The Internal Revenue Service has assessed nearly $400,000 in penalties and interests against the Maury County School Department, according to an audit Tennessee Comptrollers released this week.
The fines and penalties come from 2016 and 2017, according to the audit.
County taxpayers, of course, are the ones who must foot the bill.
In the third quarter of 2016, school system officials paid $70,477 in late penalties plus interest.
Later that year, in the fourth quarter, IRS officials fined the school system officials a total of $51,498.
In the fourth quarter of 2017, the amount the IRS fined the school system was considerably less, only $707.
“The School Department paid $79,321 on April 20, 2018, $40,478 on July 5, 2018, and the remaining $2,883 was paid using tax credits applied from other tax periods for a total of $122,682 ($79,321 plus $40,478 plus $2,883),” auditors wrote.
“The Internal Revenue Service (IRS) assessed additional Federal Tax Deposit Penalties of $99,789 for the 3rd Quarter 2016 and $148,543 for the 1st Quarter 2017 employment tax returns. These penalties were later abated. These penalties resulted from a lack of management oversight.”
Therefore, auditors went on to say, the IRS assessed interest and penalties a sum of $371,014.
Comptrollers said in their report that “federal payroll taxes deposited to the payroll clearing account should be reported to the IRS on a timely basis to avoid interest and penalty assessments.”
Also in the audit, Comptrollers said credit card charges at the county’s Board of Education did not have proper supporting documentation.
Auditors said they reviewed all credit card transactions for the period July 1, 2017 through April 13, 2018. Auditors said they reviewed available documentation for 160 credit card transactions totaling $56,266 and that several charges did not have proper supporting documentation.
“Officials could not provide auditors with proper supporting documentation for 66 credit card charges totaling $34,833. Most of these credit card transactions appear to be travel related expenses for hotels, air fare, and internet purchases for various technology supplies,” auditors wrote.
“Without proper supporting documentation, auditors were unable to determine if these expenditures were authorized. The Maury County Board of Education has not adopted written guidelines governing the use of credit cards. Sound business practices dictate that management should provide written guidance by identifying those who are entitled to use the credit cards and the purposes for which the credit cards can be used. This deficiency is the result of a lack of management oversight. Without a formal credit card policy, employees have no limitations on their credit card purchases.”
The county’s finance director concurred with this finding, according to the audit.
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Chris Butler is an investigative journalist at The Tennessee Star. Follow Chris on Facebook. Email tips to [email protected].
Photo “Maury County Public Schools” by Maury County Public Schools.
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