Special Audit of. Addison Mizner Elementary School s SACC Fieldtrips. April 16, 2010

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1 Special Audit of Addison Mizner Elementary School s SACC Fieldtrips April 16, 2010 Report #

2 MISSION STATEMENT The School Board of Palm Beach County is committed to excellence in education and preparation of all our students with the knowledge, skills, and ethics required for responsible citizenship and productive employment. Arthur C. Johnson, Ph.D.* Superintendent of Schools School Board Members Monroe Benaim, M.D., Chair Dr. Sandra Richmond, Vice Chair Frank Barbieri, Jr.*, Esq. Paulette Burdick William C. Graham Carrie Hill* Debra Robinson, M.D. Audit Committee Members Cindy Adair, CPA, Chair Richard Roberts, CPA, Vice Chair Max Davis Gregory S. Daniel Audley Porter, CPA Noah Silver, CPA David Talley Gerald Williams*, Esq. Robert Dow* *Ex-Officio Audit Committee Members

3 Special Audit of Addison Mizner Elementary School s SACC Fieldtrips Table of Contents PURPOSE AND AUTHORITY 1 Page SCOPE AND METHODOLOGY 1 BACKGROUND 2 CONCLUSIONS 1. $69,315 in SACC Funds Expended on SACC Fieldtrips 2 2. Ticket Recipients Not Available 5 3. $1,337 Game Tickets For Staff and Chaperones 5 APPENDICES A. Management s Response from Addison Mizner Elementary School 8 B. Management s Response from Afterschool Programming Department 9 C. Result of Personnel Investigation 10

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5 THE SCHOOL DISTRICT OF LUNG CHIU, CPA ARTHUR C. JOHNSON, Ph.D. PALM BEACH COUNTY, FLORIDA DISTRICT AUDITOR SUPERINTENDENT OFFICE OF THE DISTRICT AUDITOR 3318 FOREST HILL BLVD., C-306 WEST PALM BEACH, FL (561) FAX: (561) M E M O R A N D U M TO: FROM: Honorable Chair and Members of the School Board Arthur C. Johnson, Superintendent of Schools Chair and Members of the Audit Committee Lung Chiu, CPA, District Auditor DATE: April 16, 2010 Subject: Special Audit of Addison Mizner Elementary School s SACC Fieldtrips PURPOSE AND AUTHORITY During the 2007 and 2008 Annual Internal Funds Audits of Addison Mizner Elementary School, we noted that the school expended significant amount of SACC funds on fieldtrips to the Panthers hockey games for SACC students and their families, staff, and chaperones. Subsequently, the audit examined specifically the expenditures on these fieldtrips to determine whether these expenditures were appropriate. SCOPE AND METHODOLOGY The audit was performed in accordance with Generally Accepted Government Auditing Standards by Susan Miller, CIA, during April 2009, and included: Reviewing P-Card, Internal Funds, and SACC Operating Budget records for Fiscal Years 2007, 2008, and Reviewing hockey games expenditures for Fiscal Years 2007, 2008, and Reviewing participant lists for the hockey games. Reviewing SACC student records for Fiscal Years 2008 and Reviewing SACC Operational Manual. Interviewing staff. Draft findings were sent to the school and Afterschool Programming Department for review and comments. Management responses are included in the Appendices. We appreciate the courtesy and cooperation extended to us by staff during the audit. The final draft report was presented to the Audit Committee at its April 16, 2010, meeting. 1

6 BACKGROUND School Age Child Care Program (SACC) is a self-supporting program and operates with a costrecovery budget generated from fees. The school s SACC program had $103,248 in cumulative fund balance as of June 30, Date SACC Operating Fund Balance June 30, 2006 $135,292 June 30, ,486 June 30, ,248 According to staff, the SACC director was advised by the Afterschool Programming Department to spend the excessive fund balance that had accumulated. As a result, the SACC director organized fieldtrips to the Florida Panthers hockey games for SACC students and their families, and staff for social purposes. The tickets were bought as a block in advance of the game. SACC families and staff signed up for the games. Charter buses were paid for with SACC Special Activities and Operating Budget Funds. To participate in the fieldtrip, students enrolled in the SACC program had to sign-up in advance. As revealed by the audit, almost $70,000 was spent on hockey games tickets for SACC students and their families, staff, and chaperones during 2007 through Subsequently, on May 22, 2009, we referred the audit conclusions to Employee Relations for further review. As indicated by Employee Relations, the case was closed on December 9, 2009, and subject matter was handled by the Area Superintendent. (Please see Appendix C, page 10.) CONCLUSIONS 1. $69,315 in SACC Funds Expended on SACC Fieldtrips. During Fiscal Years 2007, 2008, and 2009, the school s SACC program spent a total of $69,315 on six fieldtrips to the Florida Panthers hockey games ($56,320 in admission and $12,995 in transportation) for SACC students and their families, staff, and chaperones. Monies for these games came from the school s SACC Program Special Activities and Operating Budget Funds. Monies Spent on Six Fieldtrips During 2007, 2008, and 2009 Date of the Games Fiscal Year 2007 # of Tickets Purchased Ticket Cost Chartered Bus Expense Total Expenses 11/18/2006 (Saturday, 7:30pm) 200 $6,405 $1,575 $7,980 3/3/2007 (Saturday, 7:30pm) 200 8,005 2,050 10,055 2

7 Date of the Games Fiscal Year 2008 # of Tickets Purchased Ticket Cost Chartered Bus Expense Total Expenses 12/22/2007 (Saturday 7:00pm) ,000 2,160 13,160 3/14/2008 (Friday 7:30pm) ,005 2,600 13,605 Fiscal Year /14/2008 (Friday 7:30pm) ,405 2,305 12,710 4/5/2009 (Sunday 5:00pm) 190 9,500 2,305 11,805 Total 1,323 $56,320 $12,995 $69,315 The school did not retain the attendance lists for the November 2006, March 2007, and December 2007 fieldtrips. After an audit in 2008, the school was advised to keep the attendance list. The school provided the participant lists for the March 2008, and April 2009 games. According to the participant lists provided by the school, 61 students and their families received a total of 230 tickets for the March 2008 game, and 49 students and their families received a total of 186 tickets for the April 2009 game. To ensure fiscal accountability, monies generated from self-supporting programs should not be spent to benefit District employees, and parents and relatives of the students. Florida Department of Education (DOE) and the School District provide guidelines regarding spending Internal Funds monies on staff and students families. The Department of Afterschool Programming should provide necessary training to school staff so that DOE rules and District procedures regarding how Internal Funds monies can be expended are properly adhered to. The followings are some of the parameters for spending Internal Funds monies: DOE Rules (DOE s Financial and Program Cost Accounting and Reporting for Florida Schools, Chapter 7), Section I, 7, states Funds collected shall be expended to benefit those students in school unless those funds are being collected for a specific documented purpose or are generated by vocational production shops. Section I, 8, states Collecting and expending of school internal funds shall be in accordance with the Florida Constitution, Florida Statutes, State Board of Education rules, and school board rules. Sound business practices should be observed in all transactions. 3

8 Internal Accounts Procedures (Bulletin #P CAO/COO), Section 2.a, states Internal funds shall not be used for any purpose which represents a favor, loan or credit to School District Employees, students, or other persons. Section 2.c, states Internal funds are normally intended to be used only for the benefit of students. Section 2.d, states Student activity funds shall be expended in such a way as to benefit those pupils currently in school who have contributed to the accumulation of such funds. Moreover, Accounting Department s training materials Internal Accounts 101, states Internal accounts are governed by DOE rules, state statutes, district policies and directives, and policies and procedures outlined in the internal accounts manual. These funds are student monies, to be spent by and for the benefit of the students. In fact, there are only two accounts that may be used for the benefits of adults: Administrative Courtesy and Faculty Fund. The Department of Afterschool Programming should also ensure that training is provided to schools so that staff are knowledgeable with existing guidelines in spending Internal Funds monies on staff, and student s families. Management s Response: Addison Mizner Elementary School: Staff is well aware of existing guidelines regarding Internal Funds. Research shows that parent involvement is essential in fostering positive home/school relationships. In an effort to promote a continued collaborative partnership between home and school, the SACC program has sponsored this family field trip since Our program continually boasts an enrollment of over 200 children, generating more funds than most other elementary schools. In a cost recovery program, all fees generated should be utilized for activities that support the children whose families paid the fees. There is an expectation of staff involvement, and counselors attend to build a sense of community. All funds were expended for the benefit of the students. (Please see Appendix A, page 8.) Afterschool Programming Department: The Afterschool Program at Addison Mizner is large in comparison with the majority of other District afterschool sites. Due to the financial advantages realized from economy of scale, the Addison Mizner afterschool budget has grown over the past several years. Special Activities fees would be the appropriate fund from which activities such as these should be funded. It is also expected that District guidelines regarding the accompaniment of staff as chaperones would be followed and therefore, staff chaperones would be attending the event and would not be expected to pay out of pocket for tickets required to fulfill an expected job duty. (Please see Appendix B, page 9.) 4

9 2. Ticket Recipients Not Available. The school had no records for those who went to the November 2006, March 2007, and December 2007 fieldtrips. Our review of the participant list attached to the P-Card invoice for the March 2008 fieldtrip found that some tickets were provided to the school s SACC students enrolled in Fiscal Year 2009 but were not enrolled in According to the SACC director, the list attached to the March 2008 trip was for the November 2008 trip and subsequently provided us with another participant list for the March 2008 trip. However, the school purchased 208 tickets for the November 2008 trip but the participant list indicated that a total of 256 tickets were given to participants. Consequently, the validity of the participant list for the November 2008 trip became questionable; and the list could not be used for further confirmation. Moreover, due to the lack of records for three of the November 2006, March 2007, and December 2007, fieldtrips; and we noted significant discrepancy in the November 2008 participant list, we were unable to ascertain who actually received the 883 tickets and went to these four trips, which were funded by $43,905 in SACC monies. Management s Response: Addison Mizner Elementary School: For the three trips prior to the March 2008 event, the signup sheets were discarded after each trip. We were notified during the audit in March 2008 that we should keep a list of participants records, therefore, sign-up sheets for the November 08 and April 09 trips were retained. The SACC Director inadvertently saved the file over the existing table. This human error accounts for the discrepancy in numbers. The SACC Director acknowledges his error when typing over the previous trip s Word Document list, causing some names to appear twice. He has exercised more care in typing subsequent lists. Tickets and transportation were purchased with funds generated by the collecting of student fees. None of the tickets were free. (Please see Appendix A, page 8.) Afterschool Programming Department: Appropriate documentation for all expenditures is expected of all District Afterschool Programs. Discussion regarding expectation for documentation with school administration and SACC Director occurred week of May 4, 2009 as a result of this finding. (Please see Appendix B, page 9.) 3. $1,337 Game Tickets For Staff and Chaperones. Pursuant to SACC Operational Manual, SACC funds may not be used for gifts for staff. Furthermore, providing gifts, which are funded by SACC monies, to staff and parents and relatives of SACC students does not serve public purpose. Our review of the participant lists for the March 2008 and April 2009 trips found that a total of 24 game tickets, with a total cost of $1,337, were given to staff and chaperones: 15 tickets to the SACC director; 2 tickets to a SACC counselor; and 7 tickets to other school staff/chaperones. 5

10 Game Tickets Given To Staff and Chaperones Number of Tickets Total Cost Date of the SACC SACC Other Staff (Including Games Total Director Counselor Members Transportation) March $1,088 April Total $1,337 The Department of Aftershool Programming should ensure that providing tickets to the SACC students family members and school staff do not violate Federal income withholding and reporting requirements. Management s Response: Addison Mizner Elementary School: The SACC Operational Manual states that parent involvement is a key factor in ensuring the success of the program. SACC Quality Assessment guidelines state that family involvement through outreach and activities is expected. To build a sense of community, staff is expected to participate in all family activities and they assist with the large number of attendees on the trips. They should not be expected to pay for admission as they are carrying out the supervisory responsibilities of their position. Their admission tickets are not considered gifts. After all tickets were disbursed to the students who signed up, unused tickets that were already purchased appeared under the SACC Director s name so that all tickets were accounted for. They were not given to anyone as gifts. (Please see Appendix A, page 8.) Afterschool Programming Department: Appropriate documentation for all expenditures is expected of all District Afterschool Programs. Discussion regarding expectation for documentation with school administration and SACC Director occurred week of May 4, 2009 as a result of this finding. It is expected that SACC (afterschool) funds not be used for gifts for staff. It is the understanding of this office that admission tickets for these SACC-sponsored events were not provided as gifts, but rather were provided for staff due to administration s expectation and encouragement of staff to attend. As a family/parental involvement activity, staff would be expected to attend to support the event and to assist with any issues arising during the event. It would not be expected that those staff participating would have to pay for their admissions. Records kept for future events should indicate staff attending as support of the event as opposed to free tickets provided. The free tickets designation does not appear to adequately describe the staff participation with the exception of the second ticket provided to a counselor. It should be noted that due to the fact that all tickets had to be accounted for, the tickets for which no name could be attached were attributed to being given to the director. The Department understands that the Afterschool Director stated these additional tickets went unused by anyone. 6

11 An ongoing reminder of the cost recovery nature of our District Afterschool Programs (SACC) occurs at every director meeting and training at which budgets are discussed. These reminders have included the statement that funds generated should be spent on the students from whom the funds come. That is, funds generated should be sufficient for providing a wide variety of program opportunities for current students enrolled (including family involvement) and there should not be excessive carryover nor deficit balances. District Afterschool Programs are expected to provide opportunities for increasing parental and family involvement and for support of the school community as a whole. The District Afterschool Quality Assessment includes this expectation. (Please see Appendix B, page 9.) End of Report 7

12 Appendix A Management s Response Addison Mizner Elementary School 8

13 Appendix B Management s Response Afterschool Programming Department 9

14 Appendix C Result of Personnel Investigation 10