School Board of Brevard County, Florida Internal Audit of Internal Accounts

Transcription

1 School Board of Brevard County, Florida Internal Audit of Internal Accounts September 25, 2018 Prepared By: Internal Auditors

2 TABLE OF CONTENTS Transmittal Letter... 1 Executive Summary: Schools with No Audit Comments in 2017/ Internal Accounts Audit Comment Ratings (Unweighted) Internal Accounts Audit Comments by Type (Unweighted) Internal Accounts Comments Graphs (Unweighted) Background Objectives and Approach Statistical Information Overview: Internal Accounts Comparison of Audit Comments (Unweighted) Internal Accounts Comparison of Audit Comments (Weighted) Overall District Observations Elementary Individual School Comments Secondary Individual School Comments

3 September 25, 2018 The Audit Committee of the School Board of Brevard County, Florida Viera, Florida RSM US LLP 7351 Office Park Place Melbourne, Florida O F Pursuant to the engagement letter dated May 8, 2018, we hereby submit our internal audit report of the Internal Accounts of the School Board of Brevard County, Florida ( District ). We will be presenting this report to the Audit Committee during the regularly scheduled meeting on December 7, Our report is organized in the following sections: Executive Summary Background Objectives and Approach Statistical Information Overall District Observations Individual School Comments Elementary and Secondary This provides a summary of the results related to our Internal Accounts Audit, comparison of comments issued for 2017/2018 to prior year(s), and statistical data for the current year s results. This provides an overview of the Internal Funds accounts and required procedures. The internal audit objectives and focus are expanded upon in this section as well as a review of the various phases of our approach. This section presents a historical comparison of the total number of comments (unweighted and weighted) to prior year(s) by area and for schools with bookkeeper and principal turnover. This section provides observations we noted during our fieldwork related to the overall District process and our recommendations for improvement. This section provides a description of the comments and recommended action by school along with each Principal s response. Respectfully Submitted, INTERNAL AUDITORS 1

4 EXECUTIVE SUMMARY Background Internal accounts are all funds collected or expensed within the school for activities which promote the education, general welfare, and morale of the students or to finance the normal program of student activities not otherwise financed. Examples of such collections or expenditures may include, but are not limited to, fundraising activities, field trips, school clubs and athletic teams, merchandising activities, and ticket sales. The Bookkeeper is responsible for all Internal Account Funds under the direction of the Principal. The Bookkeeper shall not, under any circumstances, be the initial collector of any funds. Since the bookkeepers duties include bank deposits, posting monies collected in the computer and bank reconciliation, there is not an appropriate level of segregation of duties if the bookkeepers are also the initial collector of monies. School Accounting supports bookkeepers by reviewing and updating procedures, providing training to bookkeepers and principals, monitoring internal account activity, and assisting with the annual internal audit. Overall Summary / Highlights Over $14M flows in and out of school internal accounts during the year. We conducted detailed testing utilizing sampling techniques at each school, and 57 of the 82 schools had 2 comments or less (70% of all schools) which is consistent with prior year results. The total number of comments increased by 58% over last year and 33 bookkeepers turned over during the year, up from 29 in the prior year. The audit identified 12 schools targeted for procedural enhancement up from 8 in the prior year. The most significant number of comments issued (32 of 172 comments, or 19%) pertain to General Ledger Review. The second most significant number of comments issued (20 of 172 comments or 12%) were due to Sales Tax Collection and Remittance. Objective and Scope The objective of the Internal Accounts audit is to: Perform the annual audit of the District s school internal account funds as required by Florida Redbook regulations; Gain an understanding of changes to District policies and procedures related to school internal account funds; Determine whether an adequate system of internal controls at each school is maintained around high risk cash handling processes in order to safeguard the assets of the school internal account funds; and Determine whether each school is in compliance with both District policies and Florida Redbook regulations. The purpose of this audit was to test compliance and controls around internal accounts. We conducted fieldwork between June and August 2017 at the 82 school sites and performed detailed testing of the following areas: Segregation of Duties Cash Receipts and Monies Collected Forms Official Receipts for Monies Collected Frequency of Remittance of Monies Collected and Frequency of Deposits Authorization of Purchases, including the use of non-employee consultants for services Cash Disbursements, including Authorization and Supporting Documentation Sales Tax Collection and Remittance Fundraising Approval, Sales and Reconciliation Ticket and Event Sales Yearbook Sales and Reconciliation Review of General Ledger Activity and Deficit Accounts Bank Reconciliations Petty Cash and Change Funds Monitoring of Cooperative Organizations At the conclusion of our audit, we summarized our findings in a report as outlined in our objectives above. We assigned a risk rating to each school based on the weighted points: Low (0-2 points); Moderate (3-9 points); and High (10 or more points). We reviewed the results with District senior leadership and the principal of each school. We would like to thank the individual schools and all those involved in assisting the Internal Auditors in connection with the review of Internal Accounts. 2

5 EXECUTIVE SUMMARY CONTINUED During the fiscal year ending June 30, 2018, the District had $14.3M of receipts and $14.1M of disbursements flow through the internal funds accounts. This is in line with the prior year s cash flows which were approximately $14.8M. Refer to the chart on page 6 for additional trend information. Please note that as of July 1, 2015, the District underwent an organizational restructuring in concert with implementation of a new strategic plan. This plan eliminated the geographical areas and the Area Superintendent positions, and created the Elementary Office of Leading and Learning and Secondary Office of Leading and Learning and Assistant Superintendent positions to head each new department. This report and all comparative data have been updated to reflect these changes, as well as the 3 school closures that occurred as of June 30, 2013 and the 1 school closure that occurred as of June 30, Some of the highlights noted during this year s audit of Internal Accounts include the following: This year s audit resulted in 20 of 82 (24%) schools receiving no comments. This is a decrease over the prior year, when 42 of 82 (51%) schools received no comments. There are 16 schools (19.5%) that have had no audit comments for 3 or more consecutive years. Nine (9) of these schools Manatee, Golfview, Sherwood, Roy Allen, Christa McAuliffe, Meadowlane Intermediate, Oak Park, Quest, and Theodore Roosevelt have had no audit comments for 5 or more consecutive years. We noted a 58% increase in the total number of comments (from 109 comments to 172 comments) from the prior year. These results are attributed to the increased bookkeeper turnover, as well as the increased principal turnover and incoming new principals during the year. The number of high risk comments increased from the prior year (from 54 to 78, respectively). Seventy percent (70%) of schools received two (2) audit comments or less, thirty-five percent (35%) of which had no audit comments at all. That means that more than 30% (25 of 82) of schools with greater than two (2) comments can be attributed to a relatively small number of schools, 12 of which are targeted for procedural enhancement. Bookkeeper turnover increased from the prior year (33 up from 29). The most significant number of comments issued (32 of 172 comments, or 19%) pertain to General Ledger Review. This comment category includes incomplete review of the quarterly general ledger report and the timeliness and cumulative preparation of the report. This is an increase over prior year (26 of 109 comments, or 24%). Five (5) of these comments in the current year were the only comment issued at the respective schools. The second most significant number of comments issued (20 of 172 comments or 12%) were due to Sales Tax Collection and Remittance, including insufficient supporting documentation of payment of sales taxes when items purchased were for resale. Based on the 2017/2018 results, there are 12 targeted schools. We noted that 8 schools were targeted for procedural enhancements in our previous report, and that the 7 are recurring targeted schools based on the current year results. 3

6 EXECUTIVE SUMMARY CONTINUED The graph below illustrates the changes in audit comments by type since 2013/2014, showing a 5-year trend. For 2017/2018, we identified two high risk areas of focus. These two high risk areas have the most significant number of comments, accounting for 30% of the total (52 of 172 comments). These areas also account for 21 of 40 (53%) of recurring comments from the previous year. General Ledger Review Sales Taxes The most significant number of comments, General Ledger Review increased, with 32 in the current year and 26 in the prior year. This comment category includes incomplete review of the quarterly general ledger report and the timeliness and cumulative preparation of the report. Of these comments, 8 were low risk, 9 were moderate risk, and 15 were high risk. The risk rating takes into consideration the number of accounts without review, and whether the review was missing over multiple quarters. Sales tax comments were the second most significant number of comments issued in the current year. This is a new high-ranking audit comment with 20 moderate risk comments. This is an increase from 5 comments in the prior year. The comment category includes insufficient supporting documentation of taxes paid on items purchased for resale and insufficient supporting documentation for taxes collected for items previously purchased free of sales taxes. Training District Staff states that they provide new bookkeepers with onboarding training consisting of one-on-one orientations over two sessions, approximately one week apart. The initial session instructs them on the Internal Funds Procedures Manual and the follow-up session allows for more targeted focus based on areas of concern. The principals have been encouraged to attend bookkeeper workshops to re-familiarize themselves with the processes and requirements, as well as to utilize the District s School Accounting staff to assist with the screening of bookkeeper applicants. Bookkeeper Turnover and Support Bookkeeper turnover has increased from prior year, and remains an issue for the District. When bookkeeper positions are open at a school, the Office of School Accounting supports the schools for one day each week. However, due to multiple vacancies throughout the District at the same time, the support of the Office of School Accounting was stretched thin, and the ability to assist other bookkeepers with questions, system issues and other activities diminished due to the onsite assignments. The high number of bookkeeper turnovers at the schools makes sustainability of providing the additional support challenging under the current structure. The District is considering ways to minimize the number of turnovers. This is an on-going concern that has been included in our follow-up reports for several years. 4

7 EXECUTIVE SUMMARY CONTINUED Number of Comments - All Schools (Unweighted) The comment categories are listed in order from greatest to least based on 2017/2018 observations. The prior four years are included to provide historical trends for the comment categories. The All Other category for 2017/2018 includes Yearbook Sales (2), Frequency of Deposits (2), Petty Cash / Change Fund (2), Safe / Vault (2), Voided Check (1), Segregation of Duties (1). 5

8 EXECUTIVE SUMMARY CONTINUED 5 Year Statistics and Trends District Wide Statistic: 2013/ / / / /2018 1) Total Number of Schools ) Number of Schools with 2 Audit Comments or Less ) Number of Schools with NO Audit Comments ) Longest Consecutive Number of Years with NO Audit Comments Severity of Comments Issued: 5) Number of High Risk Comments ) Number of Medium Risk Comments ) Number of Low Risk Comments ) Number of Recurring Comments from the Previous Year ) Total Number of Audit Comments (Unweighted) ) Total Number of Audit Comments (Weighted) ) Number of Schools Targeted for Procedural Enhancement ) Number of Repeat Schools Targeted for Procedural Enhancement Number of Principal Turnovers during the Fiscal Year ) Number Bookkeeper Turnovers during the Fiscal Year (This is the number of bookkeeper positions, rather than the number of schools with turnover, as some schools may have experienced multiple turnovers during the year.) Reasons for Bookkeeper Turnover: 14) Resignation ) Retirement ) Transfer / Promotion Within District ) Total Annual Cash Inflows - all schools: $ 13,903,857 $ 13,851,069 $ 14,807,019 $ 14,764,777 $ 14,384,253 18) Total Annual Cash Outflows - all schools: $ 13,633,891 $ 13,859,730 $ 14,513,741 $ 14,657,446 $ 14,063,302 6

9 EXECUTIVE SUMMARY CONTINUED Included in this summary are statistical tables and graphs representing the 2017/2018 results of the Internal Audit of Internal Accounts. The summary tables include the following: Schools With No Audit Comments in 2017/2018 This table presents the number of schools by area with no audit comments for 2017/2018 and the number of unweighted comments those schools have had in prior years. We noted there are 20 of 82 (24%) schools with no audit comments in 2017/2018, as compared to 42 of 82 (51%) in 2016/2017. Seventeen (17) of the 20 schools that received no comments in 2017/2018 also received no comments during 2016/2017. There are three (3) new No Comment schools in 2017/2018. The number of consecutive years each school has been a No Comment school is also shown. Internal Accounts Audit Comment Ratings (Unweighted) This table presents the number of schools with audit comments issued for 2017/2018 in the following categories: No Audit Comments 1 Audit Comment 2 Audit Comments > 2 Audit Comments Each audit comment is assigned a relative risk rating based on the risks associated with the comments issued. We noted that 60 of 82 (76%) schools received audit comments in 2017/2018. Of the comments received, 78 of 172 (45%) comments were designated as high risk in 2017/2018 as compared to 54 of 109 (50%) comments in 2016/2017. This indicates that the overall risks associated with the comments issued slightly decreased overall in 2017/2018, although there is an increase in the number of total comments. Internal Accounts Audit Comments by Type (Unweighted) This table presents the comments issued to each school by type of comment, including schools with No Comments. This table presents the 2017/2018 results in an illustration of the comments issued, the risk ratings, and the total number of comments of that type by area, by school and in total. Recurring comments have also been noted. The details of each comment issued are included, and summary has also been provided. Internal Accounts Comments Graphs (Unweighted) This section presents the total number of comments issued (unweighted) in 2017/2018 in a series of graphs by the following categories: All 82 schools By School Type (Elementary School, Secondary School) 7

10 EXECUTIVE SUMMARY CONTINUED Schools with No Audit Comments in 2017/2018 Elementary Schools School Board of Brevard County Schools with No Audit Comments in 2017/2018 Consecutive 2013/ / / / /2018 Years with Unweighted Unweighted Unweighted Unweighted Unweighted School 2016/ /2018 No Comments Comments Comments Comments Comments Comments Elementary Schools Manatee Elementary *P Golfview Elementary +P Sherwood Elementary Roy Allen Elementary Christa McAuliffe Elementary Meadowlane Intermediate ES <^ +B *B Oak Park Elementary *P Quest Elementary <^ *P Theodore Roosevelt Elementary +P *B Audubon Elementary < *B *P Sunrise Elementary West Melbourne Elementary MILA Elementary Endeavour Elementary +B +P *B^ *P Jupiter Elementary Robert L. Stevenson School of Arts Challenger 7 Elementary +P Total for Elementary Schools / /2017 # of Schools with No Comments: 17 Total Elementary Schools: 55 # of Schools with No Comments: 34 Total Elementary Schools: 55 < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year 8

11 EXECUTIVE SUMMARY CONTINUED Schools with No Audit Comments in 2017/2018 Secondary Schools School Board of Brevard County Schools with No Audit Comments in 2017/2018 Consecutive 2013/ / / / /2018 Years with Unweighted Unweighted Unweighted Unweighted Unweighted School 2016/ /2018 No Comments Comments Comments Comments Comments Comments Secondary School Astronaut High Thomas Jefferson Middle < *P Palm Bay Magnet High *B Total for Secondary Schools / /2017 # of Schools with No Comments: 3 Total Secondary Schools: 27 # of Schools with No Comments: 8 Total Secondary Schools: 27 < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year District-wide Total 2017/ /2017 # of Schools with No Comments: 20 Total Schools in District: 82 # of Schools with No Comments: 42 Total Schools in District: 82 9

12 EXECUTIVE SUMMARY CONTINUED Internal Accounts Audit Comment Rating (Unweighted) School Board of Brevard County Internal Accounts Audit Comment Ratings (Unweighted) Audit Comment Total Number of Rating: Number of School Schools High Moderate Low Comments Elementary Schools No Audit Comments 17 N/A N/A N/A N/A 1 Audit Comment Audit Comments > 2 Audit Comments Total for Elementary Schools / % of Comments for Elementary Schools 46% 47% 8% 100% Total for Elementary Schools / % of Comments for Elementary Schools 48% 35% 17% 100% Secondary Schools No Audit Comments 3 N/A N/A N/A N/A 1 Audit Comment Audit Comments > 2 Audit Comments Total for Secondary Schools / % of Comments for Secondary Schools 45% 44% 11% 100% Total for Secondary Schools / % of Comments for Secondary Schools 51% 35% 14% 100% All Schools No Audit Comments 20 N/A N/A N/A N/A 1 Audit Comment Audit Comments > 2 Audit Comments Total for All Schools / % of Total Comments 45% 45% 9% 100% Total for All Schools / % of Total Comments 50% 35% 16% 100% 10

13 EXECUTIVE SUMMARY CONTINUED Internal Accounts Audit Comments by Type (Unweighted) Elementary Schools School Board of Brevard County Internal Accounts Audit Comments by Type (Unweighted) 2017/2018 School 2016/ /2018 No Comments Frequency of Remittance Frequency of Disbursement ¹ Fundrasing Activity¹ Monies Collected Forms¹ Authorization of Expenditures Frequency of Deposits Elementary Schools Roy Allen Elementary X 0 Hans Christian Andersen Elementary N R N 3 Apollo Elementary N 1 Atlantis Elementary N 1 Audubon Elementary < *B *P X 0 Cambridge Elementary N 1 Cape View Elementary N 1 Lewis Carroll Elementary < *P R 1 Challenger 7 Elementary +P X 0 Columbia Elementary +P *B N N 2 Coquina Elementary +P *B^ N 1 Dr. W.J. Creel Elementary N 1 Croton Elementary N 1 Discovery Elementary +B *P N 1 Endeavour Elementary +B +P *B^ *P X 0 Enterprise Elementary N 1 Fairglen Elementary *B *P N N N 3 Freedom 7 Elementary *B N 1 Gemini Elementary +P N N 2 Golfview Elementary +P X 0 Harbor City Elementary +B^ *B R R R N R 5 Spessard L Holland Elementary +B^ +P N N R 3 Imperial Estates Elementary +B R N N 3 Indialantic Elementary < +B *B N N 2 Jupiter Elementary X 0 Lockmar Elementary N 1 Longleaf Elementary +P N N N 3 Subtotal for Elementary Schools Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year NR (N)ew / (R)ecurring comment ¹ This comment is rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of this comment as a whole was determined based on the majority of the total number of comments issued. General Ledger Review¹ Sales Tax Petty Cash / Change Fund Transfers and Adjustments Deficit Balances Yearbook Sales¹ Cooperative Organizations District Level Accounts Documents of Disbursements¹ Official Receipts Restricted Expenditures¹ Safe / Vault Segregation of Duties Ticket Sales¹ Voided Check¹ Total Comments 11

14 EXECUTIVE SUMMARY CONTINUED Internal Accounts Audit Comments by Type (Unweighted) Elementary Schools continued School Board of Brevard County Internal Accounts Audit Comments by Type (Unweighted) 2017/2018 School 2016/ /2018 No Comments Frequency of Remittance Frequency of Disbursement ¹ Fundrasing Activity¹ Monies Collected Forms¹ Authorization of Expenditures Frequency of Deposits Elementary Schools - Continued Manatee Elementary *P X 0 Christa McAuliffe Elementary X 0 Meadowlane Intermediate ES <^ +B X 0 Meadowlane Primary ES +B *B N N N N N 5 MILA Elementary X 0 Mims Elementary +B +P N N 2 Oak Park Elementary *P X 0 Ocean Breeze Elementary < +B *P N N R R 4 Palm Bay Elementary +B +P N N N R 4 Pinewood Elementary *B N N N N N 5 Port Malabar Elementary +B *B N N 2 Quest Elementary <^ *P X 0 Riviera Elementary +P *B N N 2 Theodore Roosevelt Elementary +P *B X 0 Sabal Elementary *B^ N N 2 Saturn Elementary +B +P R N 2 Sea Park Elementary < N N N 3 Sherwood Elementary X 0 Robert L. Stevenson School of Arts X 0 Sunrise Elementary X 0 Suntree Elementary +B +P N 1 Surfside Elementary < N 1 Tropical Elementary +B^ +P *B N N 2 John F. Turner Elementary < *P N N 2 University Park Elementary +P N R 2 West Melbourne Elementary X 0 Westside Elementary +B N 1 Ralph Williams Elementary +B *B *P N 1 Subtotal for Elementary Schools Total for Elementary Schools Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year NR (N)ew / (R)ecurring comment ¹ This comment is rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of this comment as a whole was determined based on the majority of the total number of comments issued. General Ledger Review¹ Sales Tax Petty Cash / Change Fund Transfers and Adjustments Deficit Balances Yearbook Sales¹ Cooperative Organizations District Level Accounts Documents of Disbursements¹ Official Receipts Restricted Expenditures¹ Safe / Vault Segregation of Duties Ticket Sales¹ Voided Check¹ 12 Total Comments

15 EXECUTIVE SUMMARY CONTINUED Internal Accounts Audit Comments by type (Unweighted) Secondary Schools School Board of Brevard County Internal Accounts Audit Comments by Type (Unweighted) 2017/2018 School 2016/ /2018 No Comments Frequency of Remittance Frequency of Disbursement ¹ Fundrasing Activity¹ Monies Collected Forms¹ Authorization of Expenditures Frequency of Deposits Secondary Schools Astronaut High X 0 Bayside High +P N N N N N N 6 Central Middle < *P N N N 3 Cocoa Beach Jr./Sr. High N N N N N 5 Cocoa High +P N N N 3 DeLaura Middle < +B *B^ *P R N R N R R N N R N 10 Eau Gallie High +B N N R R R R N 7 Edgewood Jr./Sr. High N R 2 Heritage High +B N N N 3 Herbert C. Hoover Middle < *P R N 2 Andrew Jackson Middle +P N 1 Thomas Jefferson Middle < *P X 0 Lyndon B Johnson Middle +P *B N N 2 John F Kennedy Middle +B *P R N 2 James Madison Middle *P N N N N 4 Ronald McNair Middle +P N N 2 Melbourne High N R N N 4 Merritt Island High *P R 1 Palm Bay Magnet High *B X 0 Rockledge High *P N N, N 3 Satellite High +B^ *P R N R N, N R R, R R R 10 Southwest Middle +B *B *P N N 2 Space Coast Jr./Sr. High < +P N R N N R 5 Stone Middle R N 2 Titusville High +P *B^ N N N N R 5 Viera High School +B *B N N R N R N N 7 West Shore Jr./Sr. High N N 2 Total for Secondary Schools Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year NR (N)ew / (R)ecurring comment ¹ This comment is rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of this comment as a whole was determined based on the majority of the total number of comments issued. General Ledger Review¹ Sales Tax Petty Cash / Change Fund Transfers and Adjustments Deficit Balances Yearbook Sales¹ Cooperative Organizations District Level Accounts Documents of Disbursements¹ Official Receipts Restricted Expenditures¹ Safe / Vault Segregation of Duties Ticket Sales¹ Voided Check¹ 13 Total Comments

16 EXECUTIVE SUMMARY CONTINUED Internal Accounts Comments Graphs (Unweighted) All Schools (Unweighted) No Comments 20 General Ledger Review 32 Sales Tax 20 Documents of Disbursements 17 Frequency of Disbursement 17 Monies Collected Forms 13 Frequency of Remittance 13 Fundraising Activity 10 Authorization of Expenditures 9 Deficit Balances 7 Official Receipts District Level Accounts Transfers and Adjustments Ticket Sales Legend High Risk - Red Medium - Yellow Low - Green Yearbook Sales Restricted Expenditures Frequency of Deposits Petty Cash / Change Fund Total Schools: 82 High Schools: 15 Middle Schools: 12 Elementary Schools: 55 Safe / Vault 2 Segregation of Duties Voided Check 1 1 *These comments are rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of these comments for the District as a whole was determined based on the majority of the total number of comments issued. 14

17 EXECUTIVE SUMMARY CONTINUED Internal Accounts Comments Graphs (Unweighted) continued No Comments Elementary Schools (Unweighted) 17 General Ledger Review 22 Frequency of Disbursement 9 Sales Tax Documents of Disbursements 8 8 Monies Collected Forms 6 Authorization of Expenditures Deficit Balances 5 5 Official Receipts 4 Fundraising Activity 3 Frequency of Remittance Petty Cash / Change Fund Frequency of Deposits Legend High Risk - Red Medium - Yellow Low - Green Yearbook Sales District Level Accounts Restricted Expenditures *These comments are rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of these comments for Elementary Schools as a whole was determined based on the majority of the total number of comments issued. Safe / Vault 1 Total Elementary Schools: 55 15

18 EXECUTIVE SUMMARY CONTINUED Internal Accounts Comments Graphs (Unweighted) continued Middle Schools (Unweighted) No Comments 1 Frequency of Remittance Sales Tax 4 4 General Ledger Review Ticket Sales 3 3 Documents of Disbursements Frequency of Disbursement Monies Collected Forms Transfers and Adjustments Deficit Balances Fundraising Activity Authorization of Expenditures District Level Accounts Frequency of Deposits Legend High Risk - Red Medium - Yellow Low - Green Segregation of Duties Voided Check 1 1 *These comments are rated as high, medium or low based on the circumstances surrounding the issue. Thus, the risk rating of these comments for Middle Schools as a whole was determined based on the majority of the total number of comments issued. Total Middle Schools: 12 16

19 EXECUTIVE SUMMARY CONTINUED Internal Accounts Comments Graphs (Unweighted) continued High Schools (Unweighted) No Comments 2 Sales Tax 8 Frequency of Remittance General Ledger Review Documents of Disbursements Frequency of Disbursement Fundraising Activity 6 6 Monies Collected Forms 5 Authorization of Expenditures 3 Transfers and Adjustments 3 District Level Accounts 3 Official Receipts Restricted Expenditures Yearbook Sales Legend High Risk - Red Medium - Yellow Low - Green Safe / Vault Ticket Sales 1 1 *These comments are rated as high or medium based on the circumstances surrounding the issue. Thus, the risk rating of this comment for High Schools as a whole was determined based on the majority of the total number of comments issued. Frequency of Deposits 0 Total High Schools: 15 17

20 BACKGROUND What are school internal account funds? School internal account funds are defined by the Florida Department of Education s Financial and Program Cost Accounting and Reporting Rules for Florida Schools ( Redbook ) as, all local school funds derived by any public school from all activities or sources. Pursuant to Chapter 8 School Internal Funds of the Redbook requirements, there are several principles related to the treatment of school internal account funds. Those principles include: The School Board shall be responsible for administration and control of internal account funds of the district school system, and in connection therewith shall: o Adopt written rules governing the receipt and disbursement of all internal account funds and for the accounting for property pursuant to Florida Statutes. o Provide for an annual audit of internal account funds in accordance with Rule 6A-1.087, FAC. The financial transactions of school organizations shall be accounted for in the school internal account funds. All funds handled by School Board employees during normal working hours shall be included in and become part of the internal account funds of the school unless accounted for in the district level accounting system. If authorized by School Board rule, a school based direct support organization as authorized by Section , F.S., may have all financial transactions accounted for in school internal account funds. Funds collected by and used for the benefit of faculty and staff may be exempt from the preceding requirements at the option of the School Board. School internal account funds shall be used to benefit activities authorized by the district School Board. Student participation in fundraising activities shall not be in conflict with the program as administered by the School Board. The objective of fundraising activities by the school, by any group within, or in the name of the school shall not conflict with programs as administered by the School Board. Funds collected shall be expended to benefit those students in school unless those funds are being collected for a specific documented purpose. Those internal account funds designated for general purposes shall be used to benefit the student body. Collecting and expending of school internal account 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. Each school organization should operate within a budget formulated by the organization members. The format of the budget shall be prescribed by the principal if not prescribed by School Board rule. Purchases from internal account funds shall not exceed the resources of the applicable student activity/project account, except for items acquired for resale or items authorized by School Board rule. Purchases to support instructional programs may be made from revenue derived from production work of vocational programs. An adequate system of internal controls shall be maintained in order to safeguard the assets of the school internal account funds. Brevard County School Board Financial Data The schools internal account activities for the 2017/2018 year which will be included in the District s audited Comprehensive Annual Financial Report are as follows: Beginning Balance 07/01/2017 Receipts Disbursements Ending Balance 06/30/2018 Total $ 6,816,821 14,384,253 14,063,302 7,137,771 18

21 BACKGROUND CONTINUED Summary of Certain Provisions of the Internal Accounts Procedures Manual Bookkeeper s Responsibilities - The Bookkeeper is responsible for all Internal Account Funds under the direction of the Principal. The Bookkeeper shall not, under any circumstances, be the initial collector of any funds. Since the bookkeepers duties include bank deposits, posting monies collected in the computer and bank reconciliation, there is not an appropriate level of segregation of duties if the bookkeepers are also the initial collector of monies. Monies Collected Forms - All monies collected must be documented on a Monies Collected Form and submitted to the Bookkeeper on the same day of collection. If extenuating circumstances exist and this practice is not feasible, the monies must be turned into the Bookkeeper no later than the next business day. Once received, the Bookkeeper will verify the count, sign and date the form, and return a copy to the person responsible for the collection of the funds. The Bookkeeper will certify the date that the money was actually received and sign the form. The signature of the Bookkeeper indicates that the total for deposit is correct, the cash listed matches the cash remitted, the checks listed matches the checks remitted, and that all of the required information is on the form. Any changes to the total amount of money to be deposited should be initialed by the bookkeeper and the person responsible for collecting the money. Official Receipts - District-approved, pre-numbered receipt forms must substantiate individual receipts of $10.00 or more for cash and/or checks. The pre-numbered receipts are the means of recording all monies received and providing support for entries on the Monies Collected Forms, as well as, substantiating each bank deposit. Individual receipts of less than $10.00 may be substantiated by class rosters, signature sheets, Monies Collected Forms, pre-numbered tickets, reports of tickets issued and sold or other auditable records. Purchase Orders - A School Internal Funds Purchase Order is generally required for any internal account funds purchase of materials in the amount of twenty-five dollars ($25.00) or greater. However, the Principal may require that purchase orders be completed for all purchases of materials in order to maintain good control over purchasing obligations. All supporting documentation must be attached to the purchase order (i.e. invoice, receipt, check requisition, etc.). Purchase orders are approved first by the Principal and secondly through District Purchasing. The principal must approve any invoices that are 20% greater than the purchase order. This approval should be noted on the original purchase order by changing the amount and the principal initialing the change. Fundraising Activity - Prior to the start of fundraising activities, an approval form must be prepared by the teacher/sponsor requesting the fundraiser and approved by the Principal. This document indicates the intention and purpose of the fundraiser. A fundraiser reconciliation must be prepared and filed at the close of each fundraising activity by the teacher/sponsor coordinating the fundraiser. This report reflects a final accounting for each fundraiser and accounts for any unsold merchandise or tickets, if applicable. Ticket Sales - Tickets are commonly utilized for after school events such as dances, athletic events, performances, and other events where an admission is charged. The sale of pre-numbered tickets, when used in conjunction with the Ticket Control Sheet and the Report of Tickets Sold eliminates the requirement for recording transactions by student names and amount paid by each student. Tickets are to be purchased in pre-numbered sequences and adequately accounted for on a Ticket Control Sheet. The Report of Tickets Sold form must be completed when tickets are sold or admission is charged for an event and is used in conjunction with the Ticket Control Sheet. There must be two ticket sales people at major events such as football games. The report provides for accountability of monies collected and is a source document supporting accounting entries. Yearbook Sales - Yearbook sales are handled by the individual schools or their parent-teacher group. Internal Funds Procedures Manual Section 22 provides requirements of yearbook orders and requirements for documentation by the yearbook sponsor. 19

22 OBJECTIVES AND APPROACH Objectives Objectives of the internal audit review of the school internal accounts include the following: Perform the annual audit of the District s school internal account funds as required by Florida Redbook regulations. Chapter 8, Section 4.2 of the Redbook regulations state the following: o The School Board shall provide for an annual audit of internal account funds. o In accordance with Rule 6A-1.087(2), FAC, the signed, written report of the audit shall include notations of any failure to comply with Florida Statutes, State Board of Education Rules and rules of the School Board. The report, which must also provide commentary as to financial management and irregularities, shall be presented to the School Board while in session and filed as a part of the public record. Gain an understanding of changes to District policies and procedures related to school internal account funds. Determine whether an adequate system of internal controls at each school is maintained around high risk cash handling processes in order to safeguard the assets of the school internal account funds. Determine whether each school is in compliance with both District policies and Florida Redbook regulations. Approach Our audit approach consisted of three phases: Understanding of the Process In order to obtain an understanding of the District s school internal accounts policies and procedures, we held an entrance conference with District management. We discussed the scope and objectives of the audit work, obtained preliminary data, and established working arrangements. We also reviewed the applicable Florida Department of Education Redbook regulations. Detailed Testing The purpose of this phase was to test compliance and controls around internal accounts. Our fieldwork was conducted at the school sites utilizing sampling and other auditing techniques to meet our audit objectives. We periodically update our test procedures to incorporate changes to the Internal Funds Procedures Manual or focus on areas not previously considered significant for audit. Issues identified are included in this report. As in previous years, newly tested items are given a oneyear grace period before a written comment is issued, unless we identify a pervasive issue. We conducted on-site school visits at 82 schools and performed testing of the following areas: Segregation of Duties Cash Receipts and Monies Collected Forms Official Receipts for Monies Collected Frequency of Remittance of Monies Collected and Frequency of Deposits Authorization of Purchases, including the use of non-employee consultants for services Cash Disbursements, including Authorization and Supporting Documentation Sales Tax Collection and Remittance Fundraising Approval, Sales and Reconciliation Ticket and Event Sales Yearbook Sales and Reconciliation Review of General Ledger Activity and Deficit Accounts Bank Reconciliations Petty Cash and Change Funds Monitoring of Cooperative Organizations Reporting At the conclusion of our audit, we summarized our findings in a report as outlined in our objectives above. Our report also includes recommendations for improving noted deficiencies, as well as identifies schools that should be targeted for procedural enhancement, such as one-on-one training and assistance. We reviewed the results with the principal at each school and have incorporated their responses into our report. 20

23 STATISTICAL INFORMATION OVERVIEW We conducted on-site visits at 82 schools. Please note that as of July 1, 2015, the District underwent an organizational restructuring in concert with implementation of a new strategic plan. This plan eliminated the geographical areas and the Area Superintendent positions, and created the Elementary Office of Leading and Learning and Secondary Office of Leading and Learning and Assistant Superintendent positions to head each new department. In addition to the data shown in the Executive Summary, this statistical information section is made up of the following tables and graphs: Internal Accounts Comparison of Audit Comments (Unweighted) This table presents a comparison of the total number of comments issued (unweighted) in 2017/2018 to prior years by area for all schools. In addition, it identifies schools with the following: Schools targeted for procedural enhancements based on the results from 2017/2018 and 2016/2017 Principal and/or bookkeeper turnover that occurred during 2017/2018 and 2016/2017 We noted that current year comments increased 58% from the prior year. The total number of comments issued in each area also changed as follows: Elementary schools increased by 33 comments, and Secondary schools increased by 30 comments. The decreases/increase can be attributed to several factors, outlined in more detail in the executive summary. Notably: The most significant number of comments issued (32 of 172 comments, or 19%) were due to General Ledger Review. This is a decrease over prior year (26 of 109 comments or 24%). Five (5) of these comments were the only comment issued at the respective school. The second most significant number of comments issued (20 of 172 comments or 12%) were due to Sales Tax Collection and Remittance, including insufficient supporting documentation sales taxes were paid on items purchased for resale. Both of these areas are recommended for additional review during the annual bookkeeper workshops and training. Internal Accounts Comparison of Audit Comments (Weighted) This table presents a comparison of the total weighted comments issued in 2017/2018 and prior years. For schools that received comments, we assigned a relative risk factor. Relative risk is an evaluation of the severity of the concern and the potential impact on operations. Items rated as high risk are considered to be of immediate concern and could cause significant operational issues if not addressed in a timely manner. Items rated as moderate risk may also cause operational issues and do not require immediate attention, but should be addressed as soon as possible. Items rated as low risk could escalate into operational issues, but can be addressed through the normal course of conducting business. Each comment issued was weighted for each school based on the following point allocation: High Risk Comment 3 points Moderate Risk Comment 2 points Low Risk Comment 1 point The total points for each school were calculated based on the comments that they received. As in past years, any school with more than 10 points was selected to be targeted for procedural enhancement as identified in the Internal Accounts Comparison of Audit Comments (Unweighted) table from above. There are 12 schools targeted for procedural enhancement based on the 2017/2018 results. We noted that 7 schools were targeted for procedural enhancements based on 2016/2017 results. Each of the 7 schools targeted for procedural enhancements in the prior year are recurring targeted schools based on 2017/2018 results. 21

24 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Unweighted) Elementary Schools 2016/ / / / /2016 Current Current Change Unweighted Unweighted Unweighted Unweighted Unweighted Increase School 2016/ /2018 Comments Comments Comments Comments Comments (Decrease) Elementary Schools Roy Allen Elementary Hans Christian Andersen Elementary Apollo Elementary Atlantis Elementary Audubon Elementary < *B *P Cambridge Elementary Cape View Elementary Lewis Carroll Elementary < *P (6) Challenger 7 Elementary +P (1) Columbia Elementary +P *B Coquina Elementary +P *B^ Dr. W.J. Creel Elementary Croton Elementary Discovery Elementary +B *P Endeavour Elementary +B +P *B^ *P Enterprise Elementary Fairglen Elementary *B *P Freedom 7 Elementary *B Gemini Elementary +P Golfview Elementary +P Harbor City Elementary +B^ (6) Spessard L Holland Elementary +B^ +P Imperial Estates Elementary +B Indialantic Elementary < +B *B Jupiter Elementary (1) Lockmar Elementary Longleaf Elementary +P Subotal for Elementary Schools Total for Elementary Schools Area District-wide Total Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Unweighted) 22

25 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Unweighted) Elementary Schools continued 2017/ / / / /2017 Current Change Unweighted Unweighted Unweighted Unweighted Unweighted Increase School 2016/ /2018 Comments Comments Comments Comments Comments (Decrease) Elementary Schools - Continued Manatee Elementary *P Christa McAuliffe Elementary Meadowlane Intermediate ES <^ +B Meadowlane Primary ES +B *B MILA Elementary Mims Elementary +B +P *P Oak Park Elementary *P Ocean Breeze Elementary < +B *P Palm Bay Elementary +B +P *P Pinewood Elementary *B Port Malabar Elementary +B *B Quest Elementary <^ *P Riviera Elementary +P *B Theodore Roosevelt Elementary +P *B Sabal Elementary *B^ Saturn Elementary +B +P Sea Park Elementary < Sherwood Elementary Robert L. Stevenson School of Arts (1) Sunrise Elementary Suntree Elementary +B Surfside Elementary < Tropical Elementary +B^ +P *B John F. Turner Elementary < *P University Park Elementary +P West Melbourne Elementary Westside Elementary +B Ralph Williams Elementary +B *B *P Subotal for Elementary Schools Total for Elementary Schools District-wide Total Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Unweighted) 23

26 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Unweighted) Secondary Schools 2017/ / / / /2017 Current Change Unweighted Unweighted Unweighted Unweighted Unweighted Increase School 2016/ /2018 Comments Comments Comments Comments Comments (Decrease) Middle and High Schools Astronaut High Bayside High +P Central Middle < *P Cocoa Beach Jr./Sr. High Cocoa High +P DeLaura Middle < +B *B^ *P Eau Gallie High +B (1) Edgewood Jr./Sr. High Heritage High +B Herbert C. Hoover Middle < *P Andrew Jackson Middle +P (3) Thomas Jefferson Middle < *P Lyndon B Johnson Middle +P *B John F Kennedy Middle +B *P James Madison Middle *P Ronald McNair Middle +P Melbourne High Merritt Island High *P Palm Bay Magnet High *B Rockledge High *P Satellite High +B^ *P Southwest Middle +B *B *P Space Coast Jr./Sr. High < +P Stone Middle Titusville High +P *B^ (1) Viera High School +B *B West Shore Jr./Sr. High Total for Middle and High Schools District-wide Total Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Unweighted) 24

27 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Weighted) Elementary Schools 2017/ / / / /2017 Current Change Weighted Weighted Weighted Weighted Weighted Increase School 2016/ /2018 Points Points Points Points Points (Decrease) Elementary Schools Roy Allen Elementary Hans Christian Andersen Elementary Apollo Elementary Atlantis Elementary Audubon Elementary < *B *P Cambridge Elementary Cape View Elementary Lewis Carroll Elementary < *P (12) Challenger 7 Elementary +P (3) Columbia Elementary +P *B Coquina Elementary +P *B^ (2) Dr. W.J. Creel Elementary Croton Elementary Discovery Elementary +B *P Endeavour Elementary +B +P*B^ *P Enterprise Elementary Fairglen Elementary *B *P Freedom 7 Elementary *B Gemini Elementary +P Golfview Elementary +P Harbor City Elementary +B^ (14) Spessard L Holland Elementary +B^ +P Imperial Estates Elementary +B Indialantic Elementary < +B *B Jupiter Elementary (2) Lockmar Elementary Longleaf Elementary +P Subotal for Elementary Schools Total for Elementary Schools Area District Wide Total: Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Weighted) 25

28 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Weighted) Elementary Schools continued 2017/ / / / /2017 Current Change Weighted Weighted Weighted Weighted Weighted Increase School 2016/ /2018 Points Points Points Points Points (Decrease) Elementary Schools - Continued Manatee Elementary *P Christa McAuliffe Elementary Meadowlane Intermediate ES <^ +B Meadowlane Primary ES +B *B MILA Elementary Mims Elementary +B Oak Park Elementary *P Ocean Breeze Elementary < +B *P Palm Bay Elementary +B Pinewood Elementary *B Port Malabar Elementary +B *B Quest Elementary <^ *P Riviera Elementary +P *B Theodore Roosevelt Elementary +P *B Sabal Elementary *B^ Saturn Elementary +B +P Sea Park Elementary < Sherwood Elementary Robert L. Stevenson School of Arts (2) Sunrise Elementary Suntree Elementary +B Surfside Elementary < Tropical Elementary +B^ +*B John F. Turner Elementary < *P University Park Elementary +P West Melbourne Elementary Westside Elementary +B Ralph Williams Elementary +B *B *P Subotal for Elementary Schools Total for Elementary Schools Area District Wide Total: Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Weighted) 26

29 STATISTICAL INFORMATION OVERVIEW CONTINUED Internal Accounts Comparison of Audit Comments (Weighted) Secondary Schools 2017/ / / / /2017 Current Change Weighted Weighted Weighted Weighted Weighted Increase School 2016/ /2018 Points Points Points Points Points (Decrease) Secondary Schools Astronaut High Bayside High +P Central Middle < *P Cocoa Beach Jr./Sr. High Cocoa High +P DeLaura Middle < +B *B^ *P Eau Gallie High +B (3) Edgewood Jr./Sr. High Heritage High +B Herbert C. Hoover Middle < *P Andrew Jackson Middle +P (6) Thomas Jefferson Middle < *P Lyndon B Johnson Middle +P *B John F Kennedy Middle +B *P James Madison Middle *P Ronald McNair Middle +P Melbourne High Merritt Island High *P Palm Bay Magnet High *B Rockledge High *P Satellite High +B^ *P Southwest Middle +B *B *P Space Coast Jr./Sr. High < +P Stone Middle (2) Titusville High +P *B^ (4) Viera High School +B *B West Shore Jr./Sr. High Total for Secondary Schools: District-wide Total Schools Targeted for Procedural Enhancements based on 2017/2018 results Schools Targeted for Procedural Enhancements based on 2016/2017 results < Bookkeeper turnover in 2015/ Bookkeeper (B) or Principal (P) turnover in 2016/2017 * Bookkeeper (B) or Principal (P) turnover in 2017/2018 ^ Bookkeeper turnover occurred twice during the year School Board of Brevard County Internal Accounts Comparison of Audit Comments (Weighted) 27

30 OVERALL DISTRICT OBSERVATIONS 1. Centralization of Processes and Sponsor Trainings Observation Originally Issued in Fiscal Year Internal Audit of Internal Accounts, report dated November 1, 2017 During Fiscal Year 2016/2017, the District centralized its banking services by consolidating all schools banking activities into a single banking institution. The District is planning to further centralize and enhance segregation of duties by bringing the check writing process to the District level. District Finance is actively developing and implementing a staffing model to adequately adjust for the workload related to the centralization plan and has recently received approval to create new positions. We support the current initiative to centralize the check writing process in order to reduce burden at the schools and increase internal controls. These additional centralized controls can assist to mitigate and detect fraud. We continue to encourage District Finance to review staffing and the current organizational structure to determine the feasibility in rolling out the enhancements to the control environment. The District reinstated mandatory Internal Accounts training for Principals starting in June We noted that currently there is not a formal training provided to teachers/sponsors for Internal Accounts procedures. We are aware that some administrators are conducting training sessions within their own schools; although this is a good practice, individual school-developed trainings could increase the risk of misinterpretation of proper procedures and lead to inconsistencies from school to school. We recommend that the District provide a formal training platform for the schools to use as standardized material to train their teachers/sponsors. The District should consider creating a video, slideshow or other means of formalized training, to be delivered locally by the Principal. Training attendance should be mandatory for all sponsors who handle internal funds. As centralized services, monitoring procedures and trainings are developed and implemented, we will continue to monitor the District s progress to strengthen internal controls regarding Internal Accounts. Management s Response: Original) District Accounting Staff will create standardized training materials that can be provided to all teachers during their annual pre-planning week at the beginning of the school year. Additionally we will post the training materials on the district website for easy access to school staff. Revised) District has prepared a draft Power Point presentation to be used in training teachers/sponsors. We expect the presentation to be finalized and ready to be rolled out to the schools by January 11, ECD: Original) August 1, 2018 Revised) January 11, 2019 Responsible Party: Jo Ann Clark, Director, Accounting Services; Michelle Coppola, Accounting Manager 28

31 SCHOOL: APOLLO ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/03/2018 Moderate 1 Sales Tax During our testing of fundraisers, we noted that sales tax was not included on the purchase of items for resale. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. We recommend the bookkeeper review and follow the sales tax policy in the Internal Funds Procedures Manual and ensure that when sales tax is not paid upon purchase, the school remits the proper sales taxes to the Florida Department of Revenue when applicable. Response: The bookkeeper will review and follow the sales tax policy in the Internal Funds Procedures Manual and ensure that when sales tax is not paid upon purchase, the school remits the proper sales taxes to the Florida Department of Revenue when applicable. ECD: 7/19/2018 Frank O Leary 29

32 SCHOOL: ATLANTIS ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/10/2018 High 1 Frequency of Disbursements During our testing of disbursements, we noted one invoice paid more than 45 days after the invoice date. Per discussion with the bookkeeper, the initial delivery was incomplete and/or contained the incorrect items. Records were not maintained to show proof of late delivery. Without proper controls over cash disbursements, there is an increased chance of misappropriation of funds. We recommend the bookkeeper remit payment in line with the procedures outlined in the Internal Accounts Procedure Manual. Response: we will remit payment in line with the procedures outlined in the Internal Accounts Procedure Manual; keep necessary documentation ECD: 7/26/18 Cynthia Adams 30

33 SCHOOL: AUDUBON ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/20/2018 No Comments for this School Response: N/A ECD: N/A Elia Lea 31

34 SCHOOL: CAMBRIDGE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 Moderate 1 General Ledger Review During our review, we noted that the Q2 General Ledger review had not been completed for two accounts. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: In the future, the bookkeeper and I will continue to discuss all paperwork that needs a principal signature. In addition, Ms. Branham will utilize and monitor a checksheet to ensure all paperwork is completed and signed. ECD: Immediately Wendy Smith 32

35 SCHOOL: CAPE VIEW ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 High 1 Authorization of Expenditures During our testing of disbursements, we noted Check #3616 for $50.00 for the use of a change fund (book fair) and was made out to the School Librarian. A vendor invoice was not generated for the disbursement. Without proper controls over cash disbursements, there is an increased chance of misappropriation. As outlined in Chapter 4C in the Internal Funds Procedures Manual, The requestor will submit a check requisition to the Principal. Upon approval and signature of the Principal, the bookkeeper shall proceed with creating the change fund in the system: To set up a change fund, create a Direct Pay vendor invoice payable to the Bookkeeper with the suffix Change Fund Cashier. Charge the invoice to the change fund General Ledger, #1113. We recommend these procedures be followed without exception. Response: 1) First I reviewed the section 4C in the Internal Funds Procedure with my bookkeeper. 2) My bookkeeper will set up all future change funds by creating a Direct Pay vendor invoice payable to her with the suffix Change Fund Cashier. The invoice will be charged to the General Ledger, ) I will review again after procedure is complete. ECD: 7/18/18 Jill Keane 33

36 SCHOOL: CHALLENGER 7 ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/10/2018 No comments for this school Response: N/A ECD: N/A Magali Rassel 34

37 SCHOOL: CHRISTA MCAULIFFE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 No Comments for this School Response: N/A ECD: N/A Victoria Finsted 35

38 SCHOOL: COLUMBIA ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/25/2018 High 1 General Ledger Review During our review, we noted that a total of 2 accounts were not reviewed as part of the quarterly general ledger review. Q1-1 account Q2-1 account We also noted that Q1 review occurred on April 24, 2018, more than 7 months after the end of the first quarter. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed timely each quarter, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Going forward we will assure that quarterly reports are reviewed by the person responsible and double-checked by the bookkeeper that all signatures are on each string and also keep a calendar to meet deadlines of one month after quarter end. ECD: Immediately Rachel Roberts Moderate 2 Documentation of Disbursements We noted a $750 expenditure for Dunkin Donuts gift cards to be used internally. There was a corresponding log to track the purchase and distribution of these gift cards to date, however the log did not contain teacher signatures verifying the receipt of the gift cards. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: Going forward we will make sure gift card recipients sign our gift card receipt form. ECD: Immediately Rachel Roberts 36

39 SCHOOL: COQUINA ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 Low 1 Yearbook Sales During testing of Yearbooks we noted the reconciliation was not performed correctly. The activity during the year did not agree to the General Ledger. Without the proper controls surrounding yearbook sales, the related cash collections and yearbooks to be sold could be misappropriated. We recommend the bookkeeper should review the yearbook reconciliation form for accuracy and compare the amounts to the general ledger. The form should then be forwarded to the Principal for review and final approval. Response: bookkeeper learning processes and procedures. Review of procedures of reconciliation with district personnel to identify errors. Will follow protocol. ECD: Immediately Blair Lovelace 37

40 SCHOOL: DR. W.J. CREEL ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/12/2018 High 1 Frequency of Disbursements During our testing of disbursements, we noted Invoice # was paid more than 45 days from the invoice date. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: The internal funds procedures manual has been reviewed with the bookkeeper. All purchase orders will follow the 45 day payment terms in the future. ECD: August 6, 2018 Kathryn Eward 38

41 SCHOOL: CROTON ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/19/2018 High 1 General Ledger Review During our review, we noted several accounts in the quarterly general ledger reports had not been reviewed in all four quarters. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. These reports should be cumulative each quarter. The principal should only sign when there is not a clear sponsor in charge of the account. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. We recommend these procedures be followed without exception. Response: The bookkeeper will review all accounts in the quarterly general ledger as described in the Internal Funds Procedures Manual and ensure that the sponsor is signing quarterly. The Principal will review each account to make sure accurate sponsors are identified. ECD: August 2018 Roseann Bennett 39

42 SCHOOL: DISCOVERY ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/13/2018 Moderate 1 Restricted Expenditures During testing of disbursements, we noted Check #6374 was used to purchase sheet music from the strings rental account. Music instrument rental fees shall be used for the purchase, repair or replacement of musical instruments. Without the proper controls surrounding purchases from the string rental funds could be misappropriated. We recommend that the bookkeeper review the Internal Funds Manual Chapter 21E, Revenues generated from the rental of instruments shall be used for the repair, replacement or purchase of string instruments. These funds may not be used for the purchase of music or other instructional materials. We recommend this procedure be followed without exception. Response: Upon review of the Internal Funds Manual Chapter 21E, the bookkeeper would use funds from project Music General for this purchase. ECD: Karry Castillo 40

43 SCHOOL: ENDEAVOUR ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/18/2018 No Comments for this School Response: N/A ECD: N/A Christopher Reed 41

44 SCHOOL: ENTERPRISE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/18 High 1 Frequency of Disbursements During our test of disbursements, we noted Invoice #P was paid more than 45 days from the invoice date. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: The goods were not received during the 45 day window. ECD: Immediately Jean Bartleson 42

45 SCHOOL: FAIRGLEN ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/27/2018 High 1 Frequency of Remittance During our test of cash receipts, we noted that for one Monies Collected Form (MCF) #420-4, funds were collected between 4/17/2018 4/18/2018, but not remitted to the Bookkeeper until 4/20/2018 (3 business days). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day and never over a weekend. Without proper controls over cash collections, there is an increased chance of misappropriation In accordance with Section 5B(1) of the Internal Accounts Procedures Manual, "All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. Monies collected should not be held over the weekend. If extenuating circumstances exist and this practice is not feasible, the monies must be turned into the Bookkeeper no later than the next business day." We recommend this procedure be followed without exception. Response: During pre-planning in August 2018 the Bookkeeper will present all faculty and staff with a printed copy of School Board policies regarding the timely submission of all Monies Collected Forms and corresponding receipts. ECD: August 2018 Dr. Richard Dunkel / Ms. Catherine Murphy High 2 Frequency of Disbursements During our test of disbursements, we noted Invoice #Sl had an invoice date of 8/28/2017, but was paid on 10/23/2017, 56 days later. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: The Bookkeeper will review purchase orders to ensure that once items have been received District payment terms are followed. Vendors will be contacted for invoices if not received in a timely manner. ECD: Immediately Dr. Richard Dunkel / Ms. Catherine Murphy 43

46 SCHOOL: FAIRGLEN ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/27/2018 Moderate 3 Documentation of Disbursements We noted a $700 expenditure for Publix gift cards to be distributed during teacher appreciation week. There was no corresponding log to track the purchase and distribution of these gift cards to date. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: A gift card log will be maintained by the Bookkeeper for any gift card purchased. That log will include the recipient and the recipient s signature. ECD: Immediately Dr. Richard Dunkel / Ms. Catherine Murphy 44

47 SCHOOL: FREEDOM 7 ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 6/27/2018 Low 1 General Ledger Review During our review, we noted that one account in Q1 was not reviewed as part of the quarterly general ledger review. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: We will implement a quarterly cumulative review, by sponsors, of all general ledger accounts. ECD: August 2018 Dorine Zimmerman 45

48 SCHOOL: GEMINI ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/28/2018 Moderate 1 General Ledger Review During our review, we noted that a cumulative total of three (3) accounts were not reviewed as part of the quarterly general ledger review. The three (3) accounts were the same across each quarter. Q1 1 account Q2-1 account Q3 1 account Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: While the Principal reviewed all accounts, she only signed once for two accounts on one page. Principal will thoroughly review and sign at every account (dotted line) on the General Ledger. In addition, an Outlook Calendar reminder was entered to ensure that GL s are printed on the correct quarterly dates. ECD: Immediately Jennifer Julian Moderate 2 Documentation of Disbursements We noted a $100 expenditure for ten (10) $10 Dunkin Donuts gift cards to be distributed to teachers as a welcome back incentive. There was no corresponding log to track the purchase and distribution of these gift cards to date. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: Upon review of the Internal Accounts Procedures Manual, it does indicate that a log is required for gift cards. Principal and the school bookkeeper will maintain a log of gift card recipients moving forward. ECD: Immediately Jennifer Julian 46

49 SCHOOL: GOLFVIEW ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 No Comments for this School Response: N/A ECD: N/A Katrina Hudson 47

50 SCHOOL: HANS CHRISTIAN ANDERSEN ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 High 1 General Ledger Review Recurring During our review, we noted several accounts had not been reviewed in the quarterly general ledger activity reports for Q1 and one account for Q4. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. Each general ledger account should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: All ledgers were reviewed, however, there were signatures covering more than one account or not at all due to no activity. All accounts with activity were signed individually. Accounts will continue to be reviewed by both the principal and the bookkeeper each quarter and each account will be signed individually; even if there is not any activity. Principal will sign each account at the balance line. ECD: August 2018 Denise Johnson High 2 Frequency of Deposits When testing cash receipts, MCF #507-2 we noted the date received by the bookkeeper was 5/23/18 and the subsequent deposit date was 6/13/18 which is 15 business days between collection and deposit. The Internal Funds Procedures Manual Chapter 5D states that deposits must be made within 5 business days, or within 3 business days if over $200. Without proper controls over cash collections, there is an increased chance of misappropriation. We recommend that the bookkeeper review the Internal Funds Procedures Manual Chapter 5D. We recommend this policy be followed without exception. Response: This is normally not an issue at our school. However, the deposit has kept safe until deposited at a later date. This will not be an issue again with the new armored vehicle pickup. Principal will follow up with the bookkeeper and confirm that deposits are being made in a timely manner and in accordance with the Internal Funds Procedures Manual. ECD: August 2018 Denise Johnson 48

51 SCHOOL: HANS CHRISTIAN ANDERSEN ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 Moderate 3 Sales Tax When testing one fundraiser (Krispy Kreme Donut Sale), we were unable to determine whether sales taxes were paid or collected and properly remitted to the Department of Revenue. In accordance with Section 11C(9) of the Internal Funds Procedures Manual, "Fundraising Activities The sale of candles, candies, confections and other novelties sold for fund raising purposes by school-sponsored organizations are taxable. Sales tax may be paid directly to a Florida vendor upon the purchase price / invoice amount or directly to the Department or Revenue based upon the sales price." We recommend this procedure be followed without exception. Response: The bookkeeper informed the auditors that sales tax was most likely included in the price. This fundraiser performed correctly, but the auditors wanted something in writing showing either nontaxable or tax paid in writing from the vendor. In the future, bookkeeper will make sure that all fundraisers are charged a sales tax from the vendor or the school will pay the Department of Revenue sales tax owed. Request that tax is indicated specifically for the school on the invoice. We will pay taxes when appropriate. ECD: August 2018 Denise Johnson 49

52 SCHOOL: HARBOR CITY ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/18 High 1 General Ledger Review Recurring During our review, we noted that the Q1 general ledger reports had not been reviewed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: a cumulative review of all general ledger accounts will be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts will be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. ECD: August 30, 2018 Joy Salamone High 2 Fundraising Activity Recurring During our testing of one fundraiser (Texas Roadhouse, November 2017, we noted The Principal did not complete the Fundraiser Approval Form. Specifically, the Approve/Deny designation was not marked and the approval was not dated. A Fundraiser Reconciliation was not completed and reviewed as required. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. We recommend the Principal and other applicable fundraiser participants fully complete the District s standard forms to document approval and financial reconciliation of fundraising activity. Response: The Principal and other applicable fundraiser participants will fully complete the District s standard forms to document approval and financial reconciliation of fundraising activity ECD: August 30, 2018 Joy Salamone 50

53 SCHOOL: HARBOR CITY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/18 High 3 Documentation of Disbursements Recurring When testing cash disbursements, we noted the following: Check #7088 was recorded in the wrong GL account. The Purchase Order stated the GL number as but the check was recorded in Additionally, no receipts or other back up was included available. No receipt for the purchase was available for Check #7143. As such, we were unable to verify the mathematical accuracy and the sales tax implications for the expenditure. We noted Check #7126 was cut for more than 30% of the approved PO amount. Evidence of Principal approval for the overage was unavailable. We recommend the bookkeeper review Chapter 7, Disbursements of the Internal Accounts Manual for specific guidance for the treatment of cash disbursements. Response: The bookkeeper will review Chapter 7, Disbursements of the Internal Accounts Manual for specific guidance for the treatment of cash disbursements ECD: August 30, 2018 Joy Salamone 51

54 SCHOOL: HARBOR CITY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/18 High 4 Monies Collected forms Recurring During our testing of cash receipts, we noted the following: There was not enough supporting information included with MCF # to determine the nature of the transaction. We were therefore unable to verify compliance with the Internal Funds Procedures Manual requirement that that transactions over $10 are issued a receipt, or whether sales taxes were paid or collected and subsequently remitted to the Florida Department of Revenue. The Check / Cash column was not completed on MCF # Without a listing of cash or check for each amount collected, it is difficult to verify if the correct amount of was deposited. Improper and inadequate completion of monies collected could result in misappropriation of funds. The Date Received by Bookkeeper line was not completed on MCF # Without properly dating receipt of cash/check amount collected, it is difficult to verify timely deposit by the bookkeeper. We recommend that the Monies Collected Form procedures located in Chapter 5B of the Internal Funds Procedures Manual be reviewed and followed without exception by all teachers/sponsors. Response: The Monies Collected Form procedures located in Chapter 5B of the Internal Funds Procedures Manual will be reviewed and followed without exception by all teachers/sponsors. ECD: August 30, 2018 Joy Salamone 52

55 SCHOOL: HARBOR CITY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/18 High 5 Petty Cash / Change Fund When testing the change fund balance on hand, we noted the change fund was not listed on the principal s report as of 6/30/18. It was determined, that the $200 change fund balance was erroneously recorded in PTO Donations, We recommend the bookkeeper review Chapter 4C(1) of the Internal Accounts Manual for requirements for establishing a change fund. Response: The bookkeeper will review Chapter 4C(1) of the Internal Accounts Manual for requirements for establishing a change fund. ECD: August 30, 2018 Joy Salamone 53

56 SCHOOL: IMPERIAL ESTATES ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 Moderate 1 General Ledger Review Recurring During our review, we noted multiple accounts in Q2 were not reviewed by the principal/sponsors. Bookkeeper noted N/A on accounts as they were closed out and not included in Q3. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Due to the fact we had ed School Accounting at the district that the accounts were closed we didn t think signatures were necessary especially since we kept said attached. In the future all will be signed for regardless. ECD: 8/2018 Katheryn Lott Moderate 2 Sales Tax During our testing of fundraisers and cash receipts we noted sales tax was not paid to the vendor or remitted to the Department of Revenue for the sale of flowers. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. We recommend the bookkeeper review and follow the sales tax policy in the Internal Funds Procedures Manual and ensure that when sales tax is not paid upon purchase, the school remits the proper sales taxes to the Florida Department of Revenue when applicable. Response: This was a transaction from so long that we could not produce proof of paying tax. In the future we will ensure all proof of tax is documented. ECD: 8/2018 Katheryn Lott 54

57 SCHOOL: IMPERIAL ESTATES ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 Moderate 3 Deficit Balances During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018: Account # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: District procedures will be followed in the future to ensure that all internal accounts will be checked for negative balances and cleared appropriately at 6/30. ECD: 8/2018 Katheryn Lott 55

58 SCHOOL: INDIALANTIC ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 6/20/2018 Moderate 1 Official Receipts During our testing of cash receipts, we noted a receipt was issued without the amount collected filled out. Therefore, we were unable to reconcile the receipt to MCF # Without the proper controls surrounding cash collections, funds could be misappropriated. We recommend that the cash receipts policy in the Internal Funds Procedures Manual is reviewed and followed without exception. Response: Review Internal Accounts Manual-Chapter 5 2e page 24 on Receipts. Hold monthly compliance meetings, have a double check process on collected receipts ensuring that all receipts are filled out properly. ECD: 1st meeting August 1, 2018, then monthly throughout the year. Dr. Lori Braga Moderate 2 Sales Tax During our testing of cash receipts, we noted that MCF # included collections for music rentals on which no sales tax was paid. The School Board is subject to sales tax on equipment rentals; therefore sales tax should be paid to the State of Florida. We recommend the bookkeeper review and follow the sales tax policy in the Internal Funds. Response: Review Internal Accounts Manual- Chapter 11 C4 page 19 on Sales Tax. Hold monthly compliance meetings, have a double check process ensuring that sales tax is collected and paid when appropriate. ECD: 1st meeting August 1, 2018, then monthly throughout the year. Dr. Lori Braga 56

59 SCHOOL: JUPITER ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/19/2018 No comments for this school Response: N/A ECD: N/A Sherie Troisi 57

60 SCHOOL: LEWIS CARROLL ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 Moderate 1 Fundraising Activity Recurring During our testing we noted that the Sponsor and Principal signed the Fundraiser Reconciliation Form approximately 120 days of the close of the fundraiser. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. The Internal Funds Procedures Manual states that the Fundraiser Reconciliation Form must be filed within 60 days of the close of each fundraiser. We recommend these procedures be followed without exception. Response: Procedures for timely Reconciliation will be clarified with staff members. Bookkeeper will follow up with sponsor/teacher to ensure Reconciliation forms are turned in within 60 days after the close of the fundraiser. ECD: 8/7/2018 Jenifer Born 58

61 SCHOOL: LOCKMAR ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/31/2018 Moderate 1 General Ledger Review During our review of the General Ledger, we noted that the Savings Account in Q3 had not been reviewed by the principal or sponsor. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: The school secretary will be assigned to review the general ledger accounts after they have been reviewed by the principal or sponsor. She will check to ensure that a sponsor or the principal has signed as the reviewer. ECD: Immediately Norma L. Hostetler 59

62 SCHOOL: LONGLEAF ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 High 1 Frequency of Disbursements During our test of disbursements, we noted Invoice # had an invoice date of 6/7/2017 and was paid on 8/2/2017, 56 days later. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of fortyfive (45) days, per Chapter of Florida Statutes. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. We recommend this policy be followed without exception. Response: Check#7805 8/2/17 Melhart Music Center: Due to damaged items received, the bookkeeper was in contact with the vendor to get replacement parts. There was no payment for the product until all the pieces were fixed and assembled. It shows on Pay 7, the damaged pieces were scheduled for shipment on 7/5/17 and after we received the parts, the bookkeeper received the new Statement page 9 and paid on 8/2/18 before the due date. Please see the attached documents provided by Farah Shakoorian, our bookkeeper. Refer to Purchase Order Terms and Conditions. ECD: Immediately Kimberly Bias Moderate 2 Official Receipts During our testing of cash receipts, we noted a receipt amount was issued for less than the amount indicated on MCF # Without the proper controls surrounding cash collections, funds could be misappropriated. We recommend that the cash receipts policy in the Internal Funds Procedures Manual is reviewed and followed without exception. Response: Bookkeeper will pay closer attention to amount collected and amount indicated on the receipt book. ECD: Immediately Kimberly Bias 60

63 SCHOOL: LONGLEAF ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 Moderate 3 Documentation of Disbursements We noted a $200 expenditure for two (2) TJ Maxx gift cards to be distributed to two employees for appreciation gifts. There was no corresponding log to track the purchase and distribution of these gift cards to date. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: A log will be maintained for gift card recipients with their respective signature moving forward to assist with control of distribution of gift cards. Attached is acknowledgement that the gift cards were received by intended recipients. ECD: Immediately Kimberly Bias 61

64 SCHOOL: MANATEE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 No Comments for this School Response: N/A ECD: N/A Shannon Daly 62

65 SCHOOL: MEADOWLANE INTERMEDIATE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/19/2018 No Comments for this School Response: N/A ECD: N/A Adrienne Schwab 63

66 SCHOOL: MEADOWLANE PRIMARY ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 1 Deficit Balances During our review of the Principal s Report, we noted 2 accounts with a deficit balance as of 6/30/2018: Account # and # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: There was a change in personnel in the bookkeeper position at the end of the fiscal year and planned transfers were not made as planned. Going forward transfers to accounts will be made proactively and in a timely manner to ensure that negatives are a non-issue. Balance sheets will be evaluated each month and any apparent negatives will be corrected. ECD: Immediately Susan Schroeder Moderate 2 General Ledger Review During our review, we noted one account had not been reviewed in the quarterly general ledger activity reports for two separate quarters. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Account appeared on one page and the line for sign off was on the next page making it easy to overlook. We have adjusted the format of this document making each account string run on a separate page in order to avoid this oversite in the future. ECD: Immediately Susan Schroeder 64

67 SCHOOL: MEADOWLANE PRIMARY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 3 Documentation of Disbursements When testing cash disbursements, we noted one transaction that purchased 2 gift cards for 2 separate employees that were retiring from the School. We were able to determine the purpose for the gift card purchase and the individuals the School intended to issue them to; however, we were unable to verify that the gift cards were distributed to those individuals. We recommend doing the following at a minimum when issuing gift cards. Document the purpose of the gift card purchase and request that recipients sign and acknowledge that they received the gift card(s). Response: A memo was written to document the purchase of the gift cards. These were given at the retirement party. We have created a document to be attached to the gift card requiring a signature from the recipient. ECD: Immediately Susan Schroeder Moderate 4 Monies Collected Forms During our testing of cash receipts, we identified that a cash receipt was not issued for a non-exempt transaction over $10. Without the proper controls surrounding cash collections, funds could be misappropriated. We recommend the bookkeeper review the cash receipts policy in the Internal Funds Procedures Manual and follow it without exception. Response: Cash was received for the vandalism to the school bus cited above and the bookkeeper, new to her position did not receipt the parent upon receipt of the funds. ECD: Immediately Susan Schroeder 65

68 SCHOOL: MEADOWLANE PRIMARY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Low 5 District Level Accounts During our review of the Principal s report dated 6/30/2018, we noted account GSF Vandalism Repayments had an account balance of $ Balance in accounts through must be remitted to the district prior to the end of the fiscal year. Without closing out these accounts as required, there are reconciling items at the District level that require follow up and tracking into the following fiscal year. We recommend the bookkeeper review the year-end procedures in the Internal Funds Procedures Manual. Response: There was a change in personnel in the bookkeeper position at the end of the fiscal year. The vandalism that occurred to the bus happened during this time period. In the future all district processes will be followed to ensure that funds are received during the current fiscal year. Procedures have been put in place to ensure that monies received for district collection are forwarded to the proper authorities in a timely manner and prior to the end of the fiscal year. ECD: Immediately Susan Schroeder 66

69 SCHOOL: MILA ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 No comments for this school Response: N/A ECD: N/A Kelli Dufresne 67

70 SCHOOL: MIMS ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/26/2018 High 1 General Ledger Review During our review of the quarterly General Ledger Reports we noted the following accounts were not reviewed and signed: 1 account in Q1 1 account in Q2 Multiple accounts in Q3 and Q4 Q1 was not reviewed within 1 month of quarter close. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. Each individual general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: When I first started as bookkeeper I was printing a general ledger account monthly for the teachers to review but did not ask for signatures. The principal and I were both new to the school this year. The accounts in Q3 and Q4 were all inactive accounts with $0 balance. We were unaware that inactive accounts needed to be reviewed and signed. All accounts will be signed off from this date forward. I will double check that all accounts have been signed off on quarterly reports. ECD: Immediately Sheryl Haskins 68

71 SCHOOL: OAK PARK ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/03/2018 No comments for this school Response: N/A ECD: N/A Susan Mulchrone 69

72 SCHOOL: OCEAN BREEZE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/25/2018 High 1 General Ledger Review Recurring During our review, we noted that a cumulative total of 5 accounts were not reviewed as part of the quarterly general ledger review. Q1-2 accounts Q2-1 accounts Q3 2 accounts Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Upon clarification of the review process, that includes the summary documentation which was not clear in the past, all pages and sections will be properly reviewed and signed in accordance with the recommendation. ECD: July 1, 2018 Laurie Hering 70

73 SCHOOL: OCEAN BREEZE ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/25/2018 High 2 Monies Collected Forms Recurring During our testing of cash receipts, we identified: MCF # was not properly completed as the Bookkeeper documented two different Computer Receipt Numbers on the one Monies Collected Form. Two MCF s numbered MCF # did not have the corresponding deposit slip and bank receipt attached to the Monies Collected Form. Without proper controls around cash collection, inaccuracy of monies collected forms could result in misappropriation of funds. In accordance with Chapter 5B of the Internal Funds Manual, the Monies Collected Form shall show the Computer Receipt Number, Actual Date Collected, Purpose for Collection of Funds, Signature of the Teacher/Sponsor (or other District employee) responsible for collecting the money, Student name and the amount collected from each, Payment type, whether it is cash or check (including the check number), and Total for Deposit. We recommend that the rules per Internal Funds Manual be followed without exception. We also recommend that the bookkeeper retain and attach the bank deposit slip and bank receipt to the Monies Collected Forms per the Internal Funds Procedures Manual, without exception. The Monies Collected Forms completed by the initial collectors should be attached to the actual bank deposit made. Response: As deposits will now be completed at the district level, there is no action to be taken on this in the future. During preplanning and upon approval of field trips, events, and fundraisers, a review of the Monies Collected procedures will be completed with teachers. ECD: June 2018; August 7, 2018 and on-going through the school year. Laurie Hering 71

74 SCHOOL: OCEAN BREEZE ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/25/2018 High 3 Frequency of Remittance During our test of cash receipts, we noted the following Monies Collected Forms in which money was not remitted by the teacher/sponsor by the business day following initial collection: MCF # with funds collected on 2/13/2018 but not remitted until 2/23/2018 (8 business days). MCF # with funds collected on 3/30/2018 but not remitted until 4/10/2018 (7 business days, held over two weekends). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the Monies Collected Form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: During preplanning and upon approval of field trips, events, and fundraisers, a review of the Monies Collected procedures will be completed with teachers, with follow up reminders. ECD: August 7, 2018 and on-going through the school year. Laurie Hering High 4 Frequency of Disbursements During our test of disbursements, we noted Invoice # was paid 125 days after the item was received. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: In the case of multiple invoices within an approved PO, the bookkeeper will pay each invoice independently and within the approved guidelines. ECD: June 26, 2018 Laurie Hering 72

75 SCHOOL: PALM BAY ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 Moderate 1 Official Receipts Recurring During our testing of cash receipts, we noted an official receipt was not issued for monies received greater than $10 on MCF # In addition, we noted three (3) Monies Collected Form s which had the white copy of receipts attached to support the Monies Collected Form. None of the Monies Collected Form s had the pink audit copy of the receipt attached. Without the proper controls surrounding cash collections, funds could be misappropriated. Chapter 5A of the Internal Accounts Procedures Manual requires a receipt be issued for all monies received of $10.00 or more (except for fieldtrips, fundraisers/ yearbooks, funds received by mail, school age child care program, and items sold). All receipts should be distributed as follows: The top white copy (original) of the receipt shall be given to the person remitting the money, and the pink (audit) copy should remain in the School Receipt Book. We recommend the official receipts procedures in the Internal Accounts Procedures Manual be followed without exception. Response: Going forward I will ensure to keep the pink copy of receipt instead of the white. I will also ensure the Receipts log is filled out every time a check comes in to our office. Proper color receipts will be provided on all transactions over $10, including anonymous donations. MCF procedures will be reviewed with all teachers. ECD: July 3, 2018 Michael Mahl High 2 General Ledger Review During our review, we noted that one (1) account in Q2 not reviewed as part of the quarterly general ledger review. In addition, the Q1 and Q2 reports were run as of April 2, 2018, six (6) and three (3) months after the end of the quarter. We also noted the Q3 general ledger was for the time period 7/1/2016 to 3/31/2018. Without timely review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Going forward there will be a reminder in my outlook calendar for the GL to print, review, and have signed in the appropriate timeframe. Quarterly review team to include Principal, AP, and Bookkeeper. ECD: July 3, 2018 Michael Mahl 73

76 SCHOOL: PALM BAY ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 High 3 Frequency of Disbursements During our test of disbursements, we noted Invoice # had an invoice date of 8/21/2017 and was paid on 4/3/2018, 225 days later. In addition, we noted purchases made on the District s Purchasing Card on 8/7/2018 and 8/8/2018 that were not reimbursed to the District until 10/11/2017, 64 days later. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty- five (45) days, per Chapter of Florida Statutes. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A and follow this policy without exception. Response: Going forward I will ensure the payments are made in a timely manner, within the 45 days requirement. All purchases will follow internal fund procedures. Items listed are a result of a new Bookkeeper and Administration. Attempts were made to follow and clarify procedures throughout the process. As documented with s associated with invoices. ECD: July 3, 2018 Michael Mahl High 4 Authorization of Expenditures During our testing of disbursements, we noted Check #6169 and #6141 had a purchase order that was prepared after the invoice date. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that all disbursements have purchase orders prepared and approved before the expenditure is made. All supporting documentation should be attached to the purchase order (i.e. invoice, receipt, check requisition, etc.). Response: Going forward I will ensure purchase orders are approved before invoices and will ensure the vendors clearly mark Invoice or Quote appropriately on the forms. All purchase orders will follow procedures. We will ensure Vendors will clearly mark Invoices and Quotes. ECD: July 3, 2018 Michael Mahl 74

77 SCHOOL: PINEWOOD ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/26/2018 High 1 Documentation of Disbursements During our test of disbursements, we noted that Check #5771 did not have sufficient supporting documentation (no vendor invoice) attached. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend all disbursements have proper documentation to support the expenditure made. Response: We are trying to contact the teacher in charge and the Vendor (who is on vacation until August 6) to get an invoice. We will make sure that we have all invoices in hand before submitting payment. ECD: Immediately Mitzi Robinson Moderate 2 Petty Cash / Change Fund During our testing of petty cash and change fund, we noted the petty cash on hand was $10 lower than the principal s report and the change fund was $10.05 greater than the principal s report. Unreconciled petty cash could result in misappropriation of funds. We recommend that reconciliation be prepared on a standard form and balanced to the approved amount on a regular basis. Petty cash receipts should accompany any reimbursements Response: Roll of quarters was a inadvertently placed in the petty cash box instead of the cash box. We will insure to reconcile cash boxes on a regular basis. ECD: Immediately Mitzi Robinson 75

78 SCHOOL: PINEWOOD ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/26/2018 Moderate 3 General Ledger Review During our review of the General Ledgers we noted the following: Q 1 Account # Social had not been signed by the principal or sponsor Q1 report was not run and reviewed until 4 months after quarter end. Q3 had one account that was not reviewed and signed. Without review of the account activity on a regular basis by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. Each individual general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: All reports will be run in a timely manner and reviewed and signed by principal. ECD: Immediately Mitzi Robinson Moderate 4 Sales Tax During our testing of Cash Receipts MCF #506-1, we noted that sales tax was not included on the purchase of items for resale. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. We recommend the bookkeeper review and follow the sales tax policy in the Internal Funds Procedures Manual and ensure that when sales tax is not paid upon purchase, the school remits the proper sales taxes to the Florida Department of Revenue when applicable. Response: We were not aware that we had to pay taxes on the chocolate bars that 6 th grade sells every year. We will make sure that we pay vendors sales tax on all non-commodities that we sell. ECD: Immediately Mitzi Robinson 76

79 SCHOOL: PINEWOOD ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/26/2018 Moderate 5 Deficit Balances During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018: Account # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: We will make sure that we clean up our deficit balances before the end of the fiscal year. ECD: Immediately Mitzi Robinson 77

80 SCHOOL: PORT MALABAR ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/12/2018 High 1 General Ledger Review During our review, we noted that a cumulative total of 3 accounts were not reviewed as part of the quarterly general ledger review. Q2-2 accounts Q3-1 account Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Per recommendation a cumulative review of all general ledger accounts will be performed quarterly and signed by the teacher, sponsor or principal. ECD: While a cumulative review of general ledger accounts is performed quarterly, three accounts were overlooked for signature because of placement on the edge or back of report. To avoid this concern we will print all accounts on one side and carefully review to ensure all are signed per recommendation effective immediately. Cindy Whalin Moderate 2 Deficit Balances During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018: Account # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: Per recommendation, the bookkeeper and principal will ensure that no expenditures will exceed cash resources available within each account. ECD: This deficit was caused by a delay in fund transfers from Title I to cover the cost of the district field trip. To avoid this in the future, we will schedule this transaction earlier in the process and follow up in a timely manner to adjust the negative balance effective immediately. Cindy Whalin 78

81 SCHOOL: QUEST ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/17/2018 No Comments for this School Response: N/A ECD: N/A Christine Boyd 79

82 SCHOOL: RIVIERA ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/20/2018 Moderate 1 Documentation of Disbursements We noted a $50 expenditure for an itunes gift card to purchase apps to be used internally by first grade teachers. There was no corresponding log to track purchases to date with teacher signatures verifying the use of the funds. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of recipients and use of gift cards to assist with the control and distribution of gift cards. Response: The principal and bookkeeper have read through district policy which address distribution of funds without supporting documents/receipts. In the future if it is necessary to purchase gift cards will be treated like petty cash and follow those policies. ECD: This issue was addressed on June 20, 2018 and the teacher provided the support documents. Kori Hurst Low 2 Safe / Vault During our testing, we noted that the safe accountability and safe combination log was not updated for the new bookkeeper, who started on 6/6/2018, and received access to the safe on 6/19/2018. Documentation of the safe log ensures that the appropriate people have access, and that the combination and accesses are updated when turnover occurs, as required by the Internal Funds Procedures Manual. We recommend that the bookkeeper review the Internal Funds Manual. A safe accountability log with the most current information listed is to be kept near the location of the safe. Listed on this log must be all staff members who currently have the combination and/or key to open the safe. In the event that any of the staff members with access are terminated or their roles have changed and access is no longer needed, the combinations must be changed. Any changes to the safe/vault must be documented on the Safe Combination Changes log. The most current version of this log is also to be kept near the location of the safe. Response: The principal and bookkeeper have read and understand the policy that address the safe accountability log and the log must be current with all staff member who currently have access to the safe. ECD: The issue was addressed on the morning of June 20, 2018 Kori Hurst 80

83 SCHOOL: ROOSEVELT ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/14/2018 No Comments for this School Response: N/A ECD: N/A Kimberly Humphrey 81

84 SCHOOL: ROY ALLEN ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/16/2018 No Comments for this School Response: N/A ECD: N/A Lori Migliore 82

85 SCHOOL: SABAL ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 High 1 Authorization of Expenditures During our testing of disbursements, we noted Check #4342 was used to purchase gift cards after the purchase order expired (PO# ). Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources. We recommend that all disbursements have valid purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approved by the principal before the expenditures are made. Response: Previous bookkeeper error with a date that is before the disbursement of the check. Reviewed policy with new bookkeeper. ECD: Immediately Stephanie Hall Moderate 2 Monies Collected Forms During our testing of cash receipts, we noted cash or check was not listed next to each amount collected on MCF # Without a listing of cash or check for each amount collected, it is difficult to verify if the correct amount of cash is being deposited. We recommend the person collecting the funds write cash or check next to all collections on the Monies Collected Form, as required by Chapter 5B of the Internal Funds Procedures Manual. Response: Reviewed procedures with new bookkeeper on Monies Collected Form from the Internal Funds Procedures Manual. ECD: Immediately Stephanie Hall 83

86 SCHOOL: SATURN ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 Low 1 General Ledger Review Recurring During our review, we noted 1 account was not reviewed as part of the quarterly general ledger review in Q3. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: I will review with the bookkeeper that all accounts are reviewed by myself as principal. I will also review with the bookkeeper that they need to have procedures in place to verify principal signatures on all pages of the ledger. ECD: Immediately Janice M. Rutherford 84

87 SCHOOL: SATURN ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 Moderate 2 Sales Tax During our testing of one fundraiser, we noted that the Fundraiser Approval Form was not signed and dated to evidence the pre-approval date. There were no supporting invoices from the vendor to substantiate whether sales tax had been paid on the purchases. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. The Internal Funds Procedures Manual states that, Prior to the start of fundraising activities, a Fundraiser Approval form must be prepared by the teacher/sponsor requesting the fundraiser and approved by the Principal. In addition, the Fundraiser Reconciliation Form must be filed within 60 days of the close of each fundraiser. We recommend these procedures be followed without exception. The Fundraiser Reconciliation Form must be completed accurately by the teacher/sponsor coordinating the fundraiser and agree to the general ledger and related invoice payment made. All supporting documentation should be attached to the form, including invoices, purchase orders, receipts, etc. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger and related supporting documentation. Response: I will review with the bookkeeper that the procedure for fundraisers is to have the Fundraiser Approval Form signed and dated to indicate the preapproval date. I will also review with the bookkeeper that invoices from the vendor document whether sales tax has been paid. ECD: Immediately Janice M. Rutherford 85

88 SCHOOL: SEA PARK ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/13/2018 High 1 General Ledger Review During the review of the quarterly General Ledger reports, it was noted that the Q3 and Q4 reports were not signed by either the principal or sponsors. Without review of the account activity on a regular basis in a cumulative report by the in charge teacher or sponsor, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. These reports should be cumulative each quarter. The principal should only sign when there is not a clear sponsor in charge of the account. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. We recommend these procedures be followed without exception. Response: The principal will work with the bookkeeper to ensure that quarterly General Ledger reports are available, reviewed and signed by principal and or sponsor in a timely manner. Dates will be set on our calendars to ensure timely completion quarterly. ECD: August 30, 2018 Ena Leiba Moderate 2 Monies Collected Forms During out testing of cash receipts, we noted that MCF #340-1 was filled out by the sponsor after the funds were remitted and counted by the bookkeeper. Without the proper controls surrounding cash collections, funds could be posted incorrectly or misappropriated. We recommend that the cash receipts procedures in the Internal Funds Procedures Manual and the School Board Policies are reviewed and followed without exception. Response: The bookkeeper and principal will review with the sponsor the cash receipts procedures in the Internal Funds Procedures Manual and the School Board Policies. We will work to ensure these procedures are followed. ECD: August 30, 2018 Ena Leiba 86

89 SCHOOL: SEA PARK ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/13/2018 Moderate 3 Sales Tax During our testing of cash receipts, we noted sales tax was not remitted to the Department of Revenue for money collected for sales related to concessions and t-shirts/baked goods. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(1) of the Internal Funds Procedures Manual, Concession Stand Sales If the concession stand is run by an internal organization, i.e. monies disbursed and deposited through the school s internal accounts, sales tax may be paid directly to a Florida vendor based upon the purchase price / invoice amount or directly to the Department of Revenue based upon the sales price." And 11C(5) Tangible Personal Property The sale of tangible personal property, purchased, rebuilt or reconditioned for resale is taxable on the sales amount. We recommend this procedure be followed without exception. Response: The principal will work with the bookkeeper to ensure that the procedures for sales tax are followed in accordance with Section 11C(1) of the Internal Funds Procedures Manual, Concession Stand Sales. Procedures will also be shares with school staff. ECD: August 30, 2018 Ena Leiba 87

90 SCHOOL: SHERWOOD ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 0 7/18/2018 No comments for this School Response: N/A ECD: N/A Karen Ivery 88

91 SCHOOL: SPESSARD L HOLLAND ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/12/2018 High 1 General Ledger Review Recurring During our review, we noted that the Q1 General Ledger did not get included in the report signed by sponsors. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: In good faith, Holland s bookkeeper shared the occurrence with the Q1 General Ledger at the onset of the audit. This was included in comments, and noted as recurring. At the beginning of , there was no bookkeeper at Holland for two months, and an employee from BPS Accounting covered weekly bookkeeping requirements. The Q1 report was not run or submitted for review, which resulted in a comment on last year s audit; this subsequently, caused this year s audit comment to be rated as recurring. This should not be considered recurring on the school s part. Diligence will be exercised in reviewing quarterly ledgers by all required parties moving forward. ECD: July 12, 2018 Samantha Alison 89

92 SCHOOL: SPESSARD L HOLLAND ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/12/2018 High 2 Authorization of Expenditures During our test of disbursements, we noted Check #8146 was not supported by a purchase order to document principal approval. Although these disbursements were direct pay items, the expenditures were for food purchases. Food purchases do not fall under the ten (10) instances where purchase orders are not required per the Internal Accounts Procedures Manual Chapter 6A. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources. We recommend that all disbursements have purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approved by the principal before the expenditures are made. Response: This was an error on the school s part. All disbursements will have purchase orders prepared and signed in advance of expenditures according to required procedures in the future. ECD: July 12, 2018 Samantha Alison Moderate 3 Fundraising Activity During our testing we noted that the Sponsor and Principal signed the Fundraiser Reconciliation Form approximately 65 days of the close of the fundraiser. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. The Internal Funds Procedures Manual states that the Fundraiser Reconciliation Form must be filed within 60 days of the close of each fundraiser. We recommend these procedures be followed without exception. Response: It was not clear that the 60 days included weekends. It was completed in 65 days, which included business days only. The 60-day timeline, including weekends, will be followed with diligence moving forward. ECD: July 12, 2018 Samantha Alison 90

93 SCHOOL: STEVENSON SCHOOL OF THE ARTS DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 No comments for this school Response: N/A ECD: N/A Michael Corneau 91

94 SCHOOL: SUNRISE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/17/2018 No comments for this school Response: N/A ECD: N/A Barry Pichard 92

95 SCHOOL: SUNTREE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/18/2018 Moderate 1 Sales Tax During our testing of cash receipts, we noted that sales tax was not included on the purchase of items for resale nor remitted to the Department of Revenue. The school was unable to provide documentation showing proof that sales tax was paid upon purchase. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. We recommend the bookkeeper review and follow the sales tax policy in the Internal Funds Procedures Manual and ensure that when sales tax is not paid upon purchase, the school remits the proper sales taxes to the Florida Department of Revenue when applicable. Response: Policy will be reviewed with bookkeeper. Would like it noted that the shirts that were sold had been purchased approximately 10 years prior and with bookkeeper turnover last year and the previous bookkeeper there is no way to determine how shirts were purchased and if sales tax was already paid on the shirts when originally purchased. ECD: 8/1/2018 Shari Tressler 93

96 SCHOOL: SURFSIDE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/12/2018 Moderate 1 Official Receipts During our testing of cash receipts, we noted an official receipt was not issued for monies received greater than $10 on MCF # Instead of issuing a receipt, collections were recorded on an Excel spreadsheet. Without the proper controls surrounding cash collections, funds could be misappropriated. In accordance with the Internal Funds Manual, Chapter 5A.3, A cash receipt will be issued for all monies received of $10 or more, except as noted below: Fieldtrips Fundraisers & Yearbooks Funds Received by Mail School Age Child Care Program Item Sold We recommend this procedure be followed without exception. Response: After reviewing the outcome of Surfside s 2018 internal audit it appears that our school documented receipts of field trip funds on an excel spreadsheet in replace of issuing receipts. Going forward we will follow the internal account procedures of issuing official receipts to anyone that submits payments of $10 or greater. ECD: Immediately Lori C. Masterson 94

97 SCHOOL: TROPICAL ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 High 1 General Ledger Review During our review, we noted that the quarterly general ledger reports, we noted the following: Quarter 1 report was printed on 2/14/2018, five months after the close of the quarter. Quarter 3 report was not cumulative when prepared and signed by sponsors/principal. The Internal Funds Procedures Manual requires that each quarterly report be completed and reviewed timely by appropriate sponsors/principal. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: I will work with my bookkeeper to ensure that the quarterly general ledger reports are reviewed and signed within the appropriate timeline. ECD: Immediately Kristin Sorokin 95

98 SCHOOL: TROPICAL ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/2018 High 2 Frequency of Disbursements During our test of disbursements, we noted that Check #6394 was remitted to the vendor 2 years after the original invoice date. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. We recommend this policy be followed without exception. Response: I will oversee my Bookkeeper s process with reviewing the Internal Funds Procedures. ECD: Immediately Kristin Sorokin 96

99 SCHOOL: TURNER ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/28/2018 High 1 General Ledger Review During our review, we noted that a cumulative total of 4 accounts were not reviewed as part of the quarterly general ledger review. Q2-2 accounts Q3 2 accounts Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Will review all general ledger accounts with the Teachers, Sponsors and Principal on a regular basis. Will have a 2 nd reviewer to make sure all accounts are signed for. Principal will schedule quarterly meetings with my bookkeeper to go over general ledgers. Teachers responsible for their clubs will review and sign off on their ledger quarterly. ECD: Immediately Ashley Toll 97

100 SCHOOL: TURNER ELEMENTARY SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/28/2018 Moderate 2 Monies Collected Forms During our testing of cash receipts, we noted cash or check was not listed next to each amount collected on MCF # Without a listing of cash or check for each amount collected, it is difficult to verify if the correct amount of cash is being deposited. We recommend the person collecting the funds write cash or check next to all collections on the Monies Collected Form, as required by Chapter 5B of the Internal Funds Procedures Manual. Response: Will be more cautious with marking on how money was collected. Check stub was attached but need to notate the check number. Principal will review this policy with my bookkeeper. I will also provide training to the faculty and staff during preplanning on how to fill out monies collected forms. The bookkeeper will make sure that they are completed correctly before taking money from faculty and staff. ECD: Immediately Ashley Toll 98

101 SCHOOL: UNIVERSITY PARK ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/17/2018 High 1 General Ledger Review Recurring During our review, we noted that the Q3 General Ledger review had not been completed for account 49901, Safety Patrols. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Bookkeeper will review the ledgers after Principal s review and return to principal if any signatures were missed. ECD: July 19, 2018 Ana Diaz High 2 Authorization of Expenditures During testing of disbursements, we noted Check # 5530 only had one signature. Without proper controls over cash disbursements, there is an increased chance of misappropriation. In accordance with Chapter 4(A)2(a) All accounts shall have a minimum of two signatures required for all transactions. We recommend this procedure be followed without exception. Response: Bookkeeper will add flags to all check line signatures for principal. Bookkeeper will double check all checks before submitting. ECD: July 19, 2018 Ana Diaz 99

102 SCHOOL: WEST MELBOURNE ELEMENTARY SCHOOL OF SCIENCE DATE OF ON-SITE VISIT AT THE SCHOOL: 07/16/2018 No comments for this school Response: N/A ECD: N/A Dr. Neleffra Marshall 100

103 SCHOOL: WESTSIDE ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/16/2018 Low 1 General Ledger Review During our review, we noted one account on the Q2 General Ledger report that had not been reviewed and signed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: The principal will have the secretary, Kelly Harris, check the signatures after she reviews the general ledger accounts. ECD: 7/31/2018 Darlene Rogers 101

104 SCHOOL: RALPH WILLIAMS ELEMENTARY SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/19/2018 Moderate 1 Deficit Balances During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018. Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: Going forward the District procedures will be followed to ensure that all internal accounts are checked for negative balances and cleared appropriately at 6/30. ECD: Completed Wesley Herold 102

105 SECONDARY SCHOOLS DIVIDER PAGE TO BE REPLACED WITH TAB

106 SCHOOL: ANDREW JACKSON MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/10/2018 High 1 Frequency of Disbursements During our test of disbursements, we noted a reimbursement request for Check #8767 was paid more than 45 days from the request date. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: After speaking with our Bookkeeper she was not aware travel forms to be treated like invoices but from here forward she will absolutely submit payment within 30 days. ECD: Immediately Tina Susin 103

107 SCHOOL: ASTRONAUT HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/11/2018 No Comments for this School Response: N/A ECD: N/A Krista Miller 104

108 SCHOOL: BAYSIDE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/12/2018 High 1 General Ledger Review During our review, we noted that a cumulative total of 9 accounts were not reviewed as part of the quarterly general ledger review. Q1-1 accounts Q2-3 accounts Q3-2 accounts Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: The accounts missed were Petty Cash, Change fund & NSF accounts that were on the same or run as the checking account breakdown. These were reviewed, but signed at the end of the page instead of individually. In the future the Principal will review every account and then meet with the bookkeeper for any questions or clarification. ECD: 7/25/18 Lena Wiebelt High 2 Frequency of Disbursements During our test of disbursements, we noted Invoice # was paid more than 100 days after the item was received. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: Training is being conducted by the Principal to all teachers regrading procedures for turning in invoices and communicating with the bookkeeper. It will be the bookkeeper s responsibility to communicate to the coaches and sponsors the 45 day timeframe to receive and process on the purchase order. The Principal will meet with the bookkeeper monthly to review this policy. ECD: 7/25/18 Lena Wiebelt 105

109 SCHOOL: BAYSIDE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/12/2018 High 3 Frequency of Remittance During our test of cash receipts, we noted the following Monies Collected Forms in which money was not remitted by the teacher/sponsor by the business day following initial collection: MCF # with funds collected on 11/10/2017 but not remitted until 11/14/2018 (2 business days, funds held over the weekend). Per discussion with bookkeeper, funds were collected by the sponsor over the weekend as well. MCF # receipts were dated 2/28/18 (Wednesday). The date was crossed out and 3/2/18 was written on the yellow/ carbon receipt copy. The Monies Collected Form is dated 3/2/18 (Friday). This indicates the collections were held more than one business day. The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the Monies Collected Form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: There will be more training related to the importance of depositing money in a timely manner. The Principal will review these procedures will ALL teachers not just club sponsors and coaches. The Principal will meet with the bookkeeper at least once a month and will review procedures to ensure we are not making exceptions for any teacher. ECD: 7/25/18 Lena Wiebelt 106

110 SCHOOL: BAYSIDE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/12/2018 High 4 Fundraising Activity During our fundraiser testing, we identified the Fundraiser Reconciliation Form was signed by the Sponsor and Principal more than 60 days after the event: Band Food & Coffee Reconciliation Form was completed 86 days after the event. Football Lift-a-thon Reconciliation Form was completed 100 days after the event Cheerleading Car Wash Reconciliation Form was completed 149 days after the event. Additionally, the Band Food and Coffee documentation did not support the sales collected for the fundraiser. The event dates on the Reconciliation Form did not agree to the Fundraiser Request Form. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. We recommend the following: the Fundraiser Reconciliation Form be completed accurately by the teacher/sponsor coordinating the fundraiser and agree to the general ledger and related invoice payment made. All supporting documentation should be attached to the form, including invoices, purchase orders, receipts, etc. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger and related supporting documentation. The Internal Funds Procedures Manual states that the Fundraiser Reconciliation Form must be filed within 60 days of the close of each fundraiser. We recommend these procedures be followed without exception. Response: This year the bookkeeper will keep a spreadsheet of all active fundraisers with the beginning and end dates specified. The bookkeeper will contact teacher within a week of the end of the fundraiser if the reconciliation form was not complete. And that contact will be documented on the spreadsheet. The Principal will meet with the bookkeeper monthly to review the spreadsheet and reconciliation forms. ECD: 7/25/18 Lena Wiebelt 107

111 SCHOOL: BAYSIDE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/12/2018 Moderate 5 Transfers and Adjustments During our testing of adjustments, we noted adjustment number did not contain the principal s approval. Without the proper controls surrounding adjustments and transfers funds could be posted incorrectly or misappropriated We recommend that the bookkeeper review the transfer procedures in the Internal Funds Procedure Manual. These procedures should be followed without exception. Response: The bookkeeper will review the transfer procedures and will follow them without exception. The bookkeeper will double check all paperwork she submits to the Principal for Principal signature prior to filing. The Principal will meet monthly with bookkeeper and will review this policy. ECD: 7/25/18 Lena C. Wiebelt 108

112 SCHOOL: BAYSIDE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/12/2018 Moderate 6 Official Receipts During our testing of cash receipts, we noted an official receipt was not issued for monies received greater than $10 on MCF # Without the proper controls surrounding cash collections, funds could be misappropriated. Chapter 5A of the Internal Accounts Procedures Manual requires a receipt be issued for all monies received of $10.00 or more (except for fieldtrips, fundraisers/ yearbooks, funds received by mail, school age child care program, and items sold). We recommend the official receipts procedures in the Internal Accounts Procedures Manual be followed without exception. Response: This finding dealt with a program for special needs students aged This program, BLAST (Brevard Learners Achieving Successful Transition) is for students who have graduated from high school and are now learning how to transition successfully into the world after school. As part of this transition the students run a school based enterprise which actually funds the program itself. When the program was started the district gave us permission to not write receipts for purchases greater than $10. After this write up we checked with the district again and were told we did not have to write receipts for these purchases. However we are working with the district to create procedures for documenting inventory of all supplies and items to be sold. ECD: 7/25/18 Lena Wiebelt 109

113 SCHOOL: CENTRAL MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/13/2018 High 1 Frequency of Remittance During our test of cash receipts, we noted the following Monies Collected Form in which money was not remitted by the teacher/sponsor by the business day following initial collection: MCF #810-1 with funds collected on 3/30/2018 but not remitted until 4/2/2018 (held over a weekend). In addition, MCF # and the corresponding bank deposit are dated 8/04/2017, however we are unable to determine when money was collected because the collections support is not dated. The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the Monies Collected Form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: MCF #810-1: School hours are until 4:15. Teacher/Sponsor brought money taken for the day as the Bookkeeper was leaving to go to the 5:00. Sponsor and Bookkeeper quickly reviewed the deposit and put the next business day on the monies collected form and put it in the safe for the next business day deposit. Bookkeeper hours are 8:30 to 5:00. Bookkeeper has multiple times gone to the bank after her scheduled hours to try and prevent these incidents. MCF#743-05: The collections support is 5 pages of printed spreadsheets from registration day. It was the sale of PE Uniforms with individual names, cash and & check columns. The collection and the MCF were both done on August 4th (registration day). Deposit was done on August 4th. ECD: To follow procedures going forward, the teacher/sponsor will need to bring any money collected during the day to the bookkeeper no later than 4:30. Bookkeeper cannot process the bank deposit before 5:00. The bookkeeper will need to continue working later hours to accommodate the teacher/sponsor schedule. Procedures are changing for the next year with armored car pick up, the bookkeeper will no longer need to get to the bank before it 6:00 pm. Todd Scheuerer 110

114 SCHOOL: CENTRAL MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/13/2018 High 2 Documentation of Disbursements During our testing of cash disbursements, we noted Check #15250 to a contractor for $ did not agree to the contract terms. The contract states the hourly rate shall be $50.00; however, the payment was based on an hourly rate of over $ Disbursements without adequate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend all disbursements have proper documentation to support the expenditure made. No disbursements shall be allowed based on account summary statements only. The bookkeeper should review detailed invoices for accuracy prior to payment to avoid overpayment. Response: Flute clinician, Consultant agreement was written that consultant was to be paid 36 $50 hourly, NTE $1,800. The consultant agreement DID NOT exceed $1,800 or 36 hours for the school year. Consultant was paid for 23 hours in the amount of $1,725 which concludes that the consultant was paid $75 an hour. ECD: Future procedure to follow is that the teacher/sponsor and the bookkeeper will need to review each invoice turned in by the consultant before payment to ensure the consultant is adhering to agreement. Todd Scheuerer 111

115 SCHOOL: CENTRAL MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/13/2018 High 3 Ticket Sales During our test of ticket sales, we noted one Report of Tickets Sold Form that listed a ticket sold as half complimentary and half regular. Tickets should be accounted for as a whole unit and not recorded as a fraction or partially sold. For one ticket, a school-issued coupon was accepted as a portion of the ticket sale. The school-issued coupons are equivalent to cash, but are not tracked by the school. Incomplete or inaccurate recording of tickets sold could result in missing tickets and/or misappropriation of funds. Incomplete/inaccurate recording of tickets sold could result in missing tickets and/or misappropriation of funds. We recommend that the Ticket Control Sheet be processed for all ticket sales in accordance with the Internal Funds Manual, Chapter 19. We recommend that this policy be followed without exception. Response: We have a program in effect called PBIS (positive behavior) Students are given Reward tickets. During games or various school activities the students are permitted to use the tickets to purchase entry. Basketball games are issued district supplied pre-printed tickets for entry into the games. To purchase the BB ticket entry, students were permitted to use 2 of the reward tickets. When a student has only one reward ticket they could receive entry with one reward ticket and $1.00. The reward center tickets are reviewed by the bookkeeper when reconciling BB ticket sales and then the reward ticket is put on a spreadsheet that it was redeemed and then put into a bucket for future drawings every 9 weeks. ECD: The PBIS reward procedures was to offer rewards with behavior tickets. All behavior tickets were tracked by the bookkeeper on a spreadsheet. The tickets are listed on the spreadsheet when given out to teachers (they are individually numbered, and signed by the teacher when received). The tickets were again listed on the spreadsheet when redeemed under the teacher s name on the same spreadsheet under a different tab. All the PBIS tickets were accounted for from the handing out to the teachers to the redemption by the student on a spreadsheet. Todd Scheuerer 112

116 SCHOOL: COCOA BEACH JR. / SR. HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 Moderate 1 Sales Tax During our testing of cash receipts, we noted sales tax was not collected and remitted to the Florida Department of Revenue for the sale of PE uniforms, MCF # It was also noted no sales tax was paid to the vendor for the purchase of the PE uniforms, Check # Additionally, during our testing of fundraisers, we noted that sales tax was paid to the state; however, the amount paid was calculated incorrectly (based on sales profit). The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(4) of the Internal Funds Manual, The sale, lease or rental of band uniforms or instruments, athletic uniforms or equipment, and other items of clothing owned by the school are taxable on the sale or rental amount. Section 11A of the Manual states Items that are resold, as a part of school fund raising projects are classified as taxable sales regardless of profit. We recommend this procedure be followed without exception. Response: It is understood that sales tax is to be paid to the Vendor (or DOR) for items purchased for resale. Calculations will be double-checked. Bookkeeper and Principal will double check sales tax monthly. ECD: Immediately and ongoing Karyle Green High 2 Frequency of Disbursements During our test of disbursements, we noted invoices # and # were paid more than 45 days from the invoice date. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: It is understood that we should pay invoices in a timely manner. We will be more diligent in doing so. This particular invoice was never received and an prompt was received after the 45 days. This is what prompted us to pay, therefore the delay. ECD: Immediately and ongoing Karyle Green 113

117 SCHOOL: COCOA BEACH JR. / SR. HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 Moderate 3 Safe / Vault Activities During our review of safe / vault activities, we noted the blank checks were maintained in a locked cabinet in the bookkeeper s office rather than the school s safe. Petty cash and change funds were also stored in the cabinet during the business day rather than remaining in the safe. Without proper controls over cash and cash equivalents, there is an increased chance of misappropriation. In accordance with Section 4E of the Internal Funds Manual, Each school must have a safe/vault to secure cash and cash equivalents. Cash and cash equivalents include but are not limited to, petty cash, change fund, blank checks, returned (NSF) checks, and cash and checks for deposit. These procedures should be followed without exception. Response: Section 4E of the Internal Funds Manual (copy attached) indicates each school must have a safe/vault to secure cash and cash equivalents. It then defines cash and cash equivalents. With the number of interactions during the school day, these items are stored in a locked bag, in a locked cabinet, and in a locked office when the bookkeeper is not in her office. At night, these items are put in the safe/vault. ECD: Immediately Karyle Green Moderate 4 Fundraising Activity During our testing of fundraisers, we noted the following items related to one fundraiser: The calculation of school profit was incorrect on the Reconciliation form. There were discrepancies notated in the supporting documentation. Without the proper controls surrounding fundraising activity, cash collections and inventory of items to be sold could be misappropriated. The Fundraiser Reconciliation Form should be completed accurately by the teacher/sponsor coordinating the fundraiser. All supporting documentation should be attached to the form, including invoices, purchase orders, receipts, etc. The form should be forwarded to the Principal for review and final approval. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger. The general ledger should be printed and attached to the reconciliation. Response: We could not determine which fundraiser this finding was attributed. We do understand the accuracy of such reconciliation, documentation and forms and will double check and review for accuracy. ECD: Immediately and ongoing Karyle Green 114

118 SCHOOL: COCOA BEACH JR. / SR. HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/02/2018 Moderate 5 Transfers and Adjustments During our testing of transfers, we noted transfer number # was made from a general account without record of approval from School Accounting. Without the proper controls surrounding adjustments and transfers, funds could be posted incorrectly or misappropriated. We recommend that the bookkeeper review general account transfer requests to ensure approval is obtained from School Accounting. The Internal Funds Manual states that, General accounts should benefit all students. Usually, transfers should not be made from General accounts to other fund type accounts. There may be extenuating circumstances where a transfer is required. In these instances, School Accounting should be contacted for approval. These procedures should be followed without exception. Response: It is understood that all transfers from general account must have approval from School Accounting. We will diligently work to receive proper approval before transferring from general account. ECD: Immediately and ongoing Karyle Green 115

119 SCHOOL: COCOA HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/10/2018 High 1 Authorization of Expenditures During our testing of disbursements, we noted one disbursement was recorded to a GL account not included in the approved PO. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. As required by the Internal Funds Procedures Manual, we recommend that all disbursements have purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approval by the principal before the expenditures are made. Response: Principal and Bookkeeper will be sure check all fundraiser they are reconciled appropriately. ECD: Immediately Rachad Wilson Moderate 2 Fundraising Activity During our testing of one fundraiser (CHS Cheerleaders JV, 9/22/17) we noted that there was no signature or dates by the Principal on the Fundraiser Reconciliation Form to evidence that the reconciliation was reviewed and completed within 60 days of the close of the fundraiser. Additionally, when testing a second fundraiser (Volleyball, 2/3/18), we noted the reconciliation was not completed and approved within 60 days of the close of the fundraiser. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold, if applicable could be misappropriated. We recommend all supporting documentation be attached to the form, including invoices, purchase orders, receipts, etc. The teacher/sponsor must sign and date the form. The form should be forwarded to the Principal for review and final approval. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger. The general ledger should be printed and attached to the reconciliation. Response: Principal and Bookkeeper will be sure check all fundraiser they are reconciled appropriately. ECD: Immediately Rachad Wilson 116

120 SCHOOL: COCOA HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/10/2018 Low 3 District Level Accounts During our review of the Principal s report dated 6/30/2018, we noted account GSF Driver s Education Fees had an account balance of $ Additionally, we noted account , GSF Lost & Damaged Textbooks had a balance of $ The Balance in accounts through must be remitted to the district by June 15 th for collections received prior to June 15 th. Without closing out these accounts as required, there are reconciling items at the District level that require follow up and tracking into the following fiscal year. We recommend the bookkeeper review the year-end procedures in the Internal Funds Procedures Manual. Response: Bookkeeper will make sure county funds are submitted before the scheduled time each year. ECD: Immediately Rachad Wilson 117

121 SCHOOL: DELAURA MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/19/2018 High 1 Frequency of Remittance Recurring During our test of cash receipts, we noted one Monies Collected Form in which money was collected on 8/14/17 but not remitted to the Bookkeeper until 8/16/2017 (2 business days). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the monies collected form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: Teachers will be trained during Pre-Planning with regard to money collection and remittance. Bookkeeper will follow-up with faculty to insure adherence to the manual procedures. ECD: 8/2/18 Jeremy LeBrun High 2 Frequency of Deposits Recurring During our test of cash receipts, we noted MCF # for an amount greater than $200 in which money was submitted to the bookkeeper on 12/18/2017 but not deposited into the bank until 12/22/2017 (4 business days). The Internal Funds Procedures Manual Chapter 5D states that deposits must be made within 5 business days, or within 3 business days if over $200. Without proper controls over cash collections, there is an increased chance of misappropriation. We recommend that the bookkeeper review the Internal Funds Procedures Manual Chapter 5D. We recommend this policy be followed without exception. Response: Bookkeeper will be monitored to insure that deposits are made on time and within the guidelines of the Internal Manual Procedures. ECD: 8/1/18 Jeremy LeBrun 118

122 SCHOOL: DELAURA MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/19/2018 High 3 Documentation of Disbursements Recurring During our testing of disbursements, we noted Check #12751 to a contractor for $ did not agree to the contract terms. The contract is signed by the Assistant Superintendent, meaning contractor rates are limited to $50.00 per hour. The payment was based on an hourly rate of $ Disbursements without adequate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend all disbursements have proper documentation to support the expenditure made. No disbursements shall be allowed based on account summary statements only. The bookkeeper should review detailed invoices for accuracy prior to payment to avoid overpayment. Response: This will be reviewed with the bookkeeper and a closer assessment of these transactions will be made to insure all contract terms are strictly adhered to as well as payment limits. ECD: 8/2/18 Jeremy LeBrun Moderate 4 Monies Collected Form Recurring During our testing of cash receipts, we noted the total amount listed on MCF # did not agree to the amount shown on the deposit slip. The amount deposited was more than the amount shown on the slip by $5.00. We also noted that MCF # was not properly completed as the Bookkeeper did not document the Computer Receipt Number as required. However, we were able to verify the sequential order of the forms. Inaccuracy of monies collected could result in misappropriation of funds. We recommend the bookkeeper count and verify that all monies (cash and checks) recorded on the Monies Collected Forms reconcile and are accurate for deposit. Further, in accordance with Chapter 5B of the Internal Funds Manual, the Monies Collected Form shall show the Computer Receipt Number, Actual Date Collected, Purpose for Collection of Funds, Signature of the Teacher/Sponsor (or other District employee) responsible for collecting the money, Student name and the amount collected from each, Payment type, whether it is cash or check (including the check number), and Total for Deposit. We recommend that the rules per Internal Funds Manual be followed without exception. Response: Bookkeeper will dedicate more attention when counting money and verifying information on monies collected forms. Bookkeeper will reconcile each transaction prior to the depositing of funds. Bookkeeper will also insure that all necessary notations are clearly and completely made on each deposit. ECD: 8/2/18 Jeremy LeBrun 119

123 SCHOOL: DELAURA MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/19/2018 Low 5 General Ledger Review Recurring During our review, we noted that 1 account was not reviewed as part of the quarterly general ledger review. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Bookkeeper realizes the importance of this review as a safeguard for all to insure monies are correct in all accounts. Bookkeeper will verify and confirm that all accounts have been reviewed and properly signed for before completion. ECD: 8/12/18 Jeremy LeBrun High 6 Authorization of Expenditures During our testing of disbursements, we noted check had a purchase order prepared after the invoice date/purchase date. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. As required by the Internal Funds Procedures Manual, we recommend that all disbursements have purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approval by the principal before the expenditures are made. Response: Bookkeeper will be monitored to insure all PO s are in place prior to any expenditure being made. ECD: 8/2/18 Jeremy LeBrun 120

124 SCHOOL: DELAURA MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/19/2018 High 7 Frequency of Disbursements During our test of disbursements, we noted four invoices that were paid 55, 75, 84, and 98 days past when the goods or services were received. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. The Internal Fund Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: Bookkeeper will be monitored to insure all invoices are paid within days of receipt. ECD: 8/2/2018 Jeremy LeBrun Moderate 8 Voided Checks During our test of voided checks, we noted the following: Signature block had not been removed from checks #12731 and #12712 The Internal Funds Procedures Manual states that voided checks must be marked VOID and the signature block removed. All copies including the original must be retained in the School Receipt Book for audit purposes. Chapter 7 of the Internal Funds Procedures Manual states that any voided receipts must have Void written across the receipt and all copies including the original must be retained in the School Receipt Book for audit purposes. We recommend this policy be followed without exception. Response: Bookkeeper will be retrained as to the importance of removing the signature block on voided checks and these will be reviewed periodically to insure the procedure is strictly followed. ECD: 8/2/18 Jeremy LeBrun 121

125 SCHOOL: DELAURA MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/19/2018 Moderate 9 Transfers and Adjustments During our review of adjustments and transfers, we noted a transfer was made from the Coupon Trust (699025) account to the General - Misc account (707010). If there are not enough funds available in the General - Misc account to cover expenses, a transfer should be requested for approval from School Accounting of funds from a different account. In accordance with Section 9 (3) of the Internal Funds Procedures Manual, "Transfers are not allowed into and out of Trust accounts. These funds are restricted in nature and are intended for a specific purpose. If there are extenuating circumstances where a transfer is required, School Accounting should be contacted for approval. Otherwise, transfers should not occur from Trust accounts. We recommend this procedure is followed without exception. Response: Bookkeeper will strictly adhere to the procedures and necessary approvals when needing to transfer monies between Internal Accounts. ECD: 8/2/18 Jeremy LeBrun Moderate 10 Sales Tax During our testing of fundraisers, we noted items purchased for resale did not include sales tax. Also, during our testing of cash receipts, we noted money collected for track uniform sales in which no sales tax was paid. Furthermore, the sales tax was not paid to the Florida Department of Revenue. The School Board is subject to sales tax when items purchased are for resale; therefore, sales tax should have been paid. In accordance with Section 11C(9) of the Internal Funds Procedures Manual, "Fundraising Activities The sale of candles, candies, confections and other novelties sold for fund raising purposes by schoolsponsored organizations are taxable. Sales tax may be paid directly to a Florida vendor upon the purchase price / invoice amount or directly to the Department or Revenue based upon the sales price." We recommend this procedure be followed without exception. Response: Bookkeeper will calculate and remit all taxes for any and all items that will be resold where tax has not been paid on the original invoice. This procedure will be followed without exception. ECD: 8/2/18 Jeremy LeBrun 122

126 SCHOOL: EAU GALLIE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 High 1 Documentation of Disbursements Recurring During our test of disbursements, we noted the following: Check #28936 was written for $5,766.69, although the supporting invoices summed $5, (overpayment of $493.50). Check #29086 was written for $ although the reimbursement amount was $ The recipient repaid $19.39 (MCF #812-02); however, the repayment was mathematically incorrect by $0.10. Check #29049 supporting documents included a quote for the sale amount, but did not include the final invoice. Disbursements without supporting documentation could result in misappropriation of funds. We recommend all disbursements have proper documentation to support the expenditure made. Response: The bookkeeper will wait for the final invoice from all vendors before submitting final payment for invoices to assure payment matches the final invoice. If there is a discrepancy between the PO and the final invoice, the bookkeeper will complete the required documentation to note the change. Any time there is a change in the amount of a final payment, it will be noted from the bookkeeper to me and I will verify the check amount to the final invoice. ECD: Beginning immediately, July, 2018 Jeremy Salmon 123

127 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 2 Sales Tax Recurring During our testing of cash receipts, we noted Sales tax was not remitted for chorus uniform rentals on collections from MCF # Sales tax was not remitted for orchestra instrument rentals on collections from MCF # During our testing of fundraisers, we noted sales tax was not remitted to the vendor or for the sale of goods for two (2) fundraisers: Fundraiser Aviation T-shirt sale Fundraiser Beta Club Carnation Sale The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11B(4) of the Internal Funds Procedures Manual, Uniforms and Equipment Sales or Rentals The sale, lease or rental of band uniforms or instruments, athletic uniforms or equipment, and other items of clothing owned by the school are taxable on the sale or rental amount. In accordance with Section 11C(9) of the Internal Funds Procedures Manual, "Fundraising Activities The sale of candles, candies, confections and other novelties sold for fund raising purposes by school-sponsored organizations are taxable. Sales tax may be paid directly to a Florida vendor upon the purchase price / invoice amount or directly to the Department or Revenue based upon the sales price." We recommend this procedure is followed without exception. Response: If items from fundraiser are sold, the bookkeeper will assure sales tax is properly accounted for and paid to the vendor for all fundraiser when appropriate. I instructed the bookkeeper to request the accounts. And I instructed the bookkeeper to address this issue during preplanning with the faculty. She will provide me with the appropriate documentation showing she paid the sales tax to vendors when appropriate. ECD: July 20 th Jeremy Salmon 124

128 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 3 General Ledger Review Recurring During our review, we noted that the quarterly general ledger reports, we noted the following: Quarter 1, account Safe Spaces was not reviewed Quarter 3, account Commodores was not reviewed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. These reports should be cumulative each quarter. We recommend these procedures be followed without exception. Response: The bookkeeper will have a second support staff review each quarterly report to assure ALL required signatures are present in the document. I will cover the requirement for each sponsor and teacher with an internal account to review and sign the quarterly report. Failure to do so by a sponsor may result in further action from me in regard to documenting the failure of the sponsor to sign the form through a summary of conference and if needed a letter of reprimand. ECD: Immediately Jeremy Salmon 125

129 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 4 Transfers & Adjustments Recurring During our testing of transfers and adjustments, we noted Transfer # was processed from the general account without supporting approval from the District. Without the proper controls surrounding adjustments and transfers, funds could be posted incorrectly or misappropriated. We recommend that the bookkeeper review the transfer procedures in the Internal Funds Procedure Manual. These procedures should be followed without exception. Response: In the future the bookkeeper will obtain approval from school accounting for an internal transfer and attach the approval and supporting documentation to the transfer. I will review the approval and supporting documentation from school accounting department prior to signing the internal transfer documentation. ECD: Immediately Jeremy Salmon 126

130 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 High 5 Fundraising Activity During our review of the Aviation T-shirt fundraiser, we noted the following: The amount paid for the Aviation T-shirt sale did not reconcile to the vendor invoice The unsold quantity on hand did not agree to the sales reconciliation The collections per the reconciliation did not agree to the general ledger detail. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. The Fundraiser Reconciliation Form must be completed accurately by the teacher/sponsor coordinating the fundraiser and agree to the general ledger and related invoice payment made. All supporting documentation should be attached to the form, including invoices, purchase orders, receipts, etc. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger and related supporting documentation. Response: After communicating with the sponsor for this event, he produced all of the remaining T-Shirts and the number matched the reconciliation form, and he will revise the form. During preplanning this year, the bookkeeper will review the process and importance of completing the fundraising forms (reconciliation sheet) properly. I have directed the bookkeeper to address the faculty during preplanning to address fundraising paperwork and the importance of it being submitted without error. I will reinforce the importance of this during my presentations as well. ECD: August 2, 2018 Jeremy Salmon 127

131 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 High 6 Restricted Expenditures During our review of cash receipts and disbursements, we noted the following: Collections for chorus uniforms MCF # and instrument rentals MCF # were posted to the general chorus and orchestra accounts, respectively, and not to a separate rental accounts. A disbursement for instrument repair check was made from the general orchestra account rather than a separate rental account. Without proper controls over cash receipts and disbursements, the related collections or disbursements could result in misappropriation of funds. As outlined in Chapter 12E(1) of the Internal Funds Procedures Manual, Secondary School Music Program Revenues generated from the rental of band or orchestra instruments will be used for the repair, replacement or purchase of instruments and may not be used for the purchase of instructional materials. Uniform rental fees will be used for the repair, cleaning or replacement or purchase of uniforms and may not be used for the purchase of instructional materials. We recommend these procedures be followed without exception. Response: A request has been made to accounting to establish an internal account for both chorus and orchestra for instrument/uniform rentals to assure the funds are placed in the appropriate account I instructed the bookkeeper to request the accounts ECD: Requested on July 20 th, for school year 2018/19 and we have already received approval to establish these accounts. Jeremy Salmon 128

132 SCHOOL: EAU GALLIE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/23/2018 Moderate 7 Monies Collected Forms During our testing of cash receipts, the original (white) copy of MCF # was not available for review; therefore, we were not able to verify the Computer Receipt Number was properly recorded on the Monies Collected Form. However, we were able to verify the remaining Monies Collected Form attributes by reviewing the carbon (yellow) copy of the form. Improper and inadequate completion of monies collected could result in misappropriation of funds. In accordance with Chapter 5B of the Internal Funds Manual, the Monies Collected Form shall show the Computer Receipt Number, Actual Date Collected, Purpose for Collection of Funds, Signature of the Teacher/Sponsor (or other District employee) responsible for collecting the money, Student name and the amount collected from each, Payment type, whether it is cash or check (including the check number), and Total for Deposit. We recommend that the rules per Internal Funds Manual be followed without exception. Response: The bookkeeper has established a process to assure both the original MCF and a copy of the MCF are on file, they are kept in her filing cabinet and filed by month. She files MCFs on the days that the money is posted at the bank and in AS400 (approximately 2x a week). I instructed the bookkeeper to create a process to assure both the original and a copy of the MCFs are organized and filed appropriately on a weekly base. ECD: July, 2018 Jeremy Salmon 129

133 SCHOOL: EDGEWOOD JR. / SR. HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 Moderate 1 Documentation of Disbursements Recurring During our testing of cash disbursements, we noted Check #17272 included reimbursement for the purchase of gift cards. The cards were used for Spirit Week prizes; however, we were unable to view evidence that the cards were distributed to the intended recipients. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. In accordance with Chapter 6, Section D of the Internal Accounts Procedures Manual, Gift Cards should only be issued for the purposes of awards, scholarships, appreciation and contributions. Gift Cards should never be issued for payments of products, services or employee labor. We recommend this procedure be followed without exception. Additionally, as a matter of best practice, we recommend maintaining a list / log of recipients of gift cards to assist with the control and distribution of these items. Response: Effective immediately, Edgewood will maintain a log of recipients of gift cards to assist with the control and distribution of these items. ECD: Tuesday, July 5, 2018, and Preplanning (August 2018) Jacqueline Ingratta 130

134 SCHOOL: EDGEWOOD JR. / SR. HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 High 2 Frequency of Remittance During our testing of cash receipts, we noted that for one MCF #696-30, funds were collected but not remitted to the Bookkeeper timely (3 business days and held over 1 weekend). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day and never over a weekend. Without proper controls over cash collections, there is an increased chance of misappropriation. In accordance with Section 5B(1) of the Internal Accounts Procedures Manual, "All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. Monies collected should not be held over the weekend. If extenuating circumstances exist and this practice is not feasible, the monies must be turned into the Bookkeeper no later than the next business day." We recommend this procedure be followed without exception. Response: I will review the policy with the faculty, staff and all community and club sponsors required the importance of remitting money to the bookkeeper daily. This incident involved my yearbook sponsor. I will meet with him individually to discuss the audit finding and remedy for the future. Additionally, all members of my staff (including community coaches) who do not follow the policy will not remit money to my bookkeeper without meeting with me first. ECD: Preplanning (August 2018) Jacqueline Ingratta 131

135 SCHOOL: HERBERT C. HOOVER MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/16/2018 Low 1 General Ledger Review Recurring During our review, we noted General Ledger account #502010, Business, had not been review for 4th quarter. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Action plan includes taking the appropriate steps to ensure all accounts are signed off. Once signed by sponsor/principal the bookkeeper will go over the ledgers to verify all are signed and dated. Bookkeeper with note which QT is being signed off and initial/sign the first page of each quarterly ledger, indicating that each page has been examined and is accurate and signed. ECD: This is to take effect immediately. Bradley Merrill Moderate 2 Sales Tax During our testing of fundraisers, we noted that a check for items sold did not include sales tax. Also, during our testing of cash receipts, we noted money collected on behalf of the students for concession items sold in which no sales tax was paid. Furthermore, the sales tax was not paid to the Florida Department of Revenue. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(1) of the Internal Funds Procedures Manual, Concession Stand Sales If the concession stand is run by an internal organization, i.e. monies disbursed and deposited through the school s internal accounts, sales tax may be paid directly to a Florida vendor based upon the purchase price / invoice amount or directly to the Department of Revenue based upon the sales price. We recommend this procedure be followed without exception. Response: Action plan includes making sure that during each fundraiser/concession pays sales tax for all items that will be sold to students/audience to ensure the DOR is paid properly. ECD: This is to take effect immediately. Bradley Merrill 132

136 SCHOOL: HERITAGE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/10/2018 High 1 Frequency of Remittance During our test of cash receipts, we noted the following: MCF # Funds were collected on 5/25/18 but not remitted to the Bookkeeper until 5/29/18 (held over 3 business days and 1 weekend) MCF # Funds were collected 5/10/18 but not remitted to the Bookkeeper until 5/19/18 (held over 13 days and multiple weekends) The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the monies collected form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: We will train the staff during pre-planning and remind them of the timeliness and policy expectations. ECD: August 2018 John Harris High 2 Frequency of Disbursements During our test of disbursements, we noted several invoices to vendor were paid more than 45 days after the invoice date. Per discussion, the invoices were received more than 45 days after the invoice date and payment was remitted timely. However, the receipt date was not noted on the invoices. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: We will train the staff during pre-planning and remind them of the timeliness and policy expectations. ECD: August 2018 John Harris 133

137 SCHOOL: HERITAGE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/10/2018 Low 3 General Ledger Review During the review of the quarterly General Ledger reports, we noted one account in the 3 rd quarter was not reviewed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. These reports should be cumulative each quarter. We recommend these procedures be followed without exception. Response: We will train the staff during pre-planning and remind them of the timeliness and policy expectations. ECD: August 2018 John Harris 134

138 SCHOOL: JAMES MADISON MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 High 1 Frequency of Remittance During our test of cash receipts we noted that for MCF #749-1, monies were collected on 7/24/17 but not remitted to the bookkeeper until 7/26/17. Without proper controls over cash collections, there is an increased chance of misappropriation. In accordance with Section 5B of the Internal Funds Manual, All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. Monies collected should not be held over the weekend. If extenuating circumstances exist and this practice is not feasible, the Monies must be turned into the Bookkeeper no later than the next business day. We recommend this procedure be followed without exception. Response: This policy will be reviewed with ALL staff members in the beginning of the school year. Bookkeeper will send out quarterly reminders to staff informing them of this policy. ECD: Immediately Joseph Flora High 2 Ticket Sales During our testing of ticket sales, we noted the following: The Ticket Control Sheet documented that 35 tickets were sold for the dance; however, the number of tickets sold per the Fundraiser reconciliation form was 34. The Ticket Control Sheet noted that the fundraiser had started with ticket #12, however, the Report of Tickets Sold noted that the fundraiser had started with ticket #6. Incomplete/inaccurate recording of tickets sold could result in missing tickets and/or misappropriation of funds. In accordance with Chapter 19C and 19D of the Internal Funds Procedures Manual, we recommend that the Ticket Sales Reports and Ticket Control Form be completed correctly for all ticket sales. We recommend that this procedure be followed without exception. Response: The bookkeeper will monitor the ticket control sheet more stringently to ensure accuracy. The bookkeeper will review this policy with the staff at the beginning of the school year. ECD: Immediately Joseph Flora 135

139 SCHOOL: JAMES MADISON MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 Moderate 3 Sales Tax During our testing of receipts, we noted no sales tax was collected and remitted to the Florida Department of Revenue for the sale of Cheer Bows, MCF # It was also noted no sales tax was paid to the vendor for the purchase of the cheer bows, Check #7984. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(4) of the Internal Funds Manual, The sale, lease or rental of band uniforms or instruments, athletic uniforms or equipment, and other items of clothing owned by the school are taxable on the sale or rental amount. Section 11A of the Manual states Items that are resold, as a part of school fund raising projects are classified as taxable sales regardless of profit. We recommend this procedure be followed without exception. Response: Bookkeeper will review this policy and reflect on her procedures for paying sales tax. The bookkeeper will ensure that payment of sales tax is made appropriately. ECD: Immediately Joseph Flora Moderate 4 Segregation of Duties During our testing of cash disbursements, Check #7954 only had one signature. Per the manual, dual signatures on checks are required for approval. Without proper controls over cash disbursements, there is an increased chance of misappropriation. In accordance with Section 4A(2) of the Internal Funds Manual-Authorized Check Signers, All accounts shall have a minimum of two signatures required for all transactions. Only original blue ink signatures can be used to authorize a check. Electronic signatures or signature stamps are not permitted to be used for authorization. We recommend this procedure be followed without exception. Response: Bookkeeper will review manual to thoroughly understand the check signing policy. Madison has instituted a new procedure for signing checks. The bookkeeper will review all signed checks to ensure that dual signatures are recorded. ECD: Immediately Joseph Flora 136

140 SCHOOL: THOMAS JEFFERSON MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/10/2018 No Comments for this School Response: N/A ECD: N/A Maera Trine 137

141 SCHOOL: JOHN F KENNEDY MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/05/2018 Moderate 1 Fundraising Activity Recurring During our testing, we noted that the fundraiser reconciliation form was completed for the Dartmouth T-Shirt fundraiser greater than 60 days after the fundraiser end date. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. We recommend the principal / bookkeeper ensure the sponsor in charge fully completes the district s reconciliation form for fundraising activity within the 60 day window as required by the Internal Funds Manual. Response: The bookkeeper will review the Internal Funds Manual relative to fundraising activity and will ensure sponsors fully complete the reconciliation forms. The principal will remind teachers at preplanning. ECD: Immediately Sherry Tomlinson Moderate 2 Transfers & Adjustments During our testing of transfers, we noted transfer number # was made from a general account without approval of School Accounting. Without the proper controls surrounding adjustments and transfers, funds could be posted incorrectly or misappropriated. We recommend that the bookkeeper review general account transfer requests to ensure approval is obtained from School Accounting. The Internal Funds Manual states that, General accounts should benefit all students. Usually, transfers should not be made from General accounts to other fund type accounts. There may be extenuating circumstances where a transfer is required. In these instances, School Accounting should be contacted for approval. These procedures should be followed without exception. Response: The bookkeeper will review the Internal Funds Manual relative to transfers and ensure appropriate approvals are always obtained prior to completing the transfer. ECD: Immediately Sherry Tomlinson 138

142 SCHOOL: LYNDON B JOHNSON MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/31/2018 Moderate 1 Deficit Balance During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018: Account # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: Did receive training from former bookkeeper and had made note but did not complete task in time. Is fully aware of the procedure and will follow it from this point forward. Has cleared the deficit through fundraising sales of old yearbooks during registration. ECD: Immediately Marina Saporito-Middleton Low 2 District Level Accounts During our review of the Principal s report dated 6/30/2018, we noted account GSF Lost & Damaged Books had an account balance of $8. Balance in accounts through must be remitted to the district prior to the end of the fiscal year. We recommend the bookkeeper review the year-end procedures in the Internal Funds Procedures Manual. Response: Did receive training from former bookkeeper and had made note but did not complete task in time. Is fully aware of the procedure and will follow it from this point forward. Has reviewed manual to properly remit payment to District. Process should be complete. Without closing out these accounts as required, there are reconciling items at the District level that require follow up and tracking into the following fiscal year. ECD: Immediately Marina Saporito-Middleton 139

143 SCHOOL: MCNAIR MAGNET MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/17/2018 High 1 Frequency of Remittance During our test of cash receipts we noted that for MCF #532-01, monies were collected on 7/18/2017 but not remitted to the Bookkeeper until 8/8/2017. Without proper controls over cash collections, there is an increased chance of misappropriation. In accordance to Chapter 5B of the Internal Funds Manual, All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. Monies collected should not be held over the weekend. If extenuating circumstances exist and this practice is not feasible, the monies must be turned into the Bookkeeper no later than the next business day. We recommend that the monies collected form procedures in Chapter 5B of the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: We will train faculty, staff and coaches on the monies collected process during pre-planning week. ECD: Immediately Jasmine Delaughter 140

144 SCHOOL: MCNAIR MAGNET MIDDLE SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/17/2018 Moderate 2 Sales Tax During our testing of cash receipts, we noted no sales tax was collected and remitted to the Florida Department of Revenue for the sale of Cheerleading uniforms, MCF # It was also noted no sales tax was paid to the vendor for the purchase of the Cheerleading uniforms, Check #8522. Additionally, during our testing of fundraisers, we noted that sales tax was not paid to the vendor or remitted to the Florida Department of Revenue for the resale of Valentine s day teddy bears. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid in both instances. In accordance with Section 11C(4) of the Internal Funds Manual, The sale, lease or rental of band uniforms or instruments, athletic uniforms or equipment, and other items of clothing owned by the school are taxable on the sale or rental amount. Section 11A of the Manual states Items that are resold, as a part of school fund raising projects are classified as taxable sales regardless of profit. We recommend this procedure be followed without exception. Response: I will train my bookkeeper on sales tax procedures for fundraisers ECD: Immediately Jasmine Delaughter 141

145 SCHOOL: MELBOURNE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/18 Moderate 1 Sales Tax Recurring During our testing of cash disbursements, we noted Check #25049 for staff reimbursement included sales tax. The School Board is not subject to sales tax; therefore sales tax should not be paid or reimbursed unless purchasing items for resale. We recommend the bookkeeper review and follow the sales tax policy and petty cash funds section of the Internal Funds Procedure Manual. The manual states that, Sales tax paid on invoices paid through petty cash cannot be reimbursed. Any cash purchase by an individual in the name of the school is still taxable. Response: Sales tax was paid accidentally. Bookkeeper is familiar with BPS policy regarding payment of sales tax. Will review policy to ensure compliance. ECD: August 20 James Kirk High 2 Ticket Sales During our test of Homecoming ticket sales, we noted the following: A listing of tickets told was used in lieu of a Ticket Control Sheet. However, the list was not sequential, with missing and duplicated ticket numbers. We were unable to verify the total number of tickets sold against the Ticket Sold Form. The total collections on the Tickets Sold Form did not agree to the general ledger detail. The general ledger showed $2,191 more in collections than the Tickets Sold Form. Incomplete recording of tickets sold could result in missing tickets and/or misappropriation of funds. In accordance with the Internal Funds Manual Section 19, we recommend that the Ticket Control Sheet and Ticket Sales Reports be completed for all ticket sales. We recommend that this policy be followed without exception. Response: Ticket control sheets and ticket sales reports will be used for all ticket sales on campus in accordance with BPS internal funds procedures. ECD: Training completed by September 1 James Kirk 142

146 SCHOOL: MELBOURNE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/24/18 High 3 Monies Collected Forms During our testing of cash receipts, we noted the following: MCF # collections did not agree to the supporting Homecoming ticket list; the Monies Collected Form was greater than the support by $1,432. MCF # did not list cash or check for the collections. A receipt for funds collected over $10 was not included. MCF # did not list cash or check for the collections. Inaccuracy of monies collected could result in misappropriation of funds. We recommend that the bookkeeper count and verify that all monies (cash and checks) recorded on the Monies Collected Forms agree and are accurate for deposit. In addition, we recommend the person collecting the funds write cash or check next to all collections on the Monies Collected Form, as required by Chapter 5B of the Internal Funds Procedures Manual. We recommend that this policy be followed without exception. Response: All monies collected will be recorded on the monies collected form and will be reconciled by the bookkeeper. Persons collecting funds will indicate cash or check on the form. ECD: Training completed by September 1. James Kirk Moderate 4 Restricted Expenditures During our testing of cash disbursements, we noted Check #25052 for band competition fees was paid from the instrument rental account. Without proper controls over cash disbursements, there is an increased chance of misappropriation. The Internal Funds Manual Section 21E(2) states, Revenues generated from the rental of band or orchestra instruments will be used for the repair, replacement or purchase of instruments and may not be used for the purchase of instructional materials. Uniform rental fees will be used for the repair, cleaning or replacement or purchase of uniforms and may not be used for the purchase of instructional materials. We recommend that this policy be followed without exception. Response: Sales tax was paid accidentally. Bookkeeper is familiar with BPS policy regarding payment of sales tax. Will review policy to ensure compliance. ECD: August 20 James Kirk 143

147 SCHOOL: MERRITT ISLAND HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/26/2018 Moderate 1 Documentation of Disbursements Recurring We noted a $3,625 expenditure for Walmart gift cards to be distributed to the entire faculty and staff as a holiday gift. There was no corresponding log to track the purchase and distribution of these gift cards to date. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: In review of the Internal Accounts Manual, Section 6-D Purchase of Gift Cards, maintaining a list/log of gift card purchases and distribution is not a requirement. Therefore, I do not believe this should be a comment on our internal account audit. My bookkeeper reviews the Internal Account Manual regularly to ensure she is following all requirements and in this case, she followed the requirements of the Internal Account Manual. ECD: ongoing James Rehmer 144

148 SCHOOL: PALM BAY HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/25/2018 No Comments for this School Response: N/A ECD: N/A Karl Kaminski 145

149 SCHOOL: ROCKLEDGE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/31/2018 High 1 Frequency of Disbursements During our review of disbursements, we noted Invoice # had an invoice date of 12/22/2017 and was paid on 2/7/2018, 47 days later. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty- five (45) days, per Chapter of Florida Statutes. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. We recommend this policy be followed without exception. Response: While reviewing Invoice # that was paid 47 days after date of invoice instead of 45 days, which made it 2 days late. We will make every effort to make sure payments are made in a timely manner per District policies and Florida Statutes. We will take in account if any holidays will be a part of the 45-day payment policy, and make necessary adjustments for payment. ECD: August 14, 2018 Bradley Merrill Moderate 2 Documentation of Disbursements We noted three transactions amounting to $ for 27 gift cards to be distributed as appreciation gifts. There was no corresponding log to track the purchase and distribution of these gift cards to date. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: In the future, there will a gift card log and/or receipt signed by the recipient of the card to show the amount and purpose of the gift card that was given to them. Disbursements without supporting documentation could result in misappropriation of funds. ECD: August 14, 2018 Bradley Merrill 146

150 SCHOOL: ROCKLEDGE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/31/2018 Moderate 3 Documentation of Receipts During our testing of cash receipts, we noted an official receipt was not issued for monies received greater than $10 on MCF # Without the proper controls surrounding cash collections, funds could be misappropriated. Chapter 5A of the Internal Accounts Procedures Manual requires a receipt be issued for all monies received of $10.00 or more (except for fieldtrips, fundraisers/ yearbooks, funds received by mail, school age child care program, and items sold). We recommend the official receipts procedures in the Internal Accounts Procedures Manual be followed without exception. Response: In the future, all deposits that are $10.00 or more, will have an official receipt attached unless it is a deposit item(s) that does not require receipts such as fundraiser, yearbooks, funds received by mail and listed on the mail log, etc. ECD: August 14, 2018 Bradley Merrill 147

151 SCHOOL: SATELLITE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 High 1 Frequency of Remittance Recurring During our test of cash receipts, we noted for MCF # money was collected on 8/8/2017 but not remitted to the Bookkeeper until 8/11/2017 (3 business days). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the monies collected form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: The teacher held the funds over the weekend. The principal will ensure the procedures for Internal Funds are followed. ECD: Immediate Bobby Pruett 148

152 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 High 2 Fundraising Activities Recurring During our test of fundraisers, we noted the following: FCCLA Water Sales The Fundraiser Reconciliation Form was not properly completed. The form was missing fundraiser event information, the signatures of both the sponsor and principal, and did not contain a reconciliation of items purchased or items sold. Without a reconciliation, we could not determine if the sale, collections, and applicable sales tax were appropriately recorded. The corresponding Fundraiser Request Form could not be located for testing. SGA Class Shirt Sales The Fundraiser Reconciliation Form did not include a reconciliation of items purchased or items sold. The general ledger activity was not included with the reconciliation form. Additionally, we noted multiple Fundraiser Request Forms were not accompanied by a Fundraiser Reconciliation Form. Some of the requests dated to August Without the proper controls surrounding fundraising activity, cash collections and inventory of items to be sold could be misappropriated. The Internal Funds Procedures Manual states that, Prior to the start of fundraising activities, a Fundraiser Approval form must be prepared by the teacher/sponsor requesting the fundraiser and approved by the Principal The Fundraiser Reconciliation Form should be completed accurately by the teacher/sponsor coordinating the fundraiser. All supporting documentation should be attached to the form, including invoices, purchase orders, receipts, etc. The form should be forwarded to the Principal for review and final approval. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger. The general ledger should be printed and attached to the reconciliation. We recommend these procedures be followed without exception. Response: The proper controls and procedures will be adhered to very strictly. Proper training will be given during pre-planning to all teachers and strictly enforced by the new principal. ECD: Immediate Bobby Pruett 149

153 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 Moderate 3 Official Receipts Recurring During our testing of cash receipts, we noted official receipts were not issued for monies received greater than $10 on the following Monies Collected Forms: MCF # MCF # MCF # Without the proper controls surrounding cash collections, funds could be misappropriated. Chapter 5A of the Internal Accounts Procedures Manual requires a receipt be issued for all monies received of $10.00 or more (except for fieldtrips, fundraisers/ yearbooks, funds received by mail, school age child care program, and items sold). We recommend the official receipts procedures in the Internal Accounts Procedures Manual be followed without exception. Response: was a monies collected form from registration. The teacher that was working that table must not have issued receipts and was overlooked was received by our secretary and was not logged on the mail log was a donation received by our softball coach and did not issue a receipt. With more training and diligent work this will not continue. ECD: Immediate Bobby Pruett Moderate 4 General Ledger Review Recurring During our review, we noted that two accounts (Change Fund and Cross Country Club) had not been signed by the principal / sponsor in the first quarter. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: I will review the ledgers each quarter and insure that all signatures are obtained. ECD: Immediate Bobby Pruett 150

154 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 Moderate 5 Sales Tax Recurring During our testing of cash receipts, we noted that sales tax was not remitted for the following collections: MCF # MCF # MCF # MCF # The School Board is subject to sales tax when items purchased are for resale (unless specifically exempted); therefore sales tax should have been paid. According to the Internal Accounts Procedures Manual section 11C, uniforms, instrumental rentals, lock rentals and parking fees are subject to sales tax. We recommend this procedure is followed without exception. Response: The sales tax was paid to the State just not properly entered as a deposit to the sales tax account. After proper training I now know the procedures for sales tax. ECD: Immediate Bobby Pruett Moderate 6 Documentation of Disbursements Recurring During our testing of disbursements, we noted the following: Check #21265 included reimbursement for the purchase of gift cards. Petty Cash disbursement on 5/28/2018 included reimbursement for the purchase of gift cards. In both instances, a listing of gift card recipients had not been maintained. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. In accordance with Chapter 6, Section D of the Internal Accounts Procedures Manual, Gift Cards should only be issued for the purposes of awards, scholarships, appreciation and contributions. Gift Cards should never be issued for payments of products, services or employee labor. We recommend this procedure be followed without exception. Additionally, as a matter of best practice, we recommend maintaining a list / log of recipients of gift cards to assist with the control and distribution of these items. Response: A proper log will be used to have each recipient sign for a gift card. ECD: Immediate Bobby Pruett 151

155 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 High 7 Monies Collected Forms During our testing of cash receipts, we noted multiple Monies Collected Forms did not include a listing of cash vs. check amounts on the deposit slip. The total amounts listed on all the Monies Collected Forms did agree to the bank receipt. The Monies Collected Forms without a listing of checks include: Deposit 1123 Deposit 1125 Deposit 1126 Deposit 1151 Without a listing of cash or check for each amount collected, it is difficult to verify if the correct amount of cash is being deposited. This also ensures that checks are not being exchanged for cash, which is prohibited in the Internal Funds Procedures Manual. Chapter 5 of the Internal Accounts Procedures Manual states, When depositing checks, the checks must be listed by last name and amount on the deposit slip. A calculator tape may be run and included with the deposit slip in lieu of listing the checks only if a copy of the checks is also retained with the deposit slip. We recommend the bookkeeper review the cash receipts procedures in the Internal Funds Procedures Manual and follow them without exception. Response: All deposit back up will be maintained. ECD: Effective immediately I will maintain all back up for deposits. Bobby Pruett 152

156 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 High 8 Monies Collected Forms During our testing of cash receipts, we noted: MCF # could not be located for testing; and The deposit slip for Deposit #1173 was mathematically incorrect by $0.60. However, the totals listed on the Monies Collected Forms agreed to the bank s deposit receipt. Inaccuracy of monies collected could result in misappropriation of funds. Chapter 5 of the Internal Accounts Procedures Manual states, All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. We recommend that the bookkeeper count and verify that all monies (cash and checks) recorded on the Monies Collected Forms agree and are accurate for deposit. We recommend the bookkeeper review the cash receipts procedures in the Internal Funds Procedures Manual and follow them without exception. Response: I will be more diligent when completing deposit slips. ECD: Immediate Bobby Pruett High 9 Frequency of Disbursements During our test of disbursements, we noted multiple invoices were paid more than 45 days after the item was received: Check #21322 was remitted 136 days after the invoice. Check #21076 was remitted 112 days after the invoice. Check #21330 was remitted 61 days after the invoice. Check #21289 was remitted 57 days after the invoice. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend that the Bookkeeper review the Internal Funds Procedures Manual Chapter 6A. We recommend this policy be followed without exception. Response: ALL INVOICES WILL BE PAID WITHIN 45 DAYS. The amount of work and clean up required from the shape this office was in when I started was not a good start. Many old invoices had not been paid by the previous bookkeeper and started a spiral of back logged invoices. I am confident that this year will be much better and procedures will be strictly followed. ECD: Immediate Bobby Pruett 153

157 SCHOOL: SATELLITE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 06/18/2018 Moderate 10 Sales Tax During our testing of cash disbursements, we noted that Check #21350 was not supported by an itemized receipt. We were therefore unable to validate proper sales tax treatment. Per the State of Florida Department of Revenue and per the Internal Funds Procedure Manual, sales tax is not to be reimbursed to employees who purchase goods on behalf of the school. According to the Internal Accounts Procedures Manual section 11(B)(1), for any purchases made and paid for personally by a staff member, any sales tax paid on these purchases will not be reimbursed. We recommend this procedure is followed without exception. Response: The receipt in question was from Dominos Pizza and an itemized receipt was not attached it just had the total due did not show that we were not charged tax. Itemized receipts will be requested for future purchases. ECD: Immediate Bobby Pruett 154

158 SCHOOL: SOUTHWEST MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/09/2018 High 1 Ticket Sales During testing of ticket sales for a basketball game on 9/21/2017, noted cash collections was erroneously posted to Athletic Overhead, Account # rather than the correct account listed on the Report of Tickets Sold Form, Account , Basketball. Without the proper controls surrounding cash collections, funds could be posted incorrectly or misappropriated. We recommend that all transactions be posted to the proper accounts by carefully reviewing all applicable support for the transaction. Response: After further review it was discovered that Gate receipts should actually go through Athletic Overhead as a result of this discovery I do not agree with this particular finding on the audit report. ECD: Immediately Ron Shaw Moderate 2 Monies Collected Forms During our testing of cash receipts, we noted a receipt was not issued for monies received for $10 or greater on MCF # The monies collected were for Art Fees. Without the proper controls surrounding cash collections, funds could be misappropriated. We recommend the bookkeeper and other relevant stakeholders review the cash receipts policy in the Internal Funds Procedures Manual and follow it without exception. Response: Janice Cave, will double check the receipts and be certain that only one student s name is listed on each individual receipt. ECD: Immediately Ron Shaw 155

159 SCHOOL: SPACE COAST JR/SR HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 08/01/2018 High 1 General Ledger Review Recurring During our review, we noted that a cumulative total of 5 accounts were not reviewed as part of the quarterly general ledger review. Q1-1 accounts Q3-2 accounts Q4 2 accounts Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Staff will be trained at the beginning of the year on the importance of reviewing ledgers and signing off on them quarterly. The principal will communicate with staff who fails to respond to the request in advance of the deadline. ECD: August, 2018/ongoing Sylvia Mijuskovic Moderate 2 Documentation of Disbursements Recurring We noted a $100 transaction for five gift cards to be distributed as appreciation gifts. There was no corresponding log to track the purchase and distribution of these gift cards to date. Disbursements without supporting documentation could result in misappropriation of funds. We recommend maintaining a list / log of gift card recipients with their respective signatures to assist with the control and distribution of gift cards. Response: A log of gift card recipients will be instituted as part of our bookkeeping processes. ECD: August, 2018/ongoing Sylvia Mijuskovic 156

160 SCHOOL: SPACE COAST JR/SR HIGH SCHOOL Moderate 3 Sales Tax During our testing of cash disbursements and collections, we noted the following: Check #16657 to purchase items for resale did not include sales tax. Sales tax was not collected when the funds were collected from the sale of these items. MCF # was used to collect money from the sale of Chorus T-shirts. No sales tax was paid to the vendor at the time of the purchase, or collected on behalf of students at the time of resale. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(9) of the Internal Funds Procedures Manual, "Fundraising Activities The sale of candles, candies, confections and other novelties sold for fund raising purposes by school-sponsored organizations are taxable. Sales tax may be paid directly to a Florida vendor upon the purchase price / invoice amount or directly to the Department or Revenue based upon the sales price." We recommend this procedure be followed without exception. Response: Staff will be trained on tax laws. The bookkeeper will review purchase orders and ensure that tax is being paid if required. ECD: August, 2018/ongoing Sylvia Mijuskovic 157

161 SCHOOL: SPACE COAST JR/SR HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 08/01/2018 High 4 Authorization of Expenditures During our testing of disbursements, we noted Check #16436 had a purchase order prepared after the invoice date/purchase date. Check #16719 and #16742 were not supported by a purchase order to document Principal approval. Check #16742 was a direct pay item for a student scholarship. Student Scholarships do not fall under the ten (10) instances where purchase orders are not required per the Internal Accounts Procedures Manual Chapter 6A. In addition, there were multiple blanket purchase orders that did not have a running balance being tracked on the purchase order. Therefore, we were unable to verify the purchase order was not overdrawn by prior disbursements. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. As required by the Internal Funds Procedures Manual, we recommend that all disbursements have purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approval by the principal before the expenditures are made. We further recommend all disbursements have proper documentation to support the expenditure made. The bookkeeper should review invoices for accuracy prior to payment to avoid overpayment. Response: All checks require support documentation before the principal signs the checks. Bookkeeper will ensure that documents are properly filed with supporting documentation. Staff will be trained on keeping a balance of open purchase orders. Reporting of balances will be required with future purchase. Bookkeeper will copy balance reports on her records. ECD: August, 2018/ongoing Sylvia Mijuskovic 158

162 SCHOOL: SPACE COAST JR/SR HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 08/01/2018 Low 5 Yearbook Sales During our testing of the yearbook reconciliation, we noted that the reconciliation ending balance did not agree to the June 2018 Principal s report ending balance by $24, Without the proper controls surrounding yearbook sales, cash collections and items to be sold could be misappropriated. We recommend the bookkeeper should review the yearbook reconciliation form for accuracy and compare the amounts to the general ledger. The form should then be forwarded to the Principal for review and final approval. Response: Yearbook reconciliations will be compared to the general ledger as part of year-end processes. ECD: August, 2018/ongoing Sylvia Mijuskovic 159

163 SCHOOL: STONE MIDDLE SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/30/2018 Low 1 General Ledger Review Recurring During our review of the General Ledger, we noted that account # in Q4 had not been reviewed by the principal or sponsor. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. We recommend a cumulative review of all general ledger accounts be performed quarterly, at a minimum, (within one month after quarter end) by the teacher, sponsor in charge, or the Principal. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. Response: Quarterly Account Print Outs will be checked twice to make sure that a print out does not get misplaced which caused the missed signature. Make sure that Stone Magnet Middle School follows proper protocol ECD: Immediately Mary Bland Moderate 2 Deficit Balances During our review of the Principal s Report, we noted one account with a deficit balance as of 6/30/2018: Account # Overspending by one internal fund is inequitable to the other funds that spend within their limits. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: A/C Bookkeeper was working with the accounting department for a check that had to be replaced (lost in the mail). The original check was not voided in the system until This caused the account to be deficit. Make sure that Stone Magnet Middle School follows proper protocol ECD: Immediately Mary Bland 160

164 SCHOOL: TITUSVILLE HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 High 1 Documentation of Disbursements Recurring During our testing of cash disbursements, we noted Check #28332 The supporting documentation did not contain the vendor invoice. A quote which pre-dated the purchase order was included. Disbursements without proper approval and accurate supporting documentation could result in misappropriation of funds or overspending the available resources for that class, club, or account. We recommend all disbursements have proper documentation to support the expenditure made. Response: My bookkeeper will work to ensure that all supporting documentation is collected in order for checks to be disbursed properly. In addition, she will refer to the districts bookkeeping manual for procedures. ECD: Effective Immediately Annetha Jones High 2 Frequency of Remittance Recurring During our testing of cash receipts, we noted for MCF # , funds were collected on 10/17/17 and not turned in to the bookkeeper until 10/19/2016 (2 business days). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. Without proper controls over cash collections, there is an increased chance of misappropriation. Chapter 5 of the Internal Funds Procedures Manual states monies must be turned into the Bookkeeper no later than the next business day. We recommend this policy be followed without exception. Response: The bookkeeper will work to ensure that all stakeholders who are associated with collecting funds understand and follow the procedures as outlined in the districts manual. ECD: Effective Immediately Annetha Jones 161

165 SCHOOL: TITUSVILLE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 High 3 Fundraising Activity During our review of fundraising activity, we noted the following: ROTC Candy Sales we were unable to locate the fundraiser reconciliation form for review Key Club Car Wash we were unable to locate the fundraiser approval or reconciliation form for review Additionally, through our review we noted a majority of the fundraisers did not complete a reconciliation form or provide supporting documentation at the end of the event. Without the proper controls surrounding fundraising activities, the related cash collections and inventory of items to be sold could be misappropriated. We recommend all supporting documentation be attached to the reconciliation form, including invoices, purchase orders, receipts, etc. The teacher/sponsor must sign and date the form. The form should be forwarded to the Principal for review and final approval. The bookkeeper should review the form for accuracy and compare the amounts to the general ledger. The general ledger should be printed and attached to the reconciliation. Response: Our bookkeeper will work with all sponsors to ensure that they know the proper procedures for completing fundraiser reconciliations in a timely manner. In addition, the bookkeeper will communicate with the activities director to ensure that he encourages the organizations to follow this directive. ECD: Effective Immediately Annetha Jones Moderate 4 Sales Tax During our review of cash disbursements, we noted Check #28675 included reimbursement for sales tax in the amount of $ The School Board is not subject to sales tax; therefore, sales tax should not be paid or reimbursed unless purchasing items for resale. Section 11B(1) of the Internal Accounts Procedures Manual states for any purchases made and paid for personally by a staff member, any sales tax paid on these purchases will not be reimbursed. We recommend this procedure be followed without exception. Response: The bookkeeper will work to ensure that all sponsors who make purchases understand the procedure as outlined in the district manual as it pertains to sales taxes. ECD: Effective Immediately Annetha Jones 162

166 SCHOOL: TITUSVILLE HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/25/2018 Low 5 District Level Accounts During our review of the Principal s report dated 6/30/2018, we noted account GSF Lost & Damaged Textbooks had an account balance of $119. Balance in accounts through must be remitted to the district prior to the end of the fiscal year. Without closing out these accounts as required, there are reconciling items at the District level that require follow up and tracking into the following fiscal year. Chapter 7 of the Internal Funds Procedures Manual states that No school organization, club, or group of students shall make expenditures that exceed the cash resources available to the organization or group. We recommend this procedure be followed without exception. Response: The bookkeeper will work to ensure that all funds collected for textbooks are remitted to the district prior to the end of the year as outlined in the districts manual. ECD: Effective Immediately Annetha Jones 163

167 SCHOOL: VIERA HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 Moderate 1 Monies Collected Forms Recurring During our testing of cash receipts, we noted that MCF # was not filled out correctly; the students names were not listed, and the check number was not listed. Improper and inadequate completion of monies collected could result in misappropriation of funds. We recommend the person collecting the funds write who the funds were received from, as well as cash or check next to all collections on the Monies Collected Form, as required by Chapter 5B of the Internal Funds Procedures Manual. Response: Review proper procedures for completing MCRs correctly with staff on 8/3/17. Spot check MCRs on a monthly basis to ensure this is being followed. ECD: Ongoing Mike Alba Moderate 2 General Ledger Review Recurring During the review of the quarterly General Ledger reports, we noted three (3) accounts in the 3 rd quarter were not reviewed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. These reports should be cumulative each quarter. We recommend these procedures be followed without exception. Response: Review all quarterly reports to ensure each account has a verifying signature. ECD: End of each quarter Mike Alba 164

168 SCHOOL: VIERA HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 Moderate 3 Sales Tax During our testing of cash disbursements and collections, we noted the following: Check #15763 to purchase items for resale did not include sales tax. Sales tax was not collected when the goods were re-sold to students as a fundraiser. Check #14351 for reimbursement included support which was not itemized; therefore, we are unable to determine whether sales tax was paid. MCF # for collections of resale items did not remit sales tax. We examined corresponding Check #14305 and noted sales tax was not paid to the vendor. The School Board is subject to sales tax when items purchased are for resale; therefore sales tax should have been paid. In accordance with Section 11C(9) of the Internal Funds Procedures Manual, "Fundraising Activities The sale of candles, candies, confections and other novelties sold for fund raising purposes by school-sponsored organizations are taxable. Sales tax may be paid directly to a Florida vendor upon the purchase price / invoice amount or directly to the Department or Revenue based upon the sales price." We recommend this procedure be followed without exception. Response: Sales tax will be emphasized during our breakout sessions with teachers and coaches when dealing with fundraisers. ECD: 8/10/18 Mike Alba 165

169 SCHOOL: VIERA HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 High 4 Authorization of Expenditures During our test of disbursements, we noted Check #14355 and #16193 were not supported by a purchase order to document principal approval. The disbursements were direct pay items for student scholarships. Student Scholarships do not fall under the ten (10) instances where purchase orders are not required per the Internal Accounts Procedures Manual Chapter 6A. Disbursements that do not have approval prior to the purchase could result in overspending of the budget or misappropriations of funds. We recommend that all disbursements have purchase orders prepared and signed by the teacher/sponsor requesting the expenditure and approved by the principal before the expenditures are made. Response: Ensure SGA sponsor that provides funding for student scholarships submit a PO before checks are processed for the senior scholarship recipients. ECD: 5/2019 Mike Alba High 5 Frequency of Remittance During our review of cash collections, we noted the following: MCF # was collected on 8/4/17 and remitted on 8/7/17 (held over 1 weekend). MCF # for football gate admissions were collected on 11/3/17 and remitted on 11/8/2017 (3 business days). The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Without proper controls over cash collections, there is an increased chance of misappropriation. In accordance with Section 5B(1) of the Internal Accounts Procedures Manual, "All monies collected must be documented on the Monies Collected Form and submitted to the Bookkeeper on the same day of collection including monies collected during the school day on Friday. Monies collected should not be held over the weekend. If extenuating circumstances exist and this practice is not feasible, the monies must be turned into the Bookkeeper no later than the next business day." We recommend this procedure be followed without exception. Response: Emphasize the importance of turning in collected funds at the end of each business day during our training session on 8/3/18. Monthly checks of MCRs will be conducted to ensure this is procedure is being followed consistently by all staff. ECD: 8/3/18 Mike Alba 166

170 SCHOOL: VIERA HIGH SCHOOL - CONTINUED DATE OF ON-SITE VISIT AT THE SCHOOL: 07/11/2018 High 6 Frequency of Disbursements During our test of disbursements, we noted vendor invoices supporting Check #14324 were not dated; therefore, we were unable to determine if the invoices were paid within 45 days. Disbursements that are not remitted to a vendor in a timely manner could result in misappropriation of funds or overspending the available resources for that class, club, or account. The Internal Funds Procedures Manual Chapter 6A states, Unless otherwise stated in a contract signed by an authorized representative of the District, purchase orders follow normal payment terms of forty-five (45) days, per Chapter of Florida Statutes. We recommend this policy be followed without exception. Response: Ensure al Invoices are dated or marked with a received by date. ECD: Ongoing Mike Alba Low 7 District Level Accounts During our review of the Principal s report dated 6/30/2018, we noted account GSF Lost & Damaged Textbooks had an account balance of $ Balance in accounts through must be remitted to the district prior to the end of the fiscal year. Without closing out these accounts as required, there are reconciling items at the District level that require follow up and tracking into the following fiscal year. We recommend the bookkeeper review the year-end procedures in the Internal Funds Procedures Manual and follow the procedure without exception. Response: Ensure the funds in these accounts be transferred to appropriate district accounts. ECD: 6/1/19 Mike Alba 167

171 SCHOOL: WEST SHORE JR. / SR. HIGH SCHOOL DATE OF ON-SITE VISIT AT THE SCHOOL: 7/30/2018 High 1 Frequency of Remittance During our test of cash receipts, we noted funds for MCF # were collected on 11/20/17 but not remitted to the Bookkeeper until 11/27/17 (held 3 business days and over a weekend). The bookkeeper notified the account sponsor of the remittance policy at the time the funds were submitted for deposit. The Internal Funds Procedures Manual states that monies collected should be turned in daily, but no later than the following business day. Monies collected should not be held over the weekend. We recommend that the monies collected form procedure in the Internal Funds Procedures Manual is reviewed and followed without exception by all teachers/sponsors. Response: The principal and bookkeeper will re-train all employees. Reminding them they must submit receipts the day of or the next business day. ECD: August 7, 2018 Rick Fleming Low 2 General Ledger Review During the review of the quarterly General Ledger reports, we noted four (4) accounts in the 1 st quarter were not reviewed. Although the accounts had no balance or activity, the Internal Funds Procedures Manual requires each account be reviewed. Without review of the account activity on a regular basis in a cumulative report by someone other than the Bookkeeper, funds could be posted incorrectly or misappropriated. As outlined in Chapter 13 of the Internal Funds Procedures Manual, a review of all general ledger accounts should be performed quarterly by the teacher or sponsor in charge of the activity. The principal should only sign when there is not a clear sponsor in charge of the account. The general ledger accounts should be signed by the reviewer noting any changes or questions, submitted to the Principal, and maintained for audit. We recommend these procedures be followed without exception. Response: The principal and bookkeeper will double check and make sure all signatures are in place. Also, a third party will check for proper signatures. We want to thank Stephanie Tantillo for a great audit experience. She was processional and used great communication skills explaining all findings. ECD: August 7, 2018 Rick Fleming 168

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