NEISD internal audit office reports audits, cash-counts and new reviews; identifies common cash-handling weaknesses

Miss Shoesmith, representing the NORTHEAST INDEPENDENT SCHOOL DISTRICT Internal Audit Department, presented the department's quarterly update at the board meeting, saying the office completed five audits and one advisory project and finished its rotation of campus visits.

She told the board her team had completed five audits and one advisory report over roughly 4—2 months and that the audits included reviews of Roosevelt High School, Churchill High School, Madison High School (including the agriscience magnet), Garner Middle School and an audit of the Northeast Education Foundation partnership. "We completed 5 audits, as well as 1 advisory project," she said.

The update outlined findings and work in progress. Shoesmith said the audit office completed a program of unannounced cash counts and safe inventories across campuses and provided feedback directly to bookkeepers. She described recurring cash-handling weaknesses including late deposits, inconsistent documentation for crowdsourced fundraisers, and safes used to store nonfinancial items. "More and more, we're seeing the frequency [of crowdsourced fundraisers] rise," Shoesmith said, adding the district adopted procedures a handful of years ago but that a learning curve remains.

Shoesmith attributed late deposits to multiple causes, noting both how money moves from students and teachers to bookkeepers and staffing/contract differences across the year. "The control that we have is 2 parts," she said, describing guidance that teachers and bookkeepers should limit how long funds are held and that deposits should be made promptly.

She said the audit office handled two hotline complaints during the period but that "nothing came of them" after initial research. The office is also conducting the annual inventory of district assets (equipment and tagged property), a conflict-of-interest review of employees (reporting a 74% response rate at the time of her presentation), and a new advisory-style review of Career and Technical Education focused on expenditures, travel and inventory controls.

Shoesmith described one paused project, the adult and community education audit, which was temporarily delayed to prioritize time-sensitive items; she estimated the audit report would be ready by June and said auditees understood the pause. "We'll get that one finished before the end of the year," she said.

On process and follow-up, Shoesmith said the audit team and Budget and Finance often coordinate retraining at campuses with recurring findings and that the audit office plans targeted spot checks and follow-ups, including desk audits and six-month reviews as needed. She also proposed providing the board a condensed monthly summary of campus cash-count findings to highlight top recurring issues rather than distributing full individual memos for every campus.

Shoesmith flagged a handful of technical items the audit team is addressing, including developing written guidance with Budget and Finance for handling foreign currency found in campus safes and refining the audit office's advisory memo format for construction-rate services. "I'm working currently with Budget and Finance, because there is not in writing a policy on how to handle foreign currency," she said.

The board moved into executive session after the update to discuss personnel and property matters under the Texas Open Meetings Act; Shoesmith had indicated some audit items contained personnel-sensitive details that could require executive-session discussion. The audit office said it would deliver a year-end summary of the unannounced cash-count program before the end of the school fiscal year and finish remaining inventory testing after that work is complete.