School Committee Votes To Conduct Audit In Stages

HOLDEN, Mass. — The Wachusett Regional School District Committee is continuing to investigate the financial errors that made by the district's former business manager, with members voting 17-1 Monday night to develop an RFP for an independent stage I forensic audit.

The errors made by Business Manager Peter Brennan resulted in an over-expenditure of about $1.2 million for fiscal year 2012 and an additional $1.4 million shortfall in employee benefits and insurance for FY13.

Following his termination, the school committee tasked the business and finance subcommittee with exploring a potential forensic audit in an effort to get to the bottom of the accounting errors and help restore the credibility the district has lost.

A poll of Daily Voice readers showed that 84 percent (69 votes) were in favor of a full audit, while 16 percent (13 votes) said no.

At Monday's school committee meeting, business and finance member Julie Kelley brought forward a motion for a full forensic audit from FY11 to present which had been supported 6-3 by the subcommittee. 

Rather than diving into the full forensic audit, which could potentially cost $300,000, the committee voted 17-1 to task the business and finance subcommittee with developing an RFP request for proposal) for a stage I forensic audit, capping the cost at $50,000.

"Given that ($300,000 is) not in our budget, and without factoring that in, we are talking about laying off 15 of our teachers, that would be a huge huge hit," said committee member Steve Hammond. "But it's something the majority of us thought was necessary, even if it was really hard. But we wanted to look into it further before we started making more sacrifices to do it."

Hammond said the recommendation from at least two audit companies was that it would be foolish to jump straight into a full forensic audit.

"Nobody does that, they said it's not best practice," he said. "It wasn't their recommendation. What they recommended was a phased approach, where you start with a less-detailed audit. It's independent, it's not our current auditor, it's a real forensic audit, but it's not a full, let's look at everything over the last four years or so audit. It's a much more lightweight approach."

Hammond said this could cost anywhere from $25,000 to $50,000.

"If that showed evidence of wrongdoing, then we would dive in further," he said.

Holden Selectman Anthony Renzoni said he was glad they were considering the forensic audit.

"They need to be calculated, and do it right the first time, so if it takes a little more study in subcommittee to go ahead and do this the right way then I fully support it, but a forensic audit is absolutely necessary as soon as possible," he said.

Renzoni said his concern, however, has been the transparency of the situation as it has unfolded.

"It's been very had to get a grip of what's going on," he said. "I agree with some of the school committee members that have been hesitant to go forward with either a forensic audit because they don't know how much it's going to cost, or budget cuts because they don't know exactly what the budgets going to be. Nobody's zeroed in and said exactly how far off we are."

Renzoni also drew attention to responsibility Superintendent Thomas Pandiscio and the school committee have in addressing the mistakes made under their watch.

"Maybe it's because I spent 21 years in the military, but he's the top. Everything that happens or doesn't happen is under his watch, and he only reports to the school committee," Renzoni said. "I understand that they made this decision in executive session to move along the business manager, but I've heard only a few school committee members say they feel responsible or they're embarrassed. Several have said that if they can't resolve this and get to the bottom of what happened with our money, they don't think they can continue to serve, and that's the kind of leadership I do appreciate in an elected official."

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