pateros goat

PATEROS – The Pateros School District has been scolded by the Washington State Auditor’s Office for its handling of associated student body money.

In an audit report for Sept. 1, 2016, through Aug. 31, 2018, the auditor’s office said it looked at areas representing the highest risk of fraud, loss, abuse or non-compliance. Those include ASB activities, accounts payable and payroll. The report was published July 29.

“The district’s internal controls over associated student body activities were insufficient to safeguard against potential loss and non-compliance with laws and regulations,” said the audit finding.

District management is responsible for designing and following internal controls that provide reasonable assurance that the district is complying with state laws and policies, and is safeguarding public resources.

ASB money may be used for optional and non-curricular activities that are cultural, athletic, recreational or social in nature, or otherwise support activities and programs of ASBs, said the auditor’s office.

Pateros’ ASB program collected $66,601 in revenue in 2017 and $76,819 in 2018.

During the state’s review of those years’ ASB activities and procedures, it tested 12 fundraisers and events, but found documentation was either inadequate or missing, the report said. The district did not:

-Require clubs to complete a profit analysis, thus reducing the district’s ability to detect potential loss.

-Require clubs to complete daily or final reconciliations for eight of the 12 events tested.

-Document beginning and ending ticket numbers for one of the events tested.

The state also found the district lacked adequate documentation to support that it deposited all receipts intact. Specifically, it found the district did not deposit $70 in T-shirt sales receipts.

“These receipts are unaccounted for and represent a loss of public funds,” said the audit report.

State officials also found the student council did not adequately document meeting minutes.

-It approved open purchase orders, but did not document approval for $15,232 of $125,344 expended in the minutes.

-Minutes did not include meeting attendees for 21 of the 23 months reviewed.

-Minutes did not include approval of prior meeting minutes for four of the 23 minutes reviewed.

-Minutes did not include details of review of annual budgets.

The state said the district did not provide the necessary resources and oversight to establish adequate internal controls or policies over ASB activities, perform all ASB activities in accordance with state laws and regulations, and ensure activities are properly supported and monitored.

“The district also did not ensure previous audit recommendations were completely implemented,” said the report.

Such conditions increased the risk that a loss or misappropriation of public funds could occur and not be detected in a timely manner, if at all.

The auditor’s office recommended the district improve internal controls over ASB activities to ensure compliance with state laws and regulations, and adequately safeguard public resources.

In response, the district acknowledged the deficiencies “and will implement a plan to hold the ASB program accountable.”

The auditor’s office noted that it “reported similar conditions during the prior accountability audit.”

That audit, covering the period from Sept. 1, 2014, through Aug. 31, 2016, included a finding that the districts internal controls over ASB activities “were insufficient to safeguard against potential loss and non-compliance with laws and regulations.”

After that audit finding, the district took several actions, including creating forms to help with tracking of merchandise for students selling merchandise, purchasing a receipting system, keeping track of purchase orders up for approval, listing invoices to be paid for each month, working on meeting minute approval, updating guidelines on awards and requiring clubs with a negative budget balance to bring them up to zero.

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