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Audit: Dayton Public Schools Sent Months of Unearned Paychecks to Former Employees

Thursday, March 1, 2018

Columbus – The Dayton City School District continued to send paychecks to some of its former employees for months after they resigned during 2017, according to a state audit released today. 

The report from Auditor of State Dave Yost’s office names three teachers who received a combined $30,086 in unearned salary after they resigned, and a former assistant principal who was paid in advance for days he ended up not working. 

In the most extreme case, the district paid former teacher Stacy Morgan for about eight months she did not work. By the time the district realized the payroll error, Morgan had amassed $16,724 in unearned salary and $1,065 in health benefits. 

“Updating a payroll system to account for staff turnover is a fundamental duty of any treasurer's office,” Auditor Yost said. “The fact that multiple errors flew under the radar for so long is a clear indication that stronger internal controls are needed moving forward.”

Similar errors caused former teachers Christine Morris and Jeffery Leon Smith to each get about two months of unearned pay amounting to $8,782 and $4,580, respectively. Former Assistant Principal Daniel Gibson was paid $2,570 in advance for the first pay of the school year, but he only earned $1,472 of the amount because he did not work the entire pay period. 

After realizing the errors, the district offset some of the losses by obtaining a $1,609 refund of Morgan’s pension contributions and crediting unused leave toward the amount she owes. The district also withheld $2,652 it was going to pay Morris during the summer. 

Auditors issued findings for recovery totaling $21,977 against the four individuals for the remaining amount. Gibson, who agreed to repay the district in 24 monthly installments, is the only one to return any of the money. The audit holds Treasurer Hiwot Abraha jointly liable for the full amount because she oversaw the accounts from which the payments were made. 

An unrelated finding reports a failure by the district to maintain records needed to substantiate $84,537 in salaries and benefits charged to federal Title I grants, which help provide learning opportunities to low-income children. One employee paid with the federal funds never performed any work related to the grant.    

The report says the district risks a decrease or loss of federal funding if it does not require staff to document their time spent on Title I activities. 

A full copy of this report is available online

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The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,900 state and local government agencies.  Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.

Contact:
Beth Gianforcaro
Press Secretary
614-644-1111