[read complete report – pdf]

Audit Objective 

Determine whether the Valley Stream Union Free School District Thirteen (District) Board of Education (Board) and Treasurer appropriately and securely executed check signatures for non-payroll checks.

Key Findings 

The Board and Treasurer did not appropriately and securely execute check signatures for non-payroll checks between July 1, 2021 and June 30, 2023. Although the checks we reviewed were disbursed for what appear to be legitimate District purposes, when the Treasurer does not maintain control of his electronic signature, the chances of unauthorized checks being signed increases. The audit also identified that: 

• Although the Board did not authorize the Treasurer to sign District checks with an electronic signature, the Treasurer used an electronic signature to sign 3,621 non-payroll checks totaling $26.7 million.
• The Treasurer did not maintain custody or supervise the use of his electronic signature, and he remotely signed 615 checks totaling $4.8 million.
• A former Board member was not removed as a signer, and new Board-appointed signers were not added to the District’s bank accounts. When Board-authorized signers are not updated with the bank, the risk of unauthorized checks being processed increases.

Key Recommendations 

• Authorize the use of an electronic signature.
• Maintain custody of the Treasurer’s electronic signature and supervise its use.
• Ensure the District’s bank always has the current appointed check signers on record.

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