State audit faults asset records

A special education director had to pay the district $237.
By PETER H. MILLIKEN
VINDICATOR TRUMBULL STAFF
WARREN -- In a finding released Tuesday, the state auditor's office said the city school system failed to maintain complete and accurate records of its capital assets and their acquisition and disposal.
Capital assets include land, buildings, vehicles, furniture, machinery and equipment. The newly released audit covers the fiscal year that ended June 30, 2004.
"The district did not report any disposals of capital assets because of a lack of records," the audit said. It also didn't record the annual depreciation expense for each capital asset, the audit report added.
"To maintain safeguards over capital assets and reduce the risk that the capital assets will be mis-stated, we recommend the district's board of education and management review the existing capital asset accounting policies and their applicability," the state auditors said.
The state auditors found that the useful life of many assets was misapplied, causing them to be depreciated over a longer-than-intended time; salvage value wasn't applied to each asset, thereby inflating the depreciable costs; and the location of many assets was misreported because procedures regarding their transfers hadn't been followed.
"New vehicles have been capitalized at incorrect cost, and vehicles used as trade-ins have not been deleted due to misapplication of the vehicle trade-in policy," the auditors said.
What's being done
To correct the deficiencies cited by the auditors, Mark Donnelly, city schools business manager, said Valuation Engineers, a Pittsburgh area firm, will be paid $17,500 to do an inventory of school property this summer. "When you have 13 different buildings, if it's not closely monitored, it does get out of hand," he said.
"We'll be able to start fresh and get our capital assets in order," said Angela J. Lewis, who became city schools treasurer May 1.
The auditors also made a finding for recovery of $237 because Douglas Dennis, special education director, was reimbursed $375 for a course he took at Ashland University in September 2003, which cost $138. Dennis repaid the district April 30, 2005.
The maximum allowable annual tuition reimbursement under Dennis' employment contract was $350, the audit report said.