DiNapoli's Office Completes School Audits
New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of Amityville Union Free School District, Ardsley Union Free School District, Hyde Park Central School District, Islip Union Free School District, Northport–East Northport Union Free School District and Richfield Springs Central School District.
“My office’s audits of school districts and BOCES help schools improve their financial management practices,” DiNapoli said. “These audits are tools for schools to make sure proper policies and procedures are in place to protect taxpayer dollars and provide students with the best possible education.”
Amityville Union Free School District – Internal Controls Over Selected Financial Operations (Suffolk County)
Auditors found that three board members failed to obtain the required six hours of training on financial oversight, accountability and fiduciary responsibilities within the first year of their election. The board members’ lack of commitment to improving their governance skills sets the wrong “tone at the top” which could influence employee attitudes toward rules and regulations that are designed to safeguard district resources and taxpayer moneys. The audit also found that district officials consistently made budget transfers prior to obtaining board approval. In addition, the board did not establish adequate internal controls related to the claims audit and purchasing functions.
Ardsley Union Free School District – Internal Controls Over Competitive Bidding and Employee Benefits (Westchester)
Auditors found that purchasing practices did not comply with board policies and applicable laws. District officials did not have documentation to show that two contracts for day and night cleaning of the schools and landscaping, totaling more than $1.4 million, were procured using the competitive bidding process as required by General Municipal Law and the district’s policy. In addition, the board did not periodically review employment contract terms to ensure that benefit provisions were clearly defined. District officials did not ensure that only appropriate benefits were properly authorized for reimbursement. As a result, six administrative employees received reimbursement for personal automobile and homeowner’s insurance premiums totaling $6,755, even though the board may have intended only that medical insurance was eligible for reimbursement.
Hyde Park Central School District - Financial Condition and Internal Controls Over Selected Financial Activities (Dutchess County)
The district did not have adequate recordkeeping procedures to monitor capital project expenditures in the early phases of the district’s facilities renovation project. Complete bidding documents for the first two phases of project were not maintained by the district. Auditors found $160,163 in payments lacked evidence that competitive bids or quotes were sought. In addition, the district’s unreserved, unappropriated fund balance in the general fund was reported at $6.4 million at of June 2007, which is more than $4 million more than the limit allowed by law. The district made separation payments to two principals of $43,005 and $20,173, respectively, without documented board approval. The district also paid $5,561 for the additional cost of health insurance for one of the principals over a two-year period without board approval.
Islip Union Free School District – Internal Controls Over Selected Financial Activities (Suffolk County)
A BOCES employee served as the purchasing agent to approve district purchases, which could put the BOCES employee in the position of approving purchase orders related to his employer. In addition, the district issued 19 confirming purchases totaling $61,995, with no indication that they were for emergency purchases and paid three vendors a total of $66,355 for goods without soliciting competitive bids or quotations. Auditors found that the district did not establish adequate policies and procedures to address internal controls over cash operations. The treasurer performed duties that were not properly segregated. Lastly, although the district has a computer use policy, there were no detailed policies and procedures to address disaster recovery; district officials were not required to periodically test data back ups for validity; and employees had access to parts of the financial system not necessary for their jobs.
Northport – East Northport Union Free School District – Internal Controls Over Selected Financial Operations (Suffolk County)
The board did not have written policies governing the cash disbursement process. Also, district officials did not properly segregate duties so that no single person controls all phases of a transaction and did not have any written procedures for wire transfers and hand-written and voided checks. The superintendent did not certify payrolls as required by the board and has not formally designated anyone to certify the payrolls in her absence. In addition, the district paid four employees $6,451 for separation payments that were not in compliance with applicable employee contracts, collective bargaining agreements, or board policy.
Richfield Springs Central School District – Internal Controls Over Purchasing (Herkimer and Otsego counties)
Auditors found that the purchasing agent did not always ensure that goods and services were purchased in accordance with the district’s procurement policy provisions and pertinent laws. Auditors reviewed 57 purchases totaling approximately $1.6 million and found that district officials did not seek competition for 31 of these purchases totaling approximately $607,000. Without the proper adherence to laws and established policies and procedures, district officials do not have assurance that they are purchasing items of the best quality at the lowest possible cost.
Click here to view the audits above.
If you have any questions or would like a comment from the Comptroller’s office regarding any of the audits above, please call 518-474-4015.