Summary

Summary of Report on Financial Statements

The Leon County District School Board prepared its basic financial statements for the fiscal year ended June 30, 2005, in accordance with prescribed financial reporting standards.

Summary of Report on Internal Control and Compliance

The District has established and implemented procedures that generally provide for internal control of District operations.  The District generally complied with significant provisions of laws, administrative rules, regulations, contracts, and grant agreements. 

Summary of Report on Federal Awards

We audited the District’s Federal awards for compliance with applicable Federal requirements.  The Child Nutrition Cluster, Special Education Cluster, Twenty-First Century Community Learning Centers, Education Technology State Grants, and Reading First State Grants programs were audited as major Federal programs.  The results of our audit indicated that the District materially complied with the requirements that were applicable to the major Federal programs tested.  However, we did note compliance and internal control findings that are summarized below.

Summary of Audit Findings

Federal Awards Finding No. 1:  Special Tests and Provisions – On-site Reviews

Federal regulations require that each school district, prior to February 1, shall perform no less than one on-site review of each school under its jurisdiction.  The District was unable to provide documentation to support that the required on-site reviews were conducted for 27 of the District’s 43 schools.

Federal Awards Finding No. 2:  Special Tests and Provisions – Competitive Food Sales

Contrary to Federal regulations and State Board of Education rules, three of five District high schools tested had vending machines that contained items of minimal nutritional value which were available to students during lunch periods.  All five of the high schools had vending machines that contained carbonated beverages which were available to students during lunch periods; however, 100 percent fruit juice was not available at these same locations.

Federal Awards Finding No. 3:  Suspension and Debarment

District records did not evidence compliance with the suspension and debarment requirement for more than $1,975,000 paid to two subreceipients and 11 vendors from three Federal programs.

Federal Awards Finding No. 4:  Equipment and Real Property Management

We noted that equipment purchased with Title I funds was located at schools not categorized as Title I schools during the 2004-05 fiscal year. 

 Federal Awards Finding No. 5:  Allowable Costs/Cost Principles - Compensation of Personnel Services

Improvements were needed in District procedures to provide for required periodic salary certifications to document salary expenditures charged to Federal grants.

Federal Awards Finding No. 6:  Procurement – Contract Administration

Federal regulations require that contracts involving Federal funds contain certain provisions, including records retention and access.  The District paid more than $1,180,000 to two subreceipients and four vendors from two Federal programs without contracts including these two provisions.

Federal Awards Finding No. 7:  Activities Allowed or Unallowed

For expenditures of Education Technology grant funds in excess of $450,000, District records did not evidence approval for payment by an employee knowledgeable of grant terms and restrictions.

Federal Awards Finding No. 8:  Procurement

District records did not evidence the basis for the negotiations for information technology purchases totaling approximately $435,000 made pursuant to direct negotiation rather than pursuant to competitive bid.  Also, the direct negotiation purchasing method was not approved by the Board, although required.

Federal Awards Finding No. 9:  Special Tests and Provisions – Private School Participation

District records did not evidence the notification of, or the extent of involvement of, private schools in the planning and implementation phase for the Education Technology State Grant program, contrary to grant requirements.

Audit Objectives and Scope

Our audit objectives were to determine whether the Leon County District School Board and its officers with administrative and stewardship responsibilities for District operations had:

• Presented the District’s basic financial statements in accordance with generally accepted accounting principles;

• Established and implemented internal control over financial reporting and compliance with requirements that could have a direct and material effect on the financial statements or on a major Federal program;

• Complied with the various provisions of law, administrative rules, regulations, and contracts and grant agreements that are material to the financial statements, and those applicable to the District’s major Federal programs; and

• Corrected or are in process of correcting all deficiencies disclosed in the prior audit report prepared by other auditors.

The scope of this audit included an examination of the District’s basic financial statements and the Schedule of Expenditures of Federal Awards as of and for the fiscal year ended June 30, 2005.  We obtained an understanding of internal control and assessed control risk necessary to plan the audit of the basic financial statements and Federal awards.  We also examined various transactions to determine whether they were executed, both in manner and substance, in accordance with governing provisions of laws, administrative rules, regulations, contracts, and grant agreements.

Audit Methodology

The methodology used to develop the findings in this report included the examination of pertinent District records in connection with the application of procedures required by auditing standards generally accepted in the United States of America, applicable standards contained in Government Auditing Standards issued by the Comptroller General of the United States, and Office of Management and Budget Circular A-133.

The Superintendent's written response to the audit findings can be viewed in its entirety on the Auditor General's web site.