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NYS Comptroller


Audits of Local Governments and School Districts

Charter School for Applied Technologies – Payment to Affiliated Entities (2013M-300)

Released: January 17, 2014 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to examine the School’s relationship with its affiliated entities and any related payments for the period July 1, 2010 through January 11, 2013.


The School is governed by a Board of Trustees which is presently comprised of nine members, including one parent representative. The School’s 2011-12 fiscal year operating expenses totaled approximately $21 million. Most of the School’s students are from the City of Buffalo.

Key Findings

  • The Board approved transfers of School funds totaling $425,000 to capitalize two wholly-owned private entities which the Board caused to be established for the purpose of enabling the School to engage in what are essentially commercial ventures. We question whether the Board had authority to approve the transfers. Even if the Board had authority to approve the transfers, we were not able to assess the level of risk involved with the School’s participation in these ventures because School officials refused to provide us access to either entity’s financial records.
  • The School made payments for services to one of the entities without a written contractual obligation to do so.

Key Recommendations

  • Confer with SED as to the propriety of its relationship with the LLC and the Corporation. Only spend School resources for activities that clearly and directly benefit its students.
  • Ensure that contractual agreements and/or amendments are properly approved and executed.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email:
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236