Summary

The Volusia County District School Board prepared its basic financial statements for the fiscal year ended June 30, 2006, 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.  However, we did note internal control and compliance findings that are summarized below.

Summary of Audit Findings

Finding No. 1:  Information Technology - Access Controls

Improvements were needed in the District’s access controls over information technology resources.  In the absence of adequate access controls over information technology resources, there is an increased risk that unauthorized or improper use of computer resources could occur.

Finding No. 2:  Information Technology - Software Change Management

Improvements were needed in the District’s software change management procedures for information technology applications to ensure that all software changes are properly authorized, tested, and implemented.

Finding No. 3: Information Technology – Disaster Preparedness

The District’s disaster preparedness could be improved by providing for periodic testing of all critical systems outlined in its Disaster Recovery Plan.

Finding No. 4:  Student Fees - Extended Day Enrichment Program

Improvements were needed in controls over student fee collections for the Extended Day Enrichment program to ensure that funds are submitted timely for deposit, and prenumbered receipts issued are reconciled to fee collections.

Finding No. 5:  Purchasing Card Administration

Improvements could be made in controls over purchasing card transactions to ensure that monthly transaction purchase limits are in accordance with cardholder agreements and that access to purchasing cards is timely removed for terminated employees.

Finding No. 6: Capital Outlay - Architect Insurance

District policies and procedures did not ensure that its architectural firms were adequately and properly insured.

Finding No. 7:  Fingerprinting and Background Screening Requirements

Improvements were needed in procedures for timely obtaining fingerprints and background checks for staff and contractors as required. Delays in performing the required background screenings increase the risk that staff and contractors may have backgrounds that are not suitable for direct contact with students.

Finding No. 8:  Cellular Telephones - Taxable Fringe Benefit

The District did not have formal policies and procedures regarding the assignment and use of District cellular telephones. 

Summary of Report on Federal Awards

We audited the District’s Federal awards for compliance with applicable Federal requirements.  The Title I Grants to Local Educational Agencies and Improving Teacher Quality 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 a compliance and internal control finding that is summarized below. 

Federal Awards Finding No. 1:  Special Tests and Provisions - Highly Qualified Teachers

The District used $157,830 in Title I funds to pay the salaries and benefits of four teachers who were not considered highly qualified as defined in Title 34, Section 200.56, Code of Federal Regulations.  These payments are considered to be questioned costs subject to disallowance by the grantor.

 Audit Objectives and Scope

Our audit objectives were to determine whether the Volusia 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;

• Established management controls that promote and encourage:  1) compliance with applicable laws, administrative rules, and other guidelines; 2) the economic, effective, and efficient operation of the District; 3) the reliability of records and reports; and 4) the safeguarding of District assets;

• 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 the process of correcting, all deficiencies disclosed in our report Nos. 2004‑202 and 2004-208 and the audit report for the 2004-05 fiscal year 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, 2006.  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 response to the audit findings and recommendations is included in the full report.