As I predicted during my campaign for Board of Trustee for the Island Trees Board of Education this past May, it pains me to give the following report, which I knew would be an unfortunate inevitability. As a result of a New York State Freedom of Information Law request, I have finally received the 2006/2007 financial statement prepared by the external auditing firm of Coughlin, Foundotos, Cullen and Danowski. The New York State Comptroller's office was very unwilling to release this document to me because it was sitting in their legal department for almost a month. Why? Contact the Island Trees Board of Education and ask them why they will not post the financial statement on the website. What are they hiding?

On page 3 of this report, it clearly states that we had another net asset loss this year, to the tune of $617,230. On the same page, C, F, C, & D reports a general fund balance loss of $1,335,428. On the same page, the auditors report the fact that we had a budget revision, because of an appropriation of $1,291,686 to pay retirement incentives to retiring teachers, on top of their pensions! The Island Trees community passed a budget last year for $49,511,234; however, the final budget for the 2006/2007 fiscal year ballooned to $51,065,324, because of your board members' generosity with your tax dollars. Currently, at least three board members have or had family members employed by the Island Trees School District. Enough said. Has anyone ever heard of the "fox watching the hen house?"

On page 38 of this year's financial statement, the auditors make a blockbuster statement. They announced that they have identified a significant deficiency in internal controls. This is the most serious findings an auditor can render! On page 41, they report "The district's business office currently does not have the expertise to either prepare or exercise adequate control over the preparation of all the components of its annual financial statements." Wow! They continue: "Because of the lack of expertise, the District was unable to exercise control over the preparation of the district-wide, full accrual basis component of the annual financial statements." They then recommend, "The District should obtain the necessary expertise, either in-house or through outsourcing, to ensure control over the preparation of the districtwide financial statements." They are recommending the replacement of the assistant superintendent for finance with an individual who can operate the office in a professional, honest manner. In the independent auditor's report dealing with the extra classroom activity funds, they state, "The records of the extra classroom activity funds of the Island Trees Union Free School District were not adequate to permit the application of adequate auditing procedures to indicate whether all receipts were recorded. " The auditors are telling the I.T.B.O.E. that they don't trust the numbers being given them by the I.T. business office. This is shocking!

As a result of Coughlin, Foundotos, Cullen and Danowski's blockbuster findings, they are "out" as external auditors for the Island Trees Union Free School District. Obviously, the board and the administration, acting as a monolith, did not want to hear or see the facts. I bet they negotiated long and hard with the auditors to keep this "hush-hush." It didn't work. Auditor Peter Rodriguez is to be applauded for his heroic work. Rather than thank the auditors for uncovering what I already knew, the district cut them loose. They have been replaced as external auditors by RS Abrams & Co. This was announced at the Nov. 28, 2007 board meeting at Gallow, on a night when three of seven board members were absent. In two years, we have had general fund balance losses totaling $1,793,230 (real dollars) and net asset losses totaling $2,407,956 (our net worth). Anyone who tells you that a net asset loss is similar to depreciating a shiny new fire truck, or is a "good thing" is simply trying to save his job. Anyone, I mean anyone, who tells you that the financial condition of the Island Trees Union Free School District is excellent, (as the May 23, 2007 letter to the I.T. residents reported), is either ignorant or lying. I stand by every word in this letter. Unlike the author of the May 23, 2007 letter to the I.T. residents, (and it wasn't the I.T. BOE) I put my name on every letter I write, and I stake my reputation on every allegation I make. My challenge to debate the entire seven-member contingent of the Island Trees Board of Education at the next LPOA meeting stands. If I'm wrong, why not debate? We need a forensic audit, directed by the Chief of Investigations of the NYS OSC. I will keep the Island Trees community posted. Thank you.

Brian M. Kelty

Island Trees Resident