RR-2026-WSFCS

Winston-Salem/Forsyth County Schools Follow Up - Rapid Response Special Report

PDF • 1.35 MB - March 05, 2026

On September 20, 2024, WS/FCS’s Finance Office executed a budget transfer of $16.99 million (WS/FCS’s ledger reflects $16.89 million) from the Non- Instructional Support Program to the Restart Schools Program. The transfer exceeded the Non-Instructional Support Program’s available balance of $13.92 million, creating an immediate overdraft. By April 30, 2025, the overdraft reached $11.34 million.
During the review period, WS/FCS’s Finance Office failed to complete monthly reconciliations of budgeted versus actual revenue and expenditures.
Throughout FY 2025, WS/FCS kept substantial costs off the books. Such costs were not recorded until September 2025, at which point the Finance Office backdated the costs to June 30, 2025. Because of this practice, WS/FCS understated its expenditures and liabilities in interim financial reports and effectively bypassed internal controls and oversight.
WS/FCS’s Board of Education authorized a zero-interest internal loan from the Child Nutrition Fund for up to $6 million to cover WS/FCS’s cash shortfalls. The loan agreement lacked clear terms for interest, repayment, and penalties, raising concerns about fund integrity and compliance with program guidelines.

First Published

March 5, 2026