Leter to the Editor: Former School District Offical Sets the Record Straight

I’d like to respond to Mr. Cantwell’s response to Craig Sherwood’s Op Ed by first saying I’m happy his ill child has recovered. 

To address Mr. Cantwell’s points with respect to me, in order:

1. A member of Executive Cabinet directly confirmed with me that I was being blamed for the “accounting error” and apologized because they weren’t able to talk Executive Cabinet out of that strategy.  There was definite intent to blame me.  The explanation of the “error” has now morphed from explaining the “accounting error” was the result of an incorrect accrual in the 2021-22 fiscal year into a “one-sided journal entry” which apparently wasn’t logged properly and therefore wasn’t “discoverable;” I discuss this in item 3 below. 
2. I chose not to respond to Mr. Cantwell’s offer made the day after that June 2023 board meeting to sit down and make amends – I was deliberately targeted, and a subsequent apology couldn’t right the damage that was done.
3. To address Mr. Cantwell’s third point, I must get down into the weeds, so please bear with me. 
   1. The terminology of a one-sided journal entry in this context isn’t correct.  To expound a bit: I don’t remember the exact date (it seemed later than July 21, more like mid-August), a member of the Fiscal team came to me and said they hadn’t accrued for the retro pay, asking if it was necessary.  My response was an emphatic “yes.”  Modified accrual basis mandates expenditures are recorded when the liability is incurred.  Time was running out to close the books, so it was decided to make the journal entry without all the expense details posted to each specific account string; that is not a “one-sided journal entry,” which is a financial record where either a debit or a credit is entered without its corresponding balancing entry. A “bird walk” would be done later in Excel when staff had time, updating the general ledger account balances to include the full account distribution so that subsequent financial reports could be accurately completed.  Unfortunately, it looks like this piece never happened.  During this time, staff were under extreme stress as a result of the department being very short-handed, working significant amounts of extra hours and overtime.  The overtime was being called into question by Admin and CSEA, adding to the stress level. It’s unfortunate the bird walk wasn’t completed but I can see how this would have slipped through the cracks.
   2. Best practice includes performing analytical reviews of balance sheet accounts over time to identify unexpected variances.  While Mr. Cantwell wasn’t present during the June 30, 2022, closing of the books, subsequent routine monthly testwork performed throughout the fiscal year should have identified the unexpectedly high accrual balance, requiring further inquiry and early detection of issues.  The accrual wouldn’t have been reversed until the retro wages were paid, which to my best recollection was in the August/September date range.  The accrual should have been reversed by First Interim, which reports financial results through October 31, but thankfully it was reversed within the fiscal year.

I’ve been a CPA for over forty years and a Chartered Global Management Accountant since 2012 when the designation was created, evidencing expertise in finance, strategy, operations, and management within a business context.  I’ve audited school districts and cities along with Fortune 500 companies while working at a Big Four accounting firm.  While I appreciate the offer to sit down with Mr. Cantwell for him to explain the accounting details to me, I will pass. 

Debbie Kukta,
CPA, CGMA, MBA