Washington Auditor Finds Moses Lake School District Flags Compliance Failures

The Washington State Auditor's Office released its audit of the Moses Lake School District and found the District faced significant financial risk and multiple compliance failures.

READ MORE: Moses Lake School District Cuts Positions in Financial Crunch

The audit examined the District's financial practices from 2022 through 2024, including the period leading up to the financial challenges identified in May 2024.
The audit found four main areas of improvement for the District.

What the State Audit Found: Four Key Areas of Concern

The Auditor's Office said the District's financial condition places it at risk of being unable to meet financial obligations or provide services at current levels, and the District did not comply with state budget requirements.

The District claims it strengthened its monthly financial reporting, expanded oversight, and implemented more detailed budget reviews and development tracking processes in response.

Moses Lake Schools and the Unauthorized Levy: What Happened

Additionally, the audit claims the District did not obtain required approval from the Office of Superintendent of Public Instruction prior to placing a levy on the 2024 ballot. The District responded by obtaining the Office of Superintendent of Public Instruction approval and implementing a checklist for levy compliance.

The audit also found inconsistent documentation and controls to demonstrate compliance with state purchasing requirements, so the District said it updated its procedures and provided staff with training on purchasing requirements.

Credit Card Use, Purchasing, and Fuel: Where Internal Controls Broke Down

Finally, the audit said there were weaknesses in internal controls related to credit card use, purchasing, and fuel expenditures. The District responded by discontinuing the use of open purchase orders, training staff on allowable expenditures and recordkeeping, and increasing board oversight.

The Auditor's office also identified areas for improvement, related to payroll and leave monitoring, contract documentation, enrollment reporting, cash handling procedures, and asset tracking.

How Moses Lake School District Is Responding to the Audit

District leaders say they will continue to monitor financial operations closely, implement audit recommendations, and provide updates to the Board and community.