LIST OF FINDINGS 90 DAYS INTO SCPA TRANSITIONPolicies/Procedures1. Background Checks (20/28) @71%, of seasoned supplemental staff had one-on-one unsupervised access to students and did not have current background checks as of October, which is in violation of Board Policy 8475. This is after the Artistic Director decisively stated that they all indeed had valid background checks. Principals response to this was lackadaisical. Spending countless hours on reactively rectifying this. [DISTRICT LEVEL There needs to be a tracking mechanism at the District-level. Security is working to proactively generate reports of when background checks expire to send to the schools. Board Policy 8475 needs to be updated various aspects do not align with current procedures. ]

2. $45K Emergency Credit Card Per a verbal agreement the loan amount was for $45K and was anticipated to be repaid from the Box Office receipts. This agreement was never put into writing as recommended by Internal Auditor, Interim Business Manager and LSDMC Finance Committee. The LSDMC Finance Committee is extremely concerned about the state of the finances and spending of the school. Exceeding the credit card limit circumvents two levels of controls, the first being the Principal being accountable to stay within established limits and by the District to not have a control in place to identify and stop the limit from being exceeded.

In addition, the Treasurers Office established a $45K cash account for this same purpose, which indicates a duplication of efforts and possibly additional spending without proper oversight. This speaks to disjointed communication within the Treasurers Office.

3. Box Office White Christmas intercepted/uncovered the intentions of using an unauthorized card reader to accept credit card payments and cash from patrons which is in violation of ORC 3313.51 because those funds would not have been coming to the District as required. A flyer was produced stating these intentions. In addition, the Artistic Director signed the Production Rights contract in violation of District Policy (need specific policy) as communicated by General Counsel that only the Treasurer can sign contracts for the District. School leadership had decided to not use the Box Office for this production. After discussion with Internal Audit, decided to use the Box Office if the Manager was available. The White Christmas production was not on the original schedule, even though a decision was made to put it on in May 2014. Even with this lead time the production rights were paid for by the Emergency Loan funds circumventing the procedure of using the EprOhio requisition system.Nutcracker uncovered an online communication that tickets for a show at Cincinnati Country Day could be purchased in advance by emailing: scpadanceparents@gmail.com. Auditor asked for school leadership to describe how they planned to ensure proper cash handling, collection and deposit of funds with the District. In addition made inquiries about how the advanced ticket sales would be processed? Who receives the e-mails that come go into the gmail account? How is CCD handling what should be SCPA receipts? Why is there not an arrangement for CCD to just issue a check for SCPA services? etc. The Artistic Director reactively put a process in place.Box Office needs a closed-circuit TV to see what is happening inside the theater, a camera positioned over the cash drawer to record transactions, and a controlled way of accessing the Box Office because currently multiple individuals have keys (i.e. Cincinnati Bell Repair man).4. General Fund Budget The FY15 School Budget has not been shared with or approved by the LSDMC. The General Fund Budget has been changed by the Principal at the District level without receiving approval from the LSDMC in violation of Board Policy 9142. [DISTRICT LEVEL - There is a Board Policy in place but District Administration needs to create procedures, distribute them and hold school administration accountable to follow them in regards to having the ILT review the budget and then for the LSDMC to review and approve the school budget. From reviewing the SCPAs Financial Data, prepared by the Interim Business Manager based on District data, it was evident that it would be beneficial for this level of financial analysis to be performed each month at each school so that School Administrator decisions can be driven off of relevant reporting data that clearly shows changes from month to month as well as year to date. This review has raised broader questions around the District Budget Process, particularly with the current structure of the Principal being responsible for the budget but not reporting to the District Treasurer.]

5. Invoicing Process - The Artistic Director creates invoices, approves them, submits them for payment & makes purchases which violates sound business practices and circumvents proper segregation of duties. Department heads should sign-off on timesheets to confirm that quality services have actual been rendered, so that actual expenditures are paid for and not estimates.

6. Cash Deposits are not placed in a locked cash box and transferred to the administrator on duty for safekeeping in the school vault in accordance with District SAF Policy D.3.4.1[DISTRICT LEVEL Treasurers Office has not conducted training on proper cash handling procedures for FY15. A comprehensive training and updated manual should be provided to all District employees with the duty of handling public funds. Board Policies 6610 and 6600.]

School Cashier makes cash deposits on her way home, approximately $50K in cash has been deposited to date ($90K total). Checks have been accepted for Enrichment Fees in violation of Board Policy ____.[DISTRICT LEVEL Evaluate the (safety) cost/benefit of School Cashiers handling cash as well as banking options that could provide for increased safety, accountability and accuracy of deposits. Verify that it is still district policy to not accept personal checks, if so, what Policy states this? 6151?].

Leadership (confidence in decision-making)1. Direct & effective communications When issues have been raised or opportunities arise to be proactive in communications the Principal has not been responsive. Some examples include: ASN inquiries, Finance Chair inquiries, Audit inquiries, Donors. Limited to no donor interactions occur which can be offensive. Mr. Alpaugh is looking forward to meeting the principal one day; Mr. Alpaugh is in the 9th year, out of 15 years of giving a generous sum to the school. He also indicated that he would love to tour the school. The Interim Business Manager has proactively set time to meet Mr. Alpaugh for coffee to ensure his intentions for the donations are known and respected.

Carlson Berne CSO - The Interim Business Manager proactively reached out to and met with Mrs. Carlson regarding the Carlson Berne CSO scholarship which she discovered had no proper invoicing and billing established. The scholarship is set up to pay private lesson teachers who have gone all year without being paid. School Leadership sends invoices w/o documentation of services rendered. Request full payment before lessons begin.

There has been no interaction with the Over the Rhine (OTR) Chamber of Commerce by school leadership. The Interim Business Manager and Box Office Manager have spearheaded initial communication with the OTR Chamber representatives the received very positive feedback and a strong interest in partnering.

The School Resource Officer (SRO) arranged a meeting at the beginning of the school year with all the appropriate individuals from the police department and the school to discuss a strategy for ensuring safety of the students and to address parent complaints about traffic around the school and the drop-off procedures. This was a collaboration opportunity with the police that could eliminate or at least reduce school personnel from handling traffic situations for which they really didnt have the proper authority. The School Resource Officer has indicated that the Principal is challenging to work with and they dont have issues interacting with other schools, the SROs are usually welcomed.

2. Oversight Committee - Special Ed Intervention specialist requested information about the Oversight Committee at the LSDMC meeting instead of that information being offered. Principal had ASN address Oversight Committee questions with his staff instead of addressing their inquiries himself. Internal Auditor has shared Oversight Committee information with the Principal and has made herself available for any questions.

3. Interim Business Manager This position was deemed necessary once it was discovered the extent of the Business Operations that occur at SCPA through analysis of the Artistic Budget and as items have come up during the school year. The Principal has expressed a concern over who is in the role of Interim Business Manager. The work that is being produced has continuously uncovered issues, opportunities to collaborate with the community and laid the foundation for demonstrating strong financial and operational controls as the school moves forward with a new 501c3. The Principal has refused to approve the timesheets which are at a fraction of the cost of what was being considered with an employment firm. Yet, the Principal hired the President of Friends as a substitute teacher, who is being investigated by the OAG and who has yet to complete the report to the Dater Foundation on how their donation was spent, which was not in adherence with the donors requirements. In November the Principal disallowed the IBM from speaking directly to the school staff regarding financials, which had been occurring without any issue since June 2014. a. Difficult to get data. b. Artistic Directors binders are never consistent & numbers in reports consistently change. IBM holds AD spending to the artistic budget submitted w/the Anon. Grant. c.Difficult to understand info from CPS (i.e. Box Office g/l accounts allowing $45k spending when the credit card was used for the loan)d. Credit Card limit still at $50k. Finance Committee wants YTD BO receipts to repay CPS immediately while shutting down the card.e. Where is the Alpaugh check & to what account was it coded to? Fund 19 or 18? f. Inability to get data from Rental Mgr. regarding future FY15 rentals on the Master Calendar & how much revenue they will generate.g. Still unable to track an Aug rental check of $880. This rental was re reduced by $200 b/c of temperature issues.

4. Friends of SCPA Even though the Friends is a separate entity, some well-placed questions by the Principal would seem advisable for the Principal to understand how the school is being impacted by this entity. My experience is that the Secretary/ Treasurer did not make a decision without consulting with the Principal first (ex. FY15 Box Office receipts erroneously deposited with the Friends). The Friends President has been committed to complete the report for the Dater Foundation for the $10K donation the Dater Foundation gave the school. The Friends deposited this $10K check into their account on 8/29 after the 7/28 dissolution meeting. The Friends stated that the funds were used to pay for the production rights for Joseph, when in fact Joseph rights were paid by the Friends on July 3 as evidenced by a check from the Friends President to Rogers and Hammerstein in the amount of $7,333.50. The difference between the $10K grant amount and the production amount left a remainder of $2,666.50 that was committed to be given to the school which did not occur.5. Website SCPAs website is operating outside of the District processes, although probably 70% or more of the website is non-functional, the Principal did not seek out District assistance in re-establishing the SCPA website on the CPS server. It took the Internal Auditor serving as a liaison for school administration to have a meeting with Public Affairs.Accountability/Action Items1. Plant Operator overtime hours $22K in June, 2014[DISTRICT LEVEL Conduct review of overtime in aggregate with reasons identified throughout the district to inform changes that potentially need to be made.]

2. Financial Analysis - Leadership knows the School Cashier is spread thin, what is the strategy to address this issue long-term? [DISTRICT LEVEL The roles of the individuals in the school office need to be assessed to ensure skill sets align with the expectations of the position. Such as financial aptitude, excel skills, etc. and that support is provided through training as needed.]

3.Position Requirements - Establish alignment between position expectations and position description. Assistant Principals are not preparing the Master Schedule as their job description describes. Under Performance Responsibilities, on the Assistant Principal job description, it states that they will create teacher and student class schedules. This will provide the focal point person that is needed for this critical process.[DISTRICT LEVEL - Assistant Principal position requirements are more extensive than the Principal requirements, which does not detail the Principals responsibility for school operations. How are evaluations tied back to these job duties?

4. External Fundraising LSDMC Finance Committee raised strong concerns about SCPA parents approaching local companies regarding significant fundraising dollars which could be in direct conflict with official efforts that are being made in that area. The SCPA December Newsletter approved by the Principal contains a disjointed approach of soliciting individuals for funds, when the funds are currently available through grants received by the school. School Administration needs to use the EprOhio requisition system to access the grant/donation dollars that are available instead of randomly soliciting outside parties for funds.

5. Auditions Provide reporting of audition statistics such as how many children, number of slots, etc. to measure the success of the process and determine needs. The October auditions were cancelled due to not enough in-district students auditioning. Would like to confirm the number of participants in the November auditions as well as the timeframe for providing acceptance or regret letters.

6. Out of-State Tuition Requested what report management uses to validate that all tuition has been collected to date to ensure adherence to Board Policy 6150. The Treasurers Office responded that Customer Help handles the out-of-state tuition now. Made the further inquiry, with the tuition being monies coming into the District is there any verification that the Treasurers Office performs to validate that all tuition payments expected have indeed been received? Treasurers Office reiterated that I needed to follow-up with the Asst. Superintendent. Sent e-mail to Asst. Superintendent on 12/5, awaiting a response.

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