About the Burnaby School District
With 24,000 students across 49 schools, the Burnaby School District is one of the largest public school districts in British Columbia. The district’s schools each collect an average of $127k annually in various school fees, totalling approximately $6.2M across the district. A top priority for the district is ensuring that every dollar collected is securely accounted for, transparent across stakeholders, and put back into schools to provide equitable access to school activities. To the Burnaby School District, the expenditure of funds is regarded as a community trust and they endeavor to see that funds are expended efficiently, economically and in the best interest of the learners.
Collecting Cash in Schools
In the past, schools within the district relied on a completely manual process to collect various school fees. Teachers, coaches, and other school staff would collect cash before submitting it to the school office. As is common in the K-12 education space, the manual cash collection process made it difficult for funds to be properly monitored. The abundance of cash onsite created an environment susceptible to theft and mismanagement.
Major Fraud Incident Makes Headlines
In 2012, the Burnaby School District charged one of its former school bookkeepers with defrauding a Burnaby secondary school. The case centred around dozens of bogus cheques from the school that the bookkeeper pocketed directly. It was also suspected that cash collected for student fees was stolen. This activity slowly took place over 2 years and the district estimates that over $100,000 was taken by the bookkeeper.
The True Cost of Fraud
Fraud doesn’t always manifest itself on a large scale, as seen at the Burnaby secondary school. Often times, it comes in the form of $20 “borrowed” to buy lunch. Although this may seem insignificant, it can add up fast. Districts need to be seen as strong stewards of public funds. When parents, volunteers, and school staff see that the funds they worked hard to raise are not being protected, they can lose trust in their district. Further, if a fraud case goes to court, it places a large burden on district employees. In the case of the Burnaby secondary school, the trial lasted for nearly 4 years and required the attention of everyone from the school’s principal to district finance staff.
The true cost of fraud isn’t limited to the money that gets stolen. It is also the loss of trust in your schools that the community will experience.
Fraud Proofing Schools
To reduce the risk of future instances of fraud, the district knew it had to build the financial structure to reduce cash in schools, track school fees, and enforce internal controls. With the leadership team aligned, the district was about to change the way school fees had been managed for decades. They knew that the new solution would only be successful if they could get principals, bookkeepers, and parents to embrace the new way of doing things. Finding a solution that was user friendly and easy to learn was a high priority. The district placed its trust in the School Cash Suite for this initiative. Using the system, several fraud prevention measures were implemented.
Online Payments: fees began to be collected online and were deposited directly into the school bank account to take cash out of the schools.
Audit Trail: transactions collected online or within the schools began to be recorded digitally and were accessible through reports in real-time.
Internal Controls: the district implemented standard processes for cash handling, bank reconciliations, and financial reporting.
Technology that tightly integrates online payments with accounting is the most powerful solution I’ve seen for preventing school fraud. From the second a payment is made, we are able to track it through a digital trail.
A New Financial Structure
Since implementing the School Cash Suite, bookkeepers and parents have been quick to embrace the system. Over 60% of funds are being collected online and never find their way into the schools. Bookkeepers can now easily track every fee and every associated payment through the system. This new digital audit trail has given the Burnaby School District new confidence in its ability to mitigate fraud. With the School Cash Suite, the district has been able to identify and stop potential fraud situations.
Using the School Cash Suite, we are able to stop fraud before it starts. The system’s audit trail allows us to identify and stop potential fraud situations immediately.