Legislative Joint Auditing-Educational Institutions
Video
Transcript
1 document
Machine transcript
May contain errors. Verify important quotations against the official video.
About transcript accuracy
- Source
- SliQ live captions
- Model
- SliQ live ASR
- Processing date
- October 2, 2026
you just give your wisdom and guidance as we do this work and do it diligently with excellence and thank you for all our school districts and and our our colleges and and universities that have a mission of educating well and again through excellence so ask us to to do that this job well and in collaboration and partnershipsus same pray amen right members thank you for being here today and hope you've had a great week. so glad to see y'all we will call this
meeting to order co-chair any comments OK right we'll kick off first on the agenda is on B is adoption of the minutes of the January8th meeting. I'll take a motion got a motion in a second second all in favor sayy aye opposed like sign it is passed members now we are going to see we have three reports today and Mr. Fink if you'll read through the first one thank you Mr chair and good
Speaker 4
1:20
afternoon today there are31 education audit reports for the review three with findings we will begin with northwest Arkansas Community College which was deferred from the January meeting instead of reading the findings in full, I'll provide a brief summary finding one was a repeat finding related to deficiencies in internal controls over financial reporting which led to material misstatements in the financial statements
a ALA auditors noted various errors which are detailed in your synopsis in the statement of net position statement of revenues expenses and changes in that position. statement of cash flows and notes to the financial statements. these errors were subsequently corrected by college personnel during the audit. finding two was related to a loss in tuition revenue totaling 1 almost $144,000 due to an internal control deficiency in a new
student information system that was implemented in april of 2023. Students who registered for classes after the academic period effective date were not charged student tuition resulting in the loss of revenue. Management has provided a response to both findings and they are also in attendance to answer any questions the committee may have. Thank you Mr Kring and we will invite Alex
Catherine Donor
Unverified
2:45
and Caitlyn to the table if you will introduce yourself for the record and we'll welcome you.
Catherine Donner
Unverified
3:01
Hello my name is Catherine Donner. I am the interim CFfo at Nack. Thank you.
Speaker 11
3:08
good afternoon Alexoskoz, chief of staff and executive director for government and public relations thank you Katherine. thank you Alex thanks for
Catherine Donor
Unverified
3:14
being here well I know these are not always fun meetings to be at but we appreciate your your time and your comments today
you know I'll just kick it off with a framework it sounds like fortunately we have accounted for the dollars but maybe they've moved to different
buckets and and through the audit reviews it's there's been some best practices and some reviewing of of how to how to
work through that but would love your initial comments of of the findings today
Speaker 11
3:44
and and set the set the scene for us yes that's that's well stated these are misclassification and process issues so all the money is there in fact I think our net position was better than what initially was reported so that's all good news and
so but we are here and Ca Katherine is the expert and knows all this information and numbers someone let her address any questions specific about the the audit itself Katherine would
would you maybe just give us some comments about the findings and the process of the timeline of of
Catherine Donner
Unverified
4:23
how we got here so timeline and as you stated in april of 23 we instituted a student workday
the fy 23 audit was completed quite a bit after the time so a lot of the errors that we found in fy 23 were not cleaned up by the time we started the fy 24 audit on a separate note the largest item on here was the overstatement of cash and cash equivalence in Fy24 for the first time in quite a few years the college invested5.5 million dollars and
because those investments were under a year they were placed into cash and cash equivalents rather than investments because the governmental accounting standards are for three months being the cutoff for cash and cash equivalents rather than investments so that was a classification error but the money was not missing it was it was simply misclassified and that was corrected we had to with the implementation of
studentorkday our scholarship allowance was the a large difference the large difference in revenue and expense overstatements were due to we had to find a way to calculate scholarship allowances differently because workday did not allow us to capture that information in the in the detail that we had always used in the past and we took it took us a while to be able to manipulate the data to get that information accurately those are the biggest
things speaking on the on the misst revenue that that happened there was a workday update in September of 23 that led to the missed revenue it was it was due to the new release update and that was something that we identified during that time but we fixed it after the end of after the end of the fiscal year we had consultants brought in to help us get that that fixed and we
also had to do a ticket withorkday for
that thank you Catherine members any questions all
Representative Howard M. Beaty, Jr.
Unverified
6:51
rightpresentative beatty in your response to the findings you you state that finance is going to develop a standard operating procedure for accounts receivable accounts payable reconciliation each month. can you describe that procedure to us so
Catherine Donner
Unverified
7:03
we have come up with a closing list of and dates that are being met each month
there there may be some exceptions here and there but in general we are closing the month several of these errors were year-end accrual entries that were overlooked or made incorrectly the prepaid there was some an invoice that was miscalculated for the prepaid accrual but we have instituted closing months we have a checklist we have processes for approvals on
journal entries to make sure that we're getting the correct ones in place they're
Representative Howard M. Beaty, Jr.
Unverified
7:48
getting the correct numbers in and just a quick follow up who who actually processes and approves your closing and adjusting entries
Catherine Donner
Unverified
7:55
at the university or at the college that would be me I am interim CFfo but my position my formal position is the executive director ofc accounting slash controller and that so that is myself for the second time in a in 2.5
years I am acting as interim because we've lost ourvP so
Representative Howard M. Beaty, Jr.
Unverified
8:17
the the errors that were where these were reversed twice was at a staff member that had had made those incorrect entries to correct it was made by a couple
Catherine Donner
Unverified
8:26
of different staff not communicating well with each other so the checklist should prevent that from happening in the future that's that's what I was hoping for is that they'd
Representative Howard M. Beaty, Jr.
Unverified
8:35
been procedures in there who who could create the entry a secondary review approval and then then a review by you so we
Speaker 31
8:44
shouldn't see this error again thank you Members any other questions cochairduke thank
Representative Hope Duke
Unverified
8:56
you Mr Cha thank you all for being making a long trip down here appreciate it I just have an andpresentative beatty kind of touched on it a little bit
my one of my concerns is just this is you know the finding one we've had it for previous audits and so I would just like
to hear from you all a little bit more about how you're going to what
you've done to implement to make sure that we don't have this
Catherine Donner
Unverified
9:23
finding at 1/5 audit so we have we have made some changes to hopefully do some things to bring in a a vice president that is that is very qualified and knowledgeable so that we can attract you know better talent that hopefully will
stay with us we have we're in discussion of reopening a position that hasn't been filled since 21, which is an associate vice president of finance and we are we have job openings you know with our recent compensation adjustments we're hoping that those new more marketable salaries will help us bring in better talent we have had a lot of turnover even continue to have turnover losing people to
some of the corporate and other universities in the area we have trouble retaining our people when we get them so we continue to have turnover and be short staffed but we are widening our searches. we are crosstraining so that hopefully that when one person does leave there's someone else who can pick up and take over at least for the short
Speaker 39
10:42
term how long have you all been without that vice president position held
Catherine Donner
Unverified
10:51
the the most previous vice president left in November 12th was her last day and so I have been acting as interim she had only she had
Speaker 29
11:00
worked for the college for a year and a half and and I was interim for several months
Speaker 10
11:07
prior to that please go ahead and add too that we actually thank you we're actually
Speaker 11
11:12
conducted a search in the fall before she departed she gave us a good notice and the college did try to fill that position in the fall. it was an unsuccessful
search unfortunately but we are reopening that search this spring to replace the vice president. Do you have other physicians
Representative Hope Duke
Unverified
11:28
that you're unable to fill in this department? yes I do
Catherine Donner
Unverified
11:33
I also at the end of the calendar year lost my general ledger manager who was I had had been working for me for two years. she gave notice and went to a corporate position and we have an assistant treasury manager positioned at
is open or is filled right now but the the incumbent is leaving in a couple of months so and then of course we have the the umvP opening
Speaker 11
12:03
and I'll add staffing just is a a challenge for us we are really a talent a workforce feeder for the the region in many ways just even outside of finance when I joined there were two team members on my team and within six months
had turned over those positions so it's just we get we have great people some great training and opportunities and then they find places other places where they can move so but we are continuing to work on this succession planning in place you know forre each of these positions and really working hard to give Katherine and her team the resources that they need for the job it's I just I just applaud Catherine for the work that she does and with a very lean team really
s staying on top of what really is a huge operation you know there And I was gonna echo echo that sentimon as
Representative Hope Duke
Unverified
13:03
well as far as Katherine it sounds like you have been one of the steady forces there for the university when they've had so much turmoil or not turmoil but
changeover so do appreciate that I have one other question and it's on finding two and I'm not sure if I'm understanding it correctly or not so I'm just gonna ask it to make sure. So on this not we're not charged student
tuition these kids so are you saying these students there was a number of students who were not charged tuition. they basically went to
Catherine Donner
Unverified
13:34
school to some degree free OK so this this just post error was tuition only so they did not they they did get charged all the appropriate fees and they did get charged tuition in some of their classes but if they did a a drop ad and like say added a class that would be the where the tuition line item didn't get charged and all of the
tuition revenue is posted by class so again it was just the some classes not all and and that error was was corrected but it was decided by our student services team that it did not make sense to go back to the student after the end of the semester and and rebuild them so it was decided and it would have been a financial aid related administrative
problem so it was decided to that we did not go back and try to collect that money that was decided by the cabinet and student services. OK thank
Representative Hope Duke
Unverified
14:40
you that kind of answered part of my next question were the students aware that this happened? Were they made aware that this happened? do not know that I'm I
Catherine Donner
Unverified
14:49
know that some of them were but I do not know in general if they determine if they it was decided to contact those students. OK well I just speaking
Representative Hope Duke
Unverified
14:58
as a mom of a college age student who at one
point had a fair amount of a scholarship double put into his account and then we called and said hey you've got an err not not at your university not your school but at a different school and we called and said hey listen this happened and we want to make sure you know that and so I would hope that we would have individuals who would pay their bill but if they're not aware that they owed parts of it as well they may not be paying because I would have other kids in my family who may not we're paying as close attention to what was going on on their accounts so I understand that
kids may not necessarily catch that but I would hope maybe in the future your cabinet will at least let them know because I think there are people up there who understand you did receive the service so you still should be obligated to pay for it just as a moral aspect of it so but thank you for clarifying that because that was one of the questions I had was as you know what who determined not to have those students try to try to recover the money. I do I do know
Catherine Donner
Unverified
15:56
that it was a student who pointed out the problem but I do not think that all of the students as you say many students may not
look it's a rather long bill when you get it so they may
Representative Hope Duke
Unverified
16:09
not look at at it line by line. Well kudos for that kid and if you were in my class I probably would have given him the A
Chair
Unverified
16:16
for telling me that he missed the question so I
Representative Wayne Long
Unverified
16:22
do appreciate that as well yeah take care of some depresentative Long recognizecog and thank you Mr Chairman how big is sales department that does you know basically takes
Catherine Donner
Unverified
16:30
care of this this portion of your so we have current we have uh6 if if we were fully staffed we
would have including myself we would have 9 that that counts includes budget my budget team which is 3 to4 people any idea about
Representative Wayne Long
Unverified
16:47
how how underpaid they are as far as compared to you know other universities very rough because I'm not that familiar
Catherine Donner
Unverified
16:58
with what the universities but I know that we had a an employee who left and it was
more of an entry level sour position and he left making47 to48 and he went to the university and took a job at60 at that time we were just about to implement phase three of our compensation adjustments that we've been working on for the last four years and so we his coworker in in order to prevent
losing him we went we were able to give him some more money but we could not convince the other employee to stay but then a few months later the worker that we increased his salary also left and went tou ofA so and I do not know what where what his salary was but one of the factors in maintaining these people is the commute it's it's very hard for entry levelve people to afford to live
in BentonvilleaRogers and so they commute from Fayetteville or west Benton County and when you can take more money and be closer to home it's they you know they usually make that choice well the reason I was asking
Representative Wayne Long
Unverified
18:23
is like you mentioned y'all have been working on a four year plan to increase salaries
and I was wondering if is there any effort to like speed up this plan because these repeat findings you know it's like we can't can't discontinue with that and
you had only6 or 9 people I think that you reprioritize some other budget items maybe you can get
Catherine Donner
Unverified
18:49
the pay where you won't you have that turnover so we we in July of 25 we implemented phase three of a four phase plan which phase3 concentrated on the higherle employees more salaried employees than the earlier phases and brought people up to midlevel in the market however
it's some of the other areas continue to raise salary as well so we can't necessarily match some of the corporate corporate areas and
Speaker 12
19:24
we're we may fall slightly under the university as well thank you ma'am Mr. Long uhpresentative Mayberry you re
recognized thank you umpresentative Duke asked quite
Representative Julie Mayberry
Unverified
19:40
a few questions that I was going to ask but 11 little
part of it to the the students who didn't have the class charged to them I'm just curious because I know that there are times when there's a student who has received a scholarship and at the end of that semester if not all of that money was needed they get that money back you know sometimes it can be just a small amount but if they weren't charged for that class did that student then also receive that money back to put in their
own pocket I'm not sure I don't know the answer for
Catherine Donner
Unverified
20:24
a class that they should have been charged for I understand I do not know the answer to that. I do know you know that we do as you say wed we disbursed the financial aid once we have satisfied their bill and do not know if we went back and adjusted the the financial aid or of the scholarships I can find out and and I realize I mean that was quite some time
Representative Julie Mayberry
Unverified
20:46
ago it's probably really hard to go find that poor college student who probably got excited because they got a few $100 back at the end of the semester to you know cover the other life expenses their car, their transportation their whatever you know to get there but I I just was curious if that was looked at and again kudos to the that was gonna be a question is you know was there not a student somewhere along the way because I know my kids we we always look at it and if something is being charged or overcharged we look at our bill
and you know thank goodness there was a student who spoke up and I don't know what you've done for that student but you know tell them thank you because this could have continued on for a pretty good amount of time yes or would it
Speaker 64
21:30
have been caught the next semester it was probably caught in a workday release. I'm sure we weren't the only school that had the problem but
Catherine Donner
Unverified
21:37
you know yes it could if we had waited on external areas it could have it could have gone on so you're saying there's other schools that
Representative Julie Mayberry
Unverified
21:44
probably have done this exact it was a work day it
Catherine Donner
Unverified
21:49
was a workday issue so and it was a release you know a a software upgrade I'm assuming it didn't just happen
Speaker 11
22:01
to us that's an assumption this coincided with the adoption of workday it was an update
Speaker 81
22:09
to it and like yeah it was an internal bug rather
Catherine Donner
Unverified
22:15
than a configuration error it was not
right so sometimes if you don't set things up correctly you might have a configuration error but this was an internal workday issue
Speaker 85
22:29
thank you Representative Brooks thank you Mr Chair and this is probably more a question
Speaker 86
22:34
for Mr. Fink in an audit has since this was a software issue which may have impacted other institutions that we looked into if this was a a larger problem that we need to investigate I'm not aware of other issues
Speaker 4
22:50
that we've had specifically for this at other higher ed institutions that's not to say that there haven't been issues noted in response to findings that we've had related to this software that's being discussed but I'm I'm not aware of this specific scenario we Nright was one
Catherine Donner
Unverified
23:11
of the first institutions in the state to convert over to student workday so that may be why
Catherine Donor
Unverified
23:21
well thank you for being here I I did hear significant work to do your best not to be back so we appreciate that thank you for putting those measures in place with the checklist that you ascribd as well so thank you for your service to the community and these students so we know it's it's important work and was without any further questions and without objection this will be filed and as
Speaker 89
23:41
reviewed thank you for being here thank you right Mr Fink
Speaker 3
23:45
next finding the next report for review is Cedarville school district which had one finding that was
Speaker 4
23:51
referred to the bomb board as well as the prosecuting attorney and attorney general the district discovered and we verified improper credit card charges of794 dollars and elementary teacher who resigned in June of 2025 stated to district officials that these charges were for personal expenses the employee reimbursed the district for the794 dollars district officials contacted the school resource officer and a police report was filed.dditionally this matter was submitted to the
professional licensureandards board and that concludes findings for Cedarville school district. members any questions on
this report? OK cohair Duke thank you Mr Chair I
Representative Hope Duke
Unverified
24:33
have a quick question for staff so I know it says additionally this matter was submitted to the professional licensersboardandards board do do we or can we get any update because we have we have several school personnel over the time that have some of these similar issues how do we make sure
or find out the information that this doesn't just this person doesn't just go to another
Speaker 4
24:59
district and do the same thing so the only thing I'm aware of on this one is that I believe the school received a letter saying that no further action was taken it it was looked into by the PLSB but I'm not aware of any additional action that was taken and I'm not aware of any additional action taken by the police department as well do you
Representative Hope Duke
Unverified
25:24
know if if if in any of these instances especially when that we've had some really significant numbers if they ever attached to their certificate because I know other items attached to their teaching license. So
Speaker 4
25:36
generally if they do so if they take that kind of action we'll know it. I know we've had some that we presented in the past where we knew that the PLSB actually took action and if I have that information I'll typically share it with the committee one more question
Speaker 87
25:48
do you know if it goes in a file or in the
Representative Hope Duke
Unverified
25:55
personnel file or anything like that I'm
I'm unaware thank you all right members without any further questions this will be and without objection it will be filed
Speaker 4
26:07
as reviewed all right the last report with findings last report is West memphis school district which had one finding that was a repeat during our examination of capital assets the following discrepancies were noted the district failed to capitalize $851,000 of construction expenditures related to the baseball softball complex 8
items with initial cost of $200,000 were included as capital asset additions but due to errors the asset values were not included in the total active assets and the total ending balance one capital outlay purchase was not properly capitalized and of the 10 items we selected for observation for were not available for inspection in a similar finding was noted in the prior audit. thank you Mr Fink and I believe we have a representative
Catherine Donor
Unverified
26:51
from West Memphis welcome to the table introduce yourself and we will welcome you.
Speaker 101
27:00
I'merric oyster. I'm the superintendent of West memphis schools apologies for Drctor Wolf, our school board president. she is out of state today otherwise she would be definitely here. thank you Mrforeer and thanks for
Catherine Donor
Unverified
27:12
being here and will we'll just open it up like we normally do we heard we heard the report on the findings we'd love some of your commentary and some thoughts and and I believe it's probably relevant information to note to to say I've got a note you've been there about 13 months is that correct in your role ok so tell us a little bit
Speaker 101
27:31
about what's going on here so we had our first legislative audit for Fy24. the district had never done a a public audit so there's a lot of processes and procedures that were never put in place so before this was the I got to give credit to the school board I wouldn't want to do a public audit but they had already agreed to do that so I started in December of 2 whatever fiscal year so I was on the tail end of that we just finished up the baseball softball I was not
aware of those findings to be honest until after the audit came through I was aware of our issues with fixed assets which is the repeat finding so what we have done we now have a process and procedure in place not only for the fixed assets but we have a requisition PO process that goes through three levels before it ever gets approved and when it gets approved when it comes in it gets received we have the you know the the chain of duties separation of duties is already in place
so now we have a tagging process for all our equipment the hard part for us quite frankly at this point is we have so many assets that were not quite frankly inventored for years so we are in the process of trying to retire some assets that should have been retired years ago we did retire a couple since I've been here and we're in the process of making some significant ones here over the next few months our department leads building principles they have a process laid out they have a due date by
May15th to get back with me on where we're at and then go from there
thank you for that description I appreciate it so were you were you kind of double click on what you had mentioned about some of the checks and balances may be there and and where is your
Catherine Donor
Unverified
29:17
school board involved on some of that are are they a part is it brought to them for final approval what does that
Speaker 101
29:24
look like? so we follow the same guidelines that you know ASBA school districts so anything over the significant dollar amount gets approved by the
board typically being new and I'll just be frank we I'm the6th superintendent since 2 022 so there's been a lot of turmoil a lot of so I'm trying to be transparent so any large ticket item I put it in front of the board whether it needs whether that's the right I'm gonna I don't want anything that's considered we're trying to do something we're not supposed to be doing so I have a deputy super when I started I had I don't wanna say nobody had very limited the people were retired around me so for about six months it was just me so our business manager is
very sharp. she's in place now we have a deputy superintendent. I have two other guys in that in that lead office so the process goes and we also federal program so the dollar amount because they have to get checked off by the chief academic officer over that grade level goes to the goes the principal him then to the deputy superintendent and if it's anything over you know significant amount then it goes through me. So one of the so three steps before it ever gets approved and then we have separation duties we have two accounts payable and then we have receiving as well that comes in a different way so
we've we've really tried to the operational excellence is something we're striving
Chair
Unverified
30:42
for thank you uhsenator Love you recognize
Senator Fredrick J. Love
Unverified
30:46
thank you Mr chair I'm looking in at I think it's the fourth bullet point which is of the 10 items selected there were four that observed that were not available so were those big ticket items or were those I mean were they old were they big ticket what kind of
Speaker 109
31:03
to to my knowledge they weren't big ticket but they were older. OK
Senator Fredrick J. Love
Unverified
31:10
so so so you're doing a you're doing a clean up your you're kind of clean out your inventory tagging things that is correct do you have any items missing? ord I mean like to your to your knowledge if if if like are we truly cleaning up or you gonna are you gonna come back and say hey you know what we have some tractors that are just missing somebody you know to
Speaker 109
31:37
my knowledge nothing big ticket like that nothing I think
staff can read a couple of these that
Speaker 87
31:43
might be helpful too and we do that that would
Speaker 4
31:48
be yes so for the four atoms that were unavailable for inspection the total cost of the fort like altogether is around6,000 dollars they were purchased anywhere from 2007 to20 19 all items except one were fully depreciated. one was a desktopu computer one was a MacBook, a musical instrument and a sympodium. oh
Senator Fredrick J. Love
Unverified
32:12
no useful value right other than that you you you've cleaned them out of your inventory. we're in the process yes
Chair
Unverified
32:23
thank you thank you Senator Love uhpresentative beatty you're recognized oh you're good now thank you
Representative Julie Mayberry
Unverified
32:32
sir uhpresentative Mayberry recognized thank you. I'm just asking for some clarifications because maybe I just misunderstood you did you say that you've not had a public audit until the last year that is correct
do you mean that you've not had our auditors do it or do you mean like has there been a private auditor there has been a private aud correct so there has been an audit it's just not been our auditors who do this all the time and know it backwards and forwards, right? say all the time don't know it's broke I can't
Speaker 101
33:05
fix it right ok, but there has been an audit
Representative Julie Mayberry
Unverified
33:08
before is private thank you for clarification Senator Love you have a question? I have a question for
Senator Fredrick J. Love
Unverified
33:16
staffph. so they said the superintendent said that west memphis has never
had an audit Is there a reason why we have not looked at
Speaker 87
33:27
them at all? so previously they their school board had chosen
Speaker 4
33:31
to use a CPA firm that was not legislative audit to do their audit so they've had an audit every year we keep up with that we track that even for the audits that we don't perform I keep a list of every audit that's done so it's not that they haven't had
an audit they chose their board did to start using Arkansas legislative audit for their Fy24 audit so now we're we're we are the ones doing that OK so when when they
Senator Fredrick J. Love
Unverified
33:58
have their their private audit which do we review that audit are we looking at things in
the audit saying hey these may be questions and so we may want to do our own audit or are we just filing it away so we were we received the audit
Speaker 4
34:20
we review it dece also receives that audit and looks over it we look to see if there are any findings if they are
Senator Fredrick J. Love
Unverified
34:29
they come before this body so tell me this from last year then were there any issues on the private audit that that
we picked up that were on the public audit I mean like
did the private auditors do exactly what they were supposed to do or were these issues just looked over I guess I guess that's that would be my question because
I don't think with how the superintendent explained it it seems like this has been going on for years. Well if they've been doing a private audit and the private audit didn't pick
it up and then all of a sudden we picked it up I mean like I'm just I'm just kind of curious to see like then what have we been reviewing number
one 2 is if these were pervasive issues then why didn't
Speaker 4
35:22
why did we not get involved sooner I guess that's what I'm at I mean do you do you understand what I'm saying though when it comes to the audit I mean we don't look at 100% so I don't the the CPA firm they've could have done all of their work they could have done it correctly and in their samples that they pulled for capital assets they may have pulled other items that the school district had on hand so I I really can't speak to that
we started doing the audit in fy 24 we noticed issues anytime we notice an issue we're gonna follow up on it in the next year to to see you know if that issue is still there so I really can only speak to the work that that our auditors perform all right thank you lovepresentative Beatty recognize I
Chair
Unverified
36:13
just want to follow up you mentioned in the audit
Representative Howard M. Beaty, Jr.
Unverified
36:18
and this is for staff that a similar finding was reported in the prior audit was that that
prior finding was it related to misclassification on the capitalization of of the assets on construction or was it more on their fixed asset side iss it the entire four points were on there in the previous audit or was it just that they were having trouble with their fixed assets so we
Speaker 4
36:43
had similar issues on the 1st,2nd, and fourth bullet point ver second forward right thank you thank you
Representativeon recognizeise? thank you Mr Chairman my
Representative Wayne Long
Unverified
36:56
question was for staff also I would assume so let's say audit does not charge the schools to do an audit is that correct that's correct why would the school choose to pay a private firm rather than you know have
it free by the state can't
really answer that question can you give me an idea about how many school districts approximately do the c A type audit rather than legislative audit
Speaker 4
37:30
so we do 197 school audits and there are38 schools that choose a private thank you sir may be that's something
Representative Wayne Long
Unverified
37:39
we need to look into. thank youirlong Senator Lo OK so I'm back on this
Senator Fredrick J. Love
Unverified
37:44
Mr. Fink because I can't let this go for some reason so if we look at an audit if if there was a repeat findings that we're saying these were repeat findings
if the school board did not elect for us to come in would we have gone down to do
Senator Fredrick J. Love
Unverified
38:18
I guess that's my I guess that's my issue because if we know from their audits
that they were having an issue and the school board
didn't elect for us to come in and we would have continued to let this go on. I guess I guess I'm trying to figure out what is it what is it legislative audit what I mean what is the legislative body to say hey wait a minute no the school
board we see this as a pattern and we're now stepping in as legislative audit. I'll give
Catherine Donor
Unverified
38:54
my commentary I I believe West Memphis is actually in good faith they've they've given I know but just as an example
they've they have an independent audit that they go down they have some findings and they communicate with with leg audit as well and I think that's probably the rhythm that's probably a similar rhythm than to what the38 other school districts go through that's an assumption that's that's my
Speaker 139
39:17
commentary but yeah but well I was just
Senator Fredrick J. Love
Unverified
39:20
thinking I mean if they would have elected not
to have us come in they would just continue to have the same issues and then they would just
continue to go and I guess that's where I guess my rub is it's like if they didn't invite us in I mean when is it our job to say hey you know what we see this audit we see that these are repeat findings and so now we're going to step in to actually do an audit from legislative audit perspective so maybe maybe this center of love
Catherine Donor
Unverified
39:54
if this could be a question for staff so what's in front of you is an audit from
the state but maybe staff can clarify this way for both of us whether a school district has an independent auditor or not they're always eligible potentially eligible for an audit from the state and so Mister Fink could
you maybe describe that for all of us what's the regular rhythm for school districts going through an audit whether they have independent auditors
Speaker 87
40:23
going on or not so typically just in terms of if there's a a
Speaker 4
40:28
private CPA has done it in the past there will be you know
basically brought before the executive committee a request for us to do the audit we've seen it where the superintendent and school boards are the ones who do that we've also seen it where the executive committee learns of certain issues and they come and they request that from us we've done that think back in 2022 we did that and so but typically we just do whatever the executive committee of L Jack approves
Senator Fredrick J. Love
Unverified
41:04
I hope that answers your question well this
is what I'm saying though when is it when I guess when do we decide that if they had repeat findings for instance the CPA has turned over this they haven't corrected year one then year two similar findings repeatat findings year two is there any is there any time
that legislative audit is going to step in and if they're not invited
Speaker 4
41:42
ga in we we staff serves at the will of the committee so we're going to do what the executive committee and what the full joint audit the committee regardless
Senator Fredrick J. Love
Unverified
41:53
of what you regardless of if you see this if you see you know hey
west memphis has had repeat findings 23 years in a row after you all reviewed it
you all would not go in unless the school board requests or unless it just gets so I mean are are you missing what I'm
Speaker 129
42:15
saying? I guess don't think so we did the audits for fy 24 and25 for west memphis'm
Speaker 125
42:20
talking about the years before because it seems like this has been a pervasive issue. We wouldn't have known
Speaker 4
42:25
about any issue unless it was in the audit report if it is in the audit report and it's a repeat finding it's gonna come before this committee whether it's a private and whether it's a private ok yes
Senator Fredrick J. Love
Unverified
42:38
sir that's what that's what that's what I was missing is like ok alright
Speaker 87
42:43
any audit that a CPA firm does that involves a public open enrollment charter school or public school district comes before this
Speaker 91
42:50
body that's that's where was that's what was missing I was like right we're
Senator Fredrick J. Love
Unverified
42:55
not going to look at it you Representative Duke you recognize just a quick question
Representative Hope Duke
Unverified
43:02
and and going along with the senator's question so
it all comes before us I guess I could think kind of with the gist of what he is saying here is what's the protection it comes before us we hear the reports but we can do a little bit of a digger dive so would that be at the executive committee that would say do they have the ability to come in and say ok we're getting some private reports here that are concerning to us now we want to know more information or if the school district says no hands off we're doing a private audit how how do we make where's the
accountability iss there additional accountability at as a resource or at the ability of legislators whether legislative audit or the executive committee or this committee that can and this has nothing really he's just kind of taken us down a direction which but I do understand it because as a private audit if you don't have that type of accountability then why would you why would you not just do it? So I'm assuming there has to be a layer in there that it that allows the legislature to ensure everything's on the up and up
Speaker 4
44:10
so the executive committee if the executive committee makes a decision that Arkansas legislative audit is going to do the audit of the school then we're going to do the audit of the school.
Representative Howard M. Beaty, Jr.
Unverified
44:26
thank you uhpresentative beatty I'm glad we finally got that cleared up that regardless of private or if it's something that's performed by the state if it still comes to this committee with the findings and and even on the private side there's even a secondary review layer that all of those private audits go
through where someone pulls the audits and reduces the working papers to make certain that findings and and procedure I think that's done by the CPAs and and within the the Arkansas served by publiccounting association. They they do peer review and look at those things so I mean regardless of what the fighting is or who found it or who performed the audit those things still come to this committee and and then this body has the authority to take action on those so I guess the main
thing is that that the findings are there and that we we've got good artists working both inle audit and the private audit that are taking care of these but I'm glad that we finally got around to the point that private or leg audit that those reports do make their way to this committee and then on to leg audit on the full committee thank you members any other questions for west memphis
Catherine Donor
Unverified
45:35
besides our own rules OK thank you for being here I appreciate it without objection this will be filed as reviewed
all right members that takes us through the the reports with findings we do have 28 school districts with no findings whether private or Ola got it and you'll see them listed on the back page of your of your deck if you've got a school district that you represent there shootot them a note would be my recommendation. it sounds likepresent Beatty's got some school districts that are passing fly flying colors give them a the kudos they deserve and so that's that is a big deal we appreciate that members any other business seeing none we are adjourned
Agenda
A. Call to order by Co-Chairman.
B. Adoption of Minutes of the January 8, 2026 meeting.
C. Review of Reports.Refer to the Synopsis
D. New Business.
E. Adjournment.
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — LEGISLATIVE JOINT AUDITING - EDUCATIONAL INSTITUTIONS, Feb 12, 2026 | Agenda | 2 | Official source ↗ |
Speakers
Senator Tyler Dees Chair
Unverified
Speaker 4
Catherine Donor
Unverified
Catherine Donner
Unverified
Speaker 11
Representative Howard M. Beaty, Jr.
Unverified
Speaker 31
Representative Hope Duke
Unverified
Speaker 39
Speaker 29
Speaker 10
Chair
Unverified
Representative Wayne Long
Unverified
Speaker 12
Representative Julie Mayberry
Unverified
Speaker 64
Speaker 81
Speaker 85
Speaker 86
Speaker 89
Speaker 3
Speaker 87
Speaker 101
Senator Fredrick J. Love
Unverified
Speaker 109
Speaker 136
Speaker 139
Speaker 129
Speaker 125
Speaker 91