Depew Union Free School District – Investment Program (2023M-77)

Issued Date

October 20, 2023

Audit Objective

Determine whether Depew Union Free School District (District) officials developed and managed a comprehensive investment program.

Key Findings

District officials did not develop and manage a comprehensive investment program.

The Business Administrator (BA) and District officials did not invest available funds in financial institutions that offered higher interest rates, prepare monthly cash flow forecasts or solicit interest rate quotes.
Over a 16-month period, officials missed an opportunity for the District to realize approximately $487,000 in additional interest earnings. Had the District realized such interest earnings, the Board may have been able to avoid increasing the 2023-24 tax levy.

Key Recommendations

Comply with the District’s investment policy and develop comprehensive written investment program procedures.

District officials generally agreed with our recommendations and have initiated or indicated they would initiate corrective action.

Background

The District is located in the Towns of Cheektowaga and Lancaster in Erie County. The District is governed by a seven-member Board of Education (Board) responsible for managing the District’s financial and educational affairs. The Superintendent of Schools (Superintendent) is the District’s chief executive officer and is responsible, along with other administrative staff, for the District’s day-to-day management under the Board’s direction.

The District has 20 bank accounts at two local financial institutions. The BA is responsible for monitoring bank accounts and investing District funds, and the Treasurer is responsible for transferring funds between bank accounts as needed.

The former BA retired on August 31, 2022, and continued carrying out the BA function two days each week as contracted until the current BA started on October 3, 2022.

Audit Period

January 1, 2022 – April 30, 2023

We extended our audit scope period back to the 2019-20 fiscal year to calculate the average annual tax levy increase.