001Here. Present. Here. Not here at the moment, but we got a text message and he will join us shortly. Uh Mr. Schultz, can you hear us? Are you here? I am here. Thank you. Did Did we get that for the minutes? Okay, great. Uh Dr. Phillips, you want to run us through the who and why? Please. Thank you. Our vision is that BCSE is the choice to learn, work, and play. Our mission is to develop expert learners by partnering with our community to invest in people. Our core beliefs include that we all can rise to the challenge of high expectations, are that learning is most effective when we have choice, flexibility, and see relevance, that we thrive when our physical, social, and psychological needs are met, that our community and school district are stronger when
002we partner with one another, that we flourish because of the diversity and variability in our community, and that our democracy and democratic institutions are strengthened by civic-minded citizens. Thank you, Dr. Phillips. Mr. McIver, can you remind us uh how this board work session is the same as uh but different from a board meeting? Uh thank you, Mr. Stinner. So, tonight we have two two meetings happening. This first one is a work session that is an official meeting of the board, so notice gets published uh posted on the doors uh the way we would for any other meeting. We do have some folks here with us tonight. Uh it is an official meeting of the board. Our practice has been that this is an opportunity for you all to discuss, and that typically we do not
003take any final actions at this meeting. It's just a chance for you all to talk and chat. Um the later meeting this evening is an executive session, which is limited to a specific topic, and by statute no action can be taken at that meeting. Uh Dr. Phillips, we've got several handouts, your confidential notes on Friday to the board, kind of outlined what's going on in this session. Could you remind us? Yes, so you have um three items related to the first policy conversation. So, the first is F-100, which was the board policy developed uh by Church Churchill and Antrim that was adopted by the board in November of 2025 and in that policy it mandates that the board adopts uh uniform the board of the state board of accounts uniform internal control standards for Indiana
004political subdivisions and directs the superintendent with the assistant superintendent for finance and operation to implement administrative guideline guidelines and procedures consistent with the state board of accounts guidance and to ensure that corporation personnel receive training concerning these internal control standards and procedures. So then you also have those internal controls that uh in F-100R um which are three pages of internal controls developed just in the last month um we acknowledging that we do have several internal controls still to develop based on the new um the new policies that were developed this year but our intentions are to complete that work this summer. And then last but not least you have in front of you the audit policy suite uh that Mr. Major sent um about a month ago uh that proposes multiple uh additions to the
005um internal control I guess not additions to F-100 but a separate policy or at least consideration of a separate separate policy. My request um in conversation with Mr. Stinner was that we get together in advance of next week's board meeting and bring together the whole group in including Mr. McGiver and Julia is back with us from Church, Churchwell and Antrim. Thanks for joining us Julia. She was here for a few meetings back last last calendar year, I believe. Um and to and Mr. um Mr. Berninger is here as well. Uh Mr. Boz- Dr. Bozeman could not be here tonight, but what we want to do is hear from each board member what your priorities are for internal controls, training processes, things that you believe that a well-run organization should have in place. Recognizing that some
006of those are going to be captured in the State Board of Accounts Uniform Internal Control Standards, but we don't know those by heart. So, we're going to take notes tonight. Uh both Julia, Mike McIver, Jamie, myself, and listen to what you believe belongs in the policy column. What is which means that can't change without your approval. So, if it's in the policy column, has to be any changes of it have to go through policy change process. Uh what you believe belongs in the administrative guidelines column that we will develop and we can easily modify those and get them changed rather efficiently. And then maybe some other suggestions for us to consider or they're more down in the weeds of implementation at the building level, for example. Um but really focusing on those first two examples
007with the hope then that we can develop um either modifications to the policy that that Jason proposed, F100, and of course the internal internal controls document based on the conversation that we have collectively as a group, and then bring that for consideration at some point in time. So. Yes, that's very helpful. Um board members may have questions before we uh start. Um and I'll start with a question. The the status of the F100 R. Would you say that's a draft at this point or are those in effect now? These are in effect. They've been posted to the to BoardDocs website and reflect current practice. Got you. You said that these have been updated when? Just within the last month. Okay. Other board members have questions about the documents in front of us before we start?
008Uh Dr. Phillips, can you confirm what drove the changes to those in the last month? Was it um you know, a a normal review cycle or were there actions we were taking to mitigate something that we had observed within the school corporation? It was a result of the policy that Jason sent to us to to review and the need to go ahead and implement the directions that the board provides in F100 that directs us to to develop those internal control standard or administrative guidelines. How long have we had F100 in place? November of 2025. Thank you. Other questions from board members? Okay. I don't know if this is the time, but I have a question about some detail in F100 that maybe I should understand it, but I don't. Sure. It and it references the
009$5,000 cutoff for whether a theft is material or not. What what's the significance of that? I believe that's established by the State Board of Accounts. What what does it mean, I guess, in >> To be material or to not be material? >> Yes. Probably best to answer that. I don't think I am. It That was a good question. If if a if there is a a material difference um in your audit when if they find something that is material, then it is a finding in an audit that then we must respond to with a corrective action. And if it's under 5,000, then what do we do as a school district? The >> I mean, it still seems like a concern if it's under 5,000. Right. The State Board of Accounts still informs us of anything
010any variance as a result of an audit, but there's not an official finding that appears in the audit report at the end. And so, internally then we still would look at internal controls to address whatever whatever issues came up as a result of that. So, the the internal controls in the F-100 are still kick into place if it's under 5,000. Correct. >> Okay. We uh try to be obsessive about every penny. And so, when uh Jamie and and Paula in the finance office, when they cannot reconcile things down to the penny, it gets very frustrating for them and they don't give up until they figure it out. I have a question that may be too broad of a question. I'm looking at Jamie. Um so, the policies and administrative guidelines are only as good as
011the people following them, right? So, can you talk about the training measures that are currently in place that That would be you, right? That's conducting the train Can you just share a little bit more in detail about what training looks like? Yeah, grab the mic, please, Jamie, just so that it's uh comes on to uh YouTube. Oh, yeah. Use that one there. Um just as an an example, in January we conducted an internal controls training for extracurricular activities. We had the ECA treasures from each school, elementary, middle, and high school, as well as the principals and athletic directors for each of those facilities. We brought them in. We went through our policies that are dictated by the state plus some others we've implemented. We went through those. Um we had we had them um sign
012in attendance sheets. We've got all that documentation. We will do that training at the beginning of each academic year going forward or anytime there is a new ECA treasure or a new principal or a new athletic director, we will provide those trainings within a few weeks of them starting their position. You said every year moving forward. When was the last time that training was done, do you know? When uh treasures are hired in well, as secretaries or admins at schools, they go through training with Skyward. They receive some training on ECA. This is the most detailed we've done in the 2 years I've been here. I would have to defer to Dr. Phillips to ask before that. I don't remember off the top of my head, no. Uh Mr. Shultz, I think you've got your
013hand raised. Yeah, I mean I was going to ask the same question to Mr. Bringer about the prior training cuz I my understanding was there was prior training. I I guess my other concern is we're asking for us to determine things to put into policy, but I still I really have a true root cause analysis of what broke down at Southside and the other locations from the State Board of Accounts to understand what is the root cause here that we're trying to mitigate against. Because something broke. Um and I mean I don't mind hypothesizing and going over, you know, dual stewardship of, you know, checks and cash and, you know, dual signatures on signings, but like do we have a true understanding of what broke down before we go into what we should add? Logan,
014the um situation at Southside has not been uh made public at this point in time. We haven't had a discussion with the the board or others other than a State Board of Accounts audit has occurred, but it hasn't been finalized or made public. So, we don't even have it to share with anyone at this point in time. The other two that we did get the State Board of Accounts from, it looked like it was inabilities on double basically [clears throat] dual signature, dual oversight, if I understood them correctly. I could be wrong. I don't have them in front of me right now, but the ones that CSA Lincoln and then there was another elementary school, can't remember. Those were an issue with uh signatures on checks, but we have internally the reason for some of
015the items in F-100 are are a result of our own internal findings about the uh situation that you mentioned. Yeah, and Logan, you know, I've got the document with me and uh one of the things I saw, there was actually four instances of issues. Two were for ticket sales at CSA Lincoln and Mount Healthy and the other two were Rock Creek and McDowell. And the document does state that while they did do a review, um an assessment, that uh our procedures were designed were not designed to identify all instances of non-compliance. Therefore, non-compliance may exist that is unidentified. That is from the State Board of Accounts. So, I think um the the four instances that are in this report that we just received uh a couple weeks back um for I think it was '22
016to '24. Um those those issues are there, but there could be more, could be less, we don't know. Mr. Griner For Dr. For Dr. Phillips, why uh why does the State Board of Accounts differentiate between extracurricular activity funds, the ECA funds, and BCSC's uh normal funds? Operating funds, referendum funds. What What's the difference there? They're two different entirely different systems. Um extracurricular accounts consist of almost entirely actual money collected at the school or program level. And that money is maintained in a bank account specific to that school and or program. Um and then that school has an extracurricular treasurer who is bonded and insured that manages those dollars with the oversight of an administrator, hence the dual the dual signatures on on checks. Um whereas district-level funds um are a completely different monster. It's I
017actually don't know that. I maybe have heard of one instance in my time in public education where there was any significant theft or fraud that happened with corporation-level funds. It's It's you're very susceptible to those things at an extracurricular program level because checks and cash are being collected for field trips, fundraisers, um at the gate to a an athletic event, and that is flowing through the thousands of events that we have in a district of our size on a daily basis during the course of the year. So, that's where much of the internal controls conversation happens. It's where the state puts on the State Board of Accounts conducts an annual seminar for us to send people to that are new to get specific training on extracurricular items and um it's just a completely different systems.
018They operate together, but they're different. >> Rich, uh did did you get a chance to look at this document? Okay. So, it it they do define in the first paragraph a little bit about where that comes from and the laws that are tied to it. So, so they they do mention why they do what they do. It's different laws, so I think I'd like to in incorporate some of that discussion into whatever policy we end up with uh so that there's a clear understanding. [clears throat] And maybe that's in there already. So, the policy that I presented has been reviewed by ISBA and SBAE both. So, the policy that you have should have uh documentation and notes from both of those entities. Driver and uh for Julia, um say your last name again. Kozicki. Kozicki.
019I appreciate it's a challenge. Um I I'd like to make sure that we've got clear distinctions about the different kinds of funds. Um would it be fair to say that the funds that are not ECA funds are tax dollars either from local, state, or federal governments? Overwhelming majority of it is, yes. >> Okay. Extracurricular should be from someone buying a ticket. So, my my policy doesn't discern a difference between any of that. They're looking at all the money that the school corporation touches regardless where it comes from. All the money that's spent and making sure everything balances. At the school building level, uh and this may vary. Let's say I've got a checkbook for uh Saturday morning basketball. Whose tax ID is associated with that checking account? It's the BCSE district level. So, the money
020belongs to BCSE. Correct. And are all extracurricular activities treated that way? Even things that aren't like a sport, that's not an IHSAA sport. Yes. There's there Help me if I'm wrong here, but we we have seen in the past extracurricular account totals for schools. Those are Those are BCSE overall, but the way I understand it is if Columbus East has a football game and they make $15,000, that goes into their account. That's accurate. And if uh Rock Creek has a basketball game and they make $1,200, it goes into their account. It's all BCSE money, but it's assigned to them for their use and generated by them, right? And it's been that way for ever? Yes. Okay. As long as you define forever as 25 years or more. Beyond that, someone else will have to answer.
021Which kinds of programs are um run by coaches and the money doesn't belong to BCSE? So, any external So, a PTO, for example, is the most common one that you'll see districts often times erroneously um keep be the um custodian of those funds and house them under their extracurricular account. That is not allowed. So, any external program is is managed independently. You know, even if they like a fund PTO does a fundraiser, the money goes to the PTO's account. It's maintained in their own bank. They have their own board and their own treasurer and their own checking account. Um Booster clubs. Yeah. Like And the band booster club or if you have a booster club for football, um those are ex- we would expect those would be separate nonprofit entities and they would hold their
022own funds. But when schools have fundraisers, I think I hear a lot about the sports tickets, but much of this, particularly at the elementary and middle school level, is not necessarily sports related. I mean, when they do their like Northside has a huge magazine sale, I think, with the uses a fundraiser and um and schools do different things that the kids are involved in raising funds. If it's not the PTO doing it, then those are run through extracurricular. Correct. I mean, our when I was at North, our calculator rental was run through extracurricular accounts. One One addendum to the State Board of Accounts audits that are done every 2 years does include the North and East ECA accounts because of their size. They are included in those audits. Above a certain threshold. And And why
023is it that uh ECA audits by the State Board of Accounts have kind of lagged? Uh they seem to be not as current as the other audits. They They're been two different times in my time in the district level here in BCSE that they've lagged behind. Um Um one time was when they just had a severe labor shortage. They couldn't hire enough auditors. And so we were well behind schedule in audits then. And then also when the federal SR um and COVID relief dollars were flowing into every local um taxing unit, they were completely overwhelmed and couldn't possibly keep up. And so um those are two different times that they've lagged behind. But your question um the most recent audit by the State Board of Accounts of our district funds, including some federal grants, that
024one still not posted the State Board of Accounts site because it has to be approved at the federal level first because it's a they audit the spending of selected federal grants. And so it's been done for a significant period of time, but it hasn't been posted to the State Board of Accounts website. >> Almost 2 years. It's been almost 2 years. I don't know why it's not on their website. >> after I started is when that audit took place and we received the findings, I believe January a year and a half. That delay doesn't I I I'm I'm assuming that delay doesn't prevent us from making updates to internal controls. Is our policy clear on that point? That we don't we don't have to wait for an audit to be published before we take action.
025I Whatever policy is in place >> board If I if if we're made aware of something that's recommended or if we find something that we feel we need to make, why would we care if an audit wasn't published? I mean, we should as quickly as reasonably possible make those changes and make improvements. Why wait 2 years? When when I've gone to SBA audit exit conferences, I've been instructed not to talk about it uh until it's published. And I just didn't know >> mean we have to talk about that the findings but that doesn't mean we can't talk about making improvements to a process. >> to make sure that it doesn't stop us from making improvements to the process. It does not, theoretically. Whatever policy we end up with. So, overall, I I'm feeling the need
026for whatever policy is developed I I want these delineations, if they matter to us to be clear about, you know, the those We've come up with three so far. There's the PTO kind of funding. There's the extracurricular accounts. And then there's our operating funds and referendum funds and education funds and federal grants. And I would ask that you keep PTO funding separate. We have no no contact on that. That's fine, but I think we should be clear that this policy doesn't doesn't deal with >> Policy is only for BCSE funds. It's it's a annual account of BCSE funds. Uh The other thing that I wonder about is um communication. Um I'm not sure at what point, but I'd like for the policy to clearly say when is communication of um an error discovered uh confirmed
027verified, at what point does it come from admin or the SBA to the Board of Directors? Now, this policy states in findings and corrective action on page two, if the audit report contains a significant deficiency. Now, this is an annual audit. So, if the audit report contains a significant deficiency, material weakness, or finding of non-compliance, the board shall conduct a review meeting with a public meeting. So, not sure that's what where I would go, but I think the board should be informed. Well, then this is what the policy states today. It says the administration shall prepare a written corrective action plan and implementation timeline within 60 days of receipt of the audit, and the audit committee shall monitor implementation of all corrective actions and report status to the board. Why would we not want immediate
028action if we found a discrepancy or issue for using uh or misusing uh the taxpayers' money? Why would we wait? Mr. Schulz, I see your hand up. I was aligning with your prior point on um separation and clearly stating that PTO funds are not BCSE. Um my focus was on that as everyone sees those as BCSE funds, so we need to be very clear and explicit. Um I do think like we're kind of going down a couple of whole rabbit holes on like the what-ifs, but like I have I feel like the biggest one is honestly just the basic GAAP principles that we've I think Mr. Majors' policy includes, but also just um honestly just more transparency. Like I we've had a couple incidents that we're still months post the way I don't even truly
029know and I know we're doing audits. I know we've had initial talks about it, but I think we still need to be able to say can what we're proposing fix what we what is broken? And I don't think we know what is officially broke yet. So, I think that's that's my biggest concern with this discussion is it's a lot of what-ifs, but we're not really sure of what actually broke first. Well, I think I would just do this. Rich, you've been here the longest in the entire time you've been here. When have you seen a full financial audit report? Like every 2 years. >> Yeah, I saw two when I was board president. Mhm. Every 2 years. And is it is it what we received from SBOA? Was it this? Like that is a lot
030thicker, I think. Yes. Was it provided to the full board or just to the executive committee? I don't know. I I This is my fourth year. I honestly, I don't recall seeing it. So, did did did that get did did that get disseminated to the rest of the board? Do you remember? I don't remember. That That would be a good policy. I mean, Dale, have you seen a full Not that I recall. I think that would be um What is That'd be Is it the full >> thing to be included in the F-100. I mean, is Well, well, I mean, you just talked about wanting to be notified as a board and it could be posted anywhere. Matter of fact, Dr. Phillips and I talked about it being posted online and I went to the
031website he gave me and they didn't have the last one posted and that's how he arrived at the federal part of it has to be signed. But even if the last one was like there's gaps and that's why for me, you know, we we are the holders of 160 plus million dollars of the taxpayers funds. Every year. At least now a minimum of every year. It's gone up significantly since I started here. And I feel that we're beholden to them to ensure that their money is accurately, adequately, and rightly spent. And if there is potential for fraud, I mean, I brought to the board 2 years ago a cash is king policy because we had people that were complaining about having to go in to a sporting event at a high school and having to
032pay with a credit card. Now we have people complaining about having to go pay the fees to use the credit card they're told they have to use. And they couldn't use cash. And the reason one of the reasons one of the reasons I was told that that was not a good idea was because the influx of cash during any sporting event and I'll use sporting event, it could be a play or whatever, drama, doesn't matter, band concert, um anytime cash is present, there's a risk for for somebody to pocket money. And that's why they wanted to use the digital means. So to me, if there's the potential, if we're forcing people to use a credit card, it doesn't hurt anything for us to just prove that there's no issues. And we've already seen in the
033ECA accounts that there's at least four four instances. So the I mean, meeting tonight is not an argument over who is right and who is wrong. This is We really do want every board member to express what do you believe is appropriate to be in these things so that we can take notes and and generate some modification or which there's already modifications that Mr. Major sent to me to this um to this proposed policy so we can create something that reflects the wishes of the whole board. We've identified a couple of things already that belong in policy that aren't there now. Well, does anybody else have I don't disagree with what you just said. The reason why there's an argument in a or the perception of an argument and that's a little bit defensive on
034my part is we started this meeting uh and led into not asking the question of why did this come up? Why are we doing it? So we're not even establishing why right now and we're we're we're talking about the semantics of what is a ECA fund versus a BCSC fund and all that, which which can be talked about at some point, but I mean, like I just said, we we we spent a lot of money, and my goal with this was to the intention was to ensure that we're as transparent as possible to the community in how we're spending the money, and there's no concern for fraud anywhere because we're monitoring and managing it with trained people uh accurately and adequately. One thing I appreciate about the current F-100, um Mr. Stenner, you highlighted that
035there are different funds, and the extracurricular accounts um are not taxpayer money, not that that makes it any less important, but but I appreciate the fact that we have a policy directed specifically at the extracurricular accounts, because I I think in terms of of our of the administration oversight of that, and and then our oversight, it's a very different um animal than than the other funds that we deal with. And it's also um you could verify this, but but in from my perspective, it seems like the one where there is the the greatest likelihood that a fraud's going to occur is going to occur in the extracurricular account. So, in in that sense, I like a separate policy that deals with how do we how do we oversee extracurricular accounts, rather than melding them all
036together. one policy, but a clear section for for each. Uh Mr. Schulz. Yeah, I mean, I'm I'm with Dale. I I agree. I think your highest risk is similar to nonprofits as your ECA. Um I also I mean, I think in the spirit of what Dr. Phillips was asking, I'll I'll just give my one sense and then feel free to default to everyone else. But I I guess I see it in three different categories. One, clearly say the PTO is outside the realm of any of these policies. Then you have ECA, and then you have corporately held funds. I don't believe the public sees our fiduciary responsibility different. I I do disagree with the prior assumption of that our our responsibility appear different between ECA and corporate. I think we should hold the same hold
037the same standard. I think what we would do is what we should be doing is applying um internal mechanisms and audits reflective of both the risk and the and the monetary impact. So, on the ECA, I will I will agree with um Mr. Allen. I think the higher risk and I think we should look at how we implement more stringent controls and especially adherence to the dual signature, um adherence to more internal audits. I don't see a policy that requires a deep enough level of internal audits, especially given that the majority of this is in cash and not necessarily in a very transferable um you know, easy to easy way to track. I think for the corporate funds, your impact could be far greater and your abuse capabilities is far higher. So, I think you're
038going to have equally level of restrictiveness over there just because again, someone's not walking off with 100,000. You could be walking off with 1.5 million. And so, your impact is different. So, I think you're going to have more internal controls regarding what I would say is even external auditing. And I I think at minimum uh any state board of account that has ever been reviewed and there's been an actual audit, the entire board should have visibility to. I don't think it should be restricted in any fashion. I looked at my email just now. I have no record ever being provided a audit. Um and so, I think that's the minimum expectation I would hold it. Actually, I would even say should be shared publicly. I think in In spirit of today, when we have multiple
039trustees having issues, I don't think um saying that we're good without sharing the actual finer details of good would be sufficient in the eyes of the public at this point. Mr. Logan, just to clarify, I I'm not saying our responsibility is different, if that's what you're referring to. I'm saying the system treats them very differently. So, they they seem like different policies would apply. Um but I would agree in terms of transparency that and I think this is not in the current F-100, but when there is an audit that it's um made available to all board members. And I also wonder, I know we have one board member that sits in on the exit interview with the audit, whatever that's called. Um and I don't know how that's set up, but is it possible that
040um that any board member that wants to attend that um could attend that? And that might be part of our policy. That that would that would be something that I I think would also be helpful. I think the other thing is is if you look across the districts, I know Johnson County, I met with several school boards up there. I believe Jackson County is the same. They have budget and finance committees that have the board involved in respective designated committees um settings. Uh we do not. Right? And so, I think that's another opportunity that we have to improve the process and install financial controls. Good. I would caution you not to have a meeting for the your your initial audit review where all board members are present cuz that would then be a public meeting.
041Yeah, the way this is set up, uh the audit committee, which would have two board members, five people total, they would review and then make recommendations for what to present and how to present it. And then everybody would get that all at the same time. It wouldn't be like it would go to the board without the admin knowing, and it wouldn't be like the admin would get it without the board knowing. It would be everybody gets it at the same time. That's a fair level playing field. And while there are board members and others that are in the meeting, I mean, the hope would be that they wouldn't just go out and talk about it outside of that. But it also depends, too, I would think, on the severity of the issue. To Logan's point,
042if we had somebody steal a million and a half, we probably want to learn that as quick as possible. And so, I think that's where for me uh two board members being able to be part of that up front is reasonable. Mm, if you [clears throat] Are we going around the table to get everybody's views? Is that right? Cuz they Are we through the just general commentary phase of the meeting? Okay. Go ahead, please. Um if I can, I'll kick us off since I jumped in. Uh I do appreciate that we have mention of internal audits, but not to beat a dead horse, I agree that just some sort of guidelines that says it's at the superintendent discretion as it's written today, but um a little more language around what might um lead to that
043would be interesting. Are there controls or something that you're looking at to help make that decision um would be would be helpful. I don't necessarily feel like another committee is required. I'm not in favor of that, personally. I just feel like having a board member participate in the audits, we get finance reviews, we have access to you all. I agree with having that anything from the SBLA published to everybody is is reasonable. Um I just don't see the value in an extra committee as written today. Um so, that's my two points I'd like to make. I don't know who want You want to go next? I don't have a whole lot. I kind of want to echo Logan's remarks about not knowing all of the details about what has happened. Um Um for me, I
044think that would be helpful to know where it broke. And so, moving forward, how can we evaluate mistakes and errors and use that to improve the process? I think that could be um very constructive for me as an individual. Thank you, Mr. Glick. So, reading through F-100, um I do like Mr. Nolan said, I do like the fact that we have a differentiation between uh actual BCSE funds and extracurricular funds. Um when we find an issue, it says SBOA triggers the superintendent to take action. Does that trigger an internal audit for that account automatically? Uh on on cuz it gives you the discretion there, right? Is that one of the practices? Cuz it doesn't really go into the defining material of what happens. It's It's just part of the audit process when when the an
045auditor discovers a um an issue, a discrepancy, or even has a question, they usually are going to approach the deputy treasurer, at which point she is digging into that issue to find out answers for the auditor. Um if it ends up being a discrepancy, and if certainly if it ends up being material, it appears in the final audit finding. But, they are walking alongside the auditor as they go through it, trying to discover why there's an issue in the first place, and then every audit that I was part of in 8 years in the business office, we were implementing modifications to our practice and um and training in real time as the audit was occurring, not waiting till afterwards. But, defining that in either internal controls or policy would be would be helpful. Thanks for
046that. Well, even even before that Uh it says the assistant superintendent for finances and operations shall take appropriate steps to investigate and remedy any loss. So, once that's discovered, is the is the practice then to trigger an audit for that account as we then cuz it even says to report it to the SBOA as well. Yes. So, I guess I guess the practice is already there. I'm I'm still trying to figure out what the whole point of this is if I know we want to see an annual audit. Um apparently there's a full audit that is somebody seeing it, not all of us are seeing it. Um that is bi-annual. Um so, in all reality, if the practice is already there and if we find issues, what are we looking at? So. How do you
047find the issues without an audit? Chicken and the egg. But so that brings up one of my wonderings and I have two I want to share. Um it seems like the two times I remember, one recent and one a while back where we had um theft with people involved in the the extracurricular accounts, it wasn't found through an audit, but it was found internally prior to an audit. Um so, what I'm wondering is um whether or not the added cost of an annual audit is worth what comes out of it and along with that, how how many districts or what percentage of districts around the state um actually do pay for their audit to have it to have it audited annually. Um the other thing I wonder I I totally agree. Um Logan, you talked
048about, you know, what let's dig in and find out what went wrong. Um how do we have conversation about what what went wrong when um when the situation under consideration is still being investigated by the State Board of Accounts and and law enforcement? How do how can we have those conversations amongst ourselves while that's still going on? And I don't know who that question's for, but that that seems like a a tension or a dilemma in getting to the root cause and fixing problems quickly. I I think I can add to that. Kind of tying in what I was talking about is practices were there. This was the Southside incident was not found with the non-audit. Correct? So, I guess how did we discover that? And then therefore did we trigger the the follow-on practices
049after we discovered that? And and how do we have those conversations while the investigation is still going on? That that's Can I I It it is a it is a dilemma. Um and I just want to share with you all um in >> [snorts] >> instructions I gave to a uh administrator just very recently about um once the situation concludes and bringing your staff together and talking about why did no one in the building know that there was something being investigated? And my instructions to this administrator were that if it was you who were accused of something that you didn't do and it was being investigated even if it's appropriate because it's appropriate for us to investigate when we find out that there's an allegation against someone. And I'm talking about for anything. Any inappropriate,
050illegal, immoral action. That I know that each one of you, meaning I'm I'm I'm putting myself in the voice of the administrator here, each one of you would want me to keep that information confidential while it was being investigated. As a matter of fact, there's certainly liability, I would assume, I'm looking at the attorneys, that could result if we were to share allegations publicly that have not yet been either in fully investigated, um and certainly not without some, you know, conclusion coming to that investigation prior to us sharing either with internal staff members or it's certainly at a public board meeting. And so that's the it's the dilemma you mentioned, Dale, that it's tough place where people, of course, crave transparency. Why wouldn't they want to know what's happening? But it's our responsibility as an
051organization to protect individuals who are accused, whether it's theft or or some other action, um while the investigation takes place. So, is that something, [clears throat] and I'm going to look at our two lawyers when I ask this question, um is that something while those investigations are going on that we could um discuss in an executive session? Or does that not fall under that? Not to put you on the spot, but In in order for the board to hold an executive session, uh that meeting has to fit one of the roughly 15 to 20 reasons that are listed out in statute. Um there is one that is in that list that has been there for a long time, which is something along the lines of receiving information about a person that that the corporation has
052oversight of. And so that in some situations may be appropriate. There is a newer reason that got added last summer, which is along the lines of um just to receive advice that may be privileged from an attorney. And so there could be some conversations that might fall under that that umbrella. But it would just really depend on the specifics of a given situation would it fit one of those reasons? If it does, absolutely, we can have an executive session. If it doesn't fit one of those bases, we can't have an executive session on it. How long is going to take you? Uh Mr. Schultz, you've got your hand up. Yeah, follow-up to Dale's callout. Um Mr. McIver, would that not fall under because action was taken in regards to the employment, the performance, and like
053termination of that part of the executive session? Yeah, I I think Mr. Schultz, you're I think that's the section the language that I'm talking about, but there is one related to employees. Um but again, you know, if if the question that board members have is kind of how quickly could we talk about something or or how fast could we be made aware of it, there would be times when something may happen that um you know, the the employment side of it may not have been figured out yet. I don't know. I'd have to look at that language to see if a volunteer would fall under if a volunteer was involved, would they fall under the same exception or not? Um again, it just would be very dependent on the facts each time. I I think
054I guess and that's where I'm Go ahead. Sorry. No, go ahead, Logan. Yeah, I mean, I guess that's where I'm like I'm not trying to say I feel like we're going to have to come back. Uh but like I I think Ms. Lloyd kind of referenced as well as like one, I don't know what broke. So, I don't know how to like if what we put in place will even fix it. And then two, like we keep referencing or alluding to our processes and our trips and our mechanisms, but like like there's nothing in front of me that says this is how often we currently review and audit these accounts. This is how often we currently review and audit these accounts. This is what trips when we actually intervene. Like it would be very helpful
055as a board member when we're like trying to put into a policy that says something is broken it it what broke and like also what was the intended function. I I feel like we're kind of having to rebuild as we fly and I I think those are two critical things before I would feel comfortable. And then also I would say is like I I don't know I mean I'll I'll default to Mr. McIver's wisdom here, but like we have mechanisms to where we can share privileged information and we've done in the past like I think that's the other thing is like whether that's notification through uh our executive notes or so forth and like those are conversations like I don't rev rather than referencing the school and or the the situation like we don't have
056to reference the situation to know what broke I don't think at least. So that that would be my final call out. Sorry, I was just adding on after Mr. Allen called it out. And sorry. Let let me add add to that. I I think that um and I don't know if this goes in the policy. I I wouldn't mind it being in the policy, but something some wording about um an executive session when some situation occurs it doesn't have to be within days of the occurrence, but it could be sooner than the many weeks or months that the investigation takes that that I mean in the with this most recent situation we did get a text, but it's not something we talked about it a board it as a board and and as a board
057heard what what's being done to correct it and what went wrong and it just that just seems like a really good use of executive sessions um, just that it makes it all significantly more timely than waiting until the whole investigation's done. Julie, uh, correct me if I'm wrong, but it was just this last legislative session that the executive So, the executive, uh, session law changed to allow for boards to meet during an investigation. The The other reason that was in place before had to be final action, at which point it's public, and the it's required to be that final action is required to be made public based on case law because there were uh, the press had requested notification. Is that accurate? That's true, and the other thing I would say is, you know, if
058we're talking about the performance of an employee, sometimes they have the ability to, come before the board to make a decision if it relates to their employment being terminated, so you can't prejudge. So, I'm thinking the focus of this would not be on the person and the charges or pending charges, but the the focus would be on the the process and the system, um, and how do we think this might have happened and what might we do to fix it? I'd encourage any kind of, uh, timeline be placed in a guideline and not in board policy because, as Mr. McGiver said, every situation is different, and sometimes you would want to know and would expect to know immediately, and other times you need investigations to occur. I appreciate that. And And just since this is
059a public meeting and and folks can can come on and and review this later, um, I just want to be clear that every time there's something like this, I notify members of the board that there's an investigation occurring, and, um, usually end of that message with call with questions. Um, and so there there is no, you know, in this situation or others at least in the last couple of years that I've been in this role are no situations, and correct me if I'm wrong, but that um I have known about an investigation that you didn't know about and then didn't offer to have a conversation about. Right. I I'm saying the piece for me that's missing is the board discussion and conversation, but Among the board. >> Absolutely. We have always been informed. And I
060appreciate that. Thank you, Mr. Major. Yeah, I I to be honest with you, I feel like most of the conversation tonight has not been about the policy I wrote. It's been about situations and uh I just hope everybody's been able to read the policy and and come up with anything constructive that they may have. I did put time frame in there. So, I felt that uh at the end if there is a discrepancy found and an issue that there had to be like I could I don't think we could wait 2 years to find, right? 60 days is reasonable for someone to come in and say, "Hey, let's talk about a situation." And so, so to me, again, you know, it's $160 million a year. We're getting ready to ask the community for a whole
061lot of money in a referendum. And uh I just feel like you know, it it's it's a very good transparency tool to ensure that everything's being done right. To the comments about uh what are we doing different? Um I would be curious if we could get a report on what we got here. Uh there's four instances of discrepancies. And uh you know, one of them there was uh a school where there was a uh basketball game and there were uh not they didn't identify the number of tickets that were pre pre-numbered and uh didn't have a uh accurate count at the end either. And so, what have we done to fix those things? It'd be really nice to see with this packet the the We don't I don't need it tonight. Um but it'd be
062nice to see what we changed to make those things better cuz this is from 2022 to 2024. So, those issues are anywhere from 2 to 4 years old. I would voice to echo what um Ms. Wilden said. I also think that another committee is an a necessary thing in the policy. Okay. All right. Uh I want to give board members Mr. Schulz, everybody present a chance to ask a question or uh say make a statement about what's important to you. Um I think We'll try to wrap this up by 6:30 and then move on to an executive session if that's possible. Mr. Schulz Do you want me to go first? Sure. Yeah. Uh I I said given the current climate regarding trustees and so forth, I I think a committee that's independent actually makes sense.
063I think it creates further transparency. So, I do I support that. I also think and I'll follow up with the email that all board members that are sitting should have the last two SBOA reports and audits uh prior to making a decision on this. Pick anything final? Uh Yeah, to go back to what Mr. Schulz said in terms of timelines and everything, the one thing I did see in 100R, the extracurricular fund, uh that actually does lay out uh a whole list of timelines where F100 is not. Um so that would be something I'd like to see is a timeline in terms of uh frequency of how things are how often things are seen. Um for instance, FR F100R talks about um the treasurer and deputy treasurer review all ECA accounts monthly. Um so that
064that's a good thing where we actually have eyes on that one. They're reviewed annually and bi-annually, honestly. Um and so along with all the annual trainings and everything that goes on in that. So in in the policy, it it'd be great to see that kind of updated in F100. I or even if we look at Jason's deeper um but that's pretty much it. Mr. Lloyd? I don't have anything further. Okay, Mr. Nolan? So I think I already shared my concerns with um the whatever Jason's proposed policy is and and the additions that I would like to see in F100. Um but at a higher level, I guess my concern is the process that we've gone through in the last couple policies. Um When when one board member brings a policy that's already written, it's really
065easy for us to get caught up in the weeds and the details of that policy. I I would really prefer if we as individual board members have a concern that we would like a new policy that maybe and maybe this means revising our policy on policies. Um but but I would like us to start with here's a concern or an issue that I see or that I hear about and then we get together and and talk about it at a working session um to get ideas to build a policy that there's consensus around. So, we're we're starting at the higher level of dealing with the issue instead of here's a policy. Now, let's nitpick at at what do we like and what do we not like. It seems um inefficient in terms of our time
066and it also it makes it really easy to turn something that is not a divisive issue for the board to make it look like it's divisive. We are all in favor of sound financial oversight. And if we start talking about what's important in that as a group, we're going to come to things we agree on instead of starting with the things we disagree on. Alan Mr. Major Yeah, so when I started I was advised by other people that our two jobs are to manage policy and hire and fire superintendent. In the time I've been here, I know Logan has presented policy and I think I've done three now. Other than that, I don't think anybody has presented any policies for anything and I don't think we've had any discussion about policies that anybody would want
067to present. So, when it comes to that, I don't disagree that we can have more conversation, but at this time I've not seen any conversation. And so um to defend myself on that as well, you know, it's this has been out there since April 13th. And very very limited conversation around it. And so, hopefully people take a look at it again. The public is expecting great things of us. We are elected officials. We are using significant amounts of the community's money and to say that one extra committee is wasted time is absurd when you're spending almost as much if not more than what the city and county are spending. so it'll be whatever it is. Thank you, Mr. Mayor. Ms. Weeldon. Um I'll reiterate my my aversion to another committee is just I think there's
068strength in seven people from the board weighing in on things rather than just two. It's not less, it's actually more that I'm after. So, including the full board in things like reports and and all of the things, I think that's a better outcome than creating another committee. That's why my position is where it is. And then just in the internal audit process, another thought, um I mentioned having a trigger, like what might trigger an internal audit. I've also seen it done where you build a competency for performing those by extra training for individuals who are capable of of doing that level of depth in questioning. And and you have a certain number of them that you feel like with the resources you've got trained up, you can perform. And so, it could be, you know,
069if you have enough people to do 50 or 100 internal audits a year, that you hold yourself to a standard of doing 50 or 100 internal audits a year. Um as we've said, the process of preparing for an audit often highlights things. That's kind of the whole point of it. So, um I've just found that having that strong internal audit process really does build a ton of competency um within your organization to and it just strengthens you overall, so. Good process. Thank you, Ms. Weeldon. Uh we do have uh an executive session coming up this evening I'm on item number three on the agenda. Our next regular board meeting is set for Columbus North High School cafeteria next Monday, May 18th, although the board meeting starts at 6:30, I think we have uh reception for
070retirees that starts at 6:00. Uh hope everyone can attend. Uh there is no further business to come before the board this evening, and so the meeting is adjourned. Our executive session is upstairs, or stay here? Just stay right here. We'll stay right here.