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Instructions: Write a thorough response discussing all steps that you would take


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Write a thorough response discussing all steps that you would take
as the principal of the school to ensure this no longer occurs. Keep in
mind that this error cannot be repeated as it is an audit exception.
Case Study
The audit report at Good Teaching Middle School revealed the following findings:
1. During both fiscal years of 2015-2016 and 2016-2017 at Good
Teaching Middle School, collections and disbursements from several
activities were commingled within the Classes and Clubs Eighth-Grade
account. Consequently, this commingling required a complete review of
all the financial activity posted to the account. Although some of the
activities did not raise sufficient revenues, all related expenditures
were covered with account balances carried over from the prior year. As
of June 30, 2017, the Classes and Clubs Eighth-Grade account balance was
nearly zero. This account started the 20152016 fiscal year with a
carryover balance of approximately $3,000.
2. The auditors’ analyses of the 2015-2016 financial activity for
the Gradventure field trip disclosed that the school should have raised
$20,625 based on student participation; however, they could only trace
$19,925 to account postings identified as revenues collected for this
activity. This pointed to a revenue shortfall of $700 that could not be
explained by the school.
3. In the case of the end-of-the-year dance, for both fiscal
years, admission tickets were not issued to control the sale of
admissions. Instead, the school used Official Teacher’s receipts, which
although numbered, are not documented with a vendor’s invoice. This
condition precluded us from performing an analysis of these sales
4. The school did not complete a Student Activity Operating Report for any of the eighth-grade activities.
The yearbook was sold to students for $25 each. The school ordered 175
books; however, only 117 were sold for a leftover inventory of 58 books.
Revenues generated from the sales and ancillary activity amounted to
$3,600. However, this total was not sufficient to cover the yearbook
invoice, which amounted to approximately $4,000. The remaining balance,
or approximately $400 was paid with revenues from the General
Miscellaneous account.
6. Yearbook Monthly Operating Reports, the Yearbook Distribution
Report, and ancillary documentation for the 2016-2017 fiscal year was
not on file. The auditors inquired as to whether the school was
producing a yearbook in 2017-2018 and found that the school had already
placed an order with the yearbook publisher for 135 books. They also
found that, as of March 1, 2018, only 70 books had been sold. They met
with the yearbook sponsor, who stated that she had not received training
regarding the yearbook activity, and she was not aware that monthly
reports were required. Consequently, none had been prepared and filed
for the current year. The auditors discussed this matter with the
current school administration for their information and follow-up.
What systems would you put in place in order to correct the missteps of this administrator?


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