Community College of Denver audit finds accounting errors

Jeff Kass, Rocky Mountain News

Published October 24, 2007 at midnight

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Millions of dollars were incorrectly entered into budget ledgers while the college president used her office to work another job, send out personal gifts and cover her husband's cell phone use.

Those are among the allegations, major and minor, released Tuesday against former Community College of Denver President Christine Johnson and management of the school.

They were part of the final findings of an investigation that stretches back more than a year.

Johnson, a popular community figure, was dismissed in June after a first set of audit findings said she misstated budget figures and improperly hired an adjunct professor who taught classes to foreign students that did not meet academic standards.

There is no indication CCD officials lined their pockets, and auditors caught the accounting errors before any money was lost, said Rhonda Bentz, Colorado Community College System spokesperson .

Bentz said the $320,000 paid to private consultants for help on the audit was important. "These are critical issues to understand," she said.

When she was fired, Johnson denied wrongdoing, and some questioned whether her contract was not renewed because she advocated for poor and minority students.

Johnson did not return calls Tuesday, nor did her attorney, Paula Greisen.

Other campuses audited

The other 12 CCCS campuses also were audited, but the overall picture at CCD was the most disturbing, said Bentz.

"It is not necessarily surprising to find some errors. You do," she said. "But we did not find the red flags in the other colleges we found here."

Among the bigger numbers cited in Tuesday's audit was $11.3 million from CCD that was incorrectly posted to the state general fund. CCD was faulted for not catching the $11.3 milion error in what should have been a routine balancing of the books, according to the audit report.

In another case, $10.2 million in student tuition and fees was correctly posted to the student account, but it also showed up as not belonging to any particular fund.

The incorrect accounting in those and a number of other cases cited by auditors do not appear to have caused any overspending, Bentz said. But, she added, "I think the train wreck happened."

The audits began after an anonymous tip in June 2006 questioned the teaching and hiring of the adjunct professor, Kourosh Tavatli. The investigation of Tavatli was done internally.

In the midst of that investigation, CCD personnel raised concerns about practices in the president's office, human resources, purchasing and financial aid.

Financial aid issue

The Community College System hired the accounting and consulting firm of Clifton Gunderson to look into those issues.

In the case of financial aid, Clifton Gunderson noted that approximately $315,000 was most likely improperly doled out, and there was a chance the number could be as high as $1.4 million.

Among a sample of 50 students on financial aid, eight had issues related to low grades, three had no documentation of a high school diploma or equivalent, and the college did not have proof of citizenship for one student.

Clifton Gunderson said CCD made what appeared to be four "unallowable donations" from the general fund, two of which were approved by Johnson.

Under an audit section titled "Other Items of Concern and Minor Infractions," Johnson reportedly spent time at CCD working as "organizer and director" for another company. It was Solera National Bancorp, Bentz said.

The audit said it found no evidence Johnson revealed her involvement in the bank to the CCCS president.

Johnson also "improperly allocated" cell phone charges for her "personal usage" and that of her husband, the audit adds, and "mailed personal gifts to family members using CCD's DHL account," although Johnson's law firm then wrote a check to reimburse the college.

Audit findings

A 58-page audit released Tuesday on finances at Community College of Denver found:

$11.3 million was the figure CCD incorrectly posted to the state general fund.

$10.2 million in student tuition and fees was correctly posted to the student account, but it also showed up as not belonging to any particular fund.

• CCD made what appeared to be four "unallowable donations" from the general fund to charities, two of which were approved by former CCD President Christine Johnson.

• Johnson reportedly spent time at CCD working as "organizer and director" of Solera National Bancorp.Sources: Clifton Gunderson Audit, Cccs Spokeswoman Rhonda Bentz

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