DiNapoli's Office Completes School Audits
New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of Garden City Union Free School District, Johnson City Central School District, Merrick Union Free School District, New Hyde Park–Garden City Park Union Free School District, Raquette Lake Union Free School District and Skaneateles 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.”
Garden City Union Free School District – Internal Controls Over Selected Financial Operations (Nassau County)
Auditors found the district used available fund balance to increase its Employee Benefits Accrued Liability Reserve to $8.1 million as of June 2007 while the district’s EBALR liability totaled only $2.9 million. The district overfunded the liability by $5.1 million or 175 percent. Auditors also found there were no written procedures for using electronic signatures, or for authorizing and reviewing online banking transactions. District officials did not include $1.6 million in annual salaries paid to 13 employees in board minutes. The district also paid five vendors a total of $732,571 for professional services without soliciting competitive proposals.
Johnson City Central School District – Internal Controls Over the Treasurer’s Duties and User Access Rights (Broome County)
The audit found the district did not adequately segregate the treasurer’s duties and most mitigating controls were not effective. While the district changed administration of access rights to the financial software to the IT director, district officials could further alleviate risk by limiting computer user access rights in the financial software based on user’s job duties.
Merrick Union Free School District – Internal Controls Over Payroll and Fuel Card Purchases (Nassau County)
Auditors found the district did not establish procedures for authorizing, documenting and approving employee overtime. In addition, the district did not properly segregate duties in payroll, and district officials did not develop written procedures for payments to employees who waive the district’s health insurance plan. The board also did not establish policies for gasoline purchase cards and did not close an unused fuel purchase card for more than a year. While auditors found that all purchases were for legitimate district purposes, these weaknesses increased the risk that the district could incur unauthorized expenses.
New Hyde Park – Garden City Park Union Free School District – Internal Controls Over Selected Financial Activities (Nassau County)
The audit found the board did not adopt formal policies and procedures for wire transfers. As a result, $5.3 million in wire transfers were either not approved or not approved in a timely manner. In addition, the district needs to improve controls over its information technology system.
Raquette Lake Union Free School District – Internal Controls Over Financial Operations (Hamilton County)
Auditors found the board did not design adequate internal controls over the district’s financial operations, specifically regarding management oversight and segregation of duties within the business office. The board did not comply with Education Law regarding fiscal training for board members and did not ensure that required financial reports were prepared and filed. The board’s lack of guidance resulted in a lack of segregation of duties without compensating controls over the investment of district moneys.
Skaneateles Central School District – Internal Controls Over Selected Financial Operations (Cayuga and Onondaga Counties)
Auditors found district officials did not establish appropriate policies to adequately segregate the treasurer’s duties and did not develop compensating controls, such as a routine review of the treasurer’s work by another employee. The district did not have written policies or procedures for the approval of separation payments. As a result, district officials paid a former custodial supervisor and a former custodian separation payments totaling $10,847 that were not authorized by the board and to which the employees may not have been entitled. Auditors also found the claims auditor’s duties were not adequately segregated from the business operations and purchasing functions
Click here to view the audits above. If you have any questions or would like a comment from the Comptroller’s office regarding the audits above, please call 518-474-4015.