Is it in the ground, or is it in a pot? Fungus is a normal component of any soil and most of them don't affect plants badly. Some, however, do. It's a matter of knowing which one you have. Are there any adverse signs on your Dracaena or is it still looking healthy? You can buy fungicides but it helps to know which fungus you're dealing with.

thanks tropicbreezent,
Yes it is in the pot. The leaves look healthy so I guess no adverse effects for now. I do know that some fungi may be harmful, hence the post. I also have fungicide (copper oxy from Bunnings) but I would rather to hear what should I do from somebody who know about dracenas...

I have maybe a dozen different species of Dracaena, and about 5 or 6 D. fragrans but they're all in the ground. What I've found with fungus is that now and again conditions favour one type and it goes ballistic for a while. Then things return to normal and the fungus often just disappears again. I suspect it's something different about the mulch, or maybe even something in the weather. I've never noticed the Dracaenas affected in any way though.

Thank you tropicbreezent, now I know I don't have to worry. I will however scrape the top layer of the soil (just to be safe ;)). Have a happy gardening!