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Audit finds 69 apparent split purchases and eight compliance gaps in ASD P-card review
Summary
An internal audit of Anchorage School District P-card use covering July 1, 2024'June 30, 2025 found eight findings, including 69 apparent split transactions totaling about $264,000, inconsistent conditional-purchase approvals, late reimbursements for personal charges, and unclear rules on gratuities; management agreed to update the P-card manual.
An internal audit of Anchorage School District procurement-card (P-card) activity identified eight findings but said most employees complied with district policy.
The audit, covering July 1, 2024 through June 30, 2025 and more than 60,000 P-card transactions, found 69 purchases that "appeared split" to circumvent a $2,500 transaction limit; auditors said the 69 splits totaled a little more than $264,000. "Each card holder has a transaction limit of $2,500," the audit summary said, and auditors flagged examples such as audio equipment purchases of about $3,800 that were split into multiple same-day transactions.
Meredith, the audit presenter, said the team routinely sees split transactions in retail categories such as sporting goods where multiple same-day authorizations can mask a single larger purchase. The auditors recommended adding clearer examples to the P-card manual and reminding card holders to request a temporary or concurrent limit increase through finance when higher-cost purchases are planned.
The review also found inconsistent use of the district's conditional-purchase process. Items such as personal service agreements, software purchases, rentals and gift cards require finance pre-approval; auditors said some cardholders did not obtain conditional approvals even when purchases met the criteria. Auditors recommended simplifying or clarifying the approval steps and removing redundant "approved list" assumptions so cardholders do not skip contacting accounting.
On personal transactions, the audit reported that personal charges were eventually reimbursed but not always within the district's 10-day guideline. The auditors cited cases where repayments occurred months after the charge and recommended closer monitoring by approvers as well as card holders.
New to this year's report, auditors flagged excessive gratuities on food-related purchases, including instances with tips as high as 37% (one $528 transaction included a $143 gratuity). The audit recommended adopting a reasonable gratuity cap and proposed about 15% as a typical business threshold; management said it would update the P-card manual rather than propose a board-level policy.
Other findings included: late allocation of transactions (only 35% allocated within five days in some samples), high-cost apparel purchases for student activities accounts that appeared out of line with peer schools (six jackets at about $228 each at one school vs. $35'$70 at others), airfare bookings that did not align with travel policy (one cancelation cost roughly $1,000), and purchases shipped to alternate addresses without supporting documentation.
Auditors said management generally agreed with the recommendations and has already begun drafting edits to the P-card manual to clarify conditional-purchase steps, gratuity guidance and documentation requirements. The audit team said it reviewed its findings with management staff on Feb. 9 and provided tables showing top departments, vendors and expense categories to help target training.
The committee thanked auditors and staff for the report and for management's responsiveness. The committee did not take a vote on policy changes in the meeting; staff indicated changes will be reflected in the P-card manual and in training for card holders.
