Risk Assessment reveals GACS at risk for fiscal mismanagement

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“A mechanism should be in place to improve transparency of GACS’s financial activities.” -IAO Chief Auditor Franklin Cooper-Nurse.

Guam – Guahan Academy Charter School once again called out for their questionable budget, procurement, and finance practices, this time by the Guam Department of Education’s Internal Audit Office.

The IAO’s Chief Auditor Franklin Cooper-Nurse combed through GACS’s revised budget and drawdown request for this fiscal year.

He writes: “It appears that amounts from other categories were shifted to fund the excess expenditures…A mechanism should be in place to improve transparency of GACS’s financial activities.”

Typically, financial requests should not exceed the maximum funding allotted to each institution, however, IAO notes that GACS exceeded their request by nearly $2M.

Cooper warns that “this indicates that GACS is not monitoring its revenues and expenditures and poses a risk for fiscal mismanagement.”

On top of these concerns, the audit says a gross lack of documentation, invoices, and payment to vendors was not supplied to IAO.

In fact, as of last month, 16 invoices totaling $428 thousand were not yet validated.

One of those invoices includes payment for hotel accommodations to the five star Dusit Thani Resort. Viewers may recall that PNC reported over $10 thousand were spent last February so board members could host a luxurious retreat. Cooper says the invoice was not validated because it was questionable in nature.

At the meeting this morning, the Council listened to Guam Education Board members about the possibility of severing all charter school’s financial ties with GDOE.

The Board of Trustees was not present at this week’s work session, so the council mulled options as to how to garner a response from the trustees.

“In terms of fiscal mismanagement there’s a lot of eyes on the issue right now,” expressed Education Board Finance Chairman Mark Mendiola.

He added, “Hopefully, we can strengthen what they have [because] we don’t want to be in the business where we’re shutting down schools or doing certain things. We want to make sure [the budget is] feasibly sound. I think that is the thing when you’re operating in the public’s trust, everybody wants to know where those scarce resources are going to, so from my standpoint is I want to definitely see what they’re doing and if they can fix it, fix it, and if not, then of course it’s up to this counsel to make the determination.”

But with the school’s accountability and transparency called into question plus the now imposing risk of financial mismanagement, how will students of GACS be affected?

That’s one issue that still remains unclear.