It should now be clear that education dollars are not immune from corrupt indulgences, and that school budgets in the approval phase and spending process leave much to be desired. If dollars are to be spent more wisely and if fraud is to be prevented, a new thought process is needed about budgets–how financial transactions are monitored, how resources are used, and how the treasure chest can be secured from being plundered. Part of the rethinking process must also include prevention—making it difficult for waste and fraud to take place.
To begin with, school boards must keep a very unpleasant fact in mind. Don I. Tharpe, the executive director of the Association of School Business Officials (ASBO) claims that “embezzlement happens a lot more frequently than we are willing to admit.” However, ASBO does not track cases of theft and fraud and neither does anyone else. With billions of dollars involved, it’s amazing that such a void exists. Since such information is not easily available, school officials are handicapped in keeping an intelligent and forensic eye on district funds.
Therefore, it’s important for the state to be much more proactive in helping school districts guard the treasure chest; after all, education is a state responsibility. In Texas, the State Comptroller—a 60-year old grandmother who was elected to the position–is performing this task. Unlike previous office holders, she had a zeal for looking at school operations and doesn’t wait to be invited to audit school operations (transportation, retirement plans, curriculum alignment, finance, etc.); instead, she unhesitatingly “storms the ramparts.” Her proactive efforts in 32 school districts have saved over $85,000,000 in just two years. In fact, she won a prestigious award for government innovation from the John F. Kennedy School of Government. This program demonstrates the value and impact of independent and aggressive audit reviews.
Inside Education, Part 4: Finance: Are school budgets cholesterol free?