Legislative Joint Auditing – Educational Institutions

There are three reports with findings with everyone being referred to a prosecuting attorney will begin today with the report that was referred to the prosecuting attorney. National Park college for fiscal year ending June thirtieth twenty twenty one. Fining number one the college has policies and procedures to properly record and classify transactions in the financial statements however a material misstatement in the financial statements was detected during the audit this misstatement had no effect on the colleges reported total net position at June thirtieth twenty twenty one and the financial statements they were subsequently corrected by the college during our audit field work. The key heirs included on the comparative statement of revenues expenses and changes in that position student tuition and fees and scholarships and fellowships were overstated by approximately seven hundred and ninety thousand dollars due to the recording of an incorrect amount for scholarship allowance a similar finding was reported in the previous two audits and on the comparative statement of net position investment in capital assets net of related debt was overstated by approximately two hundred and seventeen thousand dollars. The second finding for national park college. The college discover that a check dated in March of twenty twenty one and totaling approximately thirty eight hundred dollars was mailed to an out of state been out of state vendor and subsequently altered and cashed by a third party in April of twenty twenty one and as of the report date the college had not been reimbursed by the bank in this matter was being investigated by the United States postal service and that concludes the findings for national park college. Okay of. Committee if you don't mind we have representation from the college if they would like to share comments with us. go to the in the table and. It might answer some of the questions we may have. For the. If you would identify yourself. Both of you and the for the record and. And then you may personally. If you do you have your button Hey there you go and my name's Kelly Embry and I'm the vice president for administration and chief financial officer for national park college okay. my name's Andrew Pennington mind the controller for national park college. Okay welcome both of you of if you have some comment you'd like to share the committee. Well we'll just share part of our response I do want to preface it with I've been in my role as chief financial officer since may of this year and enters been here about seven weeks now so I just want to I want to clarify that before we move on so neither of us were actually involved in this part however we take these things very seriously so um as we've noted we look to the area error especially the one that was a repeat and try to figure out how that happened and as part of our response to that we have added a financial statement preparation checklist to ensure these errors don't occur again. let's see what else so that's the primary thing for the first finding and then regarding the check I think all that Andrew speak to that he's been the one working more closely on that piece of it okay. I guess the key factors services there's no change since the audit we we have not heard from United States postal service regarding it it was out of state I'm I'm not gonna speak to the past but I can know in the future there's actually different processes we go in to make sure that first of all that this check actually went to the vendor and then this happened we're working on automating the process so that is not sending a check to work directly to their bank so the bank to bank interaction to avoid this from ever happening in the future. Okay. Mr Chesterfield you're recognized. Thank you Mr chairman thank you both for being here the unique situation isn't it yes what I'm concerned about is why region said it could not reimburse you. Because we've seen instances like that were a mistake was made and sometimes the bank is able to reimburse the institution could you tell me why they said they could. I can tell you exactly why they said they couldn't I know the case is that it did go to the vendor vendor received it so okay that's a problem our banks not over at fault for it and okay honestly there were we in that in my opinion but they did resolve the issue by paying the vendor back so also can do now is try to collect as our role as being in New in the role for you able to identify the person that. Make this. Shaky still being investigated I couldn't tell you I think if I remember correctly Bruce Hankins used to be our controller and chief financial officer and I believe he said that it was an employee of the vendor that confiscated the check I guess and washed it and then re issued it to themselves one. The prosecuting attorney is following up on this or is this from the past it's it's for its rich I mean this is from twenty eleven Oct twenty twenty one audit so this could have been form of last year thank you Mr and congratulations on your new role thank you thank you we look forward to not seeing you here again. Okay any further questions. Mr Casey. Thank you Mr chair On the finding number one.