09.18.2026 Audit Committee Meeting

Meeting Logistics and Agenda

• The committee initially lacked quorum due to multiple members being absent.
• Leadership decided to:
  • cancel any matters requiring votes, and
  • handle informational items first.
• After Michael Dixon arrived, quorum was established and the meeting proceeded.
• The agenda was amended to correct/insert:
  • approval related to the July 16, 2026 minutes (previously not approved),
  • corrections to minutes approval dates for the August meeting, clarified as July 26.
• The amended agenda was approved unanimously.
• No public comments were raised.

OIG Annual Report (Informational Presentation and Q&A)

Carrie (OIG) delivered an Annual Report update, describing changes in format and key findings.

Key points from the report

• The OIG is independent and provides oversight through four areas:
  • Audit
  • Investigation
  • CARES & Safety
  • Contract/Quality Assurance
• Work volume in the year included:
  • 965 complaints (snapshot)
  • 6 audit reports
  • 15 investigative reports
  • 65 safety inspections
• Trends over five years showed increasing internal fund findings:
  • findings rose from 367 (2021) to 929 (2025) — an increase of 153%
  • 3,000+ findings across five audit cycles
• The report emphasized that rising numbers do not automatically prove causation, but they do indicate recurring control weaknesses requiring continued attention.
• Cross-links between misconduct and control failures were highlighted:
  • 71% of substantiated financial misconduct investigations referenced underlying school-level process weaknesses
  • 80% of material financial findings were identified after the fact through investigations, reinforcing the need for prevention and controls
• Three “spotlight” investigations were emphasized as representative examples:
  1. NIL (name/image/likeness) related investigation involving student opportunities and ethical boundaries/conflicts
  2. Charter bus audit focusing on financial and safety impacts of weak invoice/vendor controls
  3. Construction contract review identifying overbilling and the need for stronger post-award contract compliance
• The overarching theme was “findings to prevention”, stressing proactive internal oversight rather than waiting for external triggers.

Committee feedback on the Annual Report

• Members praised the report as engaging and inclusive.
• A concern was raised that the spotlight examples emphasize issues but may not clearly show the resulting resolutions/corrective actions within the highlighted sections. OIG agreed to strengthen how prevention and implemented corrective actions are reflected.
• Multiple comments emphasized the collaborative relationship between OIG and the CFO’s office, citing improved coordination through directives/memorandums and constructive responsiveness.

Inspector General (IG) Evaluation Process (Informational)

• The Chair discussed the upcoming annual IG evaluation and whether backup documentation (agendas/minutes/links) is necessary.
• Committee feedback indicated it was not necessary, and the IG would reduce the workload.

Proposed Contract Compliance Review Program (Discussion)

Terry (OIG) presented a proposal to strengthen assurance over contracts and invoicing—specifically verifying that what is billed matches what was contracted and delivered.

Core purpose

• Address recurring issues where:
  • invoices are paid despite incomplete/insufficient documentation, or
  • invoices mismatch contract terms
• Provide additional support beyond the CFO/purchasing staff capacity, since reviewing every invoice is not feasible given volume and staffing constraints.
• Focus on post-award compliance, not procurement method details (e.g., not evaluating whether ITN/ITB was used).

What the program would do

Review contracts and related invoices to answer:

• Are services/deliverables actually received as promised?
• Are invoice details complete enough to confirm contract compliance?
• How is vendor performance reflected in contract-required performance sections?

Provide “tools” to standardize review requests and assessments, such as:

• checklists
• guides
• examples

Operational considerations raised during discussion

Members emphasized the need to differentiate processes between:

• PeopleSoft/internal accounting systems (more centralized/scanned documentation), and
• school sites, which may not upload documents in the same way and may have different contract types (e.g., consultants, after-school activities, events, etc.).

Additional discussion emphasized:

• Streamlining for schools to avoid overburdening principals and accounting staff, especially given turnover and limited bandwidth.
• Using examples (e.g., receipts for flowers purchased for graduation) to support reasonable documentation requirements so schools are not forced into unnecessary detail requests after context/evidence is provided.

Program governance and timeline

• The committee was told no action was required at that meeting (presented for information).
• The proposal was characterized as using existing staff (no fiscal impact / no added personnel).
• A rollout of about 60 days was discussed, contingent on personnel logistics.
• The committee requested a road map of how contracts flow (the “sweet spot” for where the program can begin effectively) before deploying the program reviewer.
• OIG indicated the materials include a:
  • resource index
  • desk reference
  • field guide
  • checklist
• OIG agreed that the road map should be included for school-level core items.

Closing

• Next meeting scheduled for Friday, October 16.
• Meeting adjourned after a motion and second.

Presenters / Contributors

• Carrie (Inspector General’s Office) — Annual report and discussion/Q&A
• Terry (Inspector General’s Office) — Contract Compliance Review Program
• Heather Frederick — Chief Financial Officer (CFO)
• Bob Bliss — Office of Inspector General
• Oscar Strep — Office of Inspector General
• Kristen Var Garcia — Office of the General Counsel
• Dave Tally — Audit Committee
• Teresa Michael — Inspector General’s Office
• Joyce Edison — Inspector General’s Office
• Christina Daniels — Inspector General’s Office
• Michael Dixon — Audit Committee
• Leandre Camel — Audit Committee
• Dorina Bowererman — Audit Committee
• Gloria Branch — School board member
• Allison Castellano — High School representative (online)

Note: The attendee list also included a duplicated/garbled entry: “Carrie high council to inspector general (as stated in subtitles) — Inspector General’s Office.”