READS Collaborative

This is a state audit of READS Collaborative, an education collaborative serving school districts, covering July 1, 2008 through June 30, 2010.

“In accordance with Chapter 11, Section 12, of the General Laws, the Office of the State Auditor (OSA) has conducted an audit of certain activities of READS for the period July 1, 2008 through June 30, 2010.”

The auditor reviewed whether READS had good internal controls, followed the law, and met fiscal and program requirements tied to its state work.

“The audit objectives consisted of a determination of whether READS implemented effective internal controls over all aspects of its operations and an assessment of READS’s business practices and its compliance with applicable laws, rules, and regulations, as well as the various fiscal and programmatic requirements of its state contracts.”

The report says weak accounting practices made it unclear whether READS and its related nonprofit reported finances accurately or charged school districts fairly.

“As a result of these issues, there is inadequate assurance that the financial statements issued by both entities during the period covered by the audit were accurate or that the percentage of shared expenses charged to READS and paid for by school districts that purchased services from READS was reasonable and appropriate.”

If your community paid READS as a non-member district, the report says it may have paid more than it needed to, and that money could have supported other education services.

“These funds could have been used by these non-member districts to fund additional educational services.”

READS should fix how it keeps surplus money and work with state oversight offices on a fair policy for returning excess funds.

“READS should seek guidance from DLS and OAG in developing and implementing an acceptable revenue retention policy that is consistent with established guidelines.”

The report calls for follow-up by the retirement system, READS, and state education officials to resolve compensation, oversight, and policy problems.

“Based on this review, READS, in conjunction with the MTRS and the Executive Director, should take the necessary measures to resolve this matter.”

The report points beyond READS: it says state oversight of education collaboratives had been too weak, leaving them below the standards applied to public school districts and charter schools.

“This condition has resulted in education collaboratives not being held to the same performance standards that apply to public school districts and charter schools within the Commonwealth.”

An education collaborative is a public cooperative created by school districts to provide shared education services; READS also served districts that were not members when space was available.

“READS Collaborative (READS) was established in 1989 as a governmental organization under Chapter 40, Section 4E, of the Massachusetts General Laws, which allows school districts, with the approval of the Commonwealth’s Department of Elementary and Secondary Education (DESE), to enter into intergovernmental agreements establishing cooperative public entities referred to as education collaboratives.”