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State audit finds more sloppy bookkeeping at former charter school



Published: Wed, December 4, 2013 @ 12:00 a.m.

Legacy Academy

Staff report

YOUNGSTOWN

Sloppy bookkeeping at the Legacy Academy for Leaders and the Arts, a now-closed community school in the city, continued until the very end, according to the closeout audit released Tuesday by state Auditor Dave Yost’s office.

Findings for recovery issued against imprisoned former Fiscal Officer Carl Shye total nearly $70,000.

“This Grinch keeps on stealing Christmas,” Yost said in a news release. “It comes as no surprise that an audit of a fiscal operation led by Carl Shye would uncover records like these.”

The Legacy Academy for Leaders and the Arts’ board of directors decided to close the school in June 2011 because of declining enrollment. In 2012, Shye, the former fiscal officer at several community school in the state, was sentenced to two years in prison and ordered to pay more than $472,000 in restitution for a federal embezzlement charge related to his employment as treasurer for various community schools in Ohio.

During fiscal year 2011, the Legacy Academy for Leaders and the Arts issued 16 checks totaling nearly $22,000 to various vendors that did not include proper supporting documentation to state the public purpose of the expenditures. The checks were signed by Shye and Business Manager Ed Bolling.

A finding for recovery in the amount of $21,491 was issued jointly and severally against Shye and Bolling.

An additional undocumented 50 checks totaling $47,908 were issued to various vendors and signed by Shye. A finding for recovery in the amount of $47,908 was issued against Shye.

The audit found that as of July 1, 2010, the school withheld income taxes from employees but failed to remit those payments to the Internal Revenue Service, the Ohio Department of Taxation and the city.

It was determined that the school should have remitted federal income taxes in the amount of $102,768, FICA/Medicare taxes in the amount of $38,777, state income taxes in the amount of $148,251, and city income taxes in the amount of $86,367.

These matters were referred to the Internal Revenue Service, the Ohio Department of Taxation and the city.

For fiscal year 2011, auditors were unable to determine whether the proper tax amounts were withheld from employees.


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