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Auditor of State’s Office Wins Excellence in Accountability Award
Columbus – The Auditor of State’s 2012 special audit of Cuyahoga Heights Local School District has received an Excellence in Accountability Award by the National State Auditors Association (NSAA).
“This award belongs to the outstanding men and women of this office,” Auditor Yost said. “Receiving this national recognition from our peers shows that the standards we work by in the Auditor of State’s office are getting results for the citizens of Ohio.”
The Excellence in Accountability Awards are presented annually by NSAA to recognize government auditing excellence. The award was presented during the NSAA’s annual conference in Saint Paul, Minnesota. Kevin Saionzkowski, Special Audit Section Chief Auditor, and Jason Whitesel, Senior Audit Manager, accepted the award and shared an overview of the audit during the conference.
Cuyahoga Heights Local School District special audit overview and impact:
In February 2011, allegations of fraud were reported regarding transactions between the district’s IT director and members of his family, as well as goods and services being diverted to non-district operations.
A special audit was performed, and its findings showed that former district IT Director Joseph Palazzo authorized 436 payments totaling $3.8 million to seven companies which were owned or operated by his family members or friends. The district did not receive any services from these payments, and Palazzo received kickbacks from the companies totaling $1.3 million.
The special audit report was the driving force used by U.S. attorneys to secure a conviction of Palazzo, who was sentenced to 11 years and four months in federal prison and ordered to pay restitution in the amount of $3.4 million. Additionally, the school district created a new watchdog committee; implemented a new inventory system; trained district employees on the Auditor of State’s fraud hotline; and hired an independent consultant to analyze the district’s budget, cash flow and five-year forecast.
The National State Auditors Association is an organization dedicated to uniting state auditors by encouraging and providing opportunities for the free exchange of information and ideas between auditors at the local, state, and federal levels.
The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,800 state and local government agencies. Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.