NATCHEZ — An independent financial audit of the Natchez-Adams School District found only one minor compliance issue.

Natchez accounting firm Silas Simmons found that, overall, the district is in good fiscal shape.

“The Natchez-Adams School District is financially stable,” the management’s discussion and analysis section concluded. “The district has committed itself to financial excellence for many years.”

CPA Timothy Byrd said the district met its internal control standards and also was in compliance with its major federal programs. However, on the state level, Byrd said the district is not in compliance with its sixteenth-section revenue sharing, an issue that has impacted NASD receiving a clean audit for years.

Board attorney Bruce Kuehnle said the district owns sixteenth -section property that crosses county lines and that when usage rights are sold on the property, for example timber, there has to be a division of funds based on the number of students.

So far, he said, none of the districts involved in the properties are sharing money when there is revenue related to the land.

When it comes to the district’s net position, auditors reported that NASD’s finances will appear to be in worse financial shape than previous years. He said that is because of an accounting standard change in calculating pension liability.

Simply, net pension liability is the difference between what the district owes compared to what it has set aside to meet those obligations. The net pension liability is approximately $36 million.

“It is not a cash in, cash out kind of thing,” Byrd said. “It is going to make the net position look like it is not as good.”

Byrd said that figure was the major difference in creating what appears to be a net position deficit of $3.1 million in 2015 compared to 2014’s positive position of $36.8 million.

Board of Trustees member Cynthia Smith asked for a clarification.

“This is not a new bill, right?” she said. “This is something we have always paid, it has just never been reported?”

Byrd said, “The district has paid this every year. The district has done what it is supposed to do.”

Since 2012, in general fund revenues, funding from federal sources has decreased from $616,554 to $138,400. That difference has been made up at the state and local level, with the state’s contribution having increased $445,336 over that time period and the local contribution going up the most, $1.5 million, from 2012 to 2015.

The district’s total payment of instruction is down since 2012, from $15.9 million to $14.3 million, while contribution to support services and non-instructional services were up.

But the district has increased its instructional expenses for the 2015 budget, compared to 2014, by $577,276, which Byrd said is the major contributor for the district’s cost per student being up. The district spent $10,980 per child in 2014 compared to $11,527 in 2015.

Byrd said the value of the district’s investments decreased approximately $100,000 from 2014 to 2015 because of a poor market. The district has $18.3 million in total investments.