NPCS seeks more than $7,000 misspent by former employee

An audit report for North Putnam Community Schools filed on Thursday, Sept. 25, reveals that more than $7,000 in finance charges and late fees were incurred to the district due to an employee error.

According to a State Board of Accounts audit of the NPCS finances from July 1, 2004 to June 30, 2013, a Sam's Club credit card account for North Putnam Middle School was the cause of the charges.

The report claims that beginning July 2004, finance charges and late payment fees began accruing on the account due to late payments.

When the school closed the credit card in March 2010, a balance still remained unpaid on the card. Late fees and fines continued to be added until the account was paid off in January 2013.

The report states that former North Putnam Middle School extra-curricular treasurer Kara Smith failed to comply with the school corporation's policy of paying credit card bills in full when a statement is received and is therefore being held responsible for repayment of $7,097 for not remitting payments on a timely basis.

Comments from the audit also cite that a stamp bearing the signature of the NPMS principal was "not placed in a secure location and the principal allowed others to use the stamps." The report continued, "This negated the control necessary at the extra-curricular account (ECA) level where the board was depending on the administration of the schools to monitor the ECA spending."

The report also claims that more than one signature stamp for the principal was being used and that internal controls over that stamp were not being enforced as required.

Guideline compliance for ECAs state that "any penalties, interest or other charges paid by the governmental unit may be the personal obligation of the responsible official or employee."

Smith was relieved of her duties as extra-curricular treasurer upon the discovery of the financial irregularity and is being pursued to repay the school corporation in full, although NPCS is looking into all options to receive reimbursement for the funds.

"We're checking with our bonding company to see about recouping the fees," Superintendent Dan Noel said.

"We still will be pursuing payment how ever that comes."

According to Noel, when members of the administration came across the account, the State Board of Accounts was immediately notified.

The report states that the issue was discussed with Noel and NPCS Treasurer Tanya J. Pearson in February and with Smith in March.

The findings will be presented to the school board at its next meeting on Thursday, Oct. 16 at 7 p.m. at the North Putnam Administration office in Bainbridge.