Superintendent: District can show where $636,000 went

WINSTED — In November, after at least 11 months of delays, a financial audit of the Winchester school district for fiscal 2009-10 was completed.The audit showed that approximately $636,000 in expenditures were not properly documented by the school district.At a special Board of Education meeting Thursday, Dec. 6, at Batcheller School, Superintendent of Schools Thomas Danehy said the district can prove the funds were properly spent.Danehy explained that in November 2009, the school district received $1.1 million in American Recovery and Reinvestment Act (ARRA) funds.He said that some of the grant funds were spent on salary payments to employees.“In this particular year, because we had so much money from the grant and so many journal entries, our auditor [town auditor Vanessa Rossitto] said ‘wait a minute, what’s going on here?’” Danehy said. “Because there were more journal entries during 2009-2010 than previous years, it triggered a flag to the auditor.”Danehy said that 89 test cases were required for the 2009-10 audit, which he said was an unusually high amount.A test case is when the auditor requires proof of purchase orders or proof of payments made to employees.As for the $636,000, Danehy said that the funds were properly documented by the school district.“We have given four different binders of records to the auditor to support what employees were paid,” Danehy said. “She would not accept the financial records of $636,000 of funds because she had not gone through all of the documentation that was there. I’m confident that when we show this to the state they will say wow, this is okay. So, what you may have read in the papers, where it sounded like ‘ooh, they don’t have a stitch of information to support any such expenditure’ is not true. I am confident we will not have to return $636,000 in funds.”Newly elected board member James Roberts sounded skeptical of what Danehy said.“The ARRA money was designated as a high risk grant fund by the federal government,” Roberts said. “Back in 2009, the federal government instituted a zero tolerance policy in the misuse and misreporting of funds. Accountants were put on notice that they would be held responsible for any deficiencies in ARRA reporting.”Roberts said that between March 2010 and June 2010, the school district reported eight-and-a-half new teachers were hired.“If the school district has claimed teachers as being new hires that were not from that time period, we have made bogus claims to the federal government,” Roberts said. “That is fraud, without a doubt. None of the people on this list of employees shows a hiring date between March and June 2010.”“I don’t know how many folks were laid off in that year, but I wonder if they were laid off prior to March then recalled between March and June 2010,” Danehy told Roberts. “Would that count as a new hire? Sounds like it would fit the definition. I would have to do more research.”Danehy added that the district has had to file an extension with the state for completing the financial audit for fiscal 2010-2011.“We are in a different spot from last year because we have already filed an ED-01 and an ED-131, which will give the auditor the basis for test cases,” Danehy said. “Because of which, [Rossitto] will be able to pull whatever information out of those two filings that she might be looking for.”

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