Legislation to improve school audit oversight goes to governor
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Published: 25-May-2010

CapitolBeatOK Staff Report

Published: 25-May-2010

Legislation formulated in response to recent financial scandals at state schools with the goal of improving oversight of school audits overwhelmingly passed the House yesterday on a 98-1 vote. It now awaits Governor Brad Henry’s consideration.

Senate Bill 2034, by Republican Rep. Dan Sullivan of Tulsa, would give the Office of the State Auditor and Inspector more responsibility when it comes to reviewing school district audits.

“We must do all we can to make sure every education dollar is spent on academics, not padding someone’s pockets,” said House Speaker Chris Benge, also a Tulsa Republican. “Given recent fraudulent activities, we must improve accountability so Oklahoma taxpayers can have confidence in school expenditures in the future.”

All Oklahoma school districts are required to have their financial records independently audited each year. Currently, those audits are forwarded to the Department of Education.

This legislation would allow the State Auditor and Inspector to authorize four special audits a year, contingent upon availability of funding, of school districts with any size average daily membership.

Additionally, each school district would be required to forward a copy of its audit to the state auditor to determine if it complies with law.

Under the bill, if the state auditor authorizes an audit of a school district for not complying with audit requirements, the district shall pay for the audit.

Finally, the legislation requires that all firms entering into audit contracts with school districts carry a minimum of $500,000 accountants’ professional liability insurance or total amount of the budget being audited, whichever is less. The independent auditors hired by school districts will also be required in the bill to complete a minimum of eight hours of continuing education credit in school district accountancy.

“The auditor’s office has a recent track record of catching corruption and waste in our schools and is the logical entity to put in charge of financial oversight,” said Sullivan, R-Tulsa. “This bill ensures schools have the proper accountability when it comes to state expenditures.”

A recent audit of Skiatook Public Schools, conducted by the Office of the State Auditor and Inspector, found the school wasted $570,000 on over-priced supplies during a five-year period. The excess purchases included spending up to $60 apiece for $8 trash cans and $1,500 for a $500 vacuum, among other things.

Although the Skiatook district had been audited each year and that audit sent to the Department of Education, the wasteful spending was not identified until the Office of the State Auditor and Inspector became involved.

Other audits have shown problems in public schools, most notably in the Broken Arrow public schools.

Senate Bill 2034 passed the House today with a vote of 98-1 and now goes to the governor for his consideration.

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