The Western Heights Public Schools Fiscal Year 2020-2021 financial audit came to light Tuesday and contains 19 significant deficiencies, including employees being under and overpaid, a lack of internal controls for federal program revenue and expenditure reporting, and an unauthorized $25,000 bonus paid to suspended district Superintendent Mannix Barnes.
“It is hardly surprising that auditors found significant mismanagement,” State Superintendent of Public Instruction Joy Hofmeister said in a statement. “The chaos surrounding Western Heights under its former superintendent clearly contributed to the reason we took the swift action to temporarily take over the district and suspend the former superintendent’s license to prevent further financial ruin.”
The annual audit, embedded below, was completed by Kerry John Patten C.P.A. and was initially obtained and reported on by News 9’s Augusta McDonnell on Tuesday. Community members had expected the audit results to be on the agenda for the board’s meeting on Monday, June 13, but interim Superintendent Brayden Savage said they would be presented at the next meeting, in July.
Western Heights Schools Board member Briana Flatley said the board has yet to hear the audit results or findings, which are supposed to be presented to them at a board meeting before being submitted to the State Department of Education and the State Auditor & Inspector’s Office.
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“A copy was sent to me via the community around 10 p.m. last night,” Flatley told NonDoc on Wednesday morning. “I have not been able to review it yet.”
In a statement to News 9, Western Heights attorney Jerry Colclazier said the auditor’s report is only “half the story” and that the district is preparing a response before submitting the audit results to the OSDE.
The district is still awaiting the results of an investigative audit being completed by the State Auditor & Inspector’s Office.
In her statement, Hofmeister called for the resignation of Western Heights Schools Board president Robert Everman.
“Interim Superintendent Savage has made some dramatic improvements, but board president Robert Everman continues to obstruct, reform and block information from public view,” Hofmeister said. “Everman absolutely must resign for the sake of Western Heights students and families.”
NonDoc reached out to Colclazier and Savage for comment, but did not receive a response before publication of this article.
A lack of internal controls
The audit was completed on May 31 and covers the period between July 1, 2020, to June 30, 2021 — right before the State Board of Education’s July vote to take over governance of the troubled school district.
The audit states that 10 employees were overpaid by a total of about $118,000 during FY 2020-21 and two employees were underpaid — one by about $5,000 and the other by nearly $49,000.
Barnes was also given an unauthorized $25,000 bonus in violation of a provision in his employment contract, which states, “In order to receive an annual incentive stipend, superintendent’s final summative evaluation score for that fiscal year must be ‘effective’ as defined by the evaluation tool scoring.”
However, the audit report says that auditors never received documentation stating that this criteria for the bonus had been met. Community members have also questioned the validity of the employment contract as it was never placed on a board agenda for approval.
Last week, a community member sent the school board a demand letter, signed by ten registered voters living in the district, requesting that all “payments, included but not limited to salary, bonuses, benefits and attorney fees immediately cease and the board diligently seek the return of any and all monies paid by Western Heights School District on this unauthorized, unlawful or fraudulent contract with Mannix Barnes.”
Barnes had his educator’s certificate suspended by the state board at a meeting in June 2020. A hearing regarding the potential revocation of his certification has been pushed back multiple times and is currently slated for July 25.
Out of 59 purchase orders reviewed by auditors, only 16 of those purchase orders were supported with invoices dated prior to the purchase order date. The audit report states that a failure to properly encumber purchases can result in overspending and violations of laws that prohibit exceeding appropriations.
The audit report also states that, owing to the lack of internal controls surrounding procedures and processes for federal programs, revenue was forfeited because claims were not being made in a timely manner. The district also failed to document the number of meals served compared to claims made for the Seamless Summer Option Program owing to a lack of proper internal controls. This results in claims being issued and paid for incorrect amounts.
The audit also states that the school district doesn’t maintain adequate accounting records to provide sufficient information for the preparation of financial statements. The report states that:
- of the employees tested, 22 percent of payroll expenditures tested were not supported by employment contracts or other authorization resulting in potential error to financial statements;
- 941 Payroll Tax Reports had not all been filed or provided to the auditor and therefore could not be audited,
- bank reconciliations were not performed during the audit period and;
- the district does not have information necessary to include General Fixed Asset Account Group.
The Western Heights board and administration also failed to have a process in place to track the resolution of significant findings and recommendations from last year’s audit. This resulted in uncorrected and repeated findings from previous years.
Read full Western Heights audit
