Internal controls apply to school districts of all enrollment sizes. A recent project to overhaul and better define generally accepted standards resulted in the release of the publication Standards for Internal Control in the Federal Government (the Green Book). The new standards were effective beginning with fiscal year 2016. They represent a recognized safe harbor for a framework for an internal control system for all governmental entities and the release of the publication should be viewed as a call to action in all public schools.
It is essential that executive management take steps to increase their understanding of the degree to which activities, procedures and processes in various operational areas are designed, implemented, and operating together in an integrated manner. Arranging for an independent third-party assessment is the most effective way to obtain useful information that can be acted upon to make effective improvements. Executive management should make it a goal to assess one or more operational areas per school year or fiscal year.
While executive management must be attentive to the comprehensive range of activities, procedures and processes supporting an effective internal control system, it is clearly understood that there are certain practical limits that are correlated to the enrollment size of the school district. In this regard, the new standards state, “Management uses judgment in determining the extent of documentation that is needed.”
The release of the new internal control standards begs the question, “What are the school district’s improvement goals related to the internal control system for the current and for future years?”
To access the United States Government Accountability Office publication Standards for Internal Control in the Federal Government (the Green Book) by the Comptroller General of the United States (September 2014), click on the link below.
http://www.gao.gov/assets/670/665712.pdf