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
- Whisper
- Model
- ggml-large-v3-turbo.bin
- Processing date
- October 4, 2026
Our first order of business is to adopt the menace. We have a motion, second. So move. Thank you, Representative Gonzalez. You
Representative Wayne Long
Unverified
0:09
did do a second, right? Oh,
Speaker 5
0:15
seconds. Well, then quit making the motion
to second then. All right, folks, next item on the agenda is
Speaker 7
0:26
for review. Go ahead. Okay. Thank you, Mr. Chair. Good afternoon. Today, there are 10 education audit reports for the committee's review.
Speaker 8
0:35
There are two reports with no findings, and there were eight reports with findings. We will start with the two reports that were deferred from the August meeting. At the August meeting, the Blytheville School District audit reports for FY24 and FY25 were presented, and officials with the school district and DESE were present to answer questions from the committee related to findings in the audit reports. At the conclusion of presenting the reports, the committee deferred the reports to today's meeting for further consideration.
School officials were not invited back since they were present and answered questions at the August meeting. So I'm not going to present the findings from the two reports again, but the details of the findings along with management's response are included in the synopsis. And with that, I'll
turn it over to you, Mr. Chair. Thank you. And folks, without objection, we're going to refer the Blyville School District audit reports for our fiscal year 24 and 25 to the Division of Elementary and Secondary Education under Code 6-17-426 for consideration by the Professional Licensure Standards Board.
And folks, that's kind of the process. So without objection, we'll
consider this item reviewed. All right, now we're moving on
to page 10. this is the Texarkana school district of Miller
Speaker 7
2:09
County if you'll go back just one there's one for Prescott school district and and we'll start with that and then we'll
Speaker 8
2:16
do Texarkana so there were two
reports that contain findings that were deferred to the applicable prosecuting attorney and the Attorney General. The first was Prescott School District, which had one finding at the conclusion of this audit. Arkansas legislative audit and a law enforcement agency are in the process of investigating certain financial transactions of the district. We will issue a report concerning these transactions at the completion of the investigation, and that report will be presented
at tomorrow's full committee meeting. That concludes the findings for
Speaker 12
2:53
Prescott School District. Members, any questions?
I'll make this comment. I've talked with the prosecuting attorney's office. There seem to be a lot of times we refer things to the prosecutor. They do an annual report, and it's a long report that says what they did and didn't do. However, there are a number of times that they choose not to act, And the prosecutor's office would be glad to come, as of a couple weeks ago they were glad to come,
if they have a motion from this committee that we invite them to a meeting. We
don't have a problem with that, do we,
Mr. Fink, if they choose to show. Would anyone with the committee like to hear from them? I'd like to, so I'll make that motion. Motion second by Representative Long. All right, so moved, we'll invite them to the
Speaker 8
3:52
next meeting. All right, next is Texarkana. Next report is Texarkana-Arkansas School District, which had two findings.
On March 21st of 2025, the district made a drawdown of Magnet School Assistance Program funds totaling $804,000, which consisted of reimbursements of almost $63,000 and an advance payment of $741,000. from march 21st 2025 through june 30 2025 the district incurred expenditures of 321 000 while also drawing down additional funds of 87 000 and 99 000. this resulted in significant time
elapsing between the drawdown of funds and the disbursement of the funds by the district june 30 the district had 606 thousand dollars of excess federal awards on hand finding two The district initiated seven ACH payments totaling $286,000 to fraudulent accounts between April and June 2025 after receiving emails to change vendor bank information without properly verifying the authenticity of the change request. District personnel discovered the unauthorized withdrawals
after a vendor contacted the district for non-payment. The district notified the financial institution, and one of the seven transactions totaling $58,000 was recovered. However, the remaining $200 and almost $28,000 could not be recovered. That concludes the findings for Texarkana, Arkansas School District. Members, anyone have
questions? Representative Long, you're recognized.
Is there a representative from Texarkana here? I don't think they're here. Our option is to hold it until the next meeting and invite them. Yes. Motion, second. We'll hold that over and invite them to the next meeting. It's such a cordial group. I know everyone's looking forward to coming and explaining their issues to us.
Representative Wayne Long
Unverified
6:07
Arkansas Northeastern College is next. Yeah,
Speaker 8
6:09
so the remaining reports on the agenda, they do not contain findings that were referred to the PA or the AG. So A and C had two findings. The first one from September to November of 2025, 10 unauthorized withdrawals totaling $8,300 cleared the college's bank account. College personnel discovered the unauthorized withdrawals upon reviewing the affected bank account, and all funds were recovered from the bank.
Finding two, I'll do a summary because it's pretty lengthy. During the audit, we noted errors in the statement of net position, statement of revenues, expenditures, and changes in net position, statement of cash flows, and in the notes of the financial statements that resulted in material misstatements to the financial statements. These errors were presented to the college, and they were corrected by the college during our audit field work.
And that concludes the findings for Arkansas Northeastern College. Members, any questions? Seeing no questions, this item is reviewed. And the next item? Next is Heber Springs School District, which had one finding on March 17, 2025. the district's board approved a $1,200 non-recurring bonus to all personnel who signed a 2026 contract, which constituted an unequal distribution.
The district did not obtain a vote of the majority of licensed personnel agreeing to this distribution as required by Arkansas Code. That concludes the findings for
Speaker 11
7:54
Heber Springs. Members, any questions on this item? Seeing no
Speaker 8
8:02
questions, this item is reviewed. Next. Low-Note School District had two findings. Finding one during our examination of payroll records. We noted that stipends and extra duties pay was not always indicated on the employee's contract,
addendum to their contract, or board approved. The following discrepancies were noted. Two employees were paid stipends of $1,000, each that were not included in the employee's contract or addendum to the contract. Three employees were paid $5,000, $6,500, and $1,050 for additional duties, which were not included in the employee's contract or addendum to the contract. One employee resigned from the district and was subsequently paid $519 for training and consulting services through payroll.
Finding two, on August 18th, 2025, the district discovered that a check for $4,800, which had been mailed to a vendor, was fraudulently diverted to another bank account after the vendor contacted the district about a balance due. The district notified its banking institution and all funds were recovered from the bank. And that concludes the findings for Lone Oak School District. Members, anyone have any questions?
Seeing no questions, this item is reviewed. And the last report with fining was White County Central School District. The district requested and received a federal drawdown of $400,000 from their COPS School Violence Prevention Program Award on December 3rd, 2024. The program allows for a 10-day period for federal advance payments. Following the allowable 10-day period, the district had $344,000 of excess federal award funds on hand.
The remaining funds were spent from January 28th of 2025 to February 11th of 2025. And that concludes the findings for White County Central School District. Members,
Speaker 11
10:03
anyone have any questions? Seeing no questions, this
Speaker 14
10:07
item is reviewed. And the remaining two audit reports
Speaker 8
10:12
on the last page contained no findings, and staff recommends these be filed as reviewed members any questions seeing no
Speaker 11
10:23
questions those items are reviewed anyone have any further business to bring before the committee saying none we are adjourned
Agenda
A. Call to order by Co-Chairman.
B. Adoption of Minutes of the August 13, 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, Sep 10, 2026 | Agenda | 2 | Official source ↗ |
Speakers
Senator Dan Sullivan Chair
Unverified
Representative Wayne Long
Unverified
Speaker 5
Speaker 7
Speaker 8
Speaker 12
Speaker 11
Speaker 14