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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Report Highlights

New Suffolk Common School District - Board Oversight and Local Finance Law (2018M-177)

Released: December 14, 2018 -- [read complete report - pdf]

Audit Objective

Determine whether the Board provided adequate oversight of the District’s financial operations.

Determine whether the Board and District officials complied with Local Finance Law when using a line of credit.

Key Findings

  • The Treasurer’s duties are not properly segregated and the Board and District officials did not provide adequate oversight over disbursements.
  • We reviewed 46 non-payroll disbursements totaling $531,934 and determined 19 (41 percent) totaling $233,492 did not include any Board members’ initials to indicate they were audited. The remaining 27 claims totaling $298,442 that had initials did not include dates to determine when the claims audit had occurred.
  • We reviewed 76 payroll transactions totaling $113,485 and found the Principal had not certified any of them.
  • The Board did not comply with Local Finance Law when authorizing $220,000 of borrowing using a line of credit.

Key Recommendations

  • Establish compensating controls to routinely monitor and review the Treasurer’s work.
  • Audit and approve all claims before they are paid.
  • Establish procedures to review and certify payroll prior to disbursement, and ensure proper support is included.
  • Comply with Local Finance Law when authorizing District borrowing.

District officials agreed with our findings and indicated they plan to initiate corrective action.

Background

The New Suffolk Common School District (District) is located in the Town of Southold, Suffolk County. The District is governed by the Board of Education (Board), which comprises three elected Trustees. The Board is responsible for the general management and control of the District’s financial and educational affairs. The Principal of Schools is the chief administrator and is responsible for the District’s day to day management, including the certification of payroll, under the Board’s direction.

The Business Manager/Treasurer is responsible for disbursing funds, computing payroll, signing checks, initiating wire transfers, preparing bank reconciliations, maintaining accounting records and preparing financial reports.

The District operates one school for kindergarten through grade six. The District pays tuition for students in grades seven through 12 to attend neighboring school districts.

Quick Facts
Employees11
Full- and Part-time Students27
2016-17 Payroll Expenditures$401,599
2016-17 Non-Payroll Expenditures$634,896
2017-18 Budgeted Appropriations$1.1 million
Bank Line of Credit$220,000

Audit Period

July 1, 2016 – January 31, 2018


Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.ny.gov
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236