Office of Shared Accountability MONTGOMERY COUNTY PUBLIC SCHOOLS Rockville, Maryland September 15, 2008 MEMORANDUM To ‘Mr. Michael J. Zarchin, Principal ‘Thomas W. Pyle Middle School From: Roger W. Pisha, Supervisor, Intemal Audit ppd, Subject: Report on Audit of Independent Activity Funds for the Period March 1, 2006, through June 30, 2008 ‘This audit report presents the results of our examination of the financial records, reports, and intemal accounting controls relating to the Independent Activity Funds (IAF) for Thomas W. Pyle Middle School for the period March 1, 2006, through June 30, 2008. The examination was made to determine the adequacy of accountability over these funds, compliance with applicable Montgomery County Public Schools (MCPS) policies and procedures, and effectiveness of IAF management. Findings and Recommendations During our meeting with you and Ms. Mary Baur, financial assistant, on September 10, 2008, we commended you on your efforts to improve internal controls which we previously reported as, weakened by a number of conditions. All items in our previous report had been completely corrected or substantially improved and except as noted below, intemal controls are functioning as required. We found the records to be complete and orderly which facilitated the completion of our work. MCPS Regulation DMB-RA, Control of Admission Receipts, provides requirements for the accounting for sales of admission tickets. While receipts from most events were properly controlled, tickets for two events held at the school were not controlled by the ticket controller. Tickets for all events should be pre-numbered and delivered to the ticket controller for issuance to the admissions manager who should return all unsold tickets when proceeds of sales are remitted. We recommend that admission to all events be controlled in accordance with the above cited regulation. Any disbursement of more than $6,500 or any contract with an anticipated aggregate expenditure of more than $6,500 requires the prior written authorization of the chief operating officer. During our review of disbursements, we found a disbursement of $14,279.68 to purchaseMr. Michael J. Zarchin 72+ September 15, 2008 exercise equipment for the physical education department but we could find no indication the required approval had been obtained. Use of the approval process helps assure compliance with laws and regulations governing procurement. We recommend all purchases of equipment be coordinated with the Division of Procurement to assure that approvals and controls are achieved (see IAF manual pp. 2-3). Other matters were discussed and satisfactorily resolved. We appreciated the cooperation and assistance of your staff. Please provide a response to Dr. Frank Stetson, community superintendent, within 30 days of this report, with a copy to the Internal Audit office. RWP:LS:r Copy to: Mr. Bowers Dr. Lacey Dr. Scott Mr. Bedford Dr. Stetson Ms. DeGraba Ms. Diamond Mr. Doody