CCSD placed on financial reporting plan
Education department requiring CCSD officials to take corrective measures to improve district's finances
FARMINGTON — New Mexico education officials are requiring the Central Consolidated School District to execute a 90-day financial reporting plan due to concerns about alleged payroll fraud and the management of the district.
The New Mexico Public Education Department sent a letter to CCSD interim Superintendent Colleen Bowman on Dec. 2, requiring district officials to perform nine corrective steps toward improving the district’s finances, according to a copy of the letter obtained through a public records request.
Paul Aguilar, the NMPED deputy secretary of finance and operations, said in the letter he had serious concerns about the district’s management and internal controls. One of the items mentioned is the possible restructuring of the CCSD financial department by the state education department.
CCSD spokesman James Preminger said in an email that district administrators have every intention of addressing the concerns of the state education department, as the district has the same concerns. He said administrators have been working with a consulting firm to review the district’s operations before the NMPED sent the letter.
CCSD Board of Education President Randy Manning said he was aware of the letter, and the district is working on complying with the requirements of the letter to rectify the issues.
“We’ve been working on it for a while,” Manning said in a telephone interview.
There have been other state agencies that have been monitoring CCSD’s finances.
The office of state Auditor Tim Keller placed the school district on the auditor’s “At-Risk” list due to its problematic audit for the 2015 financial year in April.
CCSD was one of eight state government agencies that had a disclaimed opinion on its audit for 2014-2015 school year, according to the state auditor’s findings report for the 2015 fiscal year. A “disclaimer of opinion” is listed in an audit when the auditor couldn’t issue an opinion about the accuracy of the district’s financial state due to a lack of reliable financial information from the district.
Bowman told The Daily Times in April that the district was dedicated to correcting the findings.
The state auditor’s report stated CCSD had 19 findings in its audit, putting the district in eighth place for the most findings statewide.
The first corrective action listed in the letter required the CCSD to submit its 2016 financial audit to the State Auditor’s Office by Dec. 9 because it had not been submitted when the letter was sent on Dec. 2. District officials were also required to provide an explanation about why the audit was submitted late.
The CCSD has not submitted its 2016 audit report because it is not finished, Preminger said Friday. CCSD administrators requested an extension to the Dec. 9 deadline so the firm preparing the audit — Finance and Accounting Solutions — can finish the report. He said the state education department has not responded to that request.
Exit interviews for the audit were conducted with the CCSD staff on Thursday, and Preminger said the audit could possibly be filed in the next week.
The CCSD also was required to submit a written investigation report about its alleged payroll fraud by Dec. 15. The letter states the report should include information regarding how the district plans to address the alleged issue. That report was filed before the Dec. 15 deadline, Preminger said.
He also said the alleged payroll fraud is a personnel matter, and the district is addressing the issue by following the standard procedures for such matters.
A report detailing how the CCSD staff will address findings for the 2016 audit and previous years’ audits is due by Jan. 11.
Preminger said the district has developed a corrective action plan based on the past year’s audit findings, and the findings are being addressed through a documented internal control process.
The district is also required to submit a correct review of revenue, payroll, accounts payable and cash receipts to the state education department’s School Budget and Finance Analysis Bureau staff no later than Feb. 8.
Weekly status reports are being filed with the state education department by the district, Preminger said.
Joshua Kellogg covers education for The Daily Times. He can be reached at 505-564-4627.