New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of the Central Square Central School District, Hastings-on-Hudson Union Free School District, Livonia Central School District, Panama Central School District and the Williamsville Central School District.
“In an era of limited resources and increased accountability, it’s critical that schools make every dollar count,” DiNapoli said. “By auditing school district and charter school finances and operations, my office continues to provide taxpayers the assurance that their money is being spent appropriately and effectively.”
Although the district’s claims auditing policy contains provisions related to the appointment and duties of the claims auditor, the board did not ensure that the appointed claims auditor reported to the board on a monthly basis. Auditors reviewed a sample of 50 claims totaling approximately $2.3 million out of 1,394 claims totaling approximately $26.3 million. All payments tested were accurate, supporting invoices matched amounts charged, purchase orders for goods received were signed by the receiver, and there was evidence of the claims audit prior to payments being remitted to the vendor.
The board and district officials need to improve the budget process to help ensure fund balance is maintained in accordance with statutory requirements and reserves balances are reasonable. From 2010-11 through 2014-15, the board appropriated an average of almost $2.2 million as a financing source in the district’s annual budgets. However, because the district incurred operating surpluses in four years of these years, the district used only about 2 percent of the appropriated fund balance. The board has also overfunded reserves by $4.7 million (88 percent of total reserves) as of June 30, 2015. When the unused appropriated fund balance and excess reserves were added back, the district’s recalculated fund balance exceeded the statutory limit ranging from 19 to 21 percent for the five-year period.
The district should manage its software more effectively and efficiently. The board’s acceptable-use policies are inadequate because they do not detail practices for enforcement, such as monitoring computer use and reviewing installed software, or include specific penalties for noncompliance. Information Technology staff does not maintain a comprehensive inventory of all software that the district owns and for which it purchased licenses. In addition, district officials and IT staff do not regularly monitor or review district computers to ensure that all software installed by the user is up-to-date, appropriate and legally obtained and that virus protection and patches are installed and up-to-date.
From 2013-14 through 2015-16, the district appropriated $1.4 million in fund balance as a financing source in the annual budgets. However, the district only spent approximately $309,000 of the appropriated fund balance to finance operations during 2013-14 and 2014-15. Auditors estimate that the district will realize an operating surplus of approximately $337,000 for 2015-16 and will not use any of the $188,750 of fund balance it appropriated for the 2015-16 budget. When the unused appropriated fund balance is added back to unrestricted fund balance in the year in which it was appropriated, the recalculated unrestricted fund balance exceeded the statutory limit by 15 to 17 percentage points.
The board and district officials did not prepare accurate budgets for the 2012-13 through the 2015-16 fiscal years. While they appropriated $21.7 million of unrestricted fund balance to help finance operations, it was not needed because the district’s budgeting practices produced operating surpluses totaling $33.4 million. When unused appropriated fund balance was added back, the district’s recalculated unrestricted fund balance exceeded the statutory limit by up to 3 percentage points.
For access to state and local government spending and nearly 50,000 state contracts, visit OpenBookNY. The easy-to-use website was created by Comptroller DiNapoli to promote openness in government and provide taxpayers with better access to the financial workings of government.