Albuquerque Public Schools financial statements are in order, according to the New Mexico Office of the State Auditor.

State law requires that every state agency, including public schools, be audited once a year by an independent auditor or by representatives of the Office of the State Auditor.

A financial audit is an independent evaluation of an organization’s financial reports and reporting processes. Financial audits allow regulators, investors and others to examine an organization’s financial statements via an objective third party.

There are 172 schools in APS, this includes 88 elementary, five K-8, 28 middle schools, 20 high schools and 31 authorized charter schools, 

Auditors in their examination of the 2021-2022 APS APS budget noted one significant deficiency, “a lack of internal controls over projects in progress not being transferred to capital assets once construction is completed and/or in use.”

Auditors also noted $1.33 million in from fiscal year 2021 that had not been corrected as of June 30, 2022, and another $10.35 million from fiscal year 2020.

Accumulated depreciation represents the ongoing reduction in the value of an asset over time. 

The agency’s audit of APS for 2022-23 states that no material weaknesses or significant deficiencies were identified in terms of financial statements or federal awards. 

A material weakness, according to the New Mexico Public Education is one or more failures in internal control that make it a reasonable possibility that a meaningful misstatement on a district’s s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is less severe than a material weakness, the PED says, yet important enough to merit attention by those charged with governance.

“The FY 2023 audit report includes our auditors’ opinion that the financial statements are presented fairly, in all material respects, in accordance with the applicable financial reporting framework,” District Controller Amanda Boyle said in an email this morning. “We are satisfied with the statements and with the audit.”

The audit states that APS has no findings that must be reported under federal law, such as significant instances of abuse relating to major programs or known or likely fraud affecting certain federal awards.

However, the audit lists 109 “findings,” which indicate that some aspect of reporting or practices is incorrect, including 43 repeat findings, which remained from 2021-22 or earlier fiscal years.

Auditors in their examination of the 2021-2022 budget noted one significant deficiency, “a lack of internal controls over projects in progress not being transferred to capital assets once construction is completed and/or in use.”

Auditors also noted $1.33 million in accumulated depreciation from fiscal year 2021 that had not been corrected as of June 30, 2022, and another $10.35 million from fiscal year 2020.

What the audit found 

Examples of those findings in the audit are mostly smaller violations, rather than red flags. Some of those include employees starting work before their contracts were executed and employees starting work before their background checks had been completed.

In the latter cases, each employee was either not around students (in which case a background check was not required, but performed anyway), or cleared the background check before being in contact with students and began work during weeks when there were no students on campus.

The district provided a response to each finding, and in one case, said the school was unaware it had to retain documentation showing the employee did not have unsupervised access to students.

Other findings improper recording of prices of some items and payments and filings of some reports a few days after the due date. APS responses indicate that in some cases, the delay was caused by the illness of a responsible employee or the unavailability of a contractor.

District feedback 

Some findings involved vendors and bidding with citations of failing to get the required number of bids or ensuring the lowest price.

One instance occurred when Montessori of the Rio Grande Charter School contracted for therapy services with a chosen provider, but did not include documentation showing it had received the best obtainable price.

APS disagreed with that finding in its response.

“The vendor in question has been utilized by the charter school for more than a decade,” the response states. “Nowhere in the statute does it state that we must obtain a quote every single year. The vendor has not changed their pricing since 2018, and the view of management is that it is not necessary to obtain a quote unless there has been a change in pricing.” “

“Furthermore, in the case of services rendered, it is not always about the best obtainable price but also the best obtainable service. The Charter School could utilize a state purchasing agent to potentially reduce expenditures, but it would come at the cost of inconsistent services to our students. The vendor we are utilizing has built relationships with students and staff that cannot be replicated if we used a vendor from a state purchasing agent that would most likely send a different service provider each school year.”

The response goes on to state that most of the vendors in the state would charge more than the $75 per hour it paid for the services. The sole lower bid, APS contends, would have been $71.48 an hour, or just under 5% less.

One finding was that there was no copy of the Whistleblower Protection Act posted on a campus. According to APS, the document had been posted, but wasn’t put back up after the school’s front office and break rooms were painted, re-arranged and cleaned. The signs were reposted in a conspicuous place as required after the oversight was spotted, the district’s response states.

Some of the findings were addressed immediately, according to the audit, while the district identified timelines for addressing other issues.

The Association of School Business Officials International issued APS a Certificate of Excellence in Financial Reporting for its Annual Comprehensive Financial Report for the 2022 fiscal year.


The full audit is available here.