The Monticello Independent school district bought property with money meant for payroll. Nobody knew the bank balance. And by December 2012, they didn’t have enough money to pay employees for the rest of the school year — forcing the state to extend the district an emergency loan.
The failings at Monticello Independent were a perfect storm of problems, according to state officials. The superintendent and school board fell short in their financial responsibilities. But so did the school finance officer, who had no background or training in finance. He was working in the district’s information technology department when he also was charged with overseeing the school system’s cash, investments and financial management — a $7.7 million-a-year budget.
That Monticello employee isn’t the only Kentucky school finance officer who might be unqualified for the job.
A new report by the state auditor’s office, obtained by the Kentucky Center for Investigative Reporting, reveals that the problem is statewide:
● One-third of the commonwealth’s school finance officers don’t have college degrees in accounting or a finance-related field. Those 58 districts represent more than $1.3 billion a year in spending.
● In more than 20 percent of districts, finance officers don’t have a bachelor’s degree in any subject at all.
● Their work experience varies widely. Of Kentucky’s 173 school districts, 33 have finance officers who are former teachers, principals or superintendents. Of those, 18 have no previous financial or accounting experience or education.
● Less than half reported obtaining a finance-related certification.
The audit shows that the lack of qualified finance officers leaves districts vulnerable to increased risks of waste, fraud and abuse.