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AUDITED FINANCIAL STATEMENTS - REGULATORY BASISAND REPORTS OF INDEPENDENT AUDITORWRIGHT CITY SCHOOL DISTRICT NO. I-39,MCCURTAIN COUNTY, OKLAHOMAJUNE 30, 2017

INDEPENDENT SCHOOL DISTRICT NO. I-39MCCURTAIN COUNTY, OKLAHOMAJUNE 30, 2017TABLE OF CONTENTSPage No.1-2Table of Contents3School District Officials4-5Independent Auditor’s ReportCOMBINED FINANCIAL STATEMENTS:Combined Statement of Assets, Liabilities, and Fund Balances– Regulatory Basis - All Fund Types and Account Groups6Combined Statement of Revenues, Expenditures,and Changes in Cash Fund Balances – Regulatory Basis- All Governmental Fund Types7Combined Statement of Revenues, Expenditures, and Changesin Cash Fund Balance - Budget and Actual – Regulatory Basis- Budgeted Governmental Fund Types8-10Notes to Combined Financial Statements11-25OTHER SUPPLEMENTARY INFORMATION:COMBINING FINANCIAL STATEMENTS:Combining Statement of Assets, Liabilities, and Fund Balances –- Regulatory Basis - All Special Revenue Funds26Combining Statement of Revenues, Expenditures, and Changesin Cash Fund Balances – Regulatory Basis - All Special RevenueFunds27Combining Statement of Revenues, Expenditures, and Changesin Cash Fund Balances – Regulatory Basis - Budgeted SpecialRevenue Fund Types28-1-

INDEPENDENT SCHOOL DISTRICT NO. I-39MCCURTAIN COUNTY, OKLAHOMAJUNE 30, 2017TABLE OF CONTENTSPage No.OTHER SUPPLEMENTARY INFORMATION: – contd.Combing Statement of Assets and Liabilities – RegulatoryBasis – All Fiduciary Fund Types29Combining Statement of Changes in Assets and Liabilities Regulatory Basis - All Agency Funds30-31Schedule of Expenditures of Federal Awards32-33Schedule of Surety Bonds34Internal Control and Compliance ReportsReport on Internal Control over Financial Reporting and onCompliance and Other Matters Based on an Audit ofFinancial Statements Performed in Accordance withGovernment Auditing Standards35-36Schedule of Findings37Disposition of Prior Year’s Schedule of Findings38Schedule of Accountant’s Professional Liability Insurance Affidavit39-2-

INDEPENDENT SCHOOL DISTRICT NO. I-39MCCURTAIN COUNTY, OKLAHOMASCHOOL DISTRICT OFFICIALSJUNE 30, 2017BOARD OF EDUCATIONPresidentRandy WatkinsVice-PresidentDanny GibsonClerkJoey TomMemberTodd GrossMemberWesley EnsleySUPERINTENDENT OF SCHOOLSDavid HawkinsMINUTES CLERK &SCHOOL DISTRICT TREASURERLeah Young-3-

INDEPENDENT AUDITOR’S REPORTThe Honorable Board of EducationWright City School District No. I-039Wright City, Oklahoma 74766-0329Report on the Financial StatementsWe have audited the accompanying combined fund type and account group financial statements-regulatory basis of WrightCity School District No. I-039, Wright City, Oklahoma (the “District”) as of and for the year ended June 30, 2017, and therelated notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in thetable of contents.Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these financial statements in accordance with financialreporting provisions of the Oklahoma State Department of Education as described in Note 1, to meet the financial reportingrequirements of the State of Oklahoma. This includes determining that the regulatory basis of accounting is an acceptablebasis for the preparation of the financial statements in the circumstances. Management is also responsible for the design,implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statementsthat are free from material misstatement, whether due to fraud or error.Auditor’s ResponsibilityOur responsibility is to express opinions on these financial statements based on our audit. We conducted our audit inaccordance with auditing standards generally accepted in the United States of America and the standards applicable tofinancial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statementsare free of material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of materialmisstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internal control relevant to the entity’s preparation and fair presentation of the financial statements in order todesign audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management,as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our modified audit opinions.Basis for Adverse Opinion on U.S. Generally Accepted Accounting PrinciplesAs discussed in Note 1, the financial statements are prepared by the Wright City School District No. I-039, on the basis of thefinancial reporting provisions of the Oklahoma State Department of Education, which is a basis of accounting other thanaccounting principles generally accepted in the United States of America, to comply with the requirements of the OklahomaState Department of Education. The effects on the financial statements of the variances between the regulatory basis ofaccounting described in Note 1 and accounting principles generally accepted in the United States of America, althoughreasonably determined, are presumed to be material.Adverse Opinion on U.S. Generally Accepted Accounting PrinciplesIn our opinion, because the significance of the matter discussed in the previous paragraph, the basic financial statementsreferred to in the first paragraph do not present fairly, in accordance with accounting principles generally accepted in the-4-

United States of America, the financial position of the Wright City School District No. I-039, McCurtain County, Oklahomaas of June 30, 2017, or the revenues, expenses, and changes in net position and, where applicable, its cash flows for the yearthen ended.Basis for Qualified Opinion on Regulatory Basis of AccountingThe financial statements referred to above do not include the general fixed assets account group, which is a departure fromthe regulatory basis of accounting prescribed by the Oklahoma State Department of Education. The amount that should berecorded in the general fixed asset account group is not known.Qualified Opinion on Regulatory Basis of AccountingIn our opinion, except for the effects of the matter described in the preceding paragraph, the financial statements referred toin the first paragraph present fairly, in all material respects, the assets, liabilities and fund balances arising from regulatorybasis transactions of each fund type and account group of the District as of June 30, 2017, and the revenues collected andexpenditures paid and encumbered, of each fund type, for the year then ended, on the regulatory basis of accountingdescribed in Note 1.Other MattersOur audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise theDistrict’s basic financial statements. The combining fund statements, regulatory basis, listed in the accompanying table ofcontents are presented for purpose of additional analysis, and are not a required part of the basic financial statements. Theschedule of expenditures of federal awards is presented for purposes of additional analysis and is also not a required part ofthe basic financial statements.The combining statements-regulatory basis and the schedule of expenditures of federal awards are the responsibility ofmanagement and were derived from and relate directly to the underlying accounting and other records used to prepare thefinancial statements. Such information has been subjected to the auditing procedures applied in the audit of the financialstatements and certain additional procedures, including comparing and reconciling such information directly to theunderlying accounting and other records used to prepare the financial statements or to the financial statements themselves,and other additional procedures in accordance with auditing standards generally accepted in the United States of America. Inour opinion, the combining statements-regulatory basis are fairly stated in all material respects in relation to the basicfinancial statements as a whole on the regulatory basis of accounting described in Note 1.Other Reporting Required by Government Auditing StandardsIn accordance with Government Auditing Standards, we have also issued a report dated October 9, 2017, on ourconsideration of the District’s internal control over financial reporting and our tests of its compliance with certain provisionsof laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope ofour testing of internal control over financial reporting and compliance and the results of that testing, and not to provide anopinion on the internal control over financial reporting or on compliance. That report is an integral part of an auditperformed in accordance with Government Auditing Standards in considering the District’s internal control over financialreporting and compliance.Jenkins & KemperCertified Public Accountants, P.C.October 9, 2017-5-

COMBINED FINANCIAL STATEMENTS - REGULATORY BASIS

INDEPENDENT SCHOOL DISTRICT NO. I-39, MCCURTAIN COUNTYCOMBINED STATEMENT OF ASSETS, LIABILITIES AND FUND BALANCES REGULATORY BASIS - ALL FUND TYPES AND ACCOUNT GROUPSJUNE 30, 2017GOVERNMENTAL FUND TYPESSPECIALDEBTASSETSCashInvestmentsAmounts available in debt serviceAmounts to be provided for retirement ofgeneral long-term debtTotal AssetsGENERAL FUND TYPESEXPENDABLETRUST Y FUNDDEBT(MEMO. 0,702LIABILITIES AND FUND BALANCESLiabilitiesWarrants payableFunds held for school organizationsUnmatured obligationsLong-term debt:Bonds payableTotal liabilitiesFund balancesRestricted for:Expendable trustCapital projectsDebt serviceChild nutritionBuildingUnassignedTotal fund balancesTotal liabilities and fund 1,802)(1,802)16,27016,270324,381324,381342,600 67256,92338,383113,336The notes to the combined financial statements are an integral part of this statement-6-722,146290,0001,452,094

INDEPENDENT SCHOOL DISTRICT NO. I-39, MCCURTAIN COUNTYCOMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN CASHFUND BALANCES REGULATORY BASIS - ALL GOVERNMENTAL FUND TYPESJUNE 30, 2017GENERALRevenuesLocal sourcesIntermediate sourcesState sourcesFederal sourcesNon-revenue receiptsTotal revenues 101,17265,067CAPITALPROJECTSFIDUCIARYFUND 51,2713,231,632449,613(8,541)Cash fund balance, beginning of year (8,817)351,141349,468342,600340,651The notes to the combined financial statements are an integral part of this statement-7-1,211,6811,27167,425Revenues over (under) expendituresTOTALS(MEMO. ONLY)408,40670,062ExpendituresInstructionSupport servicesOperation of non-instructional servicesFacilities, acquisition and const. servicesOther outlaysDebt serviceTotal expendituresCash fund balance, end of year242,081GOVERNMENTAL FUND 32,614722,146556(1,802)3,751,380