Hinsdale District 86 to dig deeper into its financial procedures

The community room In Hinsdale Central High School was packed for the District 86 School Board meeting March 3. | Kimberly Fornek/Sun-Times Media
The community room In Hinsdale Central High School was packed for the District 86 School Board meeting March 3. | Kimberly Fornek/Sun-Times Media

Hinsdale High School District 86 has hired an audit firm to check the accuracy of and procedures for its accounts payable, payroll and student activity accounts.

The School Board voted 4-3 to pay Sikich LLP up to $35,000 for that review.

In a report presented to district officials last month, Sikich partner Mary O’Connor cited numerous shortcomings in the district financial procedures, including a lack a checks and balances and a lack of segregation of duties.

O’Connor recommended the district dig deeper into the handling of accounts payable, payroll and student activity accounts to verify the numbers on which the district’s budget is based are accurate. The district’s audit firm Baker Tilly agreed with that approach.

In a letter to District 86 Superintendent Bruce Law, O’Connor said her firm would, in the accounts payable department, verify vendors, analyze whether schools had the approval for purchases related to information technology, and test to determine “whether certain expenditures were appropriate and cost effective,” among other reviews.

Examiners would compare contractual obligations with the district’s actual payroll and stipends.

Sikich would review the way money was paid to and disbursed from the student activity accounts, and verify whether the balances were accurate.

Richard Skoda and Edward Corcoran said it was their responsibility as School Board members to rectify the shortcomings the audit revealed.

Not only Sikich, but also the district’s outside auditor, Jason Coyle of Baker Tilly, identified “significant and material deficiencies,” Corcoran said. To not address those would be “a significant breach of our fiduciary duties.”

Corcoran was in favor of hiring Sikich to also check the district’s residency and insurance policies, which would have raised the cost to as much as $80,000.

Law recommended Sikich limit its investigation to student activities, accounts payable and payroll at this point.

Board member Victor Casini said O’Connor had made a compelling case for double-checking those accounts, but agreed with Law they should see “how much value they add,” before paying for more audits.

Board member Jennifer Planson questioned why at the previous meeting, O’Connor had said the three accounts could be checked for $35,000, but in her letter dated Feb. 28, the fees had risen to $40,000. Law did not know why the amount proposed was higher, so the board approved spending only $35,000.

Planson, Michael Kuhn and Kay Gallo voted against the contract.

Planson said because the board had approved a zero property tax levy and would have no new money coming in, she had concerns about “all this money being spent at the district office and nothing being spent directly on students.”

Gallo said she sees the value in checking the district’s financial procedures, but she doesn’t like how it’s being done. She said she doesn’t know how Sikich was chosen, why its proposed fee changed or why the superintendent does not know why the amount changed. She said she fears “there is so much going on, our administrators have lost sight of educating the kids.”

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