PENDLETON — A state official says failure to follow state accounting guidelines led to South Madison’s low ranking on a recent Dollars to the Classroom report.
Ryan Kitchell of the Office of Management and Budget said he didn’t dispute the South Madison school district’s assertion that an accounting policy led to the school appearing to spend just 36.9 percent of its budget in the classroom.
However, Kitchell explained, South Madison failed to follow accounting guidelines imposed by the Indiana State Board of Accounts, which led to the discrepancy.
The Dollars to the Classroom report details the percentage of school budgets spent inside the classroom versus overhead and administrative costs unrelated to learning.
In the most recent report, South Madison schools reportedly spent just 36.9 percent in the classroom in 2009.
On Thursday, school district officials explained that an accounting procedure led to $11.4 million in teacher benefits being left out of the calculation.
They asserted that the real percentage spent in the classroom was 64.1 percent.
Kitchell said the school district was likely correct.
“I wouldn’t disagree with that,” Kitchell said. “To the extent, what they’re saying is accurate. It’s not apples to apples to measure it versus different schools if they’re accounting differently.”
The problem is in the different accounting practices, he said.
Rather than assigning teacher benefit packages to each school building’s expenditures along with teacher salaries, South Madison lumped all personnel services, including benefits but excluding salaries, into one type of account.
This account was considered overhead instead of classroom expenditures in the report’s calculations, Kitchell noted.
“What I don’t understand is why they’re doing it differently than every other school,” Kitchell said.
Kitchell said the South Madison method of accounting benefits is atypical. “This is the first one of these that I’ve had in three years of doing it. It doesn’t mean there’s not another one hidden out there.”
The South Madison school district has said it will change the way it accounts for benefits, in order to work in line with other school districts.
“There are specific guidelines that they did not follow and intend to on a go-forward basis,” Kitchell said.
The Dollars to the Classroom report does not affect school funding and will not impact the school district’s financial standing with the state, said Joe Buck, South Madison’s chief financial officer.
The Herald Bulletin was unable to reach South Madison Superintendent Tom Warmke for comment Friday.
Kitchell said the state would entertain recalculating the South Madison Dollars to the Classroom numbers if the school district would like to see them changed.
Contact Brandi Watters 640-4847, brandi.watters@heraldbulletin.com
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Accounting error led to poor classroom report, state says
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