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The Suffolk Public School Board decided in a 5-2 vote to pay for accounting firm Cherry Bekaert to attend the Board’s work session on June 12. Chair Heather Howell explained the cost will be $2,500 if they attend virtually, or the Board will pay no more than $4,000 for them to attend in person. The Board’s vote did not specify if it will be virtual or not; Chair Heather Howell said it will be determined by Cherry Bekaert’s availability to come in person.

Board members Karen Jenkins and Valerie Fields were the only opposing votes. 

As discussed during the Board’s work session, this will be an opportunity for someone well-versed in deeper audits and internal control consultations to provide more information and clarity on if the Board needs either of these services. 

Board member Kimberly Slingluff specified this is not because of any suspected fraud or mishandling of funds, but because community feedback over the past few years has shown a general distrust of city and school funds.   

Five public speakers attended the May 8 meeting, sharing thoughts on the Board’s budget and auditing process. Four of those speakers directly called for a forensic audit and the other spoke about the large number of SPS administrative personnel.  

Laura Harden, an auditor from Cherry Bekaert, attended the Board’s April 10 work session to provide an overview of the audit process. After the discussion, it was determined what some Board members are seeking may not be an audit at all, but more of a consultation about internal controls. 

Harden explained they perform risk-based audits where they identify any risks pertaining to the entity being audited. This means no audit is exactly the same because organizations all function differently. Cherry Bekaert has performed audits on SPS in the past at around $75,000 each.

“We get the financial statements and then we do our risk assessment procedures based on our knowledge of the organization, our knowledge of local governments, determine what accounts or what line items we consider to be more risky,” Harden said. “And then we tailor our testing of those riskier audit areas.”  

The company also performs single audits if any entity spends over $750,000 of federal funding. This is also risk-based and 20% or 40% is audited. 

Any journal entries deemed risky are also investigated further. Harden explained this could be any entry with a correction or error, entries without a description, and significant debits to revenue. 

Harden said since working with SPS, no fraud or anything suspicious has been identified. 

“An audit is not designed to search for fraud,” she said. “That’s not the purpose of an audit. The purpose of an audit is to determine that the financial statements are not materially misstated to the users. But we do make what we call fraud inquiries, that’s required under the auditing standards.”

Vice Chair Sean McGee provided a list of 35 areas he would like to be analyzed on a deeper level which included transaction patterns and spending behavior, receipt and documentation review, cardholder review, equipment additions and replacements, food services, non-departmental spending, payroll transactions, and others.

He asked if a forensic audit could investigate these items. Harding said she does not perform forensic audits, but she thinks a review of internal controls could better provide the information the Board is looking for.

“If it doesn’t make sense, we don’t need to have it,” he said. “So I want as much evidence as we can have, please, presented to us as a Board so we can make a great decision for our citizens and decide if this is what we want to do as a Board.”

Jenkins expressed frustration about the whole audit conversation because the citizens who are calling for a forensic audit are on a “witch hunt.”

“You have people here who won’t even approve the budget,” she said. “But you want to do a deep dive audit. You’re going to dig so deep you’re going to drown yourself. That’s the bottom line.”

During the May 8 Board meeting, Fields made similar remarks, stating that it would be “fiscally irresponsible” to pay for Cherry Bekaert’s return.

“We’re not clear on what it is that we’re looking for, and we’re talking about putting monies out to just have someone come and do what?” she said. “We’ve received an audit, we had no discrepancies. I think that we should accept the audit that we have and that we should display the confidence we have, or we should have confidence in the financial team that we have and move past the whole issue of audits.”