Albany-Schoharie-Schenectady-Saratoga_Final_Audit_Report

January 23, 2006

Mr. John Yagielski

Board President

Capital Region BOCES

1031 Watervliet-Shaker Road

Albany, New York 12205

Dear Mr. Yagielski:

The following is our final audit report (BOC-1102-1) of the Capital Region BOCES for the period July 1, 2001 through September 30, 2003. The audit was conducted pursuant to Sections 305 and 1950 of the Education Law in pursuit of Goal #5 of the Board of Regents/State Education Department Strategic Plan: “Resources under our care will be used or maintained in the public interest.”

Ninety days from the issuance of this report, BOCES officials will be asked to submit a report on actions taken as a result of this audit. I appreciate the cooperation and courtesies extended to the staff during the audit.

Sincerely,

Michael Abbott, CPA

Enclosure

cc: Commissioner Mills, T. Savo, B. Porter, J. Kadamus, G. Smith, C. Szuberla, C. Foster (DOB), W. Campbell (OSC), Barbara Nagler, District Superintendent

Executive Summary

Background and Scope of the Audit

Capital Region Board of Cooperative Educational Services (BOCES) is headquartered in Albany, New York and serves 24 component districts and the Albany City School District. Together these schools serve more than 79,000 students. Capital Region BOCES had general fund expenditures of $66 million and was ranked as the seventh largest BOCES in the State, in terms of total general fund expenditures, for the 2001-02 school year.

The objective of the audit was to assess the adequacy of Capital Region BOCES' internal controls which are designed to help ensure its goals and objectives are accomplished; laws, regulations, and good business practices are complied with; assets are safeguarded; and accurate and reliable data are maintained. The audit focused on internal controls and reviewed practices, records, and documentation for the period July 1, 2001 through September 30, 2003. This audit also followed up on findings and recommendations from the previous New York State Education Department (Department) audit.

Summary of Audit Results

The audit determined that Capital Region BOCES had many of the necessary controls in place; however, improvement opportunities exist in certain areas. A summary of our recommendations and findings follows:

· Improve controls in the governance area by submitting budget status reports to the Board; obtaining the Board’s prior approval for the District Superintendent to attend conferences; appointing appropriate individuals such as the internal claims auditor; adhering to competitive bidding requirements; and establishing the required policies and procedures. (pages 4-9 )

· Implement an integrated accounting system and improve documentation and accountability in the Employment Preparation Education (EPE) program. (pages 10-14)

· Improve controls over cash collections by using pre-numbered, multi-copy receipt forms and restrictively endorsing checks upon receipt. (pages 15 and 16)

· Improve controls over inventory records and physical inspection of the items. (pages 17-19)

· Improve management processes pertaining to refunds, EPE waivers and documentation, grant accounting and reporting, technology plans, payroll, and internal controls. (pages 20-30)

· Re-evaluate the need to implement the recommendations in our previous audit report. (pages 31-34)

Comments of Capital Region BOCES Officials

Capital Region BOCES officials’ comments about the findings were considered in preparing this report and are included as Appendix B. Capital Region BOCES officials generally agree with the recommendations and plan on implementing them as necessary.

Table of Contents

Introduction.. 1

Background.. 1

Objectives, Scope, and Methodology.. 2

Summary of Audit Results. 2

Comments of Capital Region BOCES Officials. 3

Governance and Planning.. 4

Budget Status Reports. 4

Approval of the District Superintendent’s Attendance at Conferences. 5

Appointment of Certain Individuals. 5

Internal Claims Auditor. 6

Deputy Treasurer. 6