Office of Shared Accountability MONTGOMERY COUNTY PUBLIC SCHOOLS Rockville, Maryland November 26, 2008 MEMORANDUM To Mrs. Nanette Poitier, Principal Julius West Middle School From: Roger W. Pisha, Supervisor, Internal Audit pif atm. Subject: Report on Audit of Independent Activity Funds for the Period January 1, 2007 through September 30, 2008 This audit report presents the results of our examination of the financial records, reports, and internal accounting controls relating to the Independent Activity Funds (IAF) for Julius West Middle School for the period January 1, 2007, through September 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 [AF management. Findings and Recommendations ‘At our meeting on November 11, 2008, we advised you that the school financial records are in very good condition and that required reports were being produced in a timely and accurate manner due to the knowledge and experience of Ms. Sheila Brooks, financial assistant. We also reviewed the status of conditions described in our previous audit report dated February 7, 2007, and noted actions have succeeded in improving those conditions. Below we describe two weaknesses found during our present audit. Sales of PE uniforms should comply with the requirements outlined in the Handbook for the Operation of School Stores. Garments should be counted when they are added to inventory and records of sales, free distributions, and removal from inventory due to damage must be maintained. We found a significant shortage in the uniform sales account in 2008 based upon the number of garments available for sale. Using the available records we were not able to ascertain the reason for the shortage. We recommend that records of disposition of all uniforms be kept to improve internal controls over this activity. Cash and checks collected by sponsors and others for IAF activities should be remitted promptly to the financial assistant. These receipts must be deposited promptly, and all receipts must be deposited on the last working day of each month and before each weekend or holiday (see IAF manual, p. 6). We noted instances in which receipts from admission to school dances were notMrs. Nanette Poirier 2 November 26, 2008 promptly remitted. We also discussed ways to improve controls over funds collected by the sponsor of the school store. To minimize the risk of loss, we recommend that all funds collected be promptly remitted and deposited in the bank. Other matters were discussed and satisfactorily resolved. We appreciated the cooperation and assistance of your staff, especially Ms. Brooks. In accordance with MCPS Regulation DIA-RA, Accounting for Financial Operations/Independent Activity Funds, please provide a response to the Internal Audit office within 30 days of this report, with a copy to Dr. Sherry Liebes, community superintendent. RWP:LS:1r Copy to: Mr. Bowers Dr. Lacey Dr. Scott Mr. Bedford Dr. Liebes Ms. DeGraba Ms. Diamond Mr. Doody