Calaveras County

CALAVERAS COUNTY OFFICE OF EDUCATION Report of Review AUDIT RESOLUTION PROCESS Fiscal Year (FY) 2011-12 and FY 2012-13 BETTY T. YEE California State Controller April 2015 BETTY T. YEE California State Controller April 17, 2015 Kathy Northington, Superintendent Calaveras County Office of Education 185 South Main Street Angels Camp, CA 95222 Dear Ms. Northington: The State Controller’s Office reviewed the Calaveras County Office of Education’s (COE) audit resolution process for local education agency exceptions noted in the annual audit reports. The review covered fiscal year (FY) 2011-12 and FY 2012-13. Our review found that the Calaveras COE followed its audit resolution process for FY 2011-12 and FY 2012-13. As a result, the Calaveras COE was in compliance with California Education Code section 41020. If you have any questions, please contact Carolyn Baez, Chief, Financial Audits Bureau, at (916) 322-7656. Sincerely, Original signed by JEFFREY V. BROWNFIELD, CPA Chief, Division of Audits JVB/ls cc: Claudia Davis, Associate Superintendent, Business Services Calaveras County Office of Education Peter Foggiato, Director School Fiscal Services Division California Department of Education Arlene Matsuura, Education Fiscal Services Consultant School Fiscal Services Division California Department of Education Dan Troy, Principal Program Budget Analyst Education Systems, California Department of Finance Calaveras County Office of Education Audit Resolution Process Contents Review Report Summary ............................................................................................................................ 1 Background ........................................................................................................................ 1 Objective, Scope, and Methodology ................................................................................. 2 Conclusion .......................................................................................................................... 3 Views of Responsible Officials .......................................................................................... 3 Restricted Use .................................................................................................................... 3 Calaveras County Office of Education Audit Resolution Process Review Report Summary The State Controller’s Office (SCO) reviewed the Calaveras County Office of Education’s (COE) audit resolution process for local education agency (LEA) exceptions noted in the annual audit reports for fiscal year (FY) 2011-12 and FY 2012-13. Our review found that the Calaveras COE followed its audit resolution process for FY 2011-12 and FY 2012-13. Background California Education Code section 41020(n) requires the State Controller to annually select a sampling of county superintendents of schools to perform a follow-up review of the audit resolution process. Results of these reviews are reported to the Superintendent of Public Instruction (SPI) and the county superintendents of the schools that were reviewed. Furthermore, California Education Code section 41020(n) states that the State Controller shall require auditors to categorize audit exceptions in the audit report in such a manner that both the county superintendent of schools and the SPI can discern which exceptions they are responsible for ensuring that LEAs correct. The Calaveras COE provides coordination of educational programs and professional and financial supervision for four LEAs its jurisdiction. In addition, the county superintendent of schools maintains special schools and programs countywide, independent of the local education agencies. County superintendents of schools are required to do the following:  Review, for each of their school districts, audit exceptions relating to attendance, inventory of equipment, internal control, and any miscellaneous items, and determine whether the findings have been corrected or an acceptable plan of correction has been developed (California Education Code section 41020(i)(1));  Review audit exceptions related to instructional materials program funds, teacher misassignments, and school accountability report cards. The county superintendents also must determine whether the exceptions have been corrected or an acceptable plan of correction has been developed (California Education Code section 41020(i)(2));  Review audit exceptions related to attendance or issues that include, but are not limited to, those related to revenue limits, adult education, and independent study (California Education Code section 41020(j)(1));  Notify the LEA, and request that the governing board of the LEA provide to the county superintendent of schools, a description of the correction or plan of correction by March 15 of the subsequent year (California Education Code section 41020(j)(2)); 1 Calaveras County Office of Education Audit Resolution Process  Review the description of the correction or plan of correction and determine its adequacy and, if its response was not adequate, require the LEA to resubmit a portion of its response (California Education Code section 41020(j)(3)); and  By May 15 of the subsequent year, certify to the SPI and the SCO that the county has reviewed all applicable exceptions, and state that all exceptions have been corrected, or that an acceptable plan for correction has been submitted by the LEA to the county superintendent, except as noted in the certification. In addition, identify by LEA any attendance-related exceptions or exceptions involving State funds, and require the LEA to submit the appropriate reporting forms to the SPI for processing (California Education Code section 41020(k));  Review LEAs’ unresolved prior year audit exceptions when the California Department of Education defers to the county (California Education Code section 41020(l)); and  Adjust subsequent local property tax requirements to correct audit exceptions relating to LEA tax rates and tax revenues (California Education Code section 41020(o)). Objective, Scope, Our review was conducted under the authority of California Education Code section 41020(n). Our review scope was limited to determining and Methodology whether or not the Calaveras COE followed its audit resolution process in resolving LEA audit exceptions. Our review did not include an evaluation of the sufficiency of the action taken by the LEA and the Calaveras COE to address each exception, nor did it assess the degree to which each exception was addressed. Specifically, our review was limited to the following procedures.  Verifying that the Calaveras COE addressed all attendance, inventory of equipment, internal control, and miscellaneous exceptions. In addition, we verified whether the Calaveras COE addressed any findings on instructional materials program funds, teacher misassignments, and school accountability report cards. However, with respect to exceptions based on sample items, our review did not include a determination of whether or not the exception results were properly quantified and addressed at a districtwide or countywide level;  Verifying whether the Calaveras COE notified LEAs that they must submit completed corrective action forms to the Calaveras COE by March 15, 2013, and March 15, 2014, for FY 2011-12 and FY 2012-13, respectively. Our review did not include an assessment of the LEAs’ progress with respect to taking corrective action;  Verifying whether the Calaveras COE required the LEAs to submit the appropriate reporting forms to the SPI for any attendance-related exceptions that affect State funding; 2 Calaveras County Office of Education Audit Resolution Process  Reviewing the letters of certification due on May 15, 2013, and May 15, 2014, that the Calaveras COE sent to the SPI and the SCO with respect to any resolved and unresolved audit exceptions;  Verifying whether the Calaveras COE followed up with unresolved prior year audit exceptions the SPI required the Calaveras COE to conduct; and  Verifying whether the Calaveras COE adjusted subsequent local property tax requirements to correct audit exceptions related to LEA tax rates and tax revenues. Conclusion Our review found that the Calaveras COE followed its audit resolution process for FY 2011-12 and FY 2012-13. As a result, the Calaveras COE was in compliance with California Education Code section 41020 for FY 2011-12 and FY 2012-13. We made no additional determination regarding the Calaveras COE’s audit resolution process beyond the scope of the review outlined above. Views of We discussed our conclusion with Claudia Thomas, Associate Superintendent; and Julie Brunson, Director of Fiscal Services at an exit Responsible conference held on March 4, 2015. The Calaveras COE representatives Officials generally agreed with the conclusion, declined a draft report, and agreed the report could be issued as final. Restricted Use This report is intended solely for the information and use of the Calaveras COE, the California Department of Education, the California Department of Finance, and the SCO; it is not intended to be and should not be used by anyone other than these specified parties. This restriction is not meant to limit distribution of this report, which is a matter of public record. Original signed by JEFFREY V. BROWNFIELD, CPA Chief, Division of Audits April 17, 2015 3 State Controller’s Office Division of Audits Post Office Box 942850 Sacramento, CA 94250-5874 http://www.sco.ca.gov S15-COE-9019