The state conducts an annual audit of each school district. The audit of DeKalb, the state’s third-largest school district, spans the fiscal year ending June 30, 2021. Watson-Harris began working as superintendent in June 2020.
After some board members expressed concerns about hiring practices and federal aid spending, an outside investigation revealed some of the problems noted in the audit. That investigation determined that Watson-Harris was unaware of these issues.
The state audit suggests that almost $1 million in pandemic aid could have been inaccurately documented or spent without appropriate approval based on their evaluation of a sample of expenditures.
Three human resources and payroll employees in the sample received bonuses totaling $23,000 without board approval or documentation of additional work performed, the audit found. Several other employees out of the random sample of 60 were found to have received bonuses they were not eligible for or for which there was no documentation.
These problems could result in “unnecessary financial strains and shortages” for the district, the report said, if federal or state education officials were to ask the district to return some of the funds.
District officials told auditors that they misunderstood “ambiguous” early guidance about how to spend the money. The investigation commissioned by board members, which spanned a similar time frame, concluded that employees were not following district procedures when it came to disbursing bonuses.
Auditors also reviewed employee compensation and found that the district could not provide documentation to support the years of experience more than two dozen employees were being paid for. Other employees received bonuses they did not qualify for or were paid above their pay scale. And about 150 employees used or accrued more vacation time than they were allowed.
The district blamed these issues on a lack of managerial oversight in the human resources and payroll departments and a failure to maintain documentation relating to employee pay.
In a response to auditors, district officials noted that its interim chief of human resources, who was in place when these issues were found, has been moved to a new position. There was no interim HR chief listed on the district’s website at the time of publication.
Lastly, auditors found that a lingering transition to a new financial management system increases the district’s risk of wasted funds and accounting errors, and puts an increased burden on staff. The conversion to a new system began in September 2019.
Board members questioned Watson-Harris about this transition in February. She said her staff was taking the issues “extremely seriously,” but noted that the problems predated her administration.
“Without effective controls over a single accounting system, the School District increases its risk of not detecting errors or omissions in its accounting and HR/payroll data,” the audit said.
District officials told auditors they expect to convert to the new system by March 2023.