October 15, 2010
DiNapoli's Office Completes Audit of the Peekskill City School District
New York State Comptroller Thomas P. DiNapoli today announced his office completed the audit: Peekskill City School District, Internal Controls Over Wire Transfers and Computer Safety.
“These school district audits are powerful tools that not only protect taxpayers, but also our children,” DiNapoli said. “As the State continues with budget difficulties, school districts need to be doing their part, ensuring that the resources they have are adequately protected. The Peekskill City School District needs to do a better job guarding against fraud and graft, ensuring access to sensitive computer data and wire transfers are authorized. There’s just too much risk right now.”
DiNapoli’s auditors looked at the Peekskill Board of Education’s internal controls over wire transfers and user access rights to the computer system. In both cases, auditors found a lack of oversight and inadequate policies and procedures. With no oversight or protocols, one or more persons could siphon off large amounts of money without detection.
Currently, the district allows the treasurer (or deputy treasurer) to authorize, initiate and record wire transfers, as well as receive wire transfer confirmation without supervisory review. Auditors also found the district did not have a comprehensive agreement with each bank or investment company that addresses electronic or wire transfers. As a result, there is an increased risk that one person could be in a position to initiate an inappropriate wire transfer and conceal it.
The treasurer also has too much computer access over a computer system that oversees the district’s entire financial system. This control weakness could allow the treasurer to initiate and conceal inappropriate transactions. Several employees were also found to have excessive rights to the financial system that were not consistent with their job duties.
To view a full copy of the audit, click here.
If you have any questions, or would like a comment from the Comptroller’s press office regarding this audit, please call 518-474-4015, or send an email to firstname.lastname@example.org.