CIS financial problems mount
charlotte.com | 2/24/08 | Gail Smith-Arrants
Carolina International School faces a deficit of $390,000 for May and June, in addition to an embezzlement case disclosed in December. "The financial mismanagement was as bad or worse than the embezzlement," school director Richard Beall said. "There were many, many mistakes being made."
Insurance will cover embezzlement losses, state officials say. But the school faces the large deficit because of the poor financial practices. Staff paychecks over the past 1 1/2 years are in question. "We'll make every teacher whole, if there're any errors, any deficits," Beall said. The school hired Dave Faunce and the Acadia Northstar consulting firm to straighten out finances after Sandra Vielbaum, 57, of Concord was charged with embezzling more than $137,000 from Cabarrus County's only charter school.
Beall said the total amount allegedly found to have been embezzled is now up to $195,000. Vielbaum, school finance officer, was being held without bond Friday in the Cabarrus County jail on the embezzlement charge and a charge related to fleeing the state.
A combination of things resulted in the school's deep debt, Beall said. Vielbaum apparently used two separate software systems, one of which was a working budget that didn't show the school's actual expenses, Beall said. Deficit spending was concealed, and unbudgeted payments were made. Late-payment penalties were assessed but not disclosed.
Money raised in the school's capital campaign -- $25,000 -- was part of the embezzled money, but will be recovered through insurance, Beall said. State officials awaiting a final audit are finding surprises, said Paul LeSieur, director of school business services for the N.C. Department of Public Instruction.
"We were told all the IRS payments had been made timely," he said Friday. "Now we come to find out they had not been made." Some charter schools have been able to pull out of such holes, LeSieur said.
A few parents last month called for Beall to resign. Faunce and Beall met with 60 staffers Thursday. One unsettled issue was whether they would get paid after April 30.
"I think the faculty's scared. They're still a little angry," said Principal Dee Duncan. "But I don't think there's one staff member who does not want the school to succeed."
Some parents worry that there won't be school after April. "Yes, it's scary," said Connie Byrne, a parent since the first year. "We're probably going to lose some teachers. "It's a matter of supporting the efforts of the administration and the board to get us what we need so we can stay afloat," she said Friday.
The most important thing is gaining support from parents, staff, vendors and the community so the school can move forward, Faunce said.
He said some charter schools have asked for help when they're already out of money. "CIS (officials) have a two-month window to get things lined up to be able to provide that funding," he said. "There's cooperation on a lot of fronts. People want to know they won't have to go through this again."
In the past, people have stepped forward to guarantee lines of credit and offer loans, Beall said.
"I think we will find a way," he said. "But the uncertainty of the situation is very difficult for everyone."