comply with this requirement since the passing of the Proposition.  We have extensive experience in education (K-12 and community college districts) accounting, policies, procedures and facilities/construction management issues.

The performance of a separate financial audit of the Proposition 39 monies provides added visibility to the expenditures made with bond funds; this is helpful to the citizens because bond expenditures are normally combined in the governmental entity’s annual financial statements.

We have extensive experience working with and presenting to the Citizen’s Oversight Committee (COC). We are able to clearly communicate the requirements of the Education Code and the State Constitution and how it relates to Proposition 39. We structure our sampling to cover a large portion of expenses to provide the peace of mind that the COC and the Board of Education/Trustees are looking for.

Who Needs This Service?

• K-12 school districts
• Community College Districts

Benefits to Our Clients

Our Performance Audit Procedures include verification of:

• Board Resolution
• Establishment of Citizens’ Oversight Committee (COC), including by-laws and conflict of interest statements
• Demographics of Citizens’ Oversight Committee members
• COC minutes, reports and documentation
• COC website
• Expenditures charged in accordance with voter approved bond project list

Our Financial Audit Procedures include:

• Opinion on audited Financial Statements

Other procedures that can be performed:

• Provide guidance on spend down requirements to avoid arbitrage payments
• Provide guidance on monitoring of change orders
• Assistance in establishing a chart of accounts to monitor projects
• Performance of agreed-upon procedures requested by the COC, the Board of Education/Trustees or management
• Assistance with job costing procedures
• Assistance with fixed asset accounting and calculation of depreciation, including tracking of construction in process
• Assistance in establishing a sound internal control process related to construction accounting, proper approvals, etc.