Taylor Releases Eagle Heights Academy Audit Showing Fiscal Mismanagement, Improper Payments and Unpaid Federal Taxes

Audit Identifies $33,500 in Findings for Recovery, $707,507 in Questioned Costs and $454,381 in Unpaid Federal Taxes

Tuesday, May 11, 2010

Mahoning County - Auditor of State Mary Taylor today released the financial audit of Eagle Heights Academy for the 2007 fiscal year.  The audit found extensive fiscal mismanagement at the Youngstown community school, including more than $30,000 in findings for recovery and failure to pay more than $450,000 in federal taxes.  

Among problems revealed in the audit are improper employee payments, undocumented payroll and a failure to pay federal taxes withheld from employee paychecks.  Additionally, the Ohio Department of Education has ordered Eagle Heights Academy to cease operations on June 30, 2010 due to continued poor academic performance.

“The lack of proper financial oversight at this school allowed for the misspending of tax dollars intended to educate Ohio’s schoolchildren,” Taylor said.  “As Auditor of State, I remain committed to ensuring that those who spend public dollars in Ohio are held accountable for their decisions and actions with regard to that public money.”

The audit also identified $33,500 in findings for recovery, or public monies illegally expended that must be repaid.  School personnel received one-time payments at the end of the school year, which were not approved by the school’s governing board.  

Additionally, the audit identified $707,507 in federal questioned costs, or errors that caused costs to be over or understated on federal reports.  These included undocumented payroll, overstated expenditure amounts and double reimbursement of federal Title I funds.

The audit also disclosed that the school failed to pay $333,722.34 in federal income tax withholdings and $120,658.93 in Medicare withholdings.  Both issues have been referred to the Internal Revenue Service.

A copy of the complete audit is available online.

The Ohio Auditor of State’s office is a leader in the accounting and auditing field, earning prestigious national honors from the Government Finance Officers Association, the National White Collar Crime Center and the National State Auditor’s Association.

Julia Debes
Deputy Press Secretary
(614) 644-1111