Edison, NJ – At its meeting on Wednesday, the Edison Board of Education unveiled a series of reforms based on the findings from a performance audit that it authorized.
The hiring of a qualified purchasing agent to ensure there is proper bidding. Providing additional training for staff. Updates to policies and procedures and exploring the implementation of an electronic bidding process.
These were some of the reforms announced by the District’s Business Administrator Daniel Michaud after an independent audit that the Board of Education asked for revealed deficiencies and potential violations of State regulations.
“This is not a state statutory required audit,” explained Scott Clelland, who’s firm, Wiss & Company LLC, performed the independent audit. “It is a voluntary audit done for the purpose of identifying efficiencies and effectiveness in how they operate and perform certain procedures.”
Last year, the Board of Education raised concerns regarding the purchasing area within the District, according to Mr. Clelland. To address the Board’s concerns, the Wiss firm was engaged to perform a performance audit, testing data from January 1, 2016 through June 30, 2018. The audit mainly focused on the District’s purchasing system and controls in place by the District’s Business Administrator.
“When we first got into the actual procedures, and through the interview process, we quickly became aware and it became apparent that the Business Administrator was really responsible for a lot,” said Mr. Clelland.
“Every penny counts, especially as we ask our residents to approve a bond referendum so that we can finally solve overcrowding and implement a full day kindergarten program. Many members of the Board, along with myself, strongly felt that we needed this performance audit to assure ourselves as well as Edison’s residents, that we have a system in place that will make the most of every dollar approved through the referendum,” said Edison Board of Education President Jerry Shi.
The audit tested several areas, including purchasing, procurement, accounts payable, the distribution of travel expenses, and document and record retention policies. In addition to collecting and testing data, auditors said that they also interviewed staff, including Mr. Michaud.
The audit produced several significant findings, according to Mr. Clelland. For example, he stated that in multiple instances the District did not obtain or properly document quotes. There were also examples of the District not reviewing invoices to ensure payment was being made in accordance with contract, noted Mr. Clelland, who also noted that the District failed to maintain records required under New Jersey law.
In one instance, the audit found that the District received bids from two vendors, but that both the vendors were located in the same building, and had the same W-9 signatures. One entity submitted bids with the physical address of the business while the other entity used a P.O. Box.
The audit also found that the District reimbursed employees for items prohibited under New Jersey law and in instances paid for air fare without proper documentation of quotes.
Based on the performance audit, the District has already implemented reforms, according to Mr. Michaud. “We did hire the purchasing agent,” he said.
“She’s going to be reviewing all of our purchasing practices. She’s going to review all purchase orders before they get to me. So, if I don’t see her name that she approved it, which means she’s going to check to see that the quotes have been met, if it’s a bid item, its going to be bid, and after she approves it, then I know it’s been vetted and then I’ll get it, and I’ll approve it.”
The hiring of a qualified purchasing agent is a step in the right direction according to Board member Richard Brescher. “I felt that we needed a purchasing agent,” he said. “There was a need to do something. That’s why we asked [Wiss] to come in and take a look at it and get [Wiss’] recommendations. The purchasing agent, I think, is well needed.”
Mr. Michaud also stated that District staff are undergoing training. “We also, we’re doing some training. She’s already gone to some workshops. We’ll be doing some additional workshops. She already updated our purchasing manual,” he said, indicating that the District will also be engaging in staff development sessions for accounts payable and other employees. Notifications were sent to all staff and all purchased need to go thru the the new purchasing agent.
Mr. Michaud also announced that the District will be looking to implement an electronic bidding process.
“The Board did not wait until this evening to start to implement corrective procedures or to improving the procedures that were already in place,” said Mr. Clelland. “I’m happy that when we had these discussions, the good ideas that came out of those early discussions were implemented during the course of this engagement,” he said.
“Tonight’s audit presentation is not meant to point fingers. But there are some findings that gravely trouble me. Particularly as it relates to the bidding process and the record keeping process. I expect that we will implement reforms to cure these deficiencies. I know in some instances we have,” said Mr. Shi.
“I remind our administrators. This is not monopoly money. This is not our inheritance. We have a duty to ensure that every tax dollar is spent wisely, that we are getting the most for our taxpayers,” said Mr. Shi.