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July 25, 2008

 

DiNapoli: Lack of Oversight Led to $206,485 in Past Due Property Taxes at Jamestown City SD

A lack of management oversight and attention to district operations at Jamestown City School District caused the district to be unaware of $206,485 in past due property taxes and put the district at increased risk for errors to go undetected, according to an audit released today by State Comptroller Thomas P. DiNapoli.

“Schools districts rely on millions of taxpayer dollars so it is very important that they carefully track money that is owed to the district,” DiNapoli said. “Unfortunately, a lack of oversight caused the Jamestown school district to be unaware of more than $200,000 in back taxes.”

DiNapoli’s audit, covering July 2005 through December 2007, found the district does not have an accounting procedures manual and district management failed to properly segregate or provide sufficient oversight of treasury and accounting duties.

Auditors found the lack of oversight and improperly prepared records caused the district to be unaware of $206,485 in outstanding property taxes. After auditors discovered the outstanding taxes, Chautauqua County remitted the taxes with interest to the district. More than half of the unpaid taxes were more than a year past due.

Auditors also discovered there was virtually no oversight of the treasurer’s billing and collecting of retiree health insurance contributions, which puts the district at increased risk that errors could go undetected.

DiNapoli’s audit also identified a number of weaknesses involving lack of attention to financial operations, poor segregation of fiscal duties and violations of district policy. In particular, auditors found:

  • $254,650 in workers compensation checks were signed by a third party and were not reviewed by the district or reconciled by the treasurer;
  • $20,741 was paid for services without signed agreements with the district;
  • $12,926 was paid to an employee without a signed contract; and
  • $4,588 in reimbursements were paid to the project director for business lunches and dinners that were not in compliance with district policy.

Auditors also found three employees submitted and approved their own timesheets and two employees were paid $8,320 more than the stated contract rate for acting as department chairpersons.

The audit recommends that district officials:

  • establish written policies and procedures for the business department;
  • monitor employees to ensure they are informed of and performing their respective duties in accordance with district policies and procedures relating to claims and reimbursements;
  • verify that approved contracts are on file and amounts are in accordance with contract terms before a claim is submitted for payment; and
  • monitor employees to ensure compliance with the meals policy.

The district generally agreed with the audit’s findings and has begun implementing corrective action.

Click here to view the audit.

School District Accountability:
In order to improve accountability of the state’s schools, DiNapoli’s office will audit all of New York’s 834 school districts, Board of Cooperative Educational Services (BOCES) and charter schools by 2010. The State Comptroller’s office has completed 445 school audits and approximately 200 school audits are currently underway.

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