The North Carolina Office of the State Auditor (OSA) has released a new special report on the financial standing of Winston-Salem/Forsyth County Schools (WS/FCS). The report provides a detailed analysis of a series of poor financial decisions that contributed to the school district's estimated $46 million budget deficit.
Highlights of the report include:
- More than $75 million in bonuses were given out as WS/FCS overspent its annual revenue during FY 2022 and FY 2023.
- WS/FCS used COVID-era temporary federal funding to support staff salaries, but once the federal funds dried up, WS/FCS did not remove positions and instead absorbed the costs.
- WS/FCS failed to reduce its staffing levels proportionally despite a decrease in its student population.
- WS/FCS manually overrode the budget 311 times to approve purchase orders.
- WS/FCS did not reconcile budgeted and actual revenue and expenditures in a timely manner.
- WS/FCS misused suspense accounts meant to hold transactions until proper classification. As of June 5, 2025, the total balance under all the suspense accounts was more than $332 million. In standard accounting practice, all items in a suspense account should be promptly investigated and resolved to ensure the account regularly maintains a zero balance.
- WS/FCS was not fully reviewing all active contracts when creating the system’s annual budget.
“Winston-Salem/Forsyth County Schools dug itself into a deep financial hole, and it’s going to take real discipline to climb out of it. Our schools need to be focused on teaching students. That becomes a lot more difficult when you’re staring down a $46 million budget deficit,” said State Auditor Dave Boliek. “By shining a bright light on these specific problems, it is our hope that a sense of urgency will develop in Winston-Salem/Forsyth County Schools to right the ship in a hurry.”
Additionally, the report shows that WS/FCS has not fully corrected previous audit findings. OSA included recommendations for WS/FCS to take and will follow up to check on implementation in the coming months. In response to the report, WS/FCS Interim Superintendent Catty Moore offered plans of action and estimated completion dates for resolving each of the findings.