Audit finds widespread problems at Shelby County schools | News

MEMPHIS, TN-

(WMC-TV) - An audit of Shelby County Schools' Activity and Cafeteria funds uncovered widespread money management problems and could uncover misuse of taxpayer money.

Two accounting firms collaborated on the massive document. They reviewed financial records at every Shelby County school and came up with possible impropriety.

Missing documentation, improper controls over handling cash and cash receipts not recorded properly – those are just a few of the dozens of money mismanagement incidents uncovered at several Shelby County Schools.

The audit of the 2010-2011 school year revealed poor financial practices in schools' Activity and Cafeteria funds at every grade level, from Arlington Elementary to Southwind High.

In one instance, the Tennessee State Comptroller is stepping in.

Auditors found extreme disorganization and potential fraudulent activity at Dexter Elementary. The State Comptroller will review auditor's findings, after the report revealed Dexter's cafeteria likely experienced loss from allegations of school theft to mishandling cash. They found deposit slips were not attached to checks and a lack of supporting documents for cash receipts.

At Germantown High school, the problems took a unique twist.

Students are sometimes allowed to use the school credit cards to make school-related purchases from the Activity Fund. Auditors said Germantown High is at risk for losses on any purchases made by students. They called for the school to cut off credit card access to the students.

At Highland Oaks Middle, the audit found multiple altered cash receipts. The audit says no explanation was given for the changes, giving an appearance of impropriety.

Forty-one out of Shelby County's fifty-one schools had problems in one form or another.

Many of the schools on this list had financial mismanagement in both the Activity and Cafeteria fund.

Additional issues include - receipts and supporting documentation showing different amounts, cash journal logs not mathematically correct and checks showing different amounts than supporting documentation.

Shelby County Schools had no comment. They said the matter would be discussed publicly at Tuesday night's school board meeting.

Click here to read the audit.

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