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June 25, 2010

DiNapoli: More Than $90,000 in Student Funds
at John F. Kennedy School Campus Misused or Stolen

More than $83,000 in student funds was either misused or stolen at the Bronx’s John F. Kennedy High School, according to an audit released by State Comptroller Thomas P. DiNapoli.  Auditors found that most of this money was owed to vendors dating back to 2004, but the vendors were never paid and the money cannot be accounted for.  Additionally, the school spent more than $7,000 of the student funds for four separate teacher retirement celebrations, which is not authorized.  DiNapoli’s auditors also found that the school’s treasurer bounced tens of thousands of dollars in checks because she did not know there wasn’t enough money in the account.

Because DiNapoli’s auditors suspect money was missing or stolen from the John F. Kennedy High School, the findings were immediately referred to the Office of the Auditor General within the Department of Education (DoE) who contacted the Special Commissioner of Investigation for the DoE.   DiNapoli noted that the DoE was quick to act on the findings.

“This was the students’ money,” DiNapoli said.  “They raised it selling cupcakes and asking for donations.  The students worked hard to raise this money. Whoever is responsible should be punished.”

The Kennedy audit was conducted in conjunction with audits of other NYC schools and how they expended General School Funds (GSF). The audit covered the period July 2007 to June 2009.

The breakdown of the missing or misused funds, which auditors have totaled at $83,389, is as follows:

  • The school owes $60,599 to a vendor  for yearbooks, caps, gowns, and championship rings purchased for prior school years 2004-05, 2005-06, and 2006-07; and
  • The school owes $22,790 to a vending machine company for supplies purchased for the school store. This same company provided at least a $1,500 in monthly credit to the school as a commission on vending machine sales. School officials said they used the credit to purchase merchandise for the school store, but auditors found that the store’s shelves were virtually empty.  
Additional findings in DiNapoli’s audit include the following:
  • The school spent $7,827 on items unrelated to students’ needs including $7,114 for four separate teacher retirement parties at restaurants and $713 in locksmith expenses (for teacher keys);  
  • The Kennedy treasurer bounced 15 checks totaling $28,825 because she was unaware that there were insufficient funds in the GSF account;
  • Kennedy officials did not maintain basic accounting records to document GSF activity and that DoE-required approval processes were routinely circumvented and ignored; and
  • There were no records kept for sales at the school store. Cash register tapes were not used when ringing up sales; there were no records to indicate the total daily cash intake before the proceeds were taken to the treasurer for deposit.

In a related audit issued on May 25, 2010 Report 2009-N-11, DiNapoli’s auditors examined the use of GSF accounts at the other high schools located on the John F. Kennedy school campus: Marble Hill High School for International Studies (Marble Hill), Bronx Theater High School (Bronx Theater), Bronx Engineering and Technology Academy (Bronx Engineering), and Bronx High School of Law and Finance (Bronx Law and Finance). (The English Language Learners and International Support Preparatory Academy did not have an account.)  Significant problems were identified in this audit as well. Among the findings in this audit were that:

  • Poor accounting records prevented the auditors from fully accounting for GSF funds.
  • At Bronx Law and Finance, the principal used GSF funds to pay for 80 credit card charges totaling $5,312; $4,060 of which were unrelated to student activities.
  • At Marble Hill and Bronx Theatre, principals had unauthorized debit cards that were sometimes used to make cash withdrawals, including over $1,260 that was ostensibly used to pay for certain senior prom costs, but not supported by either invoices or receipts.
  • All GSF accounts must be approved by DoE, yet the principals at Bronx Engineering or Bronx Law and Finance opened GSF accounts without the DoE’s approval.

DiNapoli recommended that the NYC DoE:

  • Ensures that the GSF accounts are reimbursed for the inappropriate expenditures;
  • Conduct a detailed review of the remaining untested GSF expenditures;
  • Provide training to DoE principals on the Kennedy campus regarding their responsibilities in overseeing student funds; and
  • Ensure GSF funds at the Kennedy campus are used only for appropriate purposes.

School officials have 90 days from the release of DiNapoli’s report to develop a corrective action plan.

Click here for the full audit.

NOTE:  GSF bank accounts are the accumulated funds donated to and/or raised by the students and/or school organizations to support extracurricular and co-curricular student activities. This includes funds raised for senior year activities, such as the senior prom and yearbook; funds raised by students from bake sales; and other fund raising activities undertaken to offset extracurricular expenses.


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