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Questions raised over pay, bid issues in school district audit

by Minden Press-Herald

The Webster Parish School District received an unmodified opinion on its 2016 audit, but it still has some issues to deal with.

In the report released Monday, the school district is correcting a longtime issue with an employee that was receiving “in-kind” payment from a federal grant program. Superintendent of Schools Dr. Dan Rawls said when the issue was discovered, he asked the auditors to look into it.

“There are some funds that we get where you can’t co-mingle with other money,” he said. “Sometimes, these federal grants will give you a certain amount of money with matching funds, and it comes with strings attached. In some funds, you can’t use those funds to pay the salary for someone that you are already paying a salary for. They call that ‘in kind.’”

He explained the money in this particular fund was bundled with other grants to pay this employee. Rawls said the auditor further explained many federal funds are restricted on how it can be spent.

In this particular finding, the federal fund was a special education fund. The employee was paid from that fund, and instead should have been paid from another fund.

Rawls said it was just a matter of correcting the balance of the funds in the computer.

In another finding, an employee was receiving the equivalent of a percentage of the 1969 sales tax when they actually qualified to receive payment from the fund itself, he said. The 1969 sales tax is dedicated to teacher salaries, administrators and support personnel. Some employees who are not eligible to receive funds from the 1969 sales tax receive a percentage equal to what eligible employees receive.

“It was determined that the employee met the criteria to receive the 1969 sales tax and should not have received the sales tax equivalent; therefore, the $7,152 sales tax equivalent is considered an unallowable cost,” auditors said in the report.

Rawls and supervisors are seeking legal counsel to correct this issue.

CPA Cindy Thompson, an accountant with Allen, Green and Williamson LLP, said there were some other issues they must correct for the coming fiscal year, including watching the budget variances on the board’s numerous accounts. There were two instances where central office staff went over the five percent allowance. State accounting law dictates the budget must be amended if a transaction or fund balance is changed by five percent.

One was in the 1996 sales tax, where it went over budget by $339,090. According to the report, the budget revisions process begins in January.

“Most decisions were not finalized until the latter portion of the year,” according to management’s response. “The proposed budget revisions for the 2015-2016 fiscal year were presented to and approved by the board on June 6, 2016. Unfortunately, time did not permit for another budget revision for unexpected changes.”

Thompson gave the board the highlights of the audit in its March board meeting, and also went through other findings in the report.

In another finding, auditors said the board did not meet the public bid law requirement when it did not advertise for bids within the time frame required. The bid was advertised, the report said, but the first bid appeared less than 25 days prior to the bid opening.

In the student activity funds, a myriad of small findings were noted. There were instances where school employees were unaware of the policy and procedures regarding student funds. The report listed a summary of instances in bank reconciliations, gate receipts, receipt books and disbursements.

A repeat finding dealt with sick leave and absences where one employee’s earned leave was received two times, causing their available balance to be overstated. Another one dealt with an employee in which their sick or leave days available could not be determined because of conflicting information obtained through two different system generated reports.

The personnel secretary began setting up new hires in July 2015, and Finance Director Crevonne Odom began reviewing the audit report documenting changes made to the employee master file.

The school board has about $80 million in capital assets and $49 million in cash and cash equivalents.

There is about $5.9 million in the general fund, and of that, $4.8 million is unrestricted.

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