New York State Comptroller Thomas P. DiNapoli today announced the following school district audits have been issued.
Auditors found that 34 of the 60 students in the sample (57 percent) did not have appropriate proof of residency. As a result, officials cannot ensure they billed districts of residence accurately. The school billed tuition totaling $12,600 for three students to the incorrect district of residence and underbilled four additional students’ district of residence by $4,200.
District officials did not use competitive methods for seven professional service providers who were paid $128,205. Officials referred to these providers as proprietary services because they were recommended and used by other school districts. Officials also did not have written agreements for four professional service providers who were paid $58,409 during the audit period.
During the audit period, the district did not provide any information technology (IT) security awareness training. There was also evidence that some employees did not comply with the district’s acceptable use policy. A review of the web browsing history on 15 computers found significant personal Internet use on three computers.
The district’s reported fund balance has increased significantly over the past three fiscal years and the surplus fund balance was in excess of the statutory limit at fiscal year-ends 2015-16 through 2017-18 by 6.9 to 15.3 percentage points. Appropriations were consistently overestimated which resulted in the increasing fund balance levels and the district not using any of the fund balance it appropriated to finance 2017-18 operations.
The former business manager’s separation payment was inadequately supported. The former employee, who retired on March 31, 2016, incorrectly calculated his separation payment of $86,324 without an independent review. The amount paid was $16,700 more than he was eligible for and $64,063 was paid prior to his actual retirement date. In addition, the district inappropriately provided an advance of $15,000 of separation pay to the former business manager.
For the last three completed fiscal years (2015-16 through 2017-18) the district has reported surplus fund balance in the general fund that exceeded the statutory limit by $1.15 to $1.83 million. The district has generated operating surpluses totaling approximately $1.5 million over the last three fiscal years.
Officials did not develop and manage a comprehensive investment program to ensure interest earnings were maximized. Auditors found that district officials could have invested idle operating funds averaging approximately $2.7 million during the audit period in a financial institution with higher available interest rates and interest earnings would have been increased by $61,162.
Claims were not submitted and reimbursed for 517.5 of 1,142 (45 percent) eligible services totaling $21,211. Service providers did not document 1,769.5 scheduled services totaling $56,998 in the special education system as having been provided. Had these services been appropriately claimed and documented, the district could have realized potential revenues totaling $39,105.
Auditors found evidence that some employees did not comply with the district’s acceptable use policy. In addition, district officials did not disable unneeded user accounts in a timely manner and did not provide IT security awareness training to employees.