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Corning-Painted Post school district makes changes after being flagged in state audit

Corning-Painted Post Area School District building.
Natalie Abruzzo
Corning-Painted Post Area School District building.

The Corning-Painted Post (C-PP) Area School District in Steuben County was flagged by the state comptroller’s office in its 2023 municipal and school audits. The district said it is implementing recommended safeguards to its internal auditing procedures.

State Comptroller Tom DiNapoli’s office identified $17.8 million was inappropriately processed by the school district during the course of its audit investigation late last year.

The audit found several instances where the district should improve its financial reimbursement practices.

“They had four recommendations for us, which we've already implemented an action plan for,” said Superintendent Michelle Caufield. “Most of them were [around] our partnerships with GST BOCES and making sure that we work together to look at our claims and make sure that there's more than one person auditing our claims.”

The claims auditor, referred to by Caufiled is an employee at the Greater Southern Tier Board of Cooperative Educational Services (GST BOCES), an academic institution that provides career and technical education and development.

The claims auditor was responsible for auditing billing claims that were made by GST BOCES to the Corning school district.

According to the state comptroller’s report, it was a conflict of interest for the GST BOCES claims auditor to audit their own claims because the person in this role had no independence or objectivity. The school board is required by state law to either audit claims themselves that are from a shared service provider, such as BOCES, or appoint an independent claims auditor for these purposes.

The C-PP School Board President Dr. Dale Wexell said in a statement:

“At the time of the appointment of the claims auditor, the Board obviously missed the [GST] BOCES claims issue as did BOCES itself. As soon as the BOCES claims conflict of interest situation became obvious, the situation was addressed by the Superintendent and Board as soon as possible. I would also note that other school districts that used a BOCES claims auditor would face the same issue with payment for their district BOCES billings. Our district actually framed the conflict for all.”

Wexell’s statement continued: “When the district became aware of the [GST] BOCES auditor practice of auditing the BOCES claims for the district, the situation was addressed as soon as possible by the District. The District appointed two independent claims auditors on March 15, 2023 to address the situation.”

It is not clear why GST BOCES was auditing its own claims. Multiple attempts to reach them went unanswered.

The GST BOCES claims auditor told the comptroller’s audit team that they were not aware of the school board-adopted claims auditor policy, according to the report. They also stated that they did not reference any other relevant school board policies when auditing claims.

C-PP School Business Official, Paul Webster told the comptroller’s audit team during its investigation that he was not aware of the state law requiring the school board to independently audit GST BOCES claims or appoint an independent claims auditor.

“The separation between BOCES and districts [was] very common,” explained Webster. “Most districts were doing it the way we were doing it, meaning BOCES were in fact, auditing their own invoices. That still went through a process, the invoices were correct. But they still cited that to us. Because they shouldn't be auditing their own invoices.”

Additional recommendations by the comptroller’s office include: ensuring that supporting documentation accompanies any payment of reimbursement; all claims must be audited and approved for payment prior to any reimbursement; and providing the claims auditor with all relevant policies and procedures approved by the school board.

The district said audits are conducted every seven years.

The full corrective action plan was presented during the Dec. 2023 school board meeting and can be found on the board’s website along with the audit from the state comptroller.