The following message is from Interim Superintendent Catty Q. Moore.
Today the NC Auditor’s Office released the results of an investigatory audit of the district’s finances.
We are committed to transparency, accountability, and to rebuilding the public’s trust by showing good stewardship of public dollars. We are grateful to the Auditor’s staff for this comprehensive review. The team had full access to the district’s financial systems and reviewed records dating back to 2017. Their work, along with the support HIL Consultants is providing our staff, has put WS/FCS on a better financial path.
The deep internal work of the last three months has also revealed that this financial crisis did not happen overnight. Since 2017, the district has experienced significant changes in leadership including four Chief Financial Officers, four Superintendents, three different school boards, and considerable turnover across several departments, including the Finance Department and Human Resources. WS/FCS concurs with the Auditor’s findings and recognizes the need for stronger internal processes and succession planning to address the systemic inefficiencies and lack of controls that have existed for nearly a decade or more.
Without the federal pandemic-relief funds, there is every indication we would have been in this spot five years ago.
Audit Details
The investigatory audit provides details of financial mismanagement we have described to you in our regular Community Budget Updates since May. The report notes the district’s failure to reduce staff as the student population declined, not reducing expenses after temporary pandemic relief funds expired, and poor practices, such as not reconciling budgets, not budgeting for contract costs, and overspending.
There has been some confusion around this point, so we should be clear: There was no fraud or misappropriation. Every single dollar was spent on an appropriate expense for children and school system services. We simply did not have enough revenue to match these expenses. The Auditor’s team notes in the report that they “did not find any evidence of malfeasance.”
The audit report includes detailed responses from our team that outline how we are addressing these deficiencies to ensure this never happens again.
Next Steps
Going forward, we will continue to be engaged with to the Auditor’s office. We will give regular updates to the Board of Education, the NC Department of Public Instruction, and the community on the progress we make. For additional public accountability of our finances, I will also recommend the Board of Education create a three-member, External Audit Committee of external stakeholders appointed by the board, the Forsyth County Commissioners, and the superintendent. Much of this work will be ongoing.
We are collaborating with the Auditor’s Office on a new community-facing budget dashboard to provide easy public access to our financial data. We look forward to continued collaboration with the Auditor’s Office.
You may review the full audit report and our responses under the Presentations & Documents section of our Community Budget Update web portal, https://www.wsfcs.k12.nc.us/o/wsfcs/page/community-budget-updates. I will provide a presentation on the results at the 5:30 pm, August 19 Special Board of Education meeting.
We hope the release of this audit, and our responses to it, are another step forward in rebuilding your trust.