WEBSTER CENTRAL SCHOOL DISTRICT Brian Freeman, Assistant Superintendent for Business 119 South Avenue, Webster, NY 14580 (585) 216-0017 brian_freeman@webstercsd.org
Brian Neenan, Superintendent From: Brian Freeman, Assistant Superintendent for Business Re: Internal Audit Report Corrective Action Cc: Board of Education, Audit Committee Date: March 21, 2025 Bonadio & Co., LLP has recently completed its testing for the district’s internal audit requirement. Their area of focus for this year was an evaluation of the extra classroom accounts and the policies/procedures that go along with those areas. Enclosed you will find the full reporting done by the internal auditors and the necessary corrective action steps based on their findings. Also included is a separate report with the yearly risk assessment update. This report categorizes a Low, Moderate, and High risk ranking for multiple areas in the district. Moving forward this report helps to identify areas of future testing, or areas where additional work may be needed to lower the risk associated. Based on discussions with the audit team and business office, next year will likely be the year to focus on business office policies and workflow processes. The district would like to thank the staff of Bonadio & Co., LLP for their professionalism and collaborative work. The district accepts the recommendations from Bonadio & Co., LLP as outlined in their report and appreciates the discussions their audit team brought to the process. Please let me know if you have any additional questions. Thank you.
The findings from the report have been summarized and outlined below: 1. Student Activity Treasurer Ledger Issue: Lack of reconciliation between student-ledgers and ECA treasurer records. Corrective Action: ✔ Implement a periodic reconciliation process. ✔ Require student treasurers and ECA treasurers to meet monthly for review. ✔ Establish a standardized reporting format for tracking expenditures and receipts. ✔ Conduct training for student treasurers and advisors on ledger management. Responsible Party: ECA Treasurers, Faculty Advisors, Business Office Timeline: Immediate implementation; first reconciliation review within the 2024-25 fiscal year. 2. Sales Tax Reconciliation and Cash Receipts Review Issue: Improper handling and submission of sales tax on ECA transactions. Corrective Action: ✔ Ensure the use of resale certificates to avoid paying sales tax on procurement. ✔ Train all relevant personnel on sales tax collection and submission processes. ✔ Modify procedures to record gross amounts and make direct transfers for tax remittance. Responsible Party: Business Office, ECA Treasurers Timeline: New procedures implemented within the 2024-25 fiscal year. 3. Fundraiser Approval Process Issue: Fundraisers were conducted without required approvals. Corrective Action: ✔ Enforce requirements for faculty advisors and principals to approve fundraisers. ✔ Develop a tracking system to ensure compliance before fundraisers commence. ✔ Provide training sessions on proper fundraiser authorization procedures. Responsible Party: Faculty Advisors, School Principals, Business Office Timeline: Immediate enforcement; training within the 2024-25 fiscal year. 4. Club Charter Compliance Issue: Missing signatures and lack of principal approval on club charters.
✔ Redesign club charter forms to include principal and business office approvals. ✔ Require all clubs to submit updated charters annually. ✔ Implement a monitoring process for charter submission compliance. Responsible Party: School Principals, Business Office, Faculty Advisors Timeline: Link to charter form on the district intranet within the 2024-25 fiscal year. 5. Bank Reconciliation Process Issue: Lack of documented review and approval for reconciliations. Corrective Action: ✔ Implement a policy requiring preparer and reviewer signatures with dates. ✔ Establish a review schedule to ensure reconciliations are completed timely. ✔ Conduct training for all personnel responsible for bank reconciliations. Responsible Party: Business Office, ECA Treasurers Timeline: Policy and training within the 2024-25 fiscal year. 6. Board Review of Transactions Issue: Lack of detailed reporting to the Board of Education. Corrective Action: ✔ Require quarterly detailed reports of all club receipts and disbursements. ✔ Develop a standardized reporting format to be used across all schools. ✔ Ensure board members receive training on interpreting financial reports. Responsible Party: Business Office, Board of Education Timeline: First detailed report within the 2024-25 fiscal year. 7. Training and Compliance Monitoring Issue: Gaps in knowledge and adherence to procedures. Corrective Action: ✔ Develop and mandate annual training for faculty advisors, student treasurers, and ECA staff. ✔ Establish a compliance audit team to conduct periodic reviews. ✔ Provide ongoing support and refresher sessions as needed. Responsible Party: Business Office, Compliance Team Timeline: First training session within the 2024-25 fiscal year; compliance checks semi-annually.