TEA Releases List of Audit Firms

The Texas Education Agency (TEA) released its report on independent audits received for the fiscal year 2016, reporting there were exactly 1,200 independent audits performed for institutions overseen by the TEA.  This included 1,021 independent school districts (ISD), 169 charter schools, and 10 service centers. Belt Harris Pechacek was again ranked as the leader in TEA audits performed, with 67 audits completed, continuing its legacy mission to serve educational entities that began in 1964.   Fort Worth-based Weaver leaped to the number two spot in 2015 with the purchase of Hereford Lynch out of Conroe, which closed the wide margin between Belt Harris Pechacek and all other audit providers in Texas.

Seven firms audit 25 or more TEA entities, comprising a total 325 entities, which is 27% of the total.  This concentration, as expected, is largely based on one or two firms emerging as clear leaders for their respective geographical area.  This is because of the complexity and difficulty of auditing TEA educational entities at the lowest possible costs, which results in the need for economies of scale and concentration of talent with significant experience.

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The somewhat surprising statistic is that 79 firms perform 5 or fewer ISD audits, which represents 192 district and 19% of the total ISD audits performed.  Accordingly, a large number of ISD audits are performed with little economies of scale or industry focus.  That statistic is more alarming for charter schools as 40 of 55 charter school audit firms audit 5 or fewer charter schools, which represents 78 of the 169 charter schools or 46% of all charters being audited.

Belt Harris Pechacek’s goal is to be the best in Texas in auditing local governments, including ISDs, charter schools, and service centers.  While our goal is not to be the biggest, it is a point of pride at the number of boards and administrators who place their trust in our firm each year and allow us to do our part in helping to educate the youth of Texas.

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