The Wisconsin Private School Choice Program (PSCP) requires a lot of attention to detail to ensure that errors and findings are reduced and the required audits operate smoothly.
The most common issues we come across during the PSCP related audits are as follows:
Mismatched Data During the Enrollment Audits
Student’s Name
The most common errors we see are because of differences in the student’s name. When completing the student’s profile in the Student Information System (SIS), you should be using the student’s legal first and last name. If there are instances where the student’s preferred name is different than the student’s legal name, then you can identify the preferred name in parentheses or utilize the ‘preferred name’ field in the SIS if that feature exists.
We would recommend that you verify the student’s name against their immunization record, birth certificate, etc. In addition, you should be comparing the student’s name in the SIS with the WI PSCP Online Application System (OAS) Application Verification screen. If different, identify which name is the legal name, and update the name in SIS or in the OAS before completing the application verification process. This process requires special attention when the student has multiple first or last names since occasionally there are multiple names that are not actually part of the student’s legal name. This review process is to ensure that when the attendance report is printed, the student’s name on the attendance report should tie to the legal name the in the OAS.
If the auditor identifies a difference between the OAS and SIS during the enrollment audit, we are required to obtain the student’s immunization records, birth certificate, etc. If the OAS requires a change, then a change will be reported to the Wisconsin Department of Public Instruction (DPI) in the enrollment report.
Parent’s Name
Another common error is differences in the parent’s name. During the application process, it is important to compare the parent’s legal name that was entered into the OAS with the income and residency documentation obtained. If it is different because there is a typo or abbreviation, the school should be obtaining an email from the parent identifying what their legal name is. If the difference is not a result of a typo or abbreviation, the school should be obtaining a birth certificate, marriage certification, etc. If a change to the OAS is needed, the parent’s name should be updated before completing the application verification process.
If the auditor identifies a difference with the parent’s name during the enrollment audit, we are required to obtain the email from the parent identifying the legal name or the parent’s birth certificate, marriage certification, etc. If the OAS requires a change, then a change will be reported to the WI DPI in the enrollment report.
Address
In addition to the names that require checking, the address does as well. It is important that the address on the allowed residency documentation obtained matches the address in the OAS and the school district verification obtained.
Inadequate Documentation during the Fiscal and Internal Control Practice Audits
Budget
The school is required to approve a budget by June 30th for the upcoming fiscal year which requires seven components that schools often miss. Therefore, it is imperative that the approved budget includes the following components to ensure the School is compliant:
- Total September and January FTE Enrollment
- Choice September and January FTE Enrollment
- Estimated total revenues and costs
- Estimated eligible education expenses for the Choice program
- Estimated offsetting revenues for the Choice program
- Schedule of anticipated beginning and ending net assets (Budgeted Statement of Financial Position as of year-end for the next year and current year or a similar statement)
- Anticipated beginning and ending Choice program reserve balance
Personnel
There are several sections of the Fiscal and Internal Control Practice audit that can be impacted by inadequate personnel documentation:
Employee Compensation Payments
The common issues under this section are related to compensation agreements. Each agreement needs to be signed and dated by the employee and school representative prior to the first pay date. During the audit, we typically see issues with the agreement not being signed or the signing not occurring until after the first pay date. In addition, we see issues with the compensation agreement not matching what was paid to the employee. Differences are typically due to the following:
- The compensation agreement didn’t include payments for extra responsibilities (i.e. coaching).
- The pay rate entered into the payroll processing system was mistyped or wasn’t updated.
- A change subsequent to the original compensation agreement wasn’t documented in an updated compensation agreement.
Background Checks
Background checks are required to be completed for each employee and contractor (i.e. substitutes) prior to the individual’s start date. In addition, background checks expire every five years. During the audit, we see issues with either a background check not being processed at all, being processed after the start date, or expiring.
Employee Education
Proof of education (i.e. official transcript or diploma) is required for the administrator, teachers, and teacher’s aides whether employed or contracted. If a degree was obtained from a foreign college, a transcription needs to occur by the Education Credential Evaluators (ECE) to determine what is the United States degree equivalent. Alternatively, a Wisconsin DPI license can be used as proof of education. The documentation of education should be obtained prior to the start date. This section typically doesn’t result in reportable noncompliance, but rather delays with the audit because the school either has to reach out to the individual to obtain the documentation or submit the information to the ECE which takes up to five business days to process.
Transportation
There are two transportation sections that are impacted by inadequate documentation:
School Buses
There are three categories of bus usage: the school owns a bus, contracts a bus, or utilizes buses from the public school district.
Noncompliance occurs when the school owns a bus because an inspection is not performed prior to a new bus being utilized or an inspection is not performed within the last 12 months of a previous inspection.
Delays in completing the audit occur when the school contracts a bus. This is because the school has to reach out to the bus company to obtain the certificate of insurance and inspection reports/letter which can take time. Therefore, it is recommended this is requested from the bus company as soon as the preparation list from the auditors is provided to the school.
Alternative Vehicle Pupil Transportation
Similarly to school buses, there are the three usage types and the same delays can occur when contracting alternative vehicle pupil transportation.
Noncompliance for owning alternative vehicle pupil transportation can occur in multiple ways:
- No inspection performed prior to the vehicle being utilized or within 12 months of the last inspection.
- A driver’s background check is not performed prior to them transporting students or the background check expired.
- A driver’s ‘School Bus or Alternative Vehicle License Information Request’ form is not completed prior to them transporting students.
Deficiencies during the Financial Audit
Audit Adjustments
Adjustments identified during the audit can result in deficiencies so it is important to review the trial balance with the school’s accountant prior to submission to the auditors to verify that the balances are accurate. If audit adjustments are found during the financial audit, it is important to understand the adjustment so improvements can be made to reduce the audit adjustments in future audits.
Missing Reviews and Approvals
There should be reviews and documentation of approvals over every significant transaction class, this includes, but not limited to:
- Bank statements and related reconciliations
- Payroll registers
- Invoices
- Expense reimbursements
- Credit card statements
- Deposits (i.e. mail log with dual opening of the mail)
- Manual journal entries
Key Takeaways
Based on the issues above, there are some key takeaways in order to reduce/eliminate noncompliance and not cause delays with the audit process:
- Having an adequate onboarding process, including a checklist to ensure all information is obtained prior to the employee’s start date.
- The individual responsible for reviewing the payroll register should be comparing the payroll rates to the compensation agreements whenever one is signed. In addition, a payroll rate change report should be reviewed along with the payroll register so the reviewer can verify there wasn’t any unauthorized changes.
- There should be tracking of background checks to ensure the background checks don’t expire before a new one can be processed.
- Utilize the student application checklists that Wisconsin DPI offers to ensure nothing is missed and make sure information is accurate before verifying the application.
- Create a good system to organize documents for applications, supporting documentation for transactions, and personnel files. It should be easily accessible in order to reduce delays during the audits.
If you are looking for guidance on preparing for your PSCP audits, strengthening your documentation processes, or addressing recurring findings, our school choice advisors are here to help. Contact us to discuss how your school can reduce compliance risks and prepare for a smoother audit.
