earle wood ms iaf audit 10122009

8/9/2019 Earle Wood MS IAF Audit 10122009

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Office of Shared AccountabilifyMONTGOMERY COUNTY PUBLIC SCHOOLS

Rockville, Maryland

October 12,20A9

MEMORANDUM

To:

From:

Subject: Report on Audit of lrdependent Activity Funds for the period

April 1, 2008, through August 31,2009

This audit report presents the results of our examination of the financial records, reports, andinternal accounting controls relating to the Independeart Activify Funds (IAF) for EarlB. WoodMiddle School for the period April 1, 2008, through August 31,2009- Jhs sxamination wasmade to dete'l:nine the adequacy of accountability over these funds, compliance with applicableMontgomery County Fublic Schools (MCPS) policies and procedures, and effective,nesb of IAFmanageme,lrt.

Findings and Recommendations

On October 8,2009, we met with you and Mr. Emest Solar, acting'financial assistant, to discussthe conditions found during our examination of your records. It was a pleasure to have tleparticipation of Ms. Sandra V/indlin, financial assistan! by telephong and the assistant princtpal,Mr. Christopher Rattay, who joined the meeting in progress. You are to be commended. forensuring that both you and your financial assistant attended the mandatory IAF haining recenflyafter your appointnent to the school effective April 29, 2009. We noted that five of the nineconditions described in our previous report dated June 2, 2008, have been either satisfactorilyresolved or significanfly imFrove4 and that continuing attention is needed to firther i-prove tkelsrtraining four conditions. We will first describe abd discuss these remaining fow conditions,then make resomme,ndation for an additional two weahesses we discovered-

We p:reviously reported multiple weaknesses in controls over pruchases. While those previousconditions have been largely resolvd we were unable to locate monthly logs required of cardmembers for any month after December, 2008. MCPS purchasing cardmembers must recordpurchases ou kansaction logs and submit logs monthly with invoices and recerpts attached forreview and approval by the princlpal. Monthly srrmmaly reports from American Express are tobe reviewed, signed and dated by the principal to ensure that purchases are appropriate and.within established limits. We recomme,nd you meet with staffmembers who aracardrnembers,and review record keeping and.reporting requirements.

Ms. Eugenia Dawson" PrincipalEarl B. Wood Mddle School

Roger W. Pisha, Supervisor, [rtemal Audit P,'tf.4ilX



Ms. EugeniaDawson Oclober 12,2009

MCPS Regulation DMB-RA Control of Admission Receipts, provides requirements for the

accounting for sales of admission tickets. While the conditions previously reported have been

significantly improved, we found ticket reports for a mrmber of events that had not been signed

by the admissions manager. Because these receipts are susceptible to diversion, it is vital to

strictly adhered to established procedures. We recornmend control responsibilities be reviewed

with the admissions manager(s) for each event.

Review of field trip activities again revealed that not all field trip sponsors provided completed

financial information to the financial assistant at the conclusion of a trip. Sponsors should record

cost and fee information for each field trip on MCPS Form 280-41, Field Trip Accounting, orequivalent, and submit the data to the administrative secretary when a trip is completed (see IAF

manual, p. 13). The record of the names of participants and sums collected strengthens internalcontrols by enabling the reconciliation of receipts to s rms recorded in the field trip account We

recommend all sponsors be required to use Form 28041, or equivalent, and follow the above

outlined procedures.

Sales of PE uniforms should comply with the requirements outlined in the Handboolc for the

Operation of School Stores. We again noted some weahresses over the accounting process forthe sale of uniforms, and records of sums collected from students could not be reconciled torecords of sales. To improve confuols, we recourmend foacking of uniform sales on a spreadsheet

that can be reconciled to records of account activify. In additiorq inventory records should be

adjusted for sales, purchases, glveaways, and for garments that are damaged or obsolete. The

inventory record should be compared to a physical count which should be performed at leastannually. The inventory should be secured at all times to lesse,n the likelihood of a loss.

In addition to the above conditions previously re,ported, our analysis of the school checking

account showed consecutive months when the balance exceeded imrnediate needs. Keeping highbalances in the checking account limits the amount of interest the school could be eaming. Theprincipal is responsible for ensuring that firnds in excess of current needs are invested in a

manner that vrill eam a reasonable rate of retum. A better use of the excess funds is to deposit

them in the MCPS Centralized Investuent Fr:nd to maximize interest income. Whe,n needed tocovff expenses, these funds are available for prompt retum to the school (see IAF manual, p. 5).

The monthly lank statement reconciliation which is prepared by the financial assistant using thebool*eeping program should also be performed manually by a staff member independent offiaancial operations. You should revierv both reconciliations to assure they are in agreeme,nt and

sign them before filing them with other monthly reports. Adding an independent checking

account reconciliation to ttre montlly report will sfuengthen internal contols (See IAF Manual,p.e).

Other matters were discussed and satisfactorily resolved. We appreciated the cooperation and

assistrncc of your staq especially Mr. Solar, acting financial assistant, and

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Ms. EugeniaDawson October 12,2009

Iv[s. Windlin" fuancial assistaat who, although not present during our visit, was available

consultafion by telephone as neoded. haccordance

withMCPS Regulation DIA-RA,

Accounting far Financial Operations/Indeptendent Activity Futtds, please provide a response to

the Iaternal Audit ofEce withirl 30 days of this reporL with a copy to Dr. Sherry Liebes,

community superintendent.

RWP:IS:sd

Copyto:'h[r. Bowers

Dr. Lacey

Mr. BedfordDr. Scott

Dr. Liebes

Ms. DeGraba

N[s. Diamond

h[r. Doody

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earle wood ms iaf audit 10122009

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