CPAs release status report at Board of Education meeting

P-card audit status report
Posted on 06/08/2018
Credit cards

Thursday, June 7, 2018 

P-card audit status report: No unauthorized
purchases, transactions properly documented

BEAUFORT – Purchases made using school district credit cards were properly documented and no unauthorized purchases were uncovered, according to an audit status report from a Virginia-based firm hired by the Board of Education 

After a group of community activists raised concerns last year about district credit card purchases, the Board voted to do an additional audit of those purchases over and above the analysis of P-card controls already included in the district’s annual independent procurement audits.  Reed & Associates CPAs, whose final report is due to the Board of Education later this summer, released a status report that was made public at tonight’s Board meeting.

“Based upon the agreed-upon procedures,” the Reed & Associates status report said, “we sampled a total of 262 transactions made during the period July 1, 2016 through June 30, 2017.  We found that all transactions were properly supported by documentation required at the time the transaction was made, the purpose of each transaction was documented, and the receipt of goods or services acknowledged. We did not find any transactions for personal purposes or unauthorized purchases.  We also did not find that any transactions were made that circumvented the BCSD procurement code in place at the time of the transactions.” 

Internal controls for P-cards are part of the school district’s annual independent audit that is required by the state.  The state also requires a separate procurement audit every three years that includes a focus on P-Card controls, but the Beaufort County School District, on its own initiative, has commissioned such an audit in each of the last four years.  The Reed & Associates audit was an additional examination approved by the Board of Education.

“We have an excellent finance staff, and they work hard to ensure that taxpayers’ investments are protected,” said Superintendent Jeff Moss.  “While Reed & Associates’ audit status report isn’t surprising, it’s still gratifying to see.  We’re looking forward to their final report, which I believe will confirm what I have stated all along – that our Finance Department has excellent internal controls and ensures that funds are spent in accord with the law. 

In both the district’s independent annual audits and procurement audits, no significant problems have been found with internal controls governing P-card purchases.  No school district employee has ever been linked to the illegal use of a district P-Card.  

The Beaufort County School District makes most of its purchases of goods and services electronically – everything from classroom supplies to school furniture to monthly utility bills.  The procurement process relies largely on “purchase cards” provided by Bank of America.

District officials said nearly all South Carolina school districts have P-card purchasing programs because they are more efficient and transparent than the old system of filing a requisition, completing a purchase order, receiving an invoice from the vendor and preparing a check for mailing.  For small purchases, the cost of doing that can be greater than the value of the item being purchased.  In addition, officials said, many vendors no longer accept purchase orders or checks.

According to the Government Finance Officers Association, P-cards provide an “efficient, cost-effective method of purchasing and paying for small-dollar as well as high-volume purchases.”  GFOA says the benefits of P-cards can include simplified purchasing and payment processes; reduced paperwork; lower transaction processing costs; expedited delivery of purchased goods; better pricing; and more effective monitoring of purchases.

Cash rebates on purchases are an important benefit for the school district, which received more than $420,000 in P-card cash rebates for purchases made between Sept. 1, 2016 and August 31, 2017.  Because rebate funds are added to the district’s operating budget, officials said, efforts are made to use P-Cards to purchase as many goods and services as possible.