Background

The Warrensburg Central School District is located in the Towns of Warrensburg, Thurman, Stony Creek, Bolton, Lake George, Chester, Johnsburg and Horicon, all in Warren County. As of October 2005 the District had a student population of 923. The District includes an elementary and a junior/senior high school and its operations are overseen by a nine member Board of Education (Board) and an appointed Superintendent. At the end of the 2004-05 school year the District had approximately 200 employees and annual expenditures of approximately $18 million. Major revenue sources for the District include real property taxes and State and Federal aid.

The Board has overall responsibility for the operations of the District. The Superintendent has the responsibility for managing and overseeing the daily operations of the District. The responsibility for the District’s finances and accounting records rests with the Business Manager.

The Business Manager also has several other duties including those of the District Clerk, purchasing agent and extra classroom activity fund treasurer. The District Treasurer, who works under the direction of the Business Manager, also has other duties and titles including payroll clerk and accounts payable clerk.

Objective

The objective of our audit was to determine if controls over cash receipts and disbursements, purchasing, and payrolls were appropriately designed and operating effectively. More specifically, our audit addressed the following questions:

• Are controls in place over large purchases to ensure procurements at competitive prices?
• Are controls in place to ensure proper segregation of duties over claims processing and cash disbursements?
• Are controls in place to ensure payroll procedures are segregated in order to prevent fraudulent activities and to ensure employees receive only the pay and benefits they are entitled to?
• Are there adequate policies and procedures to ensure students residing outside the boundaries of the District are paying tuition?

Scope and Methodology

During this audit we examined the books, records and reports of the District for the period July 1, 2004, through January 5, 2006. Furthermore, we obtained and examined fiscal year 2005-06 property tax payment information from the North Warren Central School District, and reviewed the minutes of the Board Meetings of the North Warren Central School District for the period covering early to mid 1989 in relation to our finding titled Residency and Tuition.

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 C of this report.

Comments of District Officials and Corrective Action

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. Except as specified in Appendix A, District officials generally agreed with our recommendations and indicated they planned to initiate corrective action. Appendix B includes our comments on the issues raised in the District’s response letter.

The Board has the responsibility to initiate corrective action. Pursuant to Section 35 of the General Municipal Law, Section 2116-a (3)(c) of the Education Law and Section 170.12 of the Regulations of the Commissioner of Education, the Board must approve a corrective action plan that addresses the findings in this report, forward the plan to our office within 90 days, forward a copy of the plan to the Commissioner of Education and make the plan available for public review in the District Clerk’s office. For guidance in preparing the plan of action, the Board should refer to applicable sections in the publication issued by the Office of the State Comptroller entitled Local Government Management Guide.