JENNINGS — The Jeff Davis Parish School Board overlooked its own policy when it invested more than 25 percent of its funds with the same issuer, according to a report released Monday by the state legislative auditor.

The 122-page report, compiled by local accountant Mike B. Gillespie, covers the year ending June 30, 2014. In it, Gillespie details three findings, including one putting the board at credit risk by violating its own policy.

“I am not trying to minimize the findings, but they are technical in nature and we will try to address them and do better,” Finance Director Bill Hebert said Monday when asked about the audit’s findings.

A management letter included in the audit report noted the School Board did not follow its own policy when it invested $3.9 million in Federal Home Loan Mortgage, which accounted for nearly 27 percent of total overall investments as of June 30, 2014.

The overinvestment was due to a misunderstanding as to whether or not the 25 percent rule applied to government securities, which are insured, Hebert said.

“We have adjusted our portfolio and are about to adopt a new policy covering investments in other securities besides government-backed securities,” Hebert said.

All future holdings will be monitored, he said.

Superintendent Brian Lejeune said the board has been very frugal with its finances and have tried to invest them in a way to earn interest rather than holding them without earning additional revenues.

“We have tried to be good stewards of our investment dollars,” Lejeune said.

In a separate finding, auditors found the board exceeded its budget expenditures by more than 5 percent, a possible violation of the state’s Local Government Budget Act. The measure requires government entities to amend their budget when total actual expenditures or revenues are greater than budgeted amounts.

Three funds were more than $35,000 overspent, according to the audit’s findings.

Overspending occurs from time to time due to unanticipated expenses, Hebert said.

“We try to be as close as possible because we don’t want to be over or under budget,” Lejeune said.

Some of the overspending occurred at Hathaway High School after a new principal took over and wanted some new things in place before the start of school, Lejeune said.

The board said it will work to ensure there are sufficient budgeted funds available for expenditures in the future and will amend the budget when necessary.

The board was also criticized for not maintaining a centralized filing system for copies of all continuing disclosure agreements, bond issue agreements for outstanding unpaid bond issues and current bond ratings.

Hebert said officials were not familiar with the aspect of the law requiring the documents to be in one central location. He said all documents were available upon the auditor’s request, but were located in various file cabinets and boxes throughout the main office and not in one central location.

A centralized filing system has been created, including a list of all Louisiana municipalities securities for which the board is considered the issuer or an obligated party, copies of all continuing disclosure agreements to which the board is a party and copies of any bond issue agreements that may contain requirements that only require disclosures when requested and a list of current bond ratings.

(MGNonline)