BENTONVILLE -- Two state auditors will visit the School District next week, the result of a legislative panel's directive to begin randomly checking districts that contract with private firms to do their audits.
Janet Schwanhausser, Bentonville's finance director, said the district was notified May 13 the state would send auditors to the district June 1.
Private audits
Here are the Northwest Arkansas school districts that use private audit firms, according to Arkansas Legislative Audit:
• Bentonville
• Farmington
• Fayetteville
• Prairie Grove
• Rogers
• Springdale
Source: Staff report
"They will be here for 80 hours conducting what the legislative auditors refer to as a checkup," Schwanhausser told the School Board at its last regular meeting May 16.
Schwanhausser said the timing of the auditors' visit is challenging because she is trying to close out this fiscal year and start budgeting for the next, but she added she's happy to get additional insight from professionals on the district's financial practices.
"We can always improve. Find things we need to do better. Maybe find things we don't have to do. Find inefficiencies. Anything we can do to get better," Schwanhausser said.
Schwanhausser began as the district's finance director in January. She oversees an operational budget of about $146 million.
Bentonville is one of 40 school districts in Arkansas that use private firms for their annual audits. Arkansas Legislative Audit audits the state's other districts. There are 237 districts in the state, according to the Arkansas Department of Education.
State Sen. Jeremy Hutchinson, R-Benton, appeared before the Executive Committee of the Legislative Joint Auditing Committee in October to request the state look into questions regarding the Bentonville district's finances. He did so at the request of his brother, Tim Hutchinson, a Northwest Arkansas attorney.
Tim Hutchinson represented former Bentonville School Board member Wendi Cheatham when she sought answers to the same kinds of questions last year. Cheatham served on the board for nearly three years before resigning in August.
The committee's discussion turned to the fact many districts don't seek the state's audits and use private audit firms instead. The committee decided in November to require Legislative Audit to check those districts randomly.
Larry Hunter, deputy legislative auditor for educational institutions at Arkansas Legislative Audit, said seven districts that use private auditors will be checked this year. The districts are chosen for this kind of check using a random number generator, he said.
"It won't be a full-blown audit. We're referring to it as performing limited procedures," Hunter said. He declined to go into details beyond that.
Legislative Audit likely will continue to check another seven districts each year, Hunter said.
Legislative Auditor Roger Norman said private contractors' audits are subject to the same standards as those performed by Arkansas Legislative Audit.
The Bentonville School District regularly uses Beall Barclay and Co., an accounting firm with an office in Rogers, to perform its annual audit. The board voted in February to accept its most recent audit by the firm.
The district received the Certificate of Excellence in Financial Reporting for its comprehensive annual financial report in 2014 and 2015. That honor came from the Association of School Business Officials International. Bentonville is the only school district in Arkansas to receive that award and one of only a few in the country to receive it two years in a row, according to a 2015 news release from the district.
NW News on 05/27/2016