Our school district is examined each year by the Auditor of State, and this year's audit report has just been released.
As shown on the "Schedule of Findings" section of the report, the State Auditor's Office found no problems, and our District was once again declared to be a "low risk auditee." I'm not sure what exactly that means in the context of a public entity, but when a business is audited, a declaration like this means that the auditors feel no need to look in every nook and cranny every year, and that they will generally gauge the accuracy of the financial reports, and the effectiveness of management and accounting controls, by looking in detail at only the accounts through which large amounts of money pass, plus a few others chosen at random.
There was a comment in the Management Letter recommending that the School Board put in place a policy "requiring the approval of the Treasurer and the Board of Education prior to the establishment of any outside checking accounts in the District's name or for District sponsored activities. The policy should include oversight procedures to be performed by the Treasurer’s Office of Board of Education to ensure all District employees responsible for handling cash collections are adhering to the policy."
This will require some thought. If you look at the Monthly Treasurer's Reports, you'll notice that many pages are taken up by the "Financial Report by Fund/SCC" section. This lists the 300+ fund accounts managed by the Treasurer's Office. Some of these are the big primary funds through which most of our funding and spending flows, such as the General Fund. It also includes scores of little funds, like one set up for the Bradley German Club, which has a balance of $25.67. These are the 'official' funds, meaning the money is deposited into the bank by the Treasurer's office, and disbursements from these funds are made according to standard procedures, via official checks.
But there are other occasions when fairly significant amounts of money are collected on behalf of a school activity, held in the hands of an individual - maybe a school employee, maybe a community member - and disbursed without controls, often in cash. This might be a school-sponsored club running a car wash to raise money for uniforms, selling trinkets to help fund a trip, and other similar situations.
The School Board's Policy Review Committee will take the Auditor of State's recommendation, consult with folks such as the policy experts at the Ohio School Boards Association, and report back to the School Board.
The audit reports for prior years can be found via the website of the Auditor of State. Just go to this search page, enter "Hilliard City Schools" and select "Franklin County."