Audits flag Oracle transition and procurement-control gap that could permit overspending

The district’s auditors and the auditor general told the committee that the district’s transition to Oracle has proceeded but that a control gap in Oracle could allow purchase orders to exceed contract amounts, creating an overspending risk the auditors recommend addressing.

Darren Achebele, partner at Meraki Smith (claims auditor), summarized the claims-audit work for October: the firm reviewed 1,615 claims with a reported total value of roughly $44.6 million and made inquiries into 331 claims (about $8.5 million in value) as part of their procedures. He described routine inquiry items and an example where sales tax was flagged and removed from an invoice.

Henry Wheeler, the Auditor General, said the office now has substantially improved Oracle access compared with the prior PeopleSoft environment and has begun disbursement and procurement reviews as part of familiarization with Oracle. Wheeler highlighted one control issue noted in the contracts audit: "the system allows the purchase order to exceed the contract amount. There's not a control that stops that, so it could allow overspending." Wheeler said the office recommended evaluating Oracle configuration to prevent POs from exceeding contract amounts and developing reports to reconcile outstanding requisitions and POs with contract values.

The committee accepted placement and contracts audit reports by motion during the meeting; the auditors and auditor-general recommended follow-up work to implement the Oracle-related recommendations and to complete outstanding testing associated with the single audit and follow-up items in placement and equity reports.