Update: While far less egregious than the apparent situation at Richard Montgomery, the audit of Gaithersburg High School (one of several available at the Parents Coalition website), also lists some opportunities for improvement. Quoting the “Findings and Recommendations” section of the report (note the following was OCR’d from the bitmapped PDF, so please consult the original for an authoritative version):

At our meeting on June 5, 2008, we discussed actions taken since our previous audit report, dated April 23, 2007, that have strengthened financial accountability for lAP resources. As discussed, those conditions have been resolved. Although these actions improve accountability and internal control, we found additional conditions which weaken controls over, or management of resources. These conditions are described below along with our recommendations.

MCPS Form 280-54, Request for a Purchase, is used to obtain principal approval to proceed with an intended purchase (see IAF manual, p. 8). The purpose of each disbursement must be fully explained on this form in order to properly record expenditures in appropriate accounts and to ensure that expenditures comply with IAF requirements. In our random sample of disbursements, we found prior approval was not obtained for 24 percent of purchases made. By requiring prior approval, the principal retains control over the expenditure of IAF funds. We recommend that Form 280-54 be prepared by staff and signed by the principal at the time verbal approval is sought so that purchase orders and invoices bear a date subsequent to the approval date.

The yearbook sponsor is required to keep detailed records of the number of books sold, the price charged as well as the number of books distributed free of charge (see IAF manual, p. 16). However, the records kept by the yearbook sponsor did not enable us to reconcile the number of books purchased with the number sold, given free, and the remaining inventory. We were therefore unable to determine that all funds generated from this activity had been remitted. We recommend the yearbook sponsor be advised about the record-keeping requirements for this activity and assisted as needed.

Vocational education business activities should be conducted in accordance with MCPS Regulation IGK-RB, Career and Technology Education Projects from Outside MCPS. During our audit we observed the daily operation of the Cosmetology shop. We found that there were no controls in place to verify that all monies received were submitted to the financial agent. It was also noted that daily receipts were being held by the sponsor and not being turned in on a timely basis. To improve internal controls over receipts we recommend that an appointment book or daily log of customers be kept along with a copy of all work orders. A copy of the prenumbered payment receipt should be attached to the work order and brought to the financial assistant with the daily receipts. At the end of each month, the financial agent should reconcile work orders, daily log, and other receipt documentation with the monthly deposits.

Other matters were discussed and satisfactorily resolved with Mrs. Annie Stone, business manager and Mrs. Debra Clouse, financial assistant. We appreciated their cooperation and assistance as well as others on your staff. Please provide a response to Mr. Adrian Talley, community superintendent, within 30 days of this report, with a copy to the Internal Audit office.

Many Gaithersblog readers will recall all the news from several weeks ago about MCPS school fees. One of the concerns raised by parents with regard to the school fees was that there was no public accounting of the use of those funds. Now, an audit of Richard Montgomery High School in Rockville has turned up evidence that, at least at that school, these funds were in fact being misused.

Channel 7 reports, Student Money Spent on Staff Perks at School:

They say thousands of dollars raised to help students is instead paying for special meals and new jackets for school leaders.

The internal audit reported thousands of dollars earmarked specifically for students at Richard Montgomery High School were in fact spent elsewhere.

From January 2007 through March of this year:

  • $9,400 went for an administration leadership retreat.
  • $5,100 was used for restaurant meals for the principal and other officials.
  • $1,100 was spent to buy eight jackets for administrators and staff.

Melissa J. Brachfeld writes in the Gazette, Auditors say money was used improperly at Richard Montgomery:

School system auditors say thousands of dollars raised by students at Richard Montgomery High School were used on meals, clothing, a retreat and other perks to benefit staff instead of students.

The money came out of the school’s Independent Activity Funds, which are collected from classroom fees, event ticket sales and fundraisers. School system policy says that unless otherwise designated, the funds belong to the student body and may not be used to benefit staff or particular student groups.

Note that this information comes out of an audit specific to Richard Montgomery, and thus does not address the question of the use of this money at other schools.