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Audit Faults
Purchasing Practices, Lax Controls of Windham-Ashland-Jewett School
District
The Windham-Ashland-Jewett school district purchased $158,000 in goods
and services without following competitive requirements and had lax
controls in other areas, according to an audit released today by New
York State Comptroller Alan G. Hevesi.
Auditors found that while the school district had policies in place
for making purchases, the district did not ensure that employees complied
with these policies or require the solicitation of written requests
for proposals (RFP) for professional services. As a result, RFPs were
not solicited for goods and services purchased for approximately $158,000,
including $6,950 for auditing services, $35,828 for architectural and
engineering services, and $115,000 for school building and renovation
projects. Auditors also found that the district had made a few improper
budget transfers and adjustments and needed to improve efforts to account
for capital assets.
“Our auditors found that the Windham-Ashland-Jewett school district
needs to do a much better job of safeguarding taxpayer dollars,” Hevesi
said. “I’m pleased that in the areas where auditors found
room for improvement that the district responded positively and indicated
that it had or would take steps to address them.”
John Wiktorko, superintendent of schools since July 2004, said “It
is our intent to use the information and suggestions provided within
the report to continue improving our policies and protocols. It is
also important to point out, the district has taken significant action,
many of these actions prior to receiving the report findings, to improve
financial policies, procedures and accountability.” His full
response is included in the audit as well as information on how the
district is responding to the auditors’ recommendations.
The audit, covering the period of July 1, 2003 through September 1,
2004, reviewed controls over purchasing, cash receipts and disbursements,
capital assets, payroll and student fundraising to determine whether
they were appropriately designed and operating effectively.
Auditors found:
- Purchasing. A test of 60 claims revealed that 16 claims, totaling $40,250,
were paid without any indication that the district had obtained the
required verbal or written quotes.
- Appropriation Control. The district also made budget adjustments
after accounts were overspent, rather than verifying that adequate
dollars were available in a particular account before issuing purchase
orders. The board of education also authorized a budget transfer
between accounts for the purchase of a lawn tractor that was not
in compliance with the Commissioner of Education’s regulations.
- Claims Processing. Although the board had appointed an internal claims
auditor, it had not established written procedures for how claims
should be audited or identified the specific duties and responsibilities
of the internal claims auditor. Auditors also found that 19 of 49
claims tested were not supported by requisitions, seven of 60 claims
did not have purchase orders and 22 of 57 paid claims did not have
supporting documentation indicating that the goods and services had
been received.
- Cash Receipts and Disbursements. When auditors tested cash receipts,
they found that internal controls over cash receipts were appropriately
designed and operating effectively and deposits had been made in
a timely manner. However, auditors recommended that the district
adopt a written investment policy to give staff direction on investment
activities.
- Capital Assets. The district had not updated capital inventory records
since 1995. As a result, the district did not have an accurate accounting
of assets with a net value of $1,889,468, including land, buildings
and equipment.
- Payroll and Student Fundraising
Controls. After reviewing payroll
records and cash receipts of extra-classroom activities, auditors
found that the district had effective processes in place to oversee
payroll and extra-classroom activities.
Auditors encouraged the board to:
- Ensure that district officials comply with the district’s
written procurement policy.
- Establish procedures to effectively monitor the district’s
budget and make certain that expenditures are limited to available
appropriations.
- Design adequate controls over budgetary transfers to ensure that
all transfers are properly authorized and in compliance with policies
and regulations.
- Improve the internal claims process, including requiring that claims
are properly processed prior to the actual payment, developing written
procedures for claims auditing and defining the responsibilities
of the internal claims auditor.
- Adopt a written investment policy.
- Maintain up-to-date records of capital assets and ensure that regular
inventories are taken.
Also included in the audit are findings regarding taxpayer complaints
that were investigated as part of the audit.
The Windham-Ashland-Jewett school district has 500 students, one building,
and 120 employees. The district’s 2004-05 budget was $8.2 million.
Click here for a copy of the audit.
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Albany Phone: (518) 474-4015 Fax:(518)
473-8940
NYC Phone: (212) 681-4825 Fax:(212) 681-4468
Internet: http://www.osc.state.ny.us
E-Mail:press@osc.state.ny.us |
