During Wednesday night’s nearly four-hour meeting, Epic Charter Schools Board members approved their Fiscal Year 2020-2021 financial audit from Arledge & Associates, which identified four material weaknesses that auditors said stemmed from actions under the schools’ prior leadership, which remains under criminal investigation. The board also approved the addition of a new member.
This is the first year that Arledge & Associates has served as the private auditor for Epic, the largest and most controversial charter schools in Oklahoma. Jake Winkler presented the report as a partner on the audits for both Epic One-on-One and Epic Blended, saying first year audits are very “challenging.”
“Epic has four material weaknesses that were identified as part of our procedures and you had four compliance findings that were identified as part of our procedures,” Winkler said during the meeting. “Management has responded to each one of these findings with a corrective action plan, and we do believe when fully implemented it will resolve those findings. I will stress that these findings did occur under the previous management and that Jeanise (Wynn) and Carrie (Truver) have already taken steps to resolve them.”
Winker said the Epic Charter Schools internal audit reports have three opinions in them including the independent auditor’s report, which is an assessment of Epic’s material conformity with the regulatory basis of accounting outlined by the Oklahoma State Department of Education, the independent audit report on internal control over financial reporting, compliance and other matters, and an independent auditor’s report over compliance on major programs.
“What I will tell you is that both of the reports are pretty similar. The only thing that’s going to be different is the financial results,” Winkler said. “The first thing I want to say is how great it was to work with Jeanise and Carrie on engagement. They were very responsive to our audit requests. They wanted to make sure that the audit was transparent and that things were as accurate as possible.”
Epic Charter Schools Deputy Superintendent of Finances Jeanise Wynn said the material and compliance findings were similar to what were found in the 2020 investigative audit completed by the State Auditor & Inspector’s Office.
Wynn said the material and compliance findings included:
- Lack of a properly functioning control environment
- Tracking and reporting of capital assets
- Payments to Epic Youth Services for administration
- Lease commitments exceeding one year
- Cross payments between Epic One-on-One and Epic Blended
- The concerning relationship with Epic California
- Compliance with the Oklahoma Cost Accounting System
- Procurement for contracts
“(Finding) number six was about the district paying for things for each other, which has ceased, and also about the relationship with Epic California, which has also ceased. But it was still happening during the audit term,” Wynn said. “(Finding) number seven was compliance with OCAS, which was of course talked about by the state auditor. (Finding) number eight was proper procurement for contracts, which is all about the purchasing policy.”
Wynn told NonDoc the audit will be available on the district’s website once the acknowledgment page is signed by board members. Board members also approved a motion to use Arledge & Associates as their auditor for Fiscal Year 2021-022.
Board members also approved a motion to set up a supporting organization as a separate 501(c)(3) with a 509 (a)(3) tax code. If approved by the Internal Revenue service, that foundation would be able to raise tax-deductible donations to support Epic students and families.
New board member approved
During the evening’s meeting, board members also approved the addition of Susan Agel. Agel will replace former board member Jon Tatum, who is leaving the board owing to an out-of-state move.
“She’s just incredible,” board member Ed Long said during the meeting. “I can’t overstate her impact and her amazing heart and service.”
Agel recently retired as the president of Positive Tomorrows, a private school for homeless children. She is the chairwoman of the Homeless Children & Youth Subcommittee of the Oklahoma Commission on Children and Youth. She previously served as a member of the Governor’s Interagency Council on Homelessness from 2016 to 2022.
In 2016, Agel was named the Journal Record’s Woman of the Year and was also named “most admired CEO” for 2013, 2014 and 2016. In 2011, she was recognized by the FBI with its Director’s Community Leadership Award for Oklahoma.
Tatum had initially joined the board last year following the resignations of former board members Betsy Brown, J.P. Franklin and former chairman Doug Scott.