Lack of control

Published 10:43 am Wednesday, March 2, 2016

Audit findings released last week concerning the lack of internal control over spending within Franklin City Public Schools is troubling, to say the very least. Five specific areas of concern were brought to the attention of City Council during a report given by Audrey Davis of Davis & Associates, the firm hired to conduct the city’s Financial Statement Audit for fiscal year 2015. The findings included the following:

• The office of the superintendent approves its own transactions and does not require an additional level of approval for these charges. Allowing one individual to both purchase and approve payments can result in the misuse of school funds and significantly increase the opportunity for fraud.

• An instance where certain school board personnel charged the cost of travel for their family on the school board’s credit card. The personnel provided a check to reimburse the improper travel charges, but no policies are in place to prohibit the use of the school board’s credit card in this manner.

• Instances where purchases were made but were not accompanied by proper supporting documentation. This creates the opportunity for charges to be falsified and for fraud to occur.

• The school board was forced to request a budget increase, as the pre-approved levels were found insufficient to meet its needs. This indicates improper planning as well as a lack of management over adhering to the pre-approved budget levels.

• The school board selected two consultants without regard for the competitive negotiation process spelled out in the Virginia Public Procurement Act. This could result in charges for products and services over and above what the school board could expect to pay in the open market.

These are not insignificant issues. At best, they demonstrate incompetence. At worst, these findings illustrate a culture of disregard for basic financial responsibility and accountability. Neither alternative is tolerable. The Franklin School Board has essentially begged for the opportunity to show that it was turning things around in the last year or so, after a similarly scathing set of reports was handed down by the state department of education. These audit findings fly in the face of such assertions, and the benefit of any remaining doubt as to the school system’s leadership ability has expired.