Auditors give School District clean financial bill of health

By Emily Richmond (contact)

Tuesday, Nov. 9, 2004 | 11:14 a.m.

Independent auditors gave the Clark County School District's finances and operations a generally clean bill of health, a new report indicates.

The district hired the accounting firm of Kafoury, Armstrong and Co. to conduct a variety of audits throughout the year, focusing on finances, business practices and daily operations. The Clark County School Board will review the auditors' findings at a special meeting tonight.

The auditors made several recommendations for improvements, including changing the way personnel files are stored and changing the School Board's methods for recording meeting minutes.

During visits to the district in May and September of this year, the auditors said they were unable to review the computerized personnel files because the imaging system was down. The hard copies of the files were also not readily available as a substitute for the computerized versions.

The auditors recommended the district review its document storage procedures, keep original documents within easy access, and keep close tabs on Lason Services, the Michigan-based company handling the actual scanning. The district has paid that company $252,200 for the current school year, officials said.

Some of the issues raised by the auditors, including the computerized storage of personnel files, will be resolved over the next two years as a new, $27 million intergrated data management system is phased in, Clark County Schools Superintendent Carlos Garcia said Monday.

Many of the problems detailed in past audits were a result of the district outgrowing its existing system, which was put in place in the early 1980s, Garcia said.

"We've known for a while we needed a new system but it was a question of finding the resources to do the job," Garcia said. "In some respects we waited too long because we didn't have a choice."

Earlier this year the School Board switched from providing summarized minutes of its meetings to full transcriptions prepared by a court reporter. Because preparing the verbatim transcriptions was more time-consuming, the School Board staff fell behind and only audio recordings were available to the auditors for some of the more recent meetings.

Nevada Revised Statutes governing public meetings does not require verbatim transcriptions as long as the condensed minutes include topics discussed and tallies of votes cast, the auditors concluded.

Based on the auditors' suggestion the district will return to the original summary written format for the board's minutes, but the district will also keep tape recordings of the meetings, said School Board President Susan Brager-Wellman.

"We want to be responsive to the auditors but we must be responsive to the public as well," Brager-Wellman said. "The audio recordings will be available to anyone who wants one and if for some reason a person also needs the complete transcription, we'll work to provide it."

The auditors also recommended an additional layer of oversight to the processing of personnel contracts for administrators, which is currently handled by a sole employee.

Walt Rulffes, deputy superintendent of operations for the district, said at the auditors' recommendation a supervisor will now be required to review the analyst's calculations and compare the work sheet to the computer records. The district's internal audit department will also conduct periodic reviews of administrative salary changes, he said.

The firm's prior audit last spring determined the district had made improvements to its oversight and controls of purchasing cards, which are issued to some employees. A 2002 audit revealed numerous examples of "split transactions," purchases in which the cost of items had been divided into two separate charges to circumvent the district's spending limit for any one item. The most recent audit did not review purchasing card transactions.

The auditors also concluded Garcia's actions as chief executive were in compliance with the district's regulations.

In addition to reviewing the auditors' findings, the School Board is also slated to discuss an update of the $3.5 billion capital improvement plan and a proposal to spend as much as $25 million constructing new facilities for the food services and transportation departments.