Freeport Union Free School District

Separation Payments
Introduction

Background

The Freeport Union Free School District (District) is located in the Town of Hempstead in Nassau County. The District is governed by the Board of Education (Board) which comprises five elected members. The Board is responsible for the general management and control of the District’s financial and educational affairs. The Superintendent of Schools (Superintendent) is the chief executive officer of the District and is responsible, along with other administrative staff, for the day-to-day management of the District under the direction of the Board.

The Board has six collective bargaining agreements with District staff and has individual employment contracts with the managerial staff. These agreements define leave benefits for covered employees. The personnel office is responsible for calculating all separation payments according to the terms of the employee contracts and using appropriate supporting documentation, such as leave records.

There are eight schools in operation within the District, with approximately 6,600 students and over 1,100 employees. The District’s budgeted expenditures for the 2007-08 fiscal year were about $134 million dollars which were funded primarily with State aid, real property taxes, and grants. During our audit period, the District made over $1.1 million dollars in separation payments.

Objective

The objective of our audit was to evaluate the internal controls over separation payments for the period July 1, 2006 to August 31, 2007. Our audit addressed the following related question:

• Are internal controls over separation payments designed appropriately and operating effectively?

Scope and Methodology

Our overall goal was to assess the adequacy of the internal controls put in place by officials to safeguard District assets. To accomplish this, we performed an initial assessment of the internal controls so that we could design our audit to focus on those areas most at risk. Our initial assessment included evaluations of the following areas: financial oversight, cash receipts and disbursements, purchasing, and payroll and personal services. Based on that evaluation, we determined that controls appeared to be adequate and limited risk existed in most of the financial areas we reviewed. We did determine that risk existed in the area of separation payments; therefore, we examined internal controls over separation payments for the period July 1, 2006 to August 31, 2007.

We conducted our audit in accordance with generally accepted government auditing standards (GAGAS). More information on such standards and the methodology used in performing this audit are included in Appendix B of this report.

Comments of District Officials

The results of our audit and recommendations have been discussed with District officials and their comments, which appear in Appendix A, have been considered in preparing this report.